Your guide to what Customer Education is, and why it matters for your business.
Customer Education is the discipline of teaching customers how to use and find value from products. As a business function, it benefits customers in many stages of their journey.
Before a sale, Customer Education educates buyers and influencers about the market and the product. After the sale, Customer Education educates users about how to use the product. This helps them get the most value over time.
Customer Education isn’t about the specific actions you take to educate the customer; it’s not about running webinars or delivering trainings or writing articles. Yes, it usually involves all of those. But what defines a Customer Education program is the role it plays in your business.
In the book, Customer Education: Why Smart Companies Profit by Making Customers Smarter, CELab co-host Adam Avramescu defines Customer Education and what it does for a business.
A Customer Education function strategically accelerates account and user growth by changing behaviors, reducing barriers to value, and improving the way people work.
Adam Avramescu, Customer Education: Why Smart Companies Profit by Making Customers Smarter
This definition doesn’t include which programs are included in your portfolio — and that’s intentional. Customer Education departments can use different programs and strategies to achieve the end goal, and no two are exactly alike. We’ll get into some common formats and programs later in this guide.
To learn why Customer Education is important, let’s break down the definition that we provided.
Customer Education is a strategic function, not an activity
Like we mentioned before, Customer Education is a strategic business function. It’s not just an activity you perform. If you’re delivering training or writing articles, those are activities, not a Customer Education strategy.
Most startups educate customers organically at first. Everyone pitches in to train customers, write help content, or create webinars and videos. That’s perfectly natural. But there comes a time when Customer Education needs to formalize.
There are a few reasons to treat Customer Education as a function, not just an activity. First of all, if no one owns your Customer Education strategy, you won’t have one. Everyone will continue pitching in, but the things they create won’t be consistent. You’ll start duplicating efforts and wasting time. Worst of all, your customer won’t have a straightforward journey.
A Customer Education strategy also helps you evolve over time. Eventually, you’ll move toward a portfolio of programs. You may have an online academy, a help center, a public training or webinar program, in-product education, certifications or badging, and paid learning services. These programs require rigor. Eventually they need to be run as an actual department. Start thinking of them as a portfolio.
Customer Education serves both accounts and individual users
Customer Education touches many user personas: buyers, product owners, champions, admins, developers, end users — you name it! We often educate people who are involved with the buying decision. We also educate those who will actually use the product.
Depending on whether your product is B2B (business-to-business) or B2B (business-to-consumer), you may have multiple layers of education. On one hand, you’ve got to educate the individual users and help them find value in your product. This is true whether you’re a B2C or B2B business: a product is only as good as people use it. For B2B products, though, you’re often educating those users within the context of an account. This might mean they’re all going to start using your product at the same time. It might also mean that they customized certain aspects of your product for their organization. These types of decisions can change the way you approach educating customers.
Customer Education accelerates growth throughout the customer journey
A thorough Customer Education strategy doesn’t just address what content is created and in what format; it addresses how you’ll drive customers’ maturity throughout their journey. We have to know what they want to achieve and show them the path to get there.
Based on your account and user persona mapping, you will include different types of education along the customer journey.
For example, an account will typically go through a journey that includes pre-sales evaluation, purchase, launch, adoption, growth and maturity, and expansion. That expansion can lead to further launches, adoption, growth, and maturity. In the best case, it’s a virtuous cycle. Have you created education programs that only address launch? Or have you thought about what you’ll offer customers to drive growth and maturity over time?
An individual user also goes through a journey. They’ll start by evaluating the product, too. Once they can see how it provides value, they’ll start learning more basic skills. If they keep seeing value, they’ll build their expertise and more advanced skills. They may even become a champion of your product who influences others to use it. Do you have education programs in place for more advanced users and champions, or just your basic users? And does your basic user program actually motivate them to get value from your product? These are big questions to consider.
Customer Education changes behavior, reduces barriers, and improves the way people work
If you ask the average person in your business what the goal of education is, they would probably say “knowledge.” If they have a training background, they also might include “skills.”
It’s true that Customer Education builds skills and knowledge, but in the service of what? Customer Education must be dedicated to helping customers find value. To grow an account, each member of the team needs the right skills. They need to overcome hurdles to value. And perhaps most importantly, they should become better at what they do. What could be more valuable than that?
