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The Age of the Customer, 2018

The document discusses the importance of customer success in modern business, emphasizing that businesses must focus on understanding and delighting customers to thrive in a technology-driven environment. It highlights strategies for implementing customer success functions, organizing for customer benefits, and the significant return on investment associated with enhancing customer experiences. Additionally, it underscores the shift from product-centric to service-oriented business models, illustrating how customer engagement can drive growth and retention.

Software◦
Related topics:
Customer Success Insights• Software as a Service•
Dan Steinman
Dan Steinman Insert Photo Golden Rule Treat others as you would like to be treated Success for All We are in this together and our success is tied to yours Childlike Joy Find the joy in each moment Stay Thirsty Always striving to innovate Shoshin Approach situations with the Beginner’s Mind VP of Customer Success VP of Customer Success Chief Customer Officer Chief Evangelist General Manager, EMEA
• In the beginning • Changing business models • ROI of Customer Success • Customers as a Growth Engine • Organization and Leadership • Customer Success in Practice What I’ll Be Discussing
But First…ChildlikeJoy
Question #1 1. In theTV show “SiliconValley”, who runs the incubator? A. Richard Hendrix B. Big Head C. Erlich Bachman D. Gavin Belson
Question #1 1. In theTV show “SiliconValley”, who runs the incubator? A. Richard Hendrix B. Big Head C. Erlich Bachman D. Gavin Belson
Insert Photo Customer Success Everybody’s Talking About It Tech Go-to-Market: Make Customer Success a Cornerstone of Your Customer Experience Strategy Customer Success Management is the Key to Outstanding B2B Customer Experiences Grow Fast or Die Slow: Focusing on Customer Success to Drive Growth How Smart, Connected Products Are Transforming Companies
Insert Photo Customer Success Everybody’s Talking About It Tech Go-to-Market: Make Customer Success a Cornerstone of Your Customer Experience Strategy Customer Success Management is the Key to Outstanding B2B Customer Experiences Grow Fast or Die Slow: Focusing on Customer Success to Drive Growth How Smart, Connected Products Are Transforming Companies So how can a midsize manufacturer “break on through to the other side” …? Their best bet is to take a page out of the SaaS vendors’ playbook and deploy a customer success function. - Geoffrey Moore
WAVES OF TRANSFORMATION
• TheProductEra • Demandexceedssupply • Focusonthesupplychain • Sixsigma • Internetchangeseverything • SystemsofRecord • SAP,Oracle,Cisco,Microsoft,Intel • B2BenablesB2C • CustomerSupport • Theas-a-ServiceEra • Supplyexceedsdemand • Focusonthecustomer • Userexperiencedesign • Cloud+Mobilechangeseverything • SystemsofEngagement • Salesforce,Amazon,Apple,Microsoft • B2CenablesB2B • CustomerSuccess The Seismic Shift from Product to Services - Geoffrey Moore
CUSTOMERS BEFORE CUSTOMERS TODAY The only source of competitive advantage is the one that can survive technology-fueled disruption — an obsession with understanding, delighting, connecting with, and serving customers. WELCOMETOTHE AGE OFTHE CUSTOMER
Customer Success is being driven by changing business models
Question #2 2. Which actor/actress has appeared in the most episodes of “Made in Chelsea”? A. Spencer Matthews B. Jamie Laing C. LouiseThompson D. Binky Felstead
Question #2 2. Which actor/actress has appeared in the most episodes of “Made in Chelsea”? A. Spencer Matthews B. Jamie Laing C. LouiseThompson D. Binky Felstead
Wave 1: Logistics SUPPORT DISTRIBUTION PRODUCT
Wave 2:Transactions SUPPORT SALES PRODUCT
EXPAND Wave 3: Subscriptions ADOPT RENEW SUPPORT LAND PRODUCT Customer Success
Wave 4: Consumption CUSTOMER SUCCESSSALEPRODUCT
Wave 5: Outcomes SALEPRODUCT SUCCESS SUCCESS SUCCESS
THE BAR FOR CUSTOMER SUCCESS WILL KEEP GOING UP Logistics Transactions Subscriptions Consumption Outcomes
The ROI of Customer Success is also evolving
Question #3 3. According to the musical “Hamilton”, Alexander Hamilton was? A. An immigrant B. Scotsman C. An orphan D. All of the above
Question #3 3. According to the musical “Hamilton”, Alexander Hamilton was? A. An immigrant B. Scotsman C. An orphan D. All of the above
Churn Level 1
Expansion Level 2
Acquisition Level 3
CUSTOMER SUCCESS DRIVES NEW BUSINESS SALES Because your prospects are talking to your customers
CUSTOMER SUCCESS DRIVES NEW BUSINESS SALES "Success begets success in terms of customer deployments and having truly happy customers, and I think we're starting to see a 'network effect' of companies talking to each other and comparing notes on which solutions work, and which ones don't." Aneel Bhusri CEO,Workday
