Can Customer Churn Be Good for a B2B SaaS Business? Sometimes...
Customer churn tends to be viewed negatively by SaaS companies, and for good reason. However, in specific scenarios, it can actually be, dare we say, a positive.
SaaS operations roles can often overlap, and in some cases, be purposely centralized. In this article, we will explore the roles of CS operations, Revenue Operations, Sales Operations, and Marketing Operations within SaaS companies and what impact they have on a company’s success.
Within a B2B SaaS company there will typically be several branches of operations. Because the work conducted by these divisions can often overlap, and in some cases, be purposely centralized, it’s easy to assume that their work is interchangeable. In reality, each of these operations fulfills a pretty distinct purpose. In this article, we will explore the role of distinct operations within SaaS companies and what impact they have on a company’s success.
Customer Success Operations is responsible for directing workflows and strategies related to the customer experience. Of the four Ops departments covered in this article, this one is most likely to work with all other company divisions that interact in any way with the customer journey.
Where Sales Operations will mostly focus on acquisition of new customers and getting them to convert, the work of CS Ops includes the entire customer life cycle. CS Ops focuses on deepening the relationship with buyers; by doing so they reduce the risk of customer churn and extend customer lifetime value for a SaaS company. This translates into increased revenue.
All Ops within a SaaS business use specific key performance indicators (KPI) to measure the success of their work. For CS Ops, two of the most important KPIs are; Customer Health Score which gauges the overall health of a client relationship. Secondly, Customer Success Ops reviews Net Promoter Scores (NPS) which indicate how a customer rates a product or service.
Sales and Marketing Ops involve attracting customers to a SaaS company, while CS Ops is concerned with keeping them with the company as long as possible. This is accomplished by ensuring customers succeed with SaaS companies' products. CS Ops will work cooperatively with Marketing and Sales to collect and share data that’s critical to achieving its mission. It will also work with these departments to ensure CS initiatives are carried through at every step of the customer journey.
Sales Operations’ primary function is to streamline the sales process, facilitating maximum efficiency and productivity, as well as providing support to the Sales team by keeping the sales pipeline filled with prospects.
Sales Operations’ directive is to make it as easy as possible for the Sales team to conduct its work. This means deploying digital tools and strategies that optimize workflows and set the Sales team up to succeed. Like every other Ops team in a SaaS company, an effective Sales Ops department is concerned with collecting valuable data; these metrics are used to reduce friction and streamline the sales process.
Sales Ops tracks KPIs related to how well the Sales team performs its job. Specific metrics measured include customer acquisition cost (CAC), which reflects the cost of growing the business and bringing in new customers. Other metrics commonly tracked are customer lifetime value (CLV), Monthly Recurring Revenue (MRR), and close rate—the number of sales made divided by the number of times a prospect is touched.
While Sales Ops will share data with other departments and work cooperatively to fulfill CS, Marketing, and Revenue Ops initiatives, its primary mission is clear: bringing more customers into the company.
Marketing Operations manages the overall process of planning and fulfilling a SaaS company’s marketing strategies. Similar to other Ops departments, this involves making sure the Marketing team has the tools and workflows required to run effectively. It also works alongside other Operations departments to create strong marketing infrastructure for the company.
Marketing Ops manages the public face of a SaaS company and how the company’s mission is broadcast to its target audience. The work it conducts helps Sales Ops accomplish its goal of collecting and converting new customers.
Marketing Ops measures success by tracking return on investment (ROI). It will also monitor the overall impact of marketing efforts in conjunction with Sales. Other metrics tracked by Marketing Ops in relation to marketing campaigns include conversion rate, click-through-rate, and number of leads per channel.
It’s a common misconception that Marketing and Sales serve the same purpose in a company. While there is some overlap in their roles, their directives are distinct. Marketing Operations is involved with building brand awareness to help attract potential customers, while Sales Operations capitalizes on that awareness to gather and convert prospects into customers. Customer Success provides critical data to both departments to assist them with their missions and then nurtures the customer relationship once a prospect becomes a buyer.
Revenue Operations is a relatively new addition to business operations. It focuses on aligning all departments within an organization that contribute to revenue to optimize profit potential.
The goal of Revenue Operations is to increase operational efficiency and interdepartmental cooperation across Marketing, Sales and Customer Success. The value of implementing RevOps in a B2B SaaS company is displayed when teams work in unison, leading to fewer silos and increased overall growth and revenue.
RevOps takes KPIs from the other operations teams and uses the data to forecast results. By collocating this information, RevOps drives greater transparency and can serve as a single point of truth when C-Suite needs KPI metrics.
Customer Success is similar to Revenue Operations in that both departments work cooperatively with other divisions throughout a company, sharing and collecting data to foster cooperative efforts. What’s different is that CS Ops focuses specifically on the customer journey, while RevOps is concerned with closing gaps between operations departments and bolstering data transparency.
While each division of the Operations team provides an essential role within B2B SaaS companies, the alignment of Marketing, Sales, Revenue, and Customer Success Operations yields the best results when implemented effectively. By understanding the specific functions of these crucial departments, B2B SaaS companies can maintain a high standard of success both internally and externally as the business continues to grow.
Scaling growth operations at your B2B SaaS business? Vitally's world-class CS platform unifies customer data across your tech stack so you can proactively identify trends and leverage insights for a world-class customer experience. Think CRM, product analytics, support tickets, emails, NPS, and revenue data—all in one tab. Get started with a free trial when you request a personalized demo today!
Schedule a personalized demo today.
We have received your request and will process it as soon as possible.