If your Customer Education program is firing on all cylinders, you’re changing the way people behave. That might mean giving them:
- Knowledge that empowers them
- Skills that enable them to get value from your product
- Motivation to use your product in different ways.
You should be able to measure differences in the way people use a product before and after training, or with vs. without education.
Focusing on behavior change also helps to determine what is or isn’t essential to teach. “Cool” features that don’t actually provide value to the customer? Don’t waste time teaching them. Features that are so basic that customers already “just get it”? Again, don’t waste your time.
What should you do instead?
Instead, prioritize educating customers on how they can overcome barriers or do better work. Ultimately that’s what most customers are looking for — more value with less friction. Let’s say you have hundreds of features in your product, but five of them will let the customer get up and running most quickly. Don’t waste time taking them on a full tour of the UI — highlight those five features! If you know there’s a common error or support issue, create docs or in-product education on it! Your work will help the customer avoid or resolve the problem.
Finally, helping customers do better work means that Customer Education is often much broader than just product education. For companies in new or growing industries (for example, Hubspot for inbound marketing or Gainsight for Customer Success), you’ll often need to educate your customers on what the industry is and how to do their jobs well. This provides great opportunities to expand Customer Education’s reach through industry-focused education.
Why is Customer Education important for a business?
Once companies invest in a true Customer Education strategy, executives often have an “a-ha” moment: Customer Education is a secret weapon for the business. Often, it’s done in an ad hoc manner, with various people across the business delivering various trainings. But when you invest in it, it becomes rocket fuel for your customers’ success.
An effective Customer Education strategy will drive real business results, especially if it serves customers across their entire journey. For example, Customer Education can influence key metrics from marketing leads, to product adoption, to support contact rate — and more. At a high level, Customer Education does several things, notably, it:
- Provides a roadmap for your customers to get increased value and over time
- Increases your brand value in the market
- Reduces support burden and frees up your CSMs and support reps to have higher-value interactions
If done right, Customer Education drives customer lifetime value and maturity, differentiates your brand as a category leader, and increases self-service efficiency. Here’s a breakdown of how Customer Education drives the metrics that SaaS businesses typically care about.
Higher Customer Lifetime Value
At the highest level, Customer Education affects two of the most important metrics for a subscription business:
- CAC (Customer Acquisition Cost): the cost to acquire a customer
- LTV (Lifetime Value): the value you receive when they’re successful.
Because customers are expensive to acquire, your business needs to keep them — and keep them growing — to achieve a profit. According to ProfitWell’s blog, this is why the ratio of Customer Acquisition Cost to Customer Lifetime Value is the “god metric” for SaaS companies.
Customer Education can support and scale your sales and marketing efforts. But arguably it’s even better at maximizing your customers’ lifetime value, so they stay and grow with you over time.
Defining CAC and LTV
Customer Acquisition Cost (CAC): This is the total cost of your sales and marketing efforts. It includes the humans your company hires, the tools they purchase, the campaigns they run, and more. This stuff is expensive, so any efficiency will help. Customer Education can reduce the number of questions your sales-humans answer repeatedly. It also helps you convert trials to paid plans effectively. We recommend providing ungated education on your product and industry. This content creates more informed buyers and provides your sales team with resources they can use during their deal cycles.
Customer Lifetime Value (LTV): The longer an account stays with you and the more they buy from you over time, the more value you derive. Customer Education helps to instill customer loyalty by building trust and accelerating value. As you educate customers, they find new ways to use your product. They’ll know which features to use, and how to use them. They’ll learn tips, tricks, and best practices that provide them more value. And these customers are usually more likely to renew or expand, and less likely to downgrade or churn. Put simply, educated customers are more likely to see value in staying with you.
Increased Customer Maturity and Satisfaction
While we’re on the topic of Customer Lifetime Value… Customer Education isn’t just valuable to your business because your customers stay longer; it’s valuable to your customers because they’ll have the tools they need to succeed.
Customer Maturity: Every business defines maturity differently. Usually, though this is a stage customer growth past basic adoption. It’s where you see customers starting to use your product in more advanced ways. Mature customers can see the path to ongoing value over time. Many companies use maturity models to diagnose the customer’s current state and set a path to a future state.
Customer Sentiment or Loyalty: Typically measured with Net Promoter Score (NPS), those 0-10 “Would you recommend this product?” surveys, customers are more likely to renew and expand over time if they’re strong advocates of your product. Customer Education helps customers become loyal advocates by empowering them and connecting them with others.
Product Adoption: The path to getting meaningful usage of a product is similar to how you would form any habit. It’s like brushing your teeth. Customer Education helps users understand why they should do it and then build a habit around it. You’ll also be able to drive more sophisticated usage over time. User sophistication often measures how individual users perform in your product. This differs from Customer Maturity, which usually measures how mature an account is.
Higher brand and marketing impact
Like we mentioned earlier, new customers are hard to acquire. That’s why Customer Education can play a role in making it easier. For years, conventional wisdom was that you shouldn’t provide too much public education or documentation. Why? Because it would expose too much to the competition.
Today, companies who invest in public-facing Customer Education find that the benefits outweigh the risks. This holds true both for brand value and lead generation. Because customers and prospects typically search for information before ever talking to a rep (70% in some studies!), you want your brand to be the first one to educate them when they search.
Customer Education makes life more efficient for your sales teams. With great education, your company will be perceived as an authority in your industry.
Brand Differentiation: If you are the “education leader” in your category, your brand will be seen as the expert. This makes buying decisions easier, and also increases customer loyalty. It’s harder to win in your category without proving that you know the space better than anyone else.
Marketing Qualified Leads (MQLs) and Marketing Attribution: Let’s say you produce educational content that’s available to customers before they buy. This will contribute to the leads your company generates. Today’s buyers often do self-service research before they ever talk to a sales rep. Where are they looking? Not just at official brochures and marketing content. They want to see help center articles, product videos, and other resources to educate themselves.
More efficient self-service and support deflection
Customers don’t like calling in to ask for support. On the other hand, your CSMs and support reps probably don’t like answering the same questions over and over. That’s a lose-lose situation.
Self-service Customer Education not only decreases your support costs, but it also decreases users’ frustration.
You can measure the average number of support tickets submitted per customer, or per 100 customers. This number should be noticeably lower for educated customers.
Increased revenue
Many Customer Education programs generate revenue directly by selling Education Services. At the very least, larger Education Services teams run on a P&L. Thus they’re expected to recover the costs of running their organization.
As you create more valuable educational content, you’ll earn the right to charge for it. Customers will also pay for private or more customized delivery of your courses.
A Scale Engine for your business
You can achieve nearly any of the metrics above by hiring enough people and throwing them at the problem. A squadron of support reps can answer all your customers’ questions; a company of CSMs can deliver live training at a customer’s whim; a maelstrom of marketers can produce a whirlwind of content. But that’s not realistic or efficient for most businesses. It’s often a poor use of those individuals’ skills and talents.
When you use expensive humans to perform repeatable education tasks, like answering the same support tickets over and over, or delivering the same trainings, you won’t be able to scale and serve hundreds or thousands more customers without needing to hire more expensive humans. This becomes even more true when you serve customers who are geographically diverse, requiring you to hire more people in-region.
With Customer Education, you’ll develop a strategy that scales with your company’s growth. Common support questions become help articles and in-product education. Repeatable trainings become virtual courses and online academies. Now, you’re providing a more consistent educational experience. And then your talented humans who work with customers can become more strategic. They’ll now fill in gaps and provide extra help, instead of being the single point of success or failure.
Wrapping up…
As you’ve seen, Customer Education can provide many benefits, but you won’t be able to serve all of these functions on day one. Even mature Customer Education programs don’t prioritize all of these metrics. It’s important for you to start with a Customer Education strategy that aligns to your overall business and product.
Align with your leaders on which metrics are most important to drive. For example, consider three company stages:
- Hypergrowth mode: you may be more focused on marketing and product adoption metrics.
- Maturing companies: you may be more focused on maturity and scale, as well as retaining customers.
- Well-established companies: revenue may be an expectation, and your department could run on a P&L.
It’s crucial to have a strategy as you build your Customer Education program. Do this before you start creating a bunch of content or selecting an LMS.
If you’re just starting out, check out our first podcast about starting a Customer Education program. Then read our Customer Education Manifesto and Six Principles to build a successful Customer Education program.