Pricing Level 4
CUSTOMER SUCCESS DRIVESYOUR ABILITYTO RAISE PRICES
ALL WRAPPED IN ADVOCACY ADVOCACY ChurnExpansion Pricing Acquisition
ASYOU MATURE,YOUR FOCUS WILL CHANGE MATURITY Churn Expansion Acquisition Pricing
86% 89% 89% 95% 13% 13% 16% 22% 117% 105%102%99% Customer Success Maturity Avg. Gross Retention % Avg. Expansion Rate % Avg. Net Retention %
Customers asYour New Growth Engine
Question #4 4. In theTV show “SiliconValley”, the incubator is in what California city? A. Menlo Park B. Palo Alto C. Sunnyvale D. San Francisco
Question #4 4. In theTV show “SiliconValley”, the incubator is in what California city? A. Menlo Park B. Palo Alto C. Sunnyvale D. San Francisco
In the Age of the Customer, you can no longer acquire your way to success ADAPT OR DIE
BECAUSE ACQUISITION IS EXPENSIVE
WHILE EXPANSION AND RETENTION ARE NOT
In the Age of the Customer, Net Retention is the most important metric in your business
100% -9% -11% +13% +18% 111% Starting Churn Downsell Upsell Cross- Sell Net Retention Expansion THE RECURRING REVENUEWATERFALL
RETENTION IS MORE IMPORTANTTHAN EVER
BECAUSETHAT’SWHERETHE REVENUE COMES FROM Installed Base New Business
BECAUSETHAT’SWHERETHE REVENUE COMES FROM
Lead
Lead Opportunity
Lead Opportunity New Customer
Lead Opportunity New Customer Successful Customer
Successful Customer Expansion New Logo Renewal
Finance Sales Renewals Support Services Marketing Product Customer
Your customers are the new GROWTH ENGINE
STAND UP! It’sTrue/False time
Organization and Leadership
Question #5 5. Who wonThe Great British Bake-Off 2017? A. Sophie B. Katie C. Paul D. Steven
Question #5 5. Who wonThe Great British Bake-Off 2017? A. Sophie B. Katie C. Paul D. Steven
HOW SHOULD WE ORGANIZE?
ORGANIZETO • Make a statement of importance
ORGANIZETO • Make a statement of importance • Create healthy tension
ORGANIZETO • Make a statement of importance • Create healthy tension • Benefit your customers, not you
ORGANIZETO • Make a statement of importance • Create healthy tension • Benefit your customers, not you • Provide clear accountability
Leadership
Leadership • Willingness to get her hands dirty
Leadership • Willingness to get her hands dirty • Customer-facing experience
Leadership • Willingness to get her hands dirty • Customer-facing experience • Process/data-oriented
Leadership • Willingness to get her hands dirty • Customer-facing experience • Process/data-oriented • Influence management
Building Blocks of a Customer Success Program
Question #6 6. In theTV show “The Big BangTheory”, what nickname did the guys give to Stephen Hawking? A. Robot B. Physicsman C. The Brain D. Wheels
Question #6 6. In theTV show “The Big BangTheory”, what nickname did the guys give to Stephen Hawking? A. Robot B. Physicsman C. The Brain D. Wheels
Customer Success in Practice Small # of customers Long tail of customers High Value MidValue LowerValue
3 2 1 SegmentYour Customers
Why SegmentYour Customers?
Why SegmentYour Customers? Because you can’t afford to treat them all alike
Your segmentation model is actually a financial model
Typical Segmentation Model • How much are they paying you? • How much could they be paying you? • Optional - Industry/Brand/? Don’t overthink it! 3 2 1
TechTouch MidTouch High Touch Each Segment = DifferentTouch Model
TechTouch MidTouch High Touch Create an Engagement Model by Segment Map The Engagemen t Model
Kickoff Meeting Strategy Alignment / Discovery Health Check Onboarding Close Meeting End User Survey Renewal Preparation Renewal Negotiation Contract Signature Contract Expiry Proactive (Date-driven) Welcome Email 1:Many Training Modules Onboarding CSAT Survey Exec Business Review Low Adoption Detractor NPS Survey Multiple Support Tickets Champion Leaves Decline in Usage Increase in usage Positive NPS Survey 90% Deployed Adopt Expand/RenewOnboardLand 1:1 Touch = Blue 1:M Outreach = Purple Risk = Red Opportunity = Green Reactive (Data-driven) MAP THE CUSTOMER LIFECYCLE
TechTouch MidTouch High Touch Your Engagement Model Will DriveYour Headcount Model H E A D C O U N T Map The Engagement Model
TechTouch MidTouch High Touch Establish RetentionTargets by Segment H E A D C O U N T Establish Retention Targets Map The Engagement Model
CustomerSuccess in Practice 1. Segmentyourcustomers
CustomerSuccess in Practice 1. Segmentyourcustomers 2. Buildanengagementmodelforeachsegment
CustomerSuccess in Practice 1. Segmentyourcustomers 2. Buildanengagementmodelforeachsegment 3. Use engagementmodeltodriveheadcountmodel
CustomerSuccess in Practice 1. Segmentyourcustomers 2. Buildanengagementmodelforeachsegment 3. Use engagementmodeltodriveheadcountmodel 4. Createretentiontargetsforeachsegment
A Simple Model SALES Manage Measure Results ££ (Bookings/Revenue)PipelineActivities that grow/move pipe Customer Success ££ (Net Retention