More and more we’re seeing a shift from focusing purely on internal training to an outward look at boosting the skills of a business’ customers.
Companies that have begun to focus on this are thriving because they’re seeing that there’s a direct correlation between customer training and both brand loyalty and increased spending.
But how do you know if this training is working? How do you begin to measure it?
Understanding the value of customer training – and how to measure it – is something we believe companies should be keyed in on, so we’ve put together a few points to give you some scope on the subject.
Revenue: The Leading Metric
It seems a little obvious, but the reason we take any action in business is usually to generate additional income.
The same goes for customer training – the effort put in now will bear fruit in the future.
In that way, investing in a customer training platform should be seen as a longer-term process than something like offering special pricing to boost sales.
Our friends at Braze, who run a fantastic customer engagement platform, are tracking the efficacy of their client initiatives – via their academy-based product certification programs – and they’ve made some staggering findings.
They compared the people and companies who had completed their training with those who hadn’t – and discovered that the former increased their spending by 67% after the training.
Now that you’ve picked your jaw up off the floor also consider that customers who train with you are already engaging more with your platform.
This has the added benefit of reducing churn which will make recurring subscription revenue more stable.
SaaS is the go-to model and we don’t see that changing anytime soon.
Because of this, we’re confident that customer training will be something almost every software provider needs to take notice of.
On top of all of this is the crowning glory of training – upselling your products.
The ROI following training is massive, with figures showing that for every $1 spent on training, a user goes on to spend an average of $12 on products related to that training.
Bottom line: If you can get someone training, you can get someone spending.
Think CRM systems, and you’ll think Salesforce, right? Our CEO, Joe, was a user for 15 years before starting Raven360 – but he openly admits that he only used around 5% of the power of Salesforce.
This was because he became accustomed to using the tools he felt he needed and was comfortable with.
As he was never pushed either internally, or given training by an external party on how to use the system more effectively, it stayed that way.
Fast forward a few years and HubSpot made an appearance and took the CRM world by storm – with a much cheaper solution that was more easily accessible to new users.
Seeing the lower price tag and the same features, Joe made the switch. As a user, it was a no-brainer from his perspective.
This is a common story across many different software packages – but it stands to reason that these switches in tech can be prevented through training.
If Joe had been well trained in Salesforce he would already be invested in it personally. He would have far less reason to switch if he was to access much more of the system he was already using.
By providing customer training you are giving your product the best chance to be retained in the future. If the user moves to a new role or starts their enterprise, they’ll more than likely want to stick with what they already know.
If they’ve had a good experience through training, they’re also far more likely to endorse it to colleagues and peers – which will also help your product spread through the market.
While personal development might be a hard metric to quantify, sales growth through recommendations and further adoption is far more tangible.
In short, by training a user you increase their lifetime value to you.
The Cost & Value of Acquisition
You can’t talk about SaaS without mentioning the twins – CAC (cost per acquisition) and LTV (lifetime value).
We’ve already touched on LTV, but it's crucial to think of them in tandem, as together they become a far more insightful metric.
Companies with a traditional sales funnel often try to push for more web traffic, hoping to capture visitors through contact forms and low investment sign-ups.
Once they have these points of contact, salespeople can swoop in at the right time to nurture them into paying customers.
However, we’ve seen that companies who offer learnings as a key part of their website can convert visitors at a far higher rate than those that don’t.
Advertising things like ‘free courses’ or ‘free academy entries’ gets the attention of website visitors straight away.
HubSpot is one of the best companies at using this strategy and their wealth of content speaks to such a wide audience that they have fantastic potential to pick up almost any user.
By positioning your website, and by associating with your brand, as a place of learning where users can access quality content, you’re going to reduce the cost involved in turning them into paying customers.
We already know that users who spend on training go on to increase their spend overall, so combine this with reducing the cost to onboard them and you’ve just boosted your margin.
Some websites are so effective at turning visitors into users that they can even forgo the step where a salesperson makes contact with a prospective client.
Now, this takes some time and a great deal of analysis of your existing base, but it has a real upside beyond just the increased revenue you’re likely to see with customer training.
Education, Education, Education
So now that we have spoken about some of the key metrics and how much you stand to gain from training your customers, we wanted to quickly go over the two main models you can choose between.
Firstly, you can produce and distribute a large majority of your training content for free. Again, remember, this is an investment.
By promoting a ‘free online training academy’ you’re likely to generate a great deal of traffic to the content. By having all the free content accessible with only a name and email address you can quickly build up a network of prospective clients.
Throughout their training, you can track their progress and aggregate all the user information to understand which courses are most and least popular, and how users engage with the content in general.
While many of your users won’t go on to purchase, the proliferation strategy of leveraging free content for leads is an effective method.
Your second option is to create a paid training setup. By charging either for individual courses or a slightly discounted rate for the entire package of content, you add value to the training and show users that it is worth a purchase.
This is a common pricing strategy but it also means that those you do spend the initial amount are committed to the process – and so the chances of upselling to them are very high.
As we mentioned earlier, by investing in it themselves they are going to be more committed to your training, your product, and your brand. Over the lifetime of that customer, this training offer can pay dividends.
We believe that customer training is one of the most exciting parts of the training space. For many years, internal staff training has been refined and improved upon - customer training, by comparison, is relatively new.
If you can create content that you think your clients would find useful then give it to them. There is some initial investment in the process but the potential payoffs are huge.
It doesn't matter what service you are offering, it's a simple formula: give your customers a chance to invest in your products and they will become better spenders, for longer and at a lower cost. What’s not to love?
At Raven360 we’re committed to internal and external training, so whatever your needs are - get in contact today.