Many of the tools and processes that Customer Success Managers (CSMs) use in their daily jobs are there to gain efficiency –and are designed to help them serve a growing number of customers in perpetually less time. Often this can mean there’s less one-on-one time with customers in an effort to address all the demands across your customer portfolio.

While the need for efficiency in a CSM’s life is undeniable, sometimes there is no substitute for picking up the phone and giving your customer a call. A brief phone call can have a greater impact on a customer’s health and go a long way to establish a solid, open relationship.

Through Gainsight’s integration with RingCentral, you can bring the power of the personal phone call back into your daily routine without losing efficiency.

About the Integration

The integration presents phone numbers within your favourite Gainsight screens and powers click-to-dial functionality with RingCentral’s cloud communications system. Once integrated, your CSMs can incorporate the personal touch of a one-on-one phone call into their daily workflow in Gainsight.

• Add the Customer’s phone number to your favourite view in the Gainsight Customer Tab to access the list of customers you need to call today

• Click to directly call any contact at the Customer from a report on the C360. You can modify these reports to only display certain contacts. For example, only display your Executive Sponsors to get to your phone call faster.

Visit the App Gallery listing to learn more about the integration.

About RingCentral

RingCentral, Inc. (NYSE: RNG) is a leading provider of cloud-based business communications and collaboration solutions. RingCentral’s cloud solution is easier to manage, and more flexible and cost-efficient than legacy on-premises communications systems. It meets the needs of modern distributed and mobile workforces spanning SMB to Enterprises globally. RingCentral, Business Communications Made Simple. RingCentral is headquartered in Belmont, Calif. RingCentral and the RingCentral logo are trademarks of RingCentral, Inc.

About Gainsight

Gainsight provides the leading solution for Customer Success to help businesses grow faster by reducing churn, increasing upsell and driving advocacy among customers Learn More

The post Bring back your personal voice with Gainsight for RingCentral appeared first on Customer Success Software | Gainsight.

Allison Pickens is VP of Customer Success & Business Operations at Gainsight. Thanks to Kelly DeHart (Director of Customer Success) and other team members for contributing to this blog post and creating some of the processes we’ll describe below.

Do these scenarios sound familiar?

1. The exec at a customer tells you s/he loves your product, but your CSM says that the junior day-to-day lead hasn’t made any progress with it.
2. Your CSM thinks the customer is making a ton of progress with your product, but the exec emails you and says they’re not getting value.

Both of these scenarios are troubling. In the first one, it’s only a matter of time before the junior lead tells the exec that it’s not worth renewing your contract. In the second, it doesn’t matter whether the customer is making progress “in reality”, since what really matters is the exec’s view of reality.

It’s critical to create alignment across the people at the customer. After all, “the customer” is really just a collection of people, all of whom have different personalities, opinions, and influences over whether “the customer” becomes successful, renews, and recommends your product.

In this post, I’ll share how we engage with executives, to ensure that our customers stay on track.

METHOD 1: Executive Business Reviews

We schedule Executive Business Reviews at regular intervals. The purpose of an EBR is to:

• Recap the value that the customer has achieved by using Gainsight
• Discuss how the customer can achieve even more value

We cover the following topics:

(1) Introductions and Company Updates:

On the first slide, we share the name and title of each participant in the meeting. This includes members of the customer and Gainsight team members. We make sure to invite not only the Exec Sponsor but also the Adoption Champion(s) (our term for the leader of a Customer Success team, often director-level) and the Gainsight Administrator (often an operations leader). The goal is to ensure that key influencers at the customer are in the meeting and are aligned on the takeaways coming out of the meeting.

The next 4 slides recap Gainsight’s progress as a company since the last EBR. The goal is to reassure the customer that they’re working with a best-in-class organization that has the desire and ability to be their long-term partner. Our Product Marketing team provides slides that show:

• Some of the customers we’ve sold to, and the percentage of large-cap software companies, publicly traded cloud companies, and “unicorn” private cloud companies that are Gainsight customers
• The growth in our organization; a chart shows number of employees over time
• Our thought leadership and best-practice resources the customer can access, including our Community, our Blog, and our Webinars
• Our Pulse conference

(2) Executive Summary

It’s important to highlight the overall takeaways from the presentation upfront. Executives often have short attention spans (certainly, I am guilty of this!), so we aim to get straight to the point, and then dive into the details later in the deck.

Here’s an example of an Exec Summary slide. The 3 components correspond to the 3 sections of the overall deck.

(3) Success Plan

We align our Success Plan process with our EBR process. Each Success Plan is intended to cover the period between EBRs. So at each EBR, we review progress made on the past period’s Success Plan, and then gather input to create a Success Plan for the next period.

We export the active customer Success Plan from the Customer360 and include it in our EBR deck to help drive this portion of the discussion. In this section we include (1) Success Plan summary slide which outlines the list of Objectives we’ve been working towards, (2) the more detailed Success Plan objective slides covering each objective in the plan, and (3) a slide to highlight timeline & status of each objective.

After the review of the existing Success Plan, we include a slide on core Customer Success Business Challenges. This slide helps guide discussion with the Exec, ultimately resulting in selection of the next core objectives to work towards. Following the EBR, the CSM will create a new Success Plan that includes the refreshed objectives.

(4) Health & Adoption

It’s critical for us to ensure alignment with the customer on the health of our partnership during the EBR. In the spirit of transparency, we share our view of the customer’s health by revealing our Gainsight Scorecard to them. We review each scorecard measure & highlight our justification for considering them as Red, Yellow, or Green. We also look to get buy-in from the customer regarding whether they agree with our assessment, or have a difference of opinion. This is a great way for us to ensure we’re on the same page, as well as to expose any gaps which need to be addressed.

In this section, we also drill down into the customer’s adoption of Gainsight (essentially a double-click into the ‘Habits’ measure of the scorecard). We include a slide on overall usage trending, which allows us to look at adoption of various parts of the product over time.

Lastly, the CSM will include any additional slides which are necessary in order to provide greater detail into a scorecard measure that is critical to the customer. Examples of this would be a detailed slide on a customer’s core product enhancement asks, or an overview of top priority support tickets.

(5) Next Steps

Before the EBR, we’ll create a slide to capture next steps that we recommend coming out of the meeting, but we will also edit that slide during the EBR to record feedback from the customer.

After the EBR, we’ll write an email that reminds the team of the next steps and includes a screenshot of the new Success Plan that we agreed to during the meeting.

EBR Frequency:

The frequency of the EBR depends on which Customer Success/Support package the customer purchased:

• Premier+: 4x per year
• Premier: 2x per year
• Standard: 1x per year

(These packages are approximately correlated to the size and lifetime value of the customer. We’ll write more about our Customer Success packages in a later post, but in the meantime you can learn about Customer Success business models here.)

We created Lifecycle Calls to Action (CTAs) to remind us to schedule these EBRs. Here’s the Playbook for the EBR:

METHOD 2: Sponsor Tracking

One of the top causes of churn for most vendors is a change in executive leadership at the customer, which often results in a change in strategy and/or a change in preference for software vendor. It’s critical to regroup quickly when this happens. You can improve your reaction time by tracking whether each executive sponsor has left the customer.

To this end, we use our Sponsor Tracking functionality in the Customer 360 dashboard.

Sponsor Tracking is an out-of-the-box feature that incorporates data from a variety of professional networks. Users can easily identify sponsors from the Customer 360 page and will be alerted any time the Sponsor changes job title, company or location. This allows you to mitigate risk with that customer, and identify new opportunities in the sponsor’s new department or company

A user can select a Sponsor from their list of Contacts, and Sponsor Tracking will suggest a matched profile.

A user can easily see which Sponsors are being tracked from the Customer 360. When a sponsor changes, you can trigger a CTA to be created with an associated Playbook for the CSM.

METHOD 3: New Sponsor Process

You’ll also need a process for what to do once a new executive has replaced the prior one. We have a New Sponsor Playbook that guides our CSMs in ensuring a successful transition. We cover 4 topics during a series of meetings:

1. Introduction to Gainsight & Partnership Overview: We review our partnership to date, assess the exec’s familiarity with Gainsight, and discuss at a high level how the team is using the product. This conversation may lead into a full demo of Gainsight.
2. How a VP of Customer Success Uses Gainsight: Best-practice discussion about how I use Gainsight to run the team. This session helps us explain how Gainsight is relevant to the exec personally in his/her role, not simply to his/her team members. (You can read more about how I use Gainsight here.)
3. Strategy Alignment Overview: We want to make sure that the work we’re doing with the exec’s direct reports is aligned with the exec’s strategic objectives. Coming out of this session, we create a new Success Plan for that exec.
4. Overview of Gainsight Instance: We get the exec up to speed on what his/her team has already configured in Gainsight at a detailed level.

Read more about our New Sponsor Process here.

METHOD 4: Executive Sponsor Program

Our VPs and other senior leaders from across departments at Gainsight are assigned as Executive Sponsors to accounts above a certain ARR threshold. They are assigned CTAs to remind them to check in with the customer execs every so often.

The primary purposes of the Exec Sponsor Program are two-fold:

1. To uncover latent challenges in our larger accounts
   1. Higher ARR or brand value means that more management attention is needed.
   2. To support effectively our largest accounts, more intimate knowledge of the account is required than CSM team leaders generally have the bandwidth to acquire.
2. To give Gainsight executives across departments exposure to real customer issues in depth. This awareness helps our VP of Product design better products, helps our VP of Sales design a better sales process, etc.

Read more about our Exec Sponsor Program here.

METHOD 5: Implementation Updates from Onboarding Project Manager

We send regular updates to the exec to keep them apprised of progress during onboarding. Onboarding is a critical time in the lifecycle: If it goes well, the customer is likely to remain a healthy customer; if it goes poorly, it can be costly to get the customer back on track later.

Sometimes onboarding doesn’t go well because the customer hasn’t dedicated the right resources. That one reason why it’s important to stay in close touch with the exec — so that you can work with him/her to assign the right people to the project.

Premier+ Customers

Currently, for customers with custom implementation SOWs, the Project Manager sends weekly updates to the Adoption Champion, copying the Executive Decision Maker (Adoption Champion is our term for the mid-level person at the customer who is most responsible for encouraging adoption of Gainsight at the individual-contributor level; often it’s a team director.) The update includes progress made during the week relative to the project plan that was aligned on at the start of the engagement, implementation steps for the next couple of weeks, key risks to meeting those milestones, and important decisions to be made next week.

We put the Adoption Champion in the “To” line and the Exec in the “CC” line because we want to empower the Adoption Champion to take ownership of the project from the customer’s side.

For customers that select our Express onboarding process, we review their project plan during the weekly status calls with the customer, we share a self-service version of the project plan so that they can monitor their progress, and we are in the process of deploying a new “External Collaborator” functionality to encourage self-service knowledge share / updates.

If any red flags are raised within or in response to the PM updates, the CSM will check in with the Executive directly to understand their sentiment and align on go-forward plan as needed.

Premier Customers

Same as for Premier+.

Standard Customers

For customers that select our Express onboarding process, we review their project plan during the weekly status calls with the customer, we share a self-service version of the project plan so that they can monitor their progress, and we are in the process of deploying a new “External Collaborator” functionality to encourage self-service knowledge share / updates.

If a customer is considered “at-risk” during implementation, the Project Manager sends an email update on progress to the Executive on a monthly basis.

METHOD 6: Regular Updates on Success Plan from CSM

Premier+

Our Success Plans tackle business objectives that span anywhere from a quarter to a year, with clearly defined monthly or quarterly deliverables, based on the planning and execution cycle at the customer’s organizations. In addition, we create turnaround Success Plans for our at-risk customers which are shorter-term and more tactical in nature. We provide live updates on a monthly basis (e.g., on weekly check-in calls with the Adoption Champion or by email) to ensure we are aligned on progress towards our goals.

Premier

Our Success Plans tackle goals over a 6 month period of time, based on the Executive’s vision & objectives. Goals are set at the beginning of the partnership, and reviewed in depth every six months via our EBR process. We also provide Success Plan updates on a quarterly basis to ensure we are aligned on progress towards our goals – these updates are provided via email from the CSM to the Exec and contain an export of the actual Success Plan from Gainsight.

Standard

We currently create Success Plans for at-risk customers. We are planning on automating this process to create Success Plans for all customers during the sales cycle that will then serve as an input into their implementation. We review Success Plan progress during EBRs once per year. Finally, we are exploring sending CoPilot email updates on Success Plan progress to execs very 6 months.

METHOD 7: Updates from CSM during Risk Situation

Premier+

In cases of rare extreme risk, (e.g. systemic failure or workflow stoppage), we provide updates every 4 hours to our execs, or more frequently whenever possible. However, in less extreme cases, the updates are daily, twice a week or weekly depending on the severity of the risk.

Daily updates are provided for the flagged risks:

• Support Risk: Major support issues resulting in workflow stoppage (Update provided by Support Director)
• Bug Risk: Majors bugs for which there is no immediate or planned solution (Update provided by Support Director)
• Launch Risk: project related risks that will shift an imminent go live date (Update provided by Project Manager)

In these cases, the internal risk owner who updates the customer will copy the CSM on all emails. The CSM will escalate internally if the risk management goes off track. Once we believe the risk has been resolved, the CSM coordinates a meeting with the Executive and the internal risk owner, to ensure everyone agrees the issue has been resolved.

Bi-monthly updates are provided for the following flagged risks:

• Sentiment, Habits, Product, and Company Risks: Update provided by CSM, except in the cases of complex product enhancement requests, in which case the Product team quarterbacks the effort and provides updates.

In the case of those types of risks:

• CSM will schedule meeting with the Executive to discuss source of concern or issue, and agree on a path forward
• CSM will identify and document the steps needed to correct, via a Success Plan that is shared with the customer
• CSM will communicate updates to the customer against the Success Plan twice-monthly (until issue is brought to resolution)

Premier

Same as Premier+.

Standard

The CSMs that work with Standard customers are primarily focused on providing updates on flagged risks relating to Habits, Company, or Sentiment Risk. Given that account ratios are higher in this part of our business, our CSMs spend less time coordinating with other departments on the risk categories that those departments manage (e.g. Implementation Risk or Support Risk).

• Habits Risk: When customers are in Red or Orange Habits (low adoption), we email execs to inform them of their team’s low usage, understand why, and align on a path toward greater adoption.
• Company Risk: When customers have a change in a core role, we email execs immediately to understand the plan / timeline for re-hire and to get an introduction to the new contact. If we experience an exec sponsor change, we work with our adoption champion to get an introduction and meeting with the new exec as soon as possible.
• Sentiment Risk: When customers express poor Sentiment (e.g. through a low NPS rating), we work with execs to identify the root cause and address their concerns.

METHOD 8: Exec Escalation

When a customer issue is so significant that they email me or our CEO, we take it very seriously. We’ve developed a process to handle these situations so that we can reach resolution as fast as possible and ensure no balls are dropped.

1. Receive concerned email from a customer. I (or our CEO) forwards it to our CSM Team Lead.
2. CSM Team Lead opens a manual “Executive Escalation” CTA and assigns it to an Escalation Manager based on customer context and technical complexity. This can be either our Director of Support, Director of Services, or CSM Lead.
3. Escalation Manager takes lead on our Executive Escalation playbook. The tasks for this playbook are:
1. Define criteria for closure upfront
2. Define frequency of internal and external updates (hourly/daily/weekly)
3. Provide internal updates to chatter and external updates to customer
4. Confirm with customer that escalation is closed
5. Send gift to customer on behalf of CEO or myself, to remind the customer how much we appreciate their partnership.

METHOD 9: Director Check-in’s

Even though your CSMs are engaging with execs at your customers, it’s important for their managers to do the same. There are 2 reasons:

1. Your exec sponsor may be more willing to share certain feedback with someone senior than with your CSM. (That said, we seek to create a strong line of communication at the CSM level, to ensure a more scalable way to gather and respond to feedback.)
2. It’s critical for team leaders to hear from customers firsthand, to boost their awareness of what’s going on in their customer segment.

Premier+

When a customer is new to the Gainsight relationship, the Gainsight team director connects with the executives/directors once every two weeks for 20 minutes to discuss:

• Pulse check on the implementation/rollout
• Change management and adoption in your team
• Sharing best practices from other customers on specific topics
• Special topics (e.g., events and speaking engagements, dashboards)

After the first 6 months, we move this to a monthly cadence of check-ins.

Particularly in our large accounts with many stakeholders, we take a “peering” approach, in which our directors align with most senior people at the account, and the CSM aligns with the next level down. This helps us improve our coverage.

Premier

The team director sends an email to customer execs quarterly, aimed to solicit feedback on progress, our team, and product. The email is sent via Co-Pilot to 10 customers a week throughout the quarter, giving leverage to the director.

Standard

Same as Premier, but every 6 months, and the email is sent to 25 customers a month.

METHOD 10: VP Check-in’s

I personally aim to engage with 15 executives at our customers every week, whether over email or by phone. I ask my team directors to send me a list of 15 executives to contact. In situations where the CSM has asked me to gather specific feedback or encourage the customer to take some specific action, I’ll create a customized email for each exec. But in most cases, I’ll simply say:

“I just wanted to check in and see how things are going. Let me know if I can remove any roadblocks or trade notes on a topic that’s top of mind for you. I’m happy to hop on a call if helpful.”

Open-ended questions allow the customer to ask for the type of support that’s most helpful to them.

In addition, blog posts like these help me stay in touch with execs in a one-to-many way. Our CEO Nick also plans this year to engage with CEOs at our customers through regular one-to-many email communication and blogs on how he uses Gainsight as a CEO.

BONUS METHOD: Track Executive Usage

We track Executive adoption of Gainsight with an “Executive Engagement” Scorecard. Currently, we have two measures in this Scorecard, one to track Exec Dashboard Usage and the other to track Exec C360 usage. Usage in these features can indicate their using Gainsight to track team metrics, lead meetings, or prep for important customer calls. We also hope to introduce measures to track Exec advocacy and event attendance.

___

If you’d like to learn more about how to implement these processes in your organization, check the Business Processes section of Gainsight Go, check out the Gainsight Vault, or contact your CSM. You can also send questions or feedback to Allison at apickens@gainsight.com. Follow her blog posts on Twitter at @PickensAllison.

The post 10 Ways We Engage with Execs at Our Customers appeared first on Customer Success Software | Gainsight.

Allison Pickens is VP of Customer Success & Business Operations at Gainsight.

The number-one question that keeps most VPs of Customer Success up at night is:

“What’s the ROI of Customer Success?”

This question is challenging to answer for two reasons:

(1) Broad Accountability with Limited Influence

CSM teams are typically held accountable for the gross renewal rate, as well as upsell in many cases.

But we all know that when a customer renews, it’s not just because of the CSM, even if s/he deserves most of the credit. The Product Team ensured adequate product-market fit, the Sales Team originally sold to a customer with the right profile and adequate resources and the Support Team followed up on tickets in a timely way.

Other teams also pave the way for the CSM to upsell his/her customers.

In reality, it takes a village to renew and upsell a customer. Customer Success can’t take full credit.

(2) Broad Influence with Limited Accountability:

At the same time, CSMs influence metrics that they’re not typically held accountable for.

A few examples:

MQLs: When an inbound lead says they “heard great things about your product,” there was a CSM behind the existing customer that spoke with the lead. But formal accountability for MQLs lies with Marketing.

Close rate: When a prospect signs a contract after speaking with a reference, there was a CSM behind that reference-able customer. But formal accountability for the close rate lies with Sales.

Ticket resolution time: When your Support team resolves a ticket quickly, they may in fact be indebted to your CSM team for providing helpful context for the ticket. But formal accountability for ticket resolution time lies with Support.

Bugs rate: When the quality of your product improves, there’s often a CSM in the background that offered feedback to your engineering team. But formal accountability for the incidence of bugs lies with Engineering.

Again, the true ROI of Customer Success isn’t limited to metrics that CSMs are typically held accountable for.

Most companies are aware of Problem #1 – that CSM teams don’t have exclusive influence over the metrics they’re accountable for.  That’s why CSM teams typically don’t get full credit for improved renewal rates; we also recognize the Product Team for improving usability, the Services Team for improving the implementation process, etc.  

Interestingly, most companies don’t recognize that Problem #1 is equally applicable to departments besides CSM.

• Marketing is held fully accountable for MQL target attainment.
• Sales is held fully accountable for attainment of the new business target.

But as illustrated by the examples listed under Problem #2 above, in reality Marketing and Sales don’t have complete influence over MQLs and new business respectively. Customer Success contributes to both of those metrics.

Non-CSM departments are also subject to Problem #2: they influence metrics that they’re not typically held accountable for. For example, the Sales Team influences time-to-value (and ultimately the gross renewal and upsell rates) by selling to customers who are or are not the right fit. But as long as the Sales Team meets their new business target, “it’s all good.”

A Venn diagram can illustrate Problems #1 and #2.  I’ve shown two examples below: one for CSM and one for Sales.

CSMs are held accountable for the Renewal Rate and Upsell metrics, but can’t completely influence them, which is why those metrics are on the border of the Influence circle. They influence Referrals, References, and Product Quality, but not completely, which is why those metrics are on the border of the Influence circle.

And the Sales Team finds itself in an analogous situation:

So why do these problems matter? In the current situation, we have the following consequences:

• If you want to improve a particular metric, it’s not clear which department you should invest in, given that multiple departments influence each metric.
• Relatedly, if you want to quantify the ROI of a given resource (i.e. the prompt of this blog post), you can’t simply look to the metrics that this resource is formally accountable for.
• If you have a feeling that a given department should do additional work to contribute to a metric that they don’t formally own, it’s hard to get them to change their focus.

In the best organizations, accountability and influence coincide.

So what does that ideal organization look like?

Before jumping to my recommended solution, let’s explore two other organizational models that address Problems #1 and #2.

Organizational Model #1: Carve Out Silos

This solution argues that if Customer Success is to be a peer to Sales and other departments, it has to be fully accountable for its own metric – i.e. take full credit and blame for it, even if the team’s influence is limited.

In this world, every department is accountable for one to two key metrics.  For example:  

• Sales: New Business ARR
• Marketing: MQLs
• Customer Success: Gross Renewal Rate and Upsell ARR
• Support: Ticket Resolution Time
• Services/Onboarding: Project Completion Time, Services Gross Margin

This is what most SaaS businesses look like today. In this model, every department head fights for resources to achieve his/her metric. At Gainsight, we call this model the “Team of Rivals.”  

The benefit? Every metric is well-represented in a cross-functional debate.

The downside? There are often significant negative externalities from each department’s actions. For example:

• Support strives for faster resolution time to the detriment of the customer experience, hurting the gross renewal rate that the CSM team is responsible for.
• Customer Success strives to improve the renewal rate, but doesn’t make the effort to convert happy customers into advocates, which is a missed opportunity to drive the Marketing Team’s MQL generation.  
• Marketing strives to boost the volume of MQLs to the detriment of the Sales Team’s average selling price.

In this model, the only person who (a) has an incentive to care about all metrics and (b) is capable of minimizing the negative externalities of each team’s effort is the CEO. The CEO spends his/her time prodding each department head to “keep the other department’s goals in mind,” organizing off-sites to alleviate friction between teams, and slogging through cross-functional initiatives.  

This is one major reason why being CEO of a typical SaaS company is a very difficult job, and also a reason why many CEOs are hiring a Chief of Staff to do the dirty work.

Organizational Model #2: Make Customer Success the Glue

At Gainsight, we know Solution #1 isn’t the best way to run a company. That’s why we’ve written so much about the role of the CSM in serving as the quarterback – on behalf of your customers – to hold other departments accountable for their role in customer success.

This model takes for granted that other departments – Sales, Marketing, etc. – are largely focused on their own one-to-two metrics and operating in their own silos. The CSM’s role is to prevent the resultant inefficiencies from affecting the customer experience.

In this model, the CSM…

• Ensures that Support Teams are not just driving time to resolution, but also driving toward the right resolution from the customer’s perspective.
• Gives feedback to the Sales Team when they sell to customers that aren’t ready for the product (see our Readiness Risk).
• Works with the Services/Onboarding Team to help overcome any negative sentiment during onboarding and ensure value is delivered (see our Implementation and Sentiment Risks).
• Etc.

The detriments of this model are as follows:

1. Your CSMs have to be strong – they’ll be expensive.
2. Your head of CS also has to be strong.
3. Ideally, non-CSM teams keep customer happiness in mind even when the CSM team isn’t monitoring them. When CSM has to monitor, opportunities to drive customer happiness are inevitably missed.
4. Pattern recognition will invariably slip through the cracks. Your CSMs might succeed in tactically resolving cross-functional issues that arise, but they won’t be in a good position to identify patterns that require functional expertise. For example, they may not recognize that a product enhancement would fix some of the issues they’re working through precisely because they’re not product experts.

Organizational Model #3: Align Accountability with Influence

Here’s the model I recommend: hold departments accountable for all metrics they influence, and only those.  

Let’s take a look at the CSM department as an example. CSMs drive New Business by generating new leads and by providing sales references and customer case studies that improve close rates. Once you analyze your close rates by lead source and how those change when a sales reference or case study is used, you can calculate the incremental New Business ARR resulting from the CSM team’s advocacy efforts.  

This means you can assign a New Business target to the CSM team.  

Because this framework assigns a value to CSMs’ influence of a metric that they are not normally held accountable for, the framework allows us to return to the question initially posed in this email: what’s the ROI of Customer Success?

The ROI is equal to the sum of the dollar-metrics that the CSM team influences. Add the Incremental New Business ARR described above to the Incremental ARR due to CSM activities influencing the renewal rate and the CSM activities influencing upsell, as described here:

The hardest part will be determining the multipliers in the chart above. But once your organization is aligned on those, you can calculate the dollar impact of your CSM team using a dashboard.  

Imagine that: Every week, reporting on the dollar impact of your CSM team.

Stay tuned: I’ll write in more detail about calculating the ROI of CSM in the coming weeks. For example, given that a saved renewal preserves a potentially perpetual annuity stream (in the form of future renewals), you could calculate the ROI of CSM efforts in terms of Lifetime Value (LTV) rather than ARR.  More to come.  

So, can you align Accountability and Influence for every department, not just for CSM?

In theory, every department should have a target for each metric it influences. In the table below, I’ve indicated which departments – in principle – should probably have a target (“T”) for each financial metric. (Taking this to the extreme, you could even argue that every cell in the table should contain a “T.”)  

For example, just as you can assign a dollar value to a sales reference from a CSM (in terms of Incremental New Business ARR), you can assign a dollar value to a support ticket closed within 24 hours (in terms of Incremental Renewed ARR).

We haven’t implemented this broad-based target system at Gainsight. But we know that SaaS companies need a better way of aligning Accountability and Influence. I’ll post more on this topic in the future.  

To learn about processes that you can set up for your CSM team and other departments, check the Business Processes section of Gainsight Go, check out the Gainsight Vault, or contact your CSM. You can also send questions or feedback to Allison at apickens@gainsight.com. Follow her blog posts on Twitter at @PickensAllison.

The post The ROI of Customer Success appeared first on Customer Success Software | Gainsight.

This blog is the first of five based on anonymized discussions from CCO Summit 2016.

A SWOT analysis is a framework that companies and business school professors have been conducting since as far back as the 1950s. If you’re interested in the history of SWOT, Tim Friesner posted a pretty comprehensive investigation of the muddled, abstruse origins of the technique.

That being said, chances are fair to middling that you’ve never heard the term before. Turns out all this time, your CEO wasn’t actually talking about the 2003 movie starring Samuel L. Jackson, Colin Farrell and LL Cool J. That’s okay! SWOT is just a handy method for visualizing and operationalizing a way of thinking strategists have used since they were figuring out how to take down wooly mammoths with stone tools.

The framework stands for Strengths, Weaknesses, Opportunities, and Threats.

Last month, Gainsight brought together over 100 Chief Customer Officers from around the world to Napa Valley for an intimate conversation on the future of Customer Success. The executives were organized into teams of ten, and together worked through a series of exercises, including a current SWOT analysis on the state of Customer Success within their businesses.

Here’s what a sample chart from CCO Summit 2016 looked like:

The exercise was useful because it helped the teams consider all angles of the current condition of our industry without overlooking key details.

With all the names anonymized to protect the innocent, here are what some of the top CS minds in the world have determined to be the biggest strengths, weaknesses, opportunities, and threats for Customer Success this year:

Strengths

• Customer Success is often the mechanism through which your entire organization gets trained on your product’s use. That makes it a crucial component of any company.
• The strong emphasis on community in CSM drives connections between your company and its customers as well as amongst your customers.
• CSMs pay very close attention to the Voice of the Customer. Sales, Marketing and Product teams are figuring this out and looking to the CSM for that invaluable info!
• Customer Success drives accountability across the entire organization. CSMs hold every individual and department accountable for how they relate to the customer.

Weaknesses

• The definition of Customer Success is fluid. It’s different from company to company, and it’s always changing. This can make it hard to even talk about Customer Success.
• Hiring can be difficult. Not only does the skillset needed vary greatly from company to company, it often varies from product to product!
• When and how does a CSM enter the relationship during the sales process? There are few (if any) rules across the industry for how the handoff happens.
• Customer Success still depends on a very strong and specific framework from Sales to take over the company/client relationship.

Opportunities

• As Customer Success continues to align with Marketing, CSMs could have the ability to tell their customers’ success stories like never before. It’s a golden chance to build your company’s narrative around its greatest asset.
• Customer Success generates some of your company’s most meaningful performance metrics. They give you an opportunity to justify your budget internally as well as externally to your customers, and ultimately drive growth.
• Some analysts are warning of a downturn in the tech economy. While this could easily be put in the threat column, it may actually drive CEOs to place more emphasis on Customer Success to protect your existing revenue.

Threats

• CSMs are proving themselves more and more with every opportunity. As your CSM team continues to be successful, other departments will want a bigger piece of your metrics, your talent, and your time.
• Customer Success is all about the long game. Victory is often measured in Lifetime Value as opposed to big, one-time deals. Without instant ROI, your team could be under pressure. That makes the right metrics absolutely crucial.
• As the value of Customer Success increases, CSMs are getting more and more expensive to hire. The pool of available, experienced talent isn’t growing to keep up with demand. CSMs need to work harder to justify their cost.
• Another factor raising the cost of Customer Success is the heavy concentration of CSMs in the Bay Area. Customer Success will continue to grow in value, it also needs to expand its geographic footprint.

Obviously this is only a snapshot into the discussion, but it certainly covers the consensus. Why not try conducting your own SWOT analysis for both your company and for Customer Success at your next team meeting?

The post SWOT’s the deal with Customer Success? appeared first on Customer Success Software | Gainsight.

Tom is a highly-motivated and innovative success leader, managing the Adobe eSign Services’ International Client Success team in EMEA and APAC. Tom’s passion is seeking and deploying the next innovative technologies that will improve the way people live, communicate and execute business. In his downtime he enjoys running, barbecuing and wine tasting.

When Adobe first acquired Adobe eSign Services (at the time EchoSign), I was part of a small tight-knit team and was appointed as the first Enterprise Client Success Manager in EMEA, working on the eSignature product.

Back then, a lot of the software industry hadn’t yet transitioned away from the perpetual license model to the now common subscription-based model. The industry was accustomed to the concept of selling software to a customer, hiding under a rock for a few years, then returning in attempt to upsell or convert to a newer version.

Fast-forward to today, software has a much lower cost of entry on a monthly, yearly or multi-year subscription; the recurring revenue of the customer adds up over time in a much more sustainable way. On the negative side, however, a customer who buys once and doesn’t renew will lose money for many Software-as-a-Service (SaaS) businesses. This makes it absolutely critical that customers not only renew, but expand their footprint with a product over time, resulting in additional business value for the customer and revenue for the provider.

How is that achieved? In a word, or two words, rather…Client Success!

A savvy and proactive Client Success team can help make a product “sticky” with customers as well as entice them to have wider and deeper use of the product. Increasing revenue begins with protecting the revenue you already have. Without any sort of Client Success strategy, business growth will have less momentum as customers churn and new business sales struggle to keep up. Client Success plugs the holes in the bucket.

Download the 10 Laws of Customer Success, an eBook curated by CEOs, Chief Customer Officers, and SVPs of Customer Success from leading B2B technology companies.

This has become obvious to a growing number of SaaS companies here in EMEA and worldwide. Therefore, it’s fairly simple to justify creating or expanding a CSM team to the executive team, based on churn or growth projections alone. Take Adobe eSign Services for example, as we’ve worked to build deeper relationships and engagements with our clients, we’ve seen our renewal percentage rates climb YoY to an industry leading level in the high 90’s, for the Enterprise base – That’s a fairly solid platform for growth and sustainability!

It’s commonplace for CSMs to be measured on retention and upsell, but putting that to one side, there are a further three internal merits of CSM that aren’t as often apparent when justifying the headcount to the executive team.

Free Marketing

As the CSM builds that trusted relationship with clients, the referenceability of your brand will noticeably improve. Positive ratings on sites like G2Crowd, Trust Radius or SFDC AppExchange will skyrocket, and you’ll have a growing stack of case studies to arm your sales team with.

People really do pay attention to glowing reviews and case studies. Don’t think of this as a “nice to have;” think of it as a necessity. If a SaaS business doesn’t have reference stories, if reviews are poor or they don’t have clients willing to go on file to say how great they are, they’re probably not going to sell or renew subscriptions as easily.

Rapidly expanding your business

With the support of a CSM team, new clients will deploy much, much faster. The onboarding process is one of the most hazardous times for customer churn.

A speedy onboarding process is invaluable and can pave the way for infant customers to become power users in no time at all. They’ll consume licenses faster, be hungry for greater adoption, and come back to buy more, all thanks to the ongoing strategic enablement offered by Client Success.

Improving the product

Client Success Managers are constantly in touch with users and obtain first hand experience as to how the product is actually used, rather than assumptions made by the rest of the business. When there is scope for product improvement, a CSM is often the very first to know and can provide that feedback internally.

It is the CSM’s job to learn how a client really uses the product rather than just how the provider thinks they use it. Through the relationships the CSM holds with the customer, they can facilitate an open two-way discussion with the product team, assist with Customer Advisory Boards or wider collaborative user groups, all providing greater insight.

Ultimately, that feedback directly translates to an enhanced, holistic product that works in the real world. It’s a win-win. Customers are happy as they feel involved and get a fantastic product, happier customers and a more relevant product equal higher retention and accelerated business growth!

Summary

In summary, the term “Client Success” means different things to different people. However, one universal aspect that people agree on is that having a well performing Client Success function will make your customers more successful and attain a good ROI. Successful customers have direct correlation to reduced churn, heightened sales and referencability, which are all buzzwords that any executive team will always consider investment in!

About Adobe

As the inventor of PDF, Adobe brings over 20 years of experience with secure digital documents to help businesses compete more effectively. Document Cloud provides departments and entire organizations with services, including enterprise-class eSign services, which bring speed and efficiency to business document workflows. Leading organizations all over the world–including companies like KLM, Groupon, Jaguar Land Rover, NetAPP and TiVo–rely on Adobe eSign Services for fast, secure and mobile e-signatures. Having processed over 150 million e-sign agreements, eSign services offers solutions for industries including healthcare and insurance, financial services, media and entertainment, government, and schools and universities.

The post 3 Alternate Benefits of Client Success Often Overlooked appeared first on Customer Success Software | Gainsight.

This blog is the second of five based on anonymized discussions from CCO Summit 2016. Read the first here.

One of the biggest factors that has led to the explosion of the Customer Success movement is the growing recognition that there’s no one-size-fits all strategy for meeting your customers’ needs. As you get to know your customers, you’ll find they each have different personalities, budgets, levels of engagement: that’s obvious. Each customer could conceivably use your product in drastically different ways.

In a perfect world, you’d be able to engage every one of them with a custom solution. Unfortunately, it will never be cost-effective to offer bespoke software for all of your customers and you’ll never have the resources for a one-to-one ratio of CSMs to clients. At CCO Summit 2016, one Chief Customer Officer at a large company was extremely proud of achieving a 25:1 ratio. Depending on the size of your organization, you could be fighting to get down to 100:1 or even higher.

Customer Success isn’t like Sales. You can’t just close a customer and move on. As a CSM, that’s 25, 100 or even 200 plates you need to keep spinning day-over-day, year-over-year. You’ll have a nervous breakdown if you don’t figure out how to separate them into tiers. Once you break them into smaller pieces, you’ll find them way easier to handle.

In a word, that’s segmentation.

But segmentation isn’t just about ripping your problems apart, or even just an efficient operational approach to Customer Success. It’s the key to growing your recurring revenue by moving your clients up the ladder. One of the big takeaways from CCO Summit 2016 is that everyone in the field is thinking about segmentation. How each company does it was the subject of much discussion.

Our VP of Customer Success & Business Operations Allison Pickens wrote a great guide on how to segment your customers. It’s based on what we learned about segmentation at Gainsight.

At CCO Summit 2016, two of the presentations that had Customer Success execs furiously taking down notes had to do with the segmentation strategies. The presenters, a Chief Customer Officer and an SVP of Customer Success, broke down how they chose to segment their customers to maximize success.

The first organization has six customer segments:

• Strategic
• Enterprise
• Channel
• Growth
• Maintenance
• Transactional/Self-serve

Generally, they range from extremely high-touch at the Strategic level to almost completely automated at the Transactional level. On top of that, customers are tiered according to growth potential. This company thinks strategically about how to channel customers up the chain. In fact, the CCO said that movement down the chain is extremely rare – they’re almost always moving up. Using this model, they’ve been able to reach a ratio of 20 Strategic Accounts per CSM or 250 Maintenance Accounts per CSM.

There are so many factors that go into sorting customers, you might think you need the Sorting Hat from Harry Potter to figure it out. But this company has six (mostly objective) levers they use to organize their clients:

• Beginning ARR
• License usage/key events
• Perceived TAM
• Brand influence
• Market stage
• Just because

As you can see, there’s no way to eliminate a CSM’s gut feeling about a client from the judgment process – nor should you try to! The levers are there to guide your decision-making, not replace it. And there’s no one-size-fits all solution for your segmentation, either. For example, the other presenter’s organization uses a three-tier model:

• Strategic (Fortune 200)
• Enterprise (Fortune 1000)
• Corporate ($1 billion+ revenue)

At the Strategic Level, clients are demanding almost entirely custom products. At the Corporate Level, it’s almost entirely packaged solutions. What’s interesting about this model is that it allows the company to charge not just for a custom product, but a custom Customer Success component.

For their biggest clients, this company offers a custom-built onboarding process and Premier Plus Customer Success. That means the client has access to both a CS Advisor and a CS Engineer. Each Premier Plus Advisor handles seven accounts, and each Engineer handles only six.

Not all customers necessarily want such a high-touch relationship. This company has found that its Enterprise Level clients tend to be more self-sufficient. Enterprise CSMs here each handle 25 clients.

How many tiers you create is completely up to you and your team of dedicated CSMs. But no matter what size company you have, it’s crucial to create a deliberate segmentation strategy. How you segment your customers informs everything about the relationship, which is the foundation of Customer Success.

Read more about how to reach the full potential of those relationships.

The post How Customer Segmentation Can Save Your Sanity AND Drive Consistent Growth appeared first on Customer Success Software | Gainsight.

This blog is the third of five based on anonymized discussions from CCO Summit 2016. Read the second here.

Hiring a new CSM can feel a lot like hiring Batman. And not the dark, brooding anti-hero with the scary Batman-voice, but the 1960s Batman. The one with Robin and Commissioner Gordon and the Batphone and Batgirl. Batman was clever, inventive, a natural leader, great with technology and great with people. He played well on a team and never let his mayor or his city down. Also, the 1966 Batman movie cost $1.5 million to make. To put that in context, The Dark Knight Rises had a budget of $275 million. Even with inflation that’s still more than $260 million difference.

Here’s what I’m talking about:

How’s that for delighting the customer? Let me know if this sounds like any of your CSM interviews:

“We need someone with immense technical skill. Somebody who can understand the ins-and-outs of our software. Oh, you also need to be great with people. Like, really great. Can you delight our clients? Can you build relationships? Do you work well in a team environment? Also, will you come in under our budget?”

At CCO Summit 2016, pretty much every Customer Success exec was interested in improving their hiring practices. That’s not surprising; finding great people is crucial in every field. But Customer Success offers at least three unique challenges:

1. As an emerging movement, the hiring pool of experienced candidates is relatively small compared to extremely high demand. That means jobs can go unfilled for longer and salary expectations grow disproportionately.
2. The skillset profile is simultaneously very broad and very focused. CSMs need technical knowledge and great relationship skills. CSM roles include elements of Support, Sales, Training, Service, Marketing, Product Management and more.
3. Being a successful CSM is all about building long-term relationships. These days, elite talent tends to move between departments as often as once every 18-20 months. In Customer Success, you don’t have that luxury. CSMs invest a lot of time and effort building connections that are meant to last for years and years. It’s logistically impossible to transition out in two weeks or even two months.

If you hold out for Adam West Batman, you’re just as likely to strike out. Either that or you might not be able to afford your dream candidate. A great CSM is worth every penny, but most CCOs at the Summit were already under pressure to justify their budgets at the executive table.

Thankfully, two presenters had some excellent ideas on how to adjust the hiring profile to find great team members where you might not be looking. One idea that is gaining traction among top CS executives is splitting the traditional CSM role in two: relationship management and technical expertise.

The previous post in this series about segmentation mentioned the tactic of including Customer Success Advisors or Customer Success Architects to create a new service tier. CSAs add value for higher customer segments and help your CSM team more efficiently meet customer needs.

Breaking the CSM role in two will naturally simplify your hiring process as well. Now you don’t need the mythical creature who’s magically great with clients and great with technical side too. In this model, your CSM’s new role would include customer onboarding, relationship management, handling the renewal transaction, and generally quarterbacking the company-client partnership. On the other hand, The CSA would be responsible for expertise on the product and how your customer uses it, building a technical framework to assist both the customer and CSM, and generally supporting the CSM on an operational basis.

You could even further break up the CSM role with regards to partners. Some B2B SaaS companies are beginning to employ CSMs to specifically handle the relationships with partners to help them deliver Customer Success at their standards. On top of that, many larger organizations divide CSM roles by account size, with compensation varying contingently.

Wondering how much you should be paying your CSMs? Watch a webinar about CSM compensation here.

It’s kind of wild to think about CSM teams broken down by specialization and skillset. Customer Success as a movement is really only about a decade old. The initial hiring profile was very simple: a jack-of-all-trades doing whatever it took to delight the customer. Since then, the profile has refined and refocused to a more value-based role. A CSM must provide value to the customer and the company in a delightful way. It’s more quantifiable and more revenue-focused.

As the CSM job description further evolves, here are a few things to look for:

• Project Management skills. The classic CSM profile places no timetables on relationships. Project Managers are always hungry to finish the job and move on to the next. CSMs never want to be done, because a customer isn’t a task – it’s a relationship. Ideally, the customer renews indefinitely. However, adding an element of urgency and timeliness to your CSM team can only help you move clients along their growth ladder.
• Internal mobility. Look to transition people in your company from Sales, Marketing, Consulting, Product, Recruiting and Support. One SVP of Customer Success said his company has no career Customer Support employees. They’re always looking to gradually transition them into Customer Success.
• Customer-centric. At the end of the day, your ideal CSM needs to be an advocate for the customer. That hasn’t changed in 10 years and will never change. Look for someone genuinely passionate about the health and delight of the customer.

The post How to Hire a CSM because 1960s Batman isn’t Real appeared first on Customer Success Software | Gainsight.

1. An incredible agenda featuring Functional Micro-conferences

If you haven’t seen the agenda yet, you need to. We’re kicking it off on Monday, May 9 with Customer Success University (CSU) Live! Certification Day and a big Welcome Party in the evening. Then we kick into full gear on Tuesday by diving into our main theme: “Customer Success is Eating the World.” Wednesday is all about Advanced Customer Success Techniques and on Thursday we’ll wrap it all up with SKO: Success Team Kick-Offs, because why should Sales teams have all the fun?

Plus, this year we’re doing something I’m really excited about: Functional Micro-conferences. As we all know, Customer Success isn’t just for CSMs; it’s for your whole company. And every department from the C-level on down needs to be on board with a customer-centric strategy. That’s why we put together seven micro-conferences on Tuesday dedicated to Founders & CEOs, CFOs, VPs of Sales, Product Leadership, Customer Marketing, Customer Operations, and Services & Support. Each one will be a deep-dive into implementing Customer Success in each specific category.

2. It’s the most important (and biggest) event in customer success

If you’re in the Customer Success business, this is your Woodstock, your World Series, and your College Graduation all rolled into one 3-day superevent. You just can’t miss it! Ever since the very first conference in 2013, the word Pulse has been synonymous with Customer Success. No other customer-centric event comes close! And this year will be bigger than ever, with hundreds of speakers and several thousand attendees. On top of that, we’re working extra-hard to make sure it still feels intimate with our Success Unplugged workshop and Functional Micro-conferences.

3. An INSANE roster of speakers

Take a second to check out just the top 10 speakers on the list. If that doesn’t convince you we have the leading voices in Customer Success lined up for Pulse 2016, just keep scrolling. There’s a lot more where that came from. We have 200 of the most brilliant minds in technology, business, and sports, including baseball legend Billy Beane (you know, the real-life Oakland A’s GM played by Brad Pitt in Moneyball), Facebook At Work Director Monica Adractas, GE Digital’s CDO Ganesh Bell, and many, many more. We also have a few surprises up our sleeves no one knows about yet! You do not want to miss out on who we have in store for you. Trust me.

4. We’re shutting down the streets of Oakland

This year Pulse is taking the city of Oakland by storm. We’ll be shutting down some of the streets to handle the influx of people, and we could not be more excited. Oakland is such a cool city, and is a vital part of the Bay Area culture and identity.

We’re taking over the Oakland Convention Center, just 12 minutes from Downtown San Francisco. Click here to get more info about the location and accommodations.

5. It’s a new kind of conference that puts the community first

We don’t want to be just another conference that comes in, disrupts the residents, pumps money into non-local vendors, and generally leeches off the city. That’s not us. Pulse 2016 is a brand new model of community-focused conference that’s in-line with our values as a company. It’s called Community Success, and it’s the part of this conference we’re most proud of. Check this out:

• ALL profits will be donated to support local nonprofits.
• Local-first approach to selecting conference vendors
• Shop Local Experience
• Step Forward Day in Community
• Community Connect Exhibition Hall

6. Maybe something like this will happen

The post Six Reasons You Should Attend Pulse 2016 appeared first on Customer Success Software | Gainsight.

Irit Eizips is the practice director at CSM Practice, helping our clients plan and execute their customer success strategy. As a Gainsight Partner, we help companies implement, optimize and manage their Gainsight solution to maximize value.

Before you implement Gainsight, here’s how to make sure you plan your project to achieve high adoption

Three things to consider from change management perspective to achieve high adoption and make Gainsight a huge success:

1. Enroll executives in endorsing the new system and commit to using it during weekly/monthly meetings with the team
2. Identify early adopters/champions early in the implementation process. They should be involved in all status meetings and review sessions during the development. Finally, have them train the other users when development phase is complete. Gainsight is a lot of experience in “training the trainer” – leverage it!
3. Plan the project in a piecemeal approach. I recommend all my clients to consider the following as factors in deciding scope:

FVD

Choose a process(es) that already exist and the users are well adapt in for your first value delivered. Specifically speaking, pick a process where challenges exist and Gainsight could add a significant value. By using this approach, the users only have to learn one thing – the new technology. This simplifies adoption and increases the chances of high adoption and instant high value realization.

Examples: Identifying upsell opportunities, flagging customers at risk, sending NPS surveys with calls to action, etc.

Note: Try to pick a process that doesn’t have to rely on data outside of SFDC. This would ensure your first value delivered happens sooner than later.

Phase 2

This phase should ideally be timed to when users have already “warmed up” to the new Gainsight system. In other words, the users are comfortable using Gainsight and are already realizing value. In this phase, you want to consider integrating NEW processes into Gainsight. The only ‘new’ thing that the users would have to learn at this stage are the new process or one new module, since they are already used to the technology.

For example: Customer lifecycle (if you’ve never had those formalized and consistent prior to installing Gainsight), customer campaigns, etc.

External Data

I recommend dealing with external data in parallel to these phases. In an ideal situation, you first roll out the first two phases quickly without getting held up on external data shenanigans. Unless you have a data-warehouse that’s squeaky clean and perfectly mapped to your Salesforce Account IDs.

That being said, in my experience, you want to start with external data that’s easy to bring in. Here you want to consider starting off with with Gainsight’s awesome connectors. If you have Zendesk ticketing system – why not start there?! It’s easy and would provide you and the team with ample and immediate of value. Next, if you have a datawarehouse – not a bad place to start with at all. All other sources, trust me when I say, you want to pace yourself and take a piece meal approach.

Bottom line, Data integration does add a lot of value, but it could also get complicated very quickly. Start with simple clean data sources if possible, and run the external data efforts in parallel to your phased project plan for business use cases whenever possible. If it’s not possible – hire a business intelligence professional to help you plan this aspect of your project ‘the right way’ and bring in the appropriate resources to make it as successful a project as possible.

The post Three Awesome Gainsight Implementation Tips appeared first on Customer Success Software | Gainsight.

In my previous post we dug into how technology companies – large and small, young and old – account for the costs of Customer Success. The feedback we received was very positive, and I appreciated reading every comment note. Thanks! With that said, we kept hearing a similar question among the feedback we received: “It’s great to understand how companies account for the cost of Customer Success, but what should my Customer Success Costs actually be?”

As most Customer Success leaders tend to be much more operations-focused as opposed to accounting-focused, it’s the right question to be asking. Well, we heard you loud and clear! At our recent Chief Customer Officer Summit, I asked a series of survey questions in order to capture these important Customer Success Cost benchmarks.

Before we get into the benchmarks, it’s important to understand both What and How these costs are being deployed. The What is easy: it’s the people that make up your Customer Success Team. The How gets a little more complicated as the CSM workload is different depending on the type of customer the CSM is managing. For this reason, the first question we need to ask as we explore Customer Success Costs is, “How do you segment your customer base?”

Key Takeaways: Segmentation

• The most common lever to segment the customer base is Annual Recurring Revenue (ARR).
• ARR is the best proxy for CSM workload: escalations / meetings / touchpoints / headaches / high-fives are directly related to the size and scale of the customer.
• Slicing the customer base into three segments that dictate CSM workload and the related CSM coverage model is the most common methodology.

CSM Ratios Per Segment

We now know the bulk of the industry thinks about their customer base in three segments: High, Medium and Low-Dollar customers. The next thing we need to understand is how resources are being deployed to drive maximum success across these segments in the most cost-effective manner possible.

Key Takeaways: Enterprise Ratios

• The median amount of ARR that an Enterprise CSM manages is $2M to $5M.
• 69% of Enterprise CSMs manage more than $2M of ARR.
• The median amount of customers an Enterprise CSM manages is 10-50.

Key Takeaways: Mid-Market

• The median amount of ARR a Mid-Market CSM manages is also $2M to $5M.
• 42% of Mid-Market CSMs manage more than $2M of ARR.
• The median amount of customers an Enterprise CSM manages is 100-250.
• A Mid-Market CSM manages roughly the same amount of ARR as an Enterprise CSM, but it’s spread across many more customers.

Key Takeaways: SMB

• The median amount of ARR an SMB CSM manages is also $1M to $2M.
• 54% of SMB CSMs manage more than $2M of ARR.
• The median amount of customers an SMB CSM manages is between 100-250.
• 37% of SMB CSMs manage more than 250 customers.

Emerging Roles Within The CSM Team

Customer Success Managers will always take up the lion’s share of your total team cost, but we are seeing other very important roles emerging within the Customer Success Team. These roles are not new to the company (with the exception of Customer Success Marketing), but the consolidation of these roles into Customer Success is new, and is continuing to pick up momentum as the ideal Customer Success Team structure.

Key Takeaways: Emerging Customer Success Roles

• Renewal Resources: specialized resources that focus on driving the maximum transaction amount during renewal time. Hiring for this role keeps the CSM as a “strategic advisor” and allows a “sales-minded” resource to drive the renewal negotiation
  • This person is typically hired after acquiring more than 150 customers.
  • It is a must-have role if the Customer Success Team owns or forecasts the retention and expansion number.

• Solution Architects: specialized resources that focus on technical set-up and on-going customization of the solution.
  • These types of resources are typically “floaters” that will help drive a project if the needs are beyond a CSM’s technical capabilities.

• Customer Marketing: responsible for driving all one-to-many communications to the existing customer base.
  • This role will continue to grow in prominence; our data shows Customer Success Teams have doubled in prominence over the last 12 months.

• Success Operations: analogous to Sales Operations for the new customer acquisition team, Success Operations is focused on optimizing the activities and processes of the Customer Success Team.
  • The Operations role is key once you have invested in a Customer Success platform and your processes mature from reactive or gut-feel to data-driven.

Customer Success Team Costs

The way I’ve been thinking about Customer Success Costs is as a percentage of revenue under management – in short, understanding the team cost in relation to the dollar value of the customer base. In the charts below we are going to dig into Customer Success Cost benchmarks across large (greater than $100M ARR), medium (between $10M and $100M ARR), and small (less than $10M ARR companies). Segmenting the benchmarks by company size normalizes for the differences of scale between companies that are in different revenue size lifecycle stages.

Key Takeaways: Greater than $100M ARR CSM Team Costs

• The bulk of the organizations have Customer Success Teams that cost 10% of ARR or less.
  • This is a great benchmark of where your CSM Team Costs should be for a greater than $100M organization.
• 39% have Customer Success Team Costs that are less that 5% of ARR. Very impressive!

Key Takeaways: Between $10M and $100M ARR CSM Team Costs

• There is a pretty even distribution of companies across the last three cost segments.
• If your Customer Success Team Costs are less than 15% of ARR, you are well within industry benchmarks.

Key Takeaways: Less than $10M ARR CSM Team Costs

• Customer Success costs fall across the spectrum at smaller companies.
• Companies are over-investing in Customer Success to protect their most precious asset: their customers.
• If your Customer Success Team Costs are less than 20%, you are within industry benchmarks.
• Keep the faith that your cost as a percentage of ARR will drop as your department matures and the company grows.

Netting It Out

• Segmenting your customer base is key to understanding your workload so you can drive success across a diverse customer base.
• When thinking about ARR and Customer-to-CSM ratios there are lots of factors to keep in mind:
  • Financial and strategic value of the customer
  • Number of contacts at each customer segment
  • The time (per customer, per quarter) that each segment requires
  • The expected renewal and retention rate per segment
• As your company matures, the roles beyond Customer Success Manager will need to be filled.
• There is a path to less than 10% Customer Success Team Costs, but it is a long road. Over-investing early is key to ensure success later in the company’s lifecycle.

Thanks for reading and hopefully you found the data we shared helpful as you continue to drive success with your customers and team. Please feel free to reach out if you have any questions regarding the post.

The post Customer Success Team Planning & Cost Benchmarks appeared first on Customer Success Software | Gainsight.

Allison Pickens leads Customer Success at Gainsight.

I’m excited to announce a new organizational structure for Customer Success at Gainsight.

Our previous “post-sales” organizational structure consisted of separate Customer Success, Services, and Support teams, each with a VP reporting separately into our CEO. We’ve decided to merge those three teams into one organization, with Customer Success as the overarching objective.

I’m very excited to lead this combined team and to share with you the philosophy behind the changes that we’ve made.

Underlying Principles

We took a first-principles approach to designing this organization. Here are the principles behind the changes:

1. Customer Success comes first. Our #1 goal in designing this new organization was to put customer outcomes first. It doesn’t matter if we’re resolving tickets or working on an onboarding project — our central mission is to drive customer success.
2. Design the organization around customer needs. Teams should be defined based on the type of value they’re delivering to the customer — not based on the value to Gainsight.

   One example of this is that we’re removing the term “Services” from our organizational structure. “Services” is about what Gainsight gets from the relationship rather than about what the customer needs. (In addition, multiple parts of our organization charged for some of their activities, e.g. Premier Support and Premier Customer Success; so that wasn’t unique to our Services team.)

3. Ensure autonomy. We should segment our organization to give each team leader the full autonomy and all the resources required to completely meet a customer’s discrete need. Minimize hand-offs between teams.
4. Clarify for our customers who to go to for what. Eliminate duplication of activities across functions.
5. Give more responsibility to high-potential leaders. We’re committed to investing in team members who have made massive contributions while at Gainsight. Many of those team members are in our St. Louis office, and I’m excited to promote a new cohort of leaders there as a part of this reorganization.
6. Maximize coordination among post-sales teams. Rather than three disparate teams, we want one unified organization with a single strategy.

Customer Needs

The new organizational structure is mapped to three discrete needs that our customers have.

• Outcomes Management: Translate business objectives into a Success Plan, drive change, and demonstrate ROI for the customer Customer Success Team
• Fast Time-to-Value: Lead a structured process to achieve a set of initial business objectives Onboarding Success Team
• Solutions On-Demand: Tackle inbound customer challenges Technical Success Team

Functional Areas

Having identified the three customer needs around which to align the organization, we then identified the key functional areas that were critical to deliver on each need.

Note that “Solutions On-Demand” includes not only the resolution of tickets that can be resolved relatively quickly, but also solutions to customer requests for more consultative guidance about how to leverage the product. That’s where our Customer Success Architects will come in. I’ll publish more about that team in the coming months.

“Solutions On-Demand” also can be delivered through Community (where customers can provide solutions to each other’s questions) and Content (which allows customers to get effective help easily and independently).

In addition to these customer-facing teams, we also have an internal-facing organization, the Customer Success Operations team, which helps all three teams work smoothly together. You can read more about our CS Ops function here. Plus, we’re building an Internal Training & Enablement function to make sure all our customer-facing teams develop maximal knowledge of the product as it rapidly evolves.

Next Steps

Since most of our team members aren’t really changing what they’re doing day-to-day, and since we’ll be following a measured transition plan, you shouldn’t see any disruption as a customer. What you should expect from us in the coming months is an even more fully integrated customer experience.

In the next several weeks, I’m looking forward to blogging about the charter for each team, including each team’s mission, primary metrics, skills required for each functional area within the team, finalized titles, job description for each role, and the career path within the team.

Cheers to a new phase for Customer Success at Gainsight!

Feel free to send questions or feedback to Allison at apickens@gainsight.com. Follow her blog posts on Twitter @PickensAllison.

The post How We Reorganized Our Entire Post-Sales Organization to Drive Customer Success appeared first on Customer Success Software | Gainsight.

Allison Pickens is VP of Customer Success & Business Operations at Gainsight

So you just got promoted to lead a team of other CSMs. Congratulations! And don’t worry too much – we’re here for you.

Here’s a framework that encompasses the key skills a Manager should have: CAPES.

The name isn’t a coincidence; your CSMs are heroes to your customers and to your company – especially when battling the Churn Bot (see below). And as a Manager, you have to lead the pack.

CAPES stands for:

Coach
Aim
Create Predictability
Manage Escalations
Scale

Coach

To know how to coach a CSM, you need to have a strong sense of what their role should be. Here’s my definition of the role of CSM:

CSMs drive the valuation cycle.

Let’s walk through each step in this diagram.

Your CSM’s job begins from the moment your Sales team brings in a customer (New ARR). A CSM’s most basic responsibility is to manage risk – to be Reactive to customer escalations. In addition, over the past several years there’s been a big push in the CS industry to transform CSMs into more Proactive drivers of customers’ adoption of their product.

It’s not enough for customers to use your product, though; they actually need to derive value from that usage. To this end, your CSM must serve as a Challenger to your customers. I’m referring to a sales methodology called the “Challenger Sale,” described in a book by Matthew Dixon and Brent Adamson. The Challenger methodology is equally applicable to Customer Success, as I’ll describe below.

Being a Reactive/Proactive Challenger allows your CSM to pave the way for the Renewal, as well as Advocacy, which leads back to New ARR – whether in the form of upsell or new customers.

It’s the efficiency of this cycle that drives your company’s valuation. CSMs help increase your valuation as a multiple of revenue by (a) increasing your gross renewal rate and (b) reducing the cost of acquiring New ARR, by enabling organic upsell and increasing the likelihood that your existing customers acquire new customers for you (rather than your company investing more in sales and marketing).

So how should you coach your CSMs on each element of this valuation cycle?

1. Manage Risk (Reactive)

Tell your CSMs:

• Never be surprised: Being blindsided on a call is an avoidable mistake.
• Always know the next steps: Be prepared and explicit in stating these in conversations with your manager.
• “Driver” mentality: Get it done! Drive to action!
• Stay positive: In Customer Success more than in other functions, positivity is paramount because we handle so many tricky scenarios every day. Positive and negative energy are both contagious. One bad apple can ruin the atmosphere for the rest of the team.
• Don’t wait too long to escalate: You won’t be blamed when something goes wrong. Escalating is the way that you mobilize resources for the customer’s benefit.

While we’re on the topic of “blaming”: It’s critical that a Manager withhold judgment on the root cause of the problem when a risk arises. There are 3 reasons for this: (a) the real cause is often not evident at first glance, (b) if you incorrectly blame your CSM, you may well alienate them, so you better be sure, and (c) you want to encourage CSMs to escalate risks; blaming them discourages it.

Here’s what a Risk Situation usually looks like:

When you initially hear about the situation, you have inadequate information at your disposal (in orange). The information available to you may not completely coincide with the customer’s perception, which may be based on some real facts, but possibly not all the facts (since the customer may not have full knowledge of the problem), and possibly some incorrect data. Your CSM’s initial understanding of the problem is probably also limited for similar reasons and may not coincide with the customer’s perception.

Your job as Manager is to uncover the full scope of facts so that you can coach the CSM to choose the right path forward, to make sure the customer is fully aware of the situation and next steps, and to prevent the issue from happening again.

Always withhold judgment on who’s to blame until you have all the facts.

2. Drive Adoption (Proactive)

Tell your CSMs:

• Follow a consistent process: There’s no excuse for not doing what’s proven to be best practice — unless your CSM has a cool idea, in which case, make it part of your process!
• Never satisfied with “a good meeting”: Meetings are not ends in themselves. They’re only as valuable as their effect on your metrics. We’ve all had “happy ears” in meetings, meaning we hear positivity when we want to hear it. Believe the meeting is successful when you see tangible results.
• Empower the customer: It’s easy to get into the trap of doing things for the customer. Teach them to fish. Tough love: It’s better for them.
• Get creative: When you set adoption targets, it will force creative thinking. Encourage your CSMs to brainstorm tactics to drive adoption.

3. Demonstrate Value (Challenger)

Share with your CSMs some insights from the “Challenger Sale” methodology that I believe equally apply to Customer Success:

• New and different view of the world: Customers expect their vendors to be thought leaders. Share new insights with them.
• Understand the customer’s business model: What would make their business successful? How does your product support those business objectives?
• Prescriptive with a vision: Customers want you to have an opinion.
• Willing to push customers intellectually: Challenge a customer’s assumptions if you think they’re not serving him/her well. Guide the customer to the best approach, even if it’s not the most comfortable one.
• Drive to real value: Usage isn’t value. Bridge the gap.

4. Renewal

• Impact made well in advance: Saving a renewal last-minute is extremely painful and often impossible. Save yourself the stress by doing all the work upfront.
• Ownership mindset: Sales might be completing the paperwork, but the CSM should feel that it’s their responsibility to get the renewal 99% of the way there.
• Provide the right information: Set the Account Executive up for success.
• Never blindside Sales: Make sure your notes in Gainsight are up-to-date.

5. Make Reference-able

We focus on a few types of advocacy activities that move the needle for us. The CSM talks to the customer about the opportunity and then connects them either with Sales or Marketing to complete the advocacy activity.

• Sales Reference: Customer speaks to a prospective customer
• Testimonial: Customer provides ROI metrics that show they’re getting measurable value
• Event Participation: Customer speaks at an event that prospects attend

Aim

As a Manager, you’ll need to hold your team accountable for certain metrics. Certain day-to-day operational metrics contribute to longer-term financial ones:

In addition, you’ll need to keep costs under control as you pursue these metrics. In particular, companies aim to spend less than 15 cents of fully-loaded CSM cost for every $1 of ARR. As a Manager, you have three levers to manage costs, shown on the right-hand side of the formula below.

You can learn more about how to manage these three levers here.

As a Manager, you should track your account ratios carefully through a chart like the one below, which shows ARR by CSM for each Manager (learn how to configure this report here):

Create Predictability

Ensuring predictable results for the metrics above requires new processes. And to implement a new process well, you’ll have to manage your team through change, which is sometimes difficult. We recommend creating routines for using Gainsight in order to foster process change.

Here are our best practices for managing through change using Gainsight:

Best Practice: Set clear expectations

• CSMs should create a Success Plan for each customer after aligning on their objectives for the given period (e.g. the current quarter)
• CSMs should check Cockpit every morning
• Review Customer 360 dashboard before all customer calls and internal strategy meetings
• Set specific usage goals (e.g. 5 Cockpit page views per week per CSM)

Best Practice: Positive reinforcement

• Leverage Gainsight usage reports (reach out to your Customer Success resource to turn these on).
• Offer prizes for top users
• Send weekly Gainsight “spotlights” to the team (e.g. “Carrie saw her customers’ NPS improve by 10 points in the last quarter!”)
• Point out the beneficial results from a CSM escalating a risk (“Great job – you preempted what might have turned into a bad situation!”), to encourage them to continue to raise the red flag

Best Practice: Run team meetings with Dashboards

• Recognize top performers for certain metrics (e.g. Habits scorecard movement)
• Highlight success stories that the metrics reveal
• Review themes (e.g. NPS trends)

Best Practice: Run process meetings with Cockpit

• At-Risk Customers Meeting — filter for Flagged Risk CTAs
• Support Escalation Meeting — filter for Flagged Support Risk CTAs
• Renewal Meeting with Sales — filter for Renewals CTAs

Best Practice: 1-on-1s

• Review priorities using Flagged CTAs in Cockpit
• Drill through to Customer360 when a question about a customer arises
• Review overall trends in Green and Red customers using the Scorecard Dashboard

Best Practice: Enable Feedback

• Hold weekly Office Hours with your Gainsight administrator for the team to offer feedback on how the new processes are working
• “Close the Loop” by reporting back to your CSMs on how their feedback was addressed

Best Practice: Elevate Gainsight Power Users

• Pair Power Users with new CSMs or less active Gainsight users to help the latter get up to speed

Manage Escalations

Executives need team managers to serve as the first line of defense when a CSM needs help with an escalation. (You can’t include a VP in every tricky meeting!) You can read more about our escalation process here.

You can reduce the likelihood of escalations by building relationships with executives at your customers in the following ways:

1. Join Executive Business Reviews: Your CSM should lead the conversation, but you should plan to have an active speaking role.
2. Meet new executive sponsors: When there’s a new executive at your customer, join the initial meeting.
3. Regular executive check-in’s: Plan to check in with executives on a regular cadence. You can even set CTAs to remind you to do so.

You can read more about how we manage relationships with executives at our customers here.

Scale

Besides running the show day-to-day, you can play an important role in helping your boss build a scalable Customer Success organization. Here are three ways you can do that:

1. Focus on scalable assets

Instead of asking for headcount every time your CSMs get busy, ask for greater investment in scalable assets.

The most scalable asset is your Product. That’s because in one fell swoop, a single product change can make a massive difference across your customer base. Are your CSMs spending time “filling the gaps” in your Product by helping customers hack together solutions to their problems? Offer feedback to your Product team.

Your Community is the second-most scalable asset, since it allows customers to answer each other’s’ questions. Content comes next because it can be used again and again (up to a point). From there, Automated Outreaches set up by your Gainsight administrator in Copilot can allow you to distribute that Content in a smart way.

Focus on investing in the bottom of the period so that you can build a sustainable business.

2. Understand the root cause of high workload

To reduce workload, you have to understand how your CSMs are spending their time.

The Gainsight chart below allows you to see the number of Risk CTAs opened each month in different Risk categories (e.g. Support Risk, Sentiment Risk, Product Risk, and others.) In this particular chart, Support Risk CTAs represent a large percentage of the total. This should tell you that your CSMs are spending a lot of time following up with your Support team on escalated tickets. Instead of asking for more headcount, see if you can inspire your Support team to create better processes that improve ticket resolution time. Learn how to configure this chart here.

3. Drive cross-functional coordination

Your CSMs can’t resolve every customer issue by themselves. They’ll need help from other departments.

For any given customer scenario, a CSM should serve as the quarterback on behalf of the customer to get the required help from other departments. But as their Manager, you’ll need to develop strong relationships with your peers in other departments to help grease the wheels. You’ll need to present Customer Success as a company imperative – not just a function – in order to get help. You should also take the lead on proposing and implementing improvements in cross-functional processes.

If you’d like to learn more about how to implement these processes in your organization, check the Business Processes section of Gainsight Go, check out the Vault, or contact your CSM. You can also send questions or feedback to Allison at apickens@gainsight.com. Follow her blog posts on Twitter @PickensAllison.

The post Manager Training: How to Be a Great Manager of CSMs appeared first on Customer Success Software | Gainsight.

This blog is the fourth of five based on anonymized discussions from CCO Summit 2016. Read the third here.

This might be a bit of a morbid post, considering most of you reading are probably CSMs or work closely with them. But have you ever wondered: when should you lose your job?

That was one of the questions posed at CCO Summit 2016, and it’s also one that elicited some fascinating discussion amongst the Customer Success executives in attendance.

And it makes sense why: in the context of Sales, for example, it doesn’t need to be spoken that when you consistently miss your goals, you find new employment. Sales departments have always been clear and open with their expectations. Performance is everything. The risks are high, but so are the rewards. Account Executives earn lucrative commissions, and consistent closers get the coffee, so to speak.

But when it comes to Customer Success, does it make sense to set hard-and-fast retention goals or churn limits, and if a CSM misses them they’re fired? I think I already know what you’re thinking, because many of the Chief Customer Officers and VPs of Customer Success had the same objections you’re probably having. There are way too many factors that contribute to upsell, churn, customer health, NPS, and almost every other commonly-used Customer Success metric. When an AE can’t close, it’s all on his or her shoulders. But when a customer churns, it could be product issues, support issues, onboarding, problems with the sales handoff, factors beyond anyone’s control, or more likely, a combination of all of those at once.

That means a CSM team shares at least some of both the credit and the blame for their numbers with every customer-related department in the company. So I ask again: when do you fire a CSM?

The consensus answer (at least at CCO Summit 2016) wasn’t to fire CSMs when they fell short of key metrics. But if they couldn’t explain why they fell short and how to fix it – that’s when it’s time to start thinking about pink slips. In that case, what are the most important metrics to measure success, and how can you use them to diagnose the causes of failing to meet them?

If you read the previous blog post in this series, you know that being a CSM is all about providing value and delight to the customer – however you can. That can sound infuriatingly vague, but it’s actually very simple to express in concrete figures. If you’re a CSM, you know how much time you spend knee-deep in metrics, statistics, surveys and equations. When it comes to defending your revenue base, you can’t afford to have nebulous benchmarks. Here are just three of the most important metrics to measure your success according to the CS execs at CCO Summit 2016 and why they matter:

1. Customer Retention Costs (CRC): This is a big one when it comes to justifying your budget to your CEO and CFO. It’s also a great metric to gauge exactly how much ROI you’re getting on every dollar you spend on Customer Success. At its most basic level, it’s simply the total cost of retaining, renewing, engaging, upselling and cross-selling your customers divided by your Annual Recurring Revenue (ARR). Ideally, this number would be as small a fraction as possible. If it’s greater than one, you have a big problem. Unfortunately, the total cost of retention can get pretty complicated to parse considering how intertwined retention is with every department in your company.
2. Net Promoter Score (NPS): NPS, aka “The Ultimate Question” is very well-known in the Customer Success world, and hopefully you’re familiar with it by now. If not, it’s basically a very short survey you send out to your customers asking them how likely they are to recommend your company or product to a friend, colleague or associate. The bottom line is that it works – demonstrably. CCO after CCO at the Summit advocated using NPS as a cornerstone metric. If you’re not using NPS, you need to start. Our Customer Success Evangelist Lincoln Murphy wrote a phenomenal post all about NPS and how to hack the survey to dramatically boost your growth.
3. Net Expansion Rate (NER): This was the metric that had many Customer Success Executives furiously scribbling at their notepads. It basically measures how your ARR is growing over a given period of time. Here’s a photo of the equation drawn on a flipchart:

   Essentially, you just take the Beginning ARR, subtract customer losses and downgrades to get Retained ARR. Then add expansions through uplift, upsell and cross-sell to calculate your Ending ARR. The delta between Beginning ARR and Ending ARR is your Net Expansion Rate (NER). One of the critical functions of a CSM team is expanding your customer base through uplift, upsell, and cross-sell. It’s just as important as cutting churn. This formula lets you measure how successfully your team is doing just those things. It gives greater insight into your ARR as it relates specifically to Customer Success.

Naturally, there are many more figures you should be looking closely at. We have a very handy Essential Guide to Business Metrics you should check out to learn more about the most fundamental numbers in the Customer Success movement.

Like any emergent field, Customer Success will crystallize over time. Firing practices may never be standardized across the industry, but they will become clearer as the movement becomes more defined. What’s most important is that we stay true to our core values: we’re all about the customer. When it comes to the dirty business of choosing to let people go, that means taking into consideration the relationships each CSM has built over years. That’s obviously not so easy to replace, and needs to be a major factor in the decision. Ultimately, Customer Success benchmarks must continue to become a nuanced blend of the cold, hard numbers and the living, breathing customer relationships the CSM is cultivating.

The post When do you fire a CSM? appeared first on Customer Success Software | Gainsight.

This blog is the fifth of five based on anonymized discussions from CCO Summit 2016. Read the fourth here.

If there’s only one takeaway from CCO Summit 2016, it’s that the Age of Customer Success has begun. When future business archaeologists look back on these last few years, they’ll probably refer to it as the beginning of the Customer Epoch. Our descendents may one day be lining up to see Nick Mehta’s MacBook or original editions of “Customer Success: The Book” at the Mars Museum of History.

The rise of Customer Success was really inevitable when you think about it. Not only is the perpetual software model going the way of the dodo, the perpetual everything model is dying off too. It’s not hard to imagine subscribing to sneakers, or toilet paper, or food or transportation. It’s already happening! How companies build lasting relationships with their customers is going to be the number-one defining factor for their viability going forward. That was more than obvious to the Chief Customer Officers and VPs of Customer Success at CCO Summit 2016.

It’s becoming obvious at the highest levels of almost every SaaS company, too. A recurring motif of the Summit had to do with a “seat at the table:” more and more Customer Success professionals were reporting that their voice was not only being heard at the executive level, but valued. If your CSM team doesn’t command the attention of your CEO yet, it’s coming soon.

That’s why it’s almost counter-intuitive that many Chief Executives working for disruptive organizations in a cutting-edge software industry have been relatively late to the Customer Success game. If the transition to a subscription economy indeed marks the beginning of a fundamentally new era in business, your company requires a fundamentally new kind of CEO to guide it through that transition.

As a thought exercise, CCO Summit 2016 attendees were asked to design the ideal CEO for the Customer Success Age. It was like something out of the title sequence for The Six Million Dollar Man. Each small group of CCOs put their heads together and brought to life their Modern Prometheus out of the best qualities of the greatest leaders in human history. Then they pitted them against each other in a round of job interviews that can only be described as gladiatorial. Here’s what they came up with:

Experience as a customer

One of the qualities that came up over and over was the ability to walk in the customer’s shoes. Experience purchasing subscription software was a must-have. A strong sense of empathy for clients was a crucial personality trait. Most small groups favored a CEO from a SaaS background.

Ready to take the next step

Some of our small groups’ hypothetical companies were private, $100 million tech companies with high growth potential and ambitions on going public. Most of the those were looking for someone with first-hand experience leading a company through the crucible of an Initial Public Offering. Others wanted a CEO who could guide them through the transition from SMB to Enterprise focus. No matter what, everyone was ready for next big step and needed a CEO with a proven track record of taking it.

A community leader

The era of the cut-throat, take-no-prisoners chief executive seems to be well in the rear-view mirror. Most of the CCO Summit 2016 small groups were extremely interested in a CEO with a passion for ethical decision-making and community leadership. That’s not surprising considering the value CSMs place on long-term, mutually beneficial relationships. The Golden Rule was mentioned more than once; it’s crucial in both Customer Success team and in a 21st century CEO.

A decisive risk-taker

It seemed like more than a few executives at the Summit were basketball fans; three different groups were looking for the Michael Jordan, the Steph Curry, and the Steve Kerr of CEOs. That’s not a small order. Every company would like one of the Greatest Of All Time at the helm. But the specific quality they were hoping their ideal chief executive would emulate is high-pressure decision making. One group defined it as a “bias toward action.” Companies in the subscription economy still value bold, proactive leadership. In a marketplace that’s evolving so quickly, it’s a crucial prerequisite for a CEO.

Do those qualities remind you of your company’s CEO? I sure hope so! Customer Success teams don’t exist in a vacuum – never have and never will. They’re so tightly integrated with Sales, Marketing, Product, Support, and yes – Executive Management. Without leadership on your side, you’ll be fighting an uphill battle on every key decision. The good news is that the Customer Success wave is in full swell right now, and CEOs will have to sink or swim. Here’s the fundamental question: does your CEO truly care about the customer? If the answer is yes, everything else will fall in place.

The post The ideal CEO for the Customer Success Age appeared first on Customer Success Software | Gainsight.

How amazing would it be if your customers were so happy with your product, they just went out and told everyone how great it is, how much they like it, and how everyone needs to try it? What if they actively recommended it to their peers and colleagues? New Sales leads would flow in like so many wildebeests migrating across this river in Tanzania.

Look at all those eager leads braving treacherous waters just for the chance to subscribe to your product. In this hypothetical world, your marketing team would be more-or-less obsolete. Your case studies, your demand gen emails, and your inbound content would essentially write itself.

As a marketing copywriter, this is my nightmare.

Thankfully, the alternate universe in which customers do all of our work – without pay – is completely mythical, right? Only very lucky companies get free Word of Mouth advertising – and even for popular products it’s rare. You can’t count on it. You can’t predict it. My job is safe.

I’ve staked my career on the belief that companies will always need good writers who know what they’re talking about and know how to get the word out. (Also, I’m hoping that robots won’t replace me anytime soon.) However, the reality is that you really can systematically engage your customers to create great marketing content for you. That’s not a perk of Customer Success; it’s a feature.

You can operationalize Word of Mouth. You must operationalize Word of Mouth. It’s not “nice to have,” it’s “essential to have.”” The Lifetime Value of a Customer Advocate is much higher than a non-advocate. There are two main reasons for that:

1. The benefits of positive reviews and references to your brand are tangible. It’s not quite free advertising, because you will need to invest in making it happen, but it’s a lot cheaper than paying for advertising, and often just as effective or more. There’s a lot of evidence that even something as simple as a glowing online review can very effectively drive leads to your product.
2. There’s a documented psychological side-effect that happens when you advocate for someone. You might know it as the Ben Franklin Effect. In Ben Franklin’s autobiography, he described how something as simple as asking to borrow a book from a rival legislator helped bridge the gap and create a lifelong partnership. Whether or not that’s a legendary story, the psychological effect is real. It’s all part of the theory of cognitive dissonance, which says that the way you treat another person influences how you feel about them. Basically, the gist is that you don’t do favors for people you like; you like people you do favors for. Ask your customers for references. It will make them like you. They will stick around longer.

But there’s really no need to convince anyone that Word of Mouth is good and Customer Advocacy is good and positive reviews are good. You want to know how to do it. Here are three steps to building predictable, consistent Customer Advocacy:

1. Set milestones: Just to be clear, these are your customer’s milestones, not yours. It could start with something as simple as converting from free trial use to paid. Then it’s finishing onboarding, then perhaps an expansion of your customer’s use of the product. The bottom line is that you want to look at these milestones from the customer’s perspective. When they master a feature of your product, for example, they’ll feel great about themselves and about the product. Put yourself in the customer’s shoes and ask, “what are the specific points in the lifecycle that they’ll feel really good about accomplishing?” Those are the milestones you want to flag as significant.
2. Track key events: How do you know when those milestones are achieved? You need to be tracking your users’ progress through your software. A good milestone to track would be a license expansion or completing onboarding. But let’s say another Milestone is mastery of a specific feature. You should figure out what usage indicators can you use to determine when that happens.
3. Organically reach out for advocacy: Whenever a customer passes a success milestone, reach out to them and ask for a review or reference. With your high-touch clients, this could look like a phone call, with low-touch clients it could be an email or automated feature built into the product. The point is that it feels organic. And your request should feel organic too. They’ve just achieved something that they feel good about. Now’s the time to ask them for help.

The next step is getting those raves and reviews into the hands of your marketing team. Trust me, they’ll know what to do with them. But even if you never published a quote or a case study, you’ve already accomplished your goal: creating a Customer Advocate. That’s a person who will tell his or her colleagues and peers about your product. That’s a person who will probably be happy to help out with favors down the road. That’s a person who just became way more likely to renew or buy more licenses. And that’s a big part of what Customer Success is all about.

The post Word of Mouth has nothing to do with luck appeared first on Customer Success Software | Gainsight.

So you landed that new VP job, huh? How exciting! Especially in a field as rapidly growing as Customer Success. It’s a tremendous step forward in your career. Good luck and go get ‘em.

Not sure how to get started? That’s not surprising; chances are you’re your company’s first Customer Success executive, and it’s your first time in the role. The Customer Success movement is still relatively new, and many organizations are just now implementing it at the executive level. However, since I’ve done this a few times, perhaps I can help. Here’s a list of things that should be at the top of your priority list:

1. Understand your customers
2. Understand your team
3. What is your segmentation strategy?
4. What is your engagement strategy?
5. What tools do you have at your disposal?
6. What are the boss’s expectations?
7. Make sure your CEO is all-in

Understand Your Customers

As the VP of Customer Success, your job is essentially to manage the installed base of customers and, if you are a recurring revenue business, maximize their dollar value. You may or may not be held accountable for the company’s retention number but that’s likely your North Star when it comes to prioritizing your team’s efforts. Virtually everything you do should be designed to improve that metric just as a VP of Sales thinks and executes against his or her revenue number all day, every day.

So, if you’re managing the existing customer base, you should probably first understand them. I don’t mean talking to them, although that’s a really good idea, too. I mean doing some real analytics to see what the current state is. I’d start by simply getting a list of all customers that have ever signed a contract with your company, sorted in descending order by contract value. That will give you a few insights immediately just by reading – no analysis needed:

• How many are there?
• What’s the contract value range?
• How much is your largest contract worth?
• How much is your smallest contract worth?
• Who are they? (You will probably know some of them)

Now, get that information, along with a few other key pieces of data – original contract date, renewal date, beginning contract value, lifecycle stage (at least active vs. churned), renewal dates (if you don’t have all monthly contracts) – into a spreadsheet so you can start understanding some of these key elements:

• What’s the average of all contracts?
• How long has the average customer been a customer?
• What’s the average value of all churned customers?
• How many customers have churned?
• What’s the average length of your contracts?
• Where’s the 80/20 break for ARR?
• Where are the contract value breaks when you trifurcate?
• What has been the churn rate each year (logos and $$)
• How much has the average contract grown or shrunk annually?
• What’s the contract growth rate for the top 10%?
• How many renewals are due this month, next six months, etc.?
• How many customers in each lifecycle stage?
• What’s the average age of customers in each lifecycle stage?

There’s one more critical thing you need to understand that you can’t get through analytics alone: why are customers churning or at-risk? This may be tracked already, although you should be very skeptical of the quality of this data. You may have to gather this anecdotally at first and you may have to reach out to several customers who have churned. However you do it, it’s critical to know why. If retention is your number, you better understand why some customers are not retained.

There’s lots more you can do, too, but that’s a start. The bottom line is that you need to fully understand your business – which is your customer base – especially regarding retention. If you are the first VP of Customer Success, it’s likely that you will learn things that no one else in the company actually knows. Make sure you do the math right because you’re likely to get challenged on some of the numbers.

Understand Your Team

This is Management 101 of course, and it applies to any new management job. You need to dig in with each individual, or each leader if you’ve inherited a really large team. You’ll want to know them personally anyway so you can establish a relationship and lead accordingly. You also need to begin the process of understanding their skills and work background.

In the particular case of Customer Success, it’s especially important to know what drives their daily workload. This is about completing the Pareto chart on why they are doing what they are doing and how much of their time it’s taking. This can be kind of a crude method but you may consider asking each of them to track every hour of their time for a couple of weeks so you know why they are doing what they are doing and how much time it’s taking. Are they chasing down Support escalations? Are they helping Sales guys close new deals? Are they working on your CEO’s pet projects? Remember that your job is to make them more efficient and productive and you can’t remove obstacles from their lives if you don’t know what they are doing and why. Put the time and diligence in to figure this out.

What Is Your Segmentation Strategy?

There may be a customer segmentation system already in place or there may not be. In either case, you need to start thinking about this and determining what it should be. This task is fundamental to everything else you will do. It will drive your engagement model which will ultimately drive your headcount model. It’s also something that should matter to every other executive so it’s your chance to get to know them and get their input on this topic. Your personal reason for nailing down customer segmentation is so you can determine the different journey for each group of customers and the team responsible for each of those segments. There are a few pretty standard variables for determining your segments:

• Contract value: one option is simply to do a couple of logical breaks based on how much customers are paying you. You’ll probably want to treat the bigger ones with a higher level of touch and try to be much more scalable with the ones who pay you less.
• ARR/Revenue potential: if you can figure out a methodology for determining potential, it’s perfectly valid to put some customers in your top tier based on how much they could realistically be worth over some reasonable period of time.
• Brand value: certain company names have higher value than others. That’s just the way it is. If IBM is a customer, no matter how small or how little opportunity there is to grow them, you still may want to protect that logo in a high-touch way.
• Industry/Vertical: many companies have a very clear industry sweet spot when they start off. Let’s say that’s technology for the sake of this argument. If 90% of the current customers are in technology, perhaps a new customer in Health Care or Financial Services is more valuable even than a larger additional contract with another technology company.

It’s convenient if you can match customer segments with prospect segments. Your Sales team almost certainly has some kind of segmentation model. But it’s likely they didn’t think about managing customers when they mapped out their strategy so those segments may or may not make sense for you. Life will be easier for everyone if they are aligned but that just won’t always be the case.

What Is Your Engagement Strategy?

Now we’re getting to the fun stuff. Once you have segments, you can begin to think strategically about how you want to treat each customer within those segments. There’s a decent chance that, if it’s not true already, you’ll end up breaking your overall team into smaller teams each of which are focused on one of the segments. Because the segments almost always end up being a proxy for value (most valuable customers will be in your top tier, least valuable in your bottom tier), you’ll need to apply different skills to each segment in addition to a different process.

One thing your engagement strategy will do for you is to give you a framework for conversation with the rest of the company, especially those holding the purse strings. You will need to fight for headcount and your engagement model will drive your headcount model. It will be your working document for conversations with your CFO and CEO about the number of people you need. Let’s say your segmentation model puts 50 customers in your top tier and your engagement model for that segment maps out 16 touchpoints during a one-year contract cycle with each of those customers. Your estimate of the time required for each of those touchpoints has shown you that you need eight people to manage those 50 customers. Your CFO is likely to take that input and come back with an offer of six people instead of eight. Now you can have an intelligent business conversation with her about your engagement model and which of the touchpoints she thinks should be eliminated or automated to reduce the headcount needs while still meeting the retention goal for that segment (which will be really important to her).

One way to approach this task is to first map out the engagement model for your top segment. Many – probably most – of your touchpoints with those customers will be one-to-one, as that’s the most effective process, and your retention goal for that segment will likely be very high. Once you have that in place, you can use it as the model for your lower segments and simply determine for each touchpoint if you can eliminate, automate, or reduce the frequency to lower your costs. The model for each segment ultimately has to make financial sense.

What Tools Do You Have At Your Disposal?

Depending on the size of your installed base and your team, this can be extremely important. Automation is the only way to logically scale a Customer Success team. The alternatives are not great – 1) throw bodies at the problem or 2) ignore some customers. So you will need to assess the toolset that you have for yourself and your team to deliver on the company’s expectations. You most likely have a CRM system in place and almost certainly have access to Microsoft Excel. And that may be enough. If your company has been around for a while, there’s a chance that there are some processes in place already for managing customers and probably – at least crudely – for understanding customer health. That’s always a good start no matter how well it works because it means someone has been thinking about it already and may have even gathered some of the necessary data to deliver what you will need. Here are a few things you’ll want to be able to do and this will drive your technology needs:

• Early warning on at-risk customers: you will want some way to help prioritize which customers your team is working on.
• Overall assessment of customer health: this is for you what the Sales pipeline is for your VP of Sales.
• Triggers on key dates/milestones: if you only have 20 customers, this isn’t an issue. But, if you have 100 or more, you will want a system alerting you 90 days before every renewal and once a quarter to prepare for your QBRs.
• Triggers on key data: usage drops, survey scores, licenses deployed, etc. This will be critical at some point to help you deploy resources appropriately.
• A snapshot of every customer for anyone in the company to see: this will help you avoid the scramble that happens when your CEO is going to visit a customer and will help prepare your CSMs for every customer call without having to hunt down information from other systems.
• Dashboards/Reporting: you will have to create these in some way and Excel is always an option but it would be really helpful if you had some of this automated in a system.

What Are The Boss’s Expectations?

I know, I know. This is “New Job 101.” Nevertheless, you need to understand what it is your boss expects from you. As a VP, this should be a set of metrics that you will have to figure out how to deliver on. But these can be particularly subtle in the world of Customer Success. Think about it this way: does a new VP of Sales have to ask his boss what metrics she expects him to deliver? Never. Here’s your quota, here’s your team, go get ‘em. But it may not be quite that clear in Customer Success. Some teams are driven solely by their NPS score as an example. If your churn rate is high and you don’t have enough headcount to manage every customer, you may just be expected to focus on at-risk customers and improve the gross renewal rate. If you’re reasonably well staffed and your churn is under control, there’s a good chance that upsell – and therefore net retention – is the driving metric. If your boss is a big believer that advocacy is the most important thing that comes out of the installed base, perhaps the number of references and/or case studies is the key measurable.

Regardless of your boss’s expectations, there are a few things that are really important and will, at least partially, fall to you even if they aren’t explicitly stated:

• You are the voice of the customer. Don’t take this lightly. The reality of your customers is critical to the whole company and it’s your job to deliver that reality.
• You are the torch-bearer for retention. You will need to constantly remind the whole company that you are a Customer Success-driven company, not just a Sales-driven company and that customer lifetime value is at least as important as making the company’s quarterly sales number. Don’t kid yourself about how easy this is for everyone else to forget.
• You need to influence all other organizations in the company in order to hit your retention targets. If customers are struggling or failing because they aren’t onboarded properly, you need to apply some pressure to that team. If Sales is causing you problems because they aren’t setting expectations correctly, you need to go correct that. If the product demos beautifully but doesn’t live up to the demo in real life, you need to make sure that changes. Great Sales VPs don’t sit in their office hoping to make their number. They get out and influence everyone else in the company to help. You need to do the same.

Make Sure Your CEO Is All-In

It’s a top-down, companywide commitment. That’s Customer Success Law #1. If that’s not true when you enter into this new job, you need to make sure it quickly becomes true. If it’s already true, hallelujah! Make sure that does not change. It’s critical. You can’t be in this alone. Customer Success is the most cross-functional part of the company and some of those other functions won’t participate unless they know it’s a top priority for the CEO. Convince him that he needs to spend just as much time with customers as he does with prospects. Challenge him to engage with you in solving hard problems just like he does with Sales and Product. Make sure that he knows that the company’s churn rate is HIS choice because he holds the purse strings and can change the focus. Help him think through how to incent behaviors across all organizations that lead to successful customers. It’s a tough road to be sure. CEOs have to balance an impossible set of priorities but you can help make him successful and he knows it. Put his skills and authority to good use so you can deliver on that promise.

Congratulations again on your new role. It’s exciting and daunting, I’m sure. But it’s also doable. There are others doing it and there’s more information every day that can help. Fear not and go make it happen!

The post You’re the New VP of Customer Success. Now What? appeared first on Customer Success Software | Gainsight.

Generally speaking, the workflow of a successful sales operation looks something like this:

• The Sales Development Representative (SDR) qualifies a lead and passes it to a salesperson.
• The salesperson contacts the lead and wins their business, then passes the new customer to a Customer Success Representative (CSR).
• The CSR helps the customer with installation, support, maintenance, and increases the likelihood for long-term Customer Success.

It’s a smart framework that has been proven to work time and time again, but while many Customer Success teams achieve a satisfactory ROI, they don’t always maximize that ROI. And that’s what ROIs are there for, right? Fill that cup until it overflows. Turn that amp up to 11. Keep the dream alive!

To maximize your ROI, you have to upsell, cross-sell, and of course, resell.

Now, a good inside sales person is trained to do just that, but within this common sales operation framework, salespeople aren’t always in a good position to up, cross, or resell anything. That’s because when the planets are aligned and the time is right for more selling, the salesperson has already moved on to new leads. They’re probably not even in contact with the customer anymore.

But the Customer Success representative is. They still have a relationship with the customer. In fact, it’s not unusual for the CSR to have a stronger relationship with the customer than the sales person. They have front row seats to the customer’s ongoing needs, goals, and success in using the product or service. They’re perfectly positioned to cross-sell, upsell, and resell to maximize that ROI.

Okay. Before I go any further, let’s define Customer Success, and establish what a CSR actually does, just so there’s not any confusion.

Customer Success, which became popular in the SaaS world, is what happens after someone signs a deal. It’s a proactive approach for engaging clients to ensure a more accurate, efficient, and seamless onboarding process, reduce customer churn, and identify further selling opportunities. A CSR works with the customer to help get them set up with the product. They call in to see how everything is going. They field questions and concerns and make intelligent recommendations. In short, they’re there to ensure that each customer has a successful experience with the product, and achieves their desired outcome.

It’s also important to note that Customer Success is not the same thing as customer service. A customer service rep is who you call to moan about how hard it is to put the IKEA table together. A Customer Success rep is who you call to come over and help you build it.

Customer Success is also not the same as customer support, although the two departments bare some similarities. While Customer Success is more proactive and dedicated to the overall success of the customer, customer support is more reactive, and dedicated to the day-to-day technical issues.

Now back to my point. After the salesperson signs the customer, they pass them to a CSR, who starts facilitating the onboarding process. At this point, the customer will often be more relaxed, as the selling part is ostensibly over and the purchasing decision has been made. If the CSR is good at their job, they’ll use the opportunity to develop a rapport with the customer. This rapport can net a lot of valuable information. We’re talking everything from business goings-on to personal anecdotes, and over time, CSRs develop a better understanding of customer use cases than anyone else in their own organization.

In short, the CSR truly becomes the “go-to” person for all things customer-related. They can provide valuable information to marketing and engineering about product use cases. They can share success stories with the SDR and inside sales team to help them land new customers. And naturally, they’re the first line of defense should something ever go wrong. Great Customer Success reps and teams love supporting their customers, and are massively gifted at talking customers off cliffs of anger, frustration, and cancellation.

CSRs are the Swiss Army Knives of your organization. However, one of their tools may not be as sharp as the rest: selling. In fact, when we ask CSRs why they never pursued a more traditional sales role, we often hear things like, “because I hate selling” or “selling (closing a deal) makes me really uncomfortable.” And frankly, that’s not a problem. In most cases, you’re not hiring CSRs to be “closers.” We even see inside sales reps who struggle with closing successfully transition to the Customer Success arena.

But this is where it gets interesting. In many cases, CSRs struggle with upselling or cross selling not because they’re afraid to do it, but because nobody ever taught them how to do it. Their impression of sales is high pressure, high intensity, and high anxiety. And if they’re not naturally wired to enjoy that kind of environment, why would they want to enter that world? In essence, it’s not their fault at all.

Without proper sales training, it’s not unusual for CSRs to lack the confidence and know-how needed to steer a conversation in their desired direction. They may not understand how to move a deal through a sales pipeline. They may not be comfortable bringing up business, or bringing it up organically using natural language.

I’ve heard from a lot of CSRs about this very issue. They don’t like to close because they feel like used car salesmen. They don’t want to be pushy or aggressive. They want to be supportive and solve problems because that’s their job, and they’re worried that changing gears may hurt their relationship with the customer when in fact, due to the very nature of their relationship with the customer, they are in the best position to increase revenue opportunities.

But they only feel that way because nobody has taught them anything other than what they’ve observed in the world. So, of course many CSRs are afraid of selling. Most people would be afraid of the same thing — at least until they’ve gone through proper sales training. And if CSRs were to do that, they’d realize that they’re actually doing 90% of the selling already.

Just think about it: as a CSR, a major part of your job is establishing rapport with the customer to guide a conversation, ask discovery questions, and provide constructive advice. CSRs are also trained to handle objections and to listen for underlying problems and needs. In fact, they are often better listeners than sales people. Well, hello! That’s most of the sales process right there.

The last 10% is just asking for the sale.

Just imagine what could be achieved if you gave your Customer Success team much of the same sales training you give your sales team? I’m talking about lessons on conversational selling, controlling the conversation, looking and listening, and creating additional interest in your products or services. Upselling would go through the roof. Cross-selling would explode. Reselling would skyrocket. And ROIs would be maxing out.

Who doesn’t want all of that?

Richard is a Saas, Sales and Start-Up veteran bringing 20 years of experience to his role as owner of The Harris Consulting Group and as Director of Training and Consulting Services at Sales Hacker. Clients ask Richard to help with defining, implementing, and measuring sales as it relates to The Four P’s: People, Performance, Planning, and Process at the top, middle, and back end of the funnel. He specializes in helping organizations improve the quality of the conversations SDRs, Sales Account Executives, and Customer Success Professionals have with prospects and clients.

Clients include: Gainsight, Udemy, Litmos, Research Gate, Revel Systems, LevelEleven, TopOpps, and a host of others.

The post Why Your Customer Success Team Needs Real Sales Training appeared first on Customer Success Software | Gainsight.

Geologists from Stanford University recently made an astounding discovery. Drilling core samples in Palo Alto, a thousand feet below Sand Hill Road, they discovered the fossils of an ancient civilization. Their excitement grew as excavation revealed a Neanderthal community with complex tools, written language, and a primitive subscription economy.

A paleo-forensic team pieced together the daily life of one adult Neanderthal that lived there 40,000 years ago. They’ve published his narrative below, and titled their work the Tales of Groc, the Customer Success Caveman.

Chapter 1: Blindside Churns

Groc arrived at the office bleary-eyed. His 6-month old cavebaby had been crying all night. He’d had a thin breakfast of squirrel and pine nuts and he had a mountain of EBR prep to get done. As he approached his desk, he could see a stone tablet with writing on it. Groc’s heart sank. It looked like another churn notice.

Groc was a CSM for StoneHenjj. At one point, they were the leader in the mobile platform space. They were the first to put four wheels under a plank of wood, creating the original mobile platform. They called it the “Cart.” The platform supported an endless number of Enterprise, SMB and consumer use cases, and lightning-fast growth followed. Two years ago, StoneHenjj raised Series D funding at a valuation of 100,000 rabbits.

But the technology behind the Cart was widely available and StoneHenjj soon faced fierce competition. Wood startup Carpentr had brought wood planks to the mass market and Sandr had disrupted the stone industry by grinding blocks of stone into wheels. A stronger mobile platform with six wheels was produced by BetterCart, and ZenStone designed a platform that could handle bad weather.

Instead of selling the Cart, cavemen and cavewomen could pay StoneHenjj 10 rabbits a year to use one. The cavemarkets valued these sorts of businesses higher. As competitors flooded into StoneHenjj’s space, they found they were losing customers rapidly. It turns out that Neanderthals weren’t wedded to their mobile platforms. If another hot startup had a better platform than the Cart, customers were going to switch. Groc had dealt with many churns in the past several months.

Today’s churn notice came from BoulderDash. They were the Valley’s leading on-demand boulder delivery service. Groc read the writing on the tablet:

Your Cart falls short of expectations that were set in the Sales cycle. It only carries one boulder at a time! I was promised it would carry three. Also, our boulders are shaped like pyramids and we ship them pointy-side down. How come your Carts don’t handle that use-case? BetterCart just demo’d a five boulder platform that accommodates our shapes. We are switching.

Sincerely,
Thag
Director of Rocks & Business Operations

Groc’s manager, Ook, was visibly upset. “That was a potential 5,000 rabbit account! How could we have not known about this?”

Groc was flustered. “I visited Thag from BoulderDash a few weeks ago and we seemed to be on the right track. The triangle thing was an ongoing issue, but I thought the BamBam integration would solve that.”

“The BamBam integration was only for the Enterprise edition of Cart,” replied Ook. “They have the SMB edition… didn’t you see the Support log?”

Groc hurried over to the woodpile in the corner of the office to check the Support log for BoulderDash. Sure enough, the Support team had etched a message into the birch log, stating that the BamBam integration was not compatible.

Groc threw his hands up, “I don’t have the tools to bring all this information together and understand our customers’ health!”

The CEO of StoneHenjj sent a letter by Mammoth Express to try and save the account, but to no avail. Within a couple months, BoulderDash was pushing rocks all over the Valley using BetterCart.

The post Tales of Groc: Customer Success Caveman – Chapter 1 appeared first on Customer Success Software | Gainsight.

Martine is the Chief Customer Officer of the branding automation SaaS vendor, Bynder. Prior to joining Bynder she spent over 15 years working with customers both in the tradeshow / event industry and at Apple.

As a pioneer in Customer Success, I have witnessed this term become more recognized across the world. However, this should be more than just a buzzword, Customer Success should be the foundation of your business model.

In October 2015, I discussed the importance for businesses to make the customer journey a part of their product. Jus like how companies cannot apply the same principles for each region, customer success can no longer be just an add-on. For example, in the Netherlands, there are unique challenges that you would not necessarily find in the U.K. or U.S., but by turning those obstacles into advantages, a successful Customer Success strategy can be achieved.

Not Just a Passing Fancy

Customer Success is a young industry. I joined as Bynder’s Chief Customer Officer in the fall of 2014, when the role was only about one and a half years’ old. At the time, there were very few Customer Success Managers (CSM) in the Netherlands, but it was becoming clear that the Customer Success role would be the spider in the web of every customer-centric service company. During onboarding, our own CSMs spent the initial months in implementation – learning the customer journey inside and out.

Too many companies in EMEA treat Customer Success as a passing fancy, mildly comprehending that the value of good Customer Success translates directly into renewals and upsells. When we first implemented Customer Success at Bynder, we started from scratch to ensure we were building a customer-focused organization that knew and understood the needs of our clients. This didn’t only help us to understand our customers, but helped us create a roadmap for the future. Mapping best practices and the user journey from a technological perspective on our platform allowed us to continuously improve the customer experience.

Build a Team

A great CSM should be capable of handling all stages of the customer journey. Therefore, you should build a customer-focussed team as soon as possible. Steve Jobs once said; “great things in business are never done by one person, they’re done by a team of people.”

Given that Customer Success is a relatively new field, the challenge we face in the Netherlands is having few too experienced CSMs to hire from. In fact, many recruits have never even heard of the term ‘Customer Success’, and some think it’s a job in customer service.

Download the 10 Laws of Customer Success, an eBook curated by CEOs, Chief Customer Officers, and SVPs of Customer Success from leading B2B technology companies.

Working in a B2B SaaS company demands business experience, however the role of a CSM is both technical and social. The CSM needs to have the drive and ambition to educate customers on all of your business’ current products and new features, drive change and adoption, while upselling the customer and keeping their needs a priority. Establishing trust and communication as a CSM is key.

Customer Tactfulness

Customer Success has many more facets than customer service, but its roots are still in meeting the customer’s needs. Not known for their customer service, the Dutch are sometimes perceived as too direct. While this can quickly flatten an opportunity for a server to get a tip, it can be an asset in the business world by exuding honesty.

You can create healthy customer relationships by striving for a partnership and not a supplier/customer relationship — directness with tact, courtesy, and honesty are crucial. No partnership will benefit from a business always saying ‘yes’ if they cannot deliver on a promise. There will be times when you have to say ‘no’ to your clients, but finding a middle ground or a mutually-beneficial alternative solution is what will get you a renewed contract.

About Bynder

Bynder is a branding automation and marketing solution designed to build, manage and scale brands globally. Run as a Software as a Service (SaaS) model, Bynder is an integrated solution that enables brand managers to achieve end-to-end brand consistency. Founded in 2010, Bynder is the leading branding automation solution and powers over 300 brands worldwide, including KLM Royal Dutch Airlines, Logitech and AkzoNobel. Bynder has offices in Amsterdam, Rotterdam, London, Boston and Barcelona and is currently active in over 50 countries.

The post How To Turn Regional Challenges In EMEA Into Advantages appeared first on Customer Success Software | Gainsight.

Geologists from Stanford University recently made an astounding discovery. Drilling core samples in Palo Alto, a thousand feet below Sand Hill Road, they discovered the fossils of an ancient civilization. Their excitement grew as excavation revealed a Neanderthal community with complex tools, written language, and a primitive subscription economy.

A paleo-forensic team pieced together the daily life of one adult Neanderthal that lived there 40,000 years ago. They’ve published his narrative below, and titled their work the Tales of Groc, the Customer Success Caveman. Read Chapter 1 here.

Chapter 2 – Early Adopters

Groc had been an early employee at StoneHenjj. When he joined, they had just a few dozen customers using a very early version of their product, Cart 1.0. Mobile platform technology was just gaining traction and the system architecture still needed a lot of work. Cart 1.0 was built with pumice wheels that crumbled and cedar axles that would snap. Training new users was also a major challenge. Many first-timers lost entire shipments of boulders when Cart rolled too quickly down a hill. Brakes were an enhancement that was still several product releases away.

The early adopters of Cart were a special bunch. They paid their hard-earned rabbits to grapple with a challenging product. But they bought into the vision of what Cart could be. Sure, Cart 1.0 could only carry one caveman at a time, but imagine if it could carry twenty! Cart 1.0 was man-powered, but what if you could set up a Mule integration to boost its speed? These early adopters were rewarded with greater leverage over Cart’s product roadmap and the pride that comes with influencing a wildly successful technology.

Groc managed the relationships with a number of these early customers. Many had stayed up to date as the product developed, upgrading from Cart 1.0 to 2.0, then Cart Cavemaster, Cart F160, Cart Fit, and finally Cart Millenium. Others stayed with Cart 1.0. This wasn’t always easy for the Customer Success team at StoneHenjj. They deeply valued the loyalty of those still using Cart 1.0, but were challenged to support their technical needs as the product continued to mature.

One day, Groc went for an on-site visit at StoneSling, an early adopter still using Cart 1.0. They were a loincloth wholesaler, offering their premier support solution to folks all over the Valley. Since their wares were easily transportable and light, they didn’t have a strong need to upgrade beyond Cart 1.0. Now they were experiencing issues with axle breakage due to heavy usage.

Groc met with Clud, the Director of Logistics at StoneSling. Clud explained his situation:

“The breakage has become more frequent as the Carts get older. We’re doing more business than we used to so we need the technology to perform as well as possible. We’re afraid that upgrading from 1.0 all the way to Millenium would disrupt workflow too much, so we’re hoping to find a fix for 1.0.”

“We’ll get you back on track,” replied Groc. “I’ll escalate this issue with Support and we’ll have replacement axles delivered by Condor tomorrow. As for your upgrade concerns, we’ve invested a lot of rabbits in developing some seamless migration plans. Our night crew can set you up with Millenium while all of StoneSling is asleep! Can we grab some time next week?”

The relief on Clud’s face was clear; “Absolutely. Thank you, Groc!”

“Of course, Clud! Where would we be without customers like you? You’ve provided invaluable feedback and countless references that have gotten StoneHenjj where it is today. Remember when we were trying to close Mammoth Mart? Your chat with their VP sealed the deal! And your ideas on using granite instead of pumice wheels were key to the success of Cart Cavemaster. We’re dedicated to your success.”

The post Tales of Groc: Customer Success Caveman – Chapter 2 appeared first on Customer Success Software | Gainsight.