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Customer education: An emerging business discipline for the subscription-based B2B marketplace

Customer learning management is a systematic, strategic approach to delivering the knowledge that helps customers succeed, spanning the customer’s journey from prospect to new user to proficient expert.

Customer education: An emerging business discipline for the subscription-based B2B marketplace
[cristalov / Adobe Stock]

The business-to-business market is being transformed by business models that allow customers to purchase the outcomes delivered by a product or service rather than acquiring those products or services outright. Even the most complex products and services are now available for purchase on a recurring subscription basis.

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Software as a service may be the most well-known manifestation of this trend. But consider, too, the increasing availability of “device as a service” offerings for enterprise buyers of servers, PCs, smartphones, and other hardware, as well as other subscription-based models for acquiring business services.

NEW PERFORMANCE METRICS FOR A NEW BUSINESS MODEL

For sellers, subscription-based models can help significantly reduce cost-based barriers to purchase. But to succeed long-term with subscription models, sellers should recognize and adjust to the impact of these models not only on sales and finance but also on marketing, customer service, fulfillment, and more.

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Arguably, the most important measure of performance in these models is recurring revenue. While there will be some differences based on pricing models, there are basically three levers driving net recurring revenue: the number of subscribers, the degree of subscriber usage (how much of the subscribed offering are customers using and how frequently), and renewal rates.

THE RISE OF CUSTOMER LEARNING MANAGEMENT

The importance of influencing user behaviors in subscription-based businesses is a primary reason why customer education is fast becoming a strategic business discipline, on par with management, marketing, and finance. In fact, our mid-2021 survey of 200 companies found that more than nine out of 10 had increased their investment in customer learning, and more than 60% had done so substantially—by 30% or more.

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According to our research, leading companies increasingly recognize customer education as a driver of customer value. As a result, they are converting post-sale onboarding and training into a new business discipline to help their businesses grow. That new discipline is customer learning management. Customer learning management is a systematic, strategic approach to delivering the knowledge that helps customers succeed, spanning the customer’s journey from prospect to new user to proficient expert.

TOP-OF-THE-FUNNEL TACTICS

Customer education can be leveraged at all stages of the buying journey, from the top of the funnel to trials and onboarding through post-sale engagement. In B2B marketing, especially for complex offerings, customer education strategies can be used at the top of the funnel to create more engaged prospects. Certain higher value marketing and prospecting tools—white papers, webinars, or pre-sale assessments and consultations—are by their nature “educational.”

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Higher-value top-of-the-funnel offerings can generate higher conversion rates. For example, webinars could outperform paid searches in generating qualified leads. As the value of infusing customer-education principles into top-of-the-funnel tactics becomes increasingly evident, we expect to see more and more customer education teams collaborating closely with their marketing, sales, and customer success counterparts and, in an increasing number of cases, reporting directly to the chief marketing or chief commercial officer.

OPTIMIZING TRIALS

Customer trials are a critically important stage in the purchase decision process. This is when customers are in a “speed dating” situation with your offering, presenting you with myriad opportunities to gain insights and customer feedback. Surveys and attrition data can shed light on what customers are experiencing at this high-stakes moment.

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You are likely to find that what is needed to improve post-trial conversions is short, sound, targeted, and effective educational interventions delivered at the moment of need. These are the kind of interventions a team steeped in learning strategies can help design and implement—and that can help improve customers’ experience in the next critical phase of their journey: onboarding.

STRATEGIC, INFORMED ONBOARDING

A strategic and informed approach to onboarding new customers recognizes that onboarding is the opportunity to bolster customers’ ability to solve meaningful, work-related problems with your offering, not merely teach them how to use specific offering features. This presupposes that your onboarding methodology had done the important work of truly understanding the outcome customers intended to purchase when they selected your offering and what they need to master about your offering to achieve those outcomes.

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Consequently, more mature customer education programs will use persona-based training during the onboarding phase to get each discrete cohort of user personas to a level of proficiency and productivity that enables them to realize the value your offering promised. During onboarding, users will likely see a more diverse range of learning experiences so that they can choose the way they want to learn, from in-product micro-learning that helps unblock critical tasks to in-person training and virtual sessions with subject matter experts for power users.

ACCELERATING TIME TO VALUE AND PRODUCT ADOPTION

To achieve broad—and enthusiastic—the adoption of subscription-based offerings of any kind, accelerating the customer’s time to value is critical. This inevitably entails a cross-functional effort that includes account managers, customer success managers, customer support representatives, consultants, project managers, and trainers.

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While each of these functions will measure their impact differently, the aggregate effort needs to yield customers who both understand your offering as well as how to use it to get results that make them more effective and successful in their jobs.

Against that goal, well-conceived customer education programs are proving their worth. Well-designed and implemented programs can help increase brand awareness, shorten decision-making cycles, improve the onboarding experience, increase feature adoption, and help create power users who will become staunch brand advocates. Those are results subscription-based businesses cannot afford to ignore.


Barry Kelly is the CEO and the co-founder of Thought Industries and co-author of The Customer Education Playbook. 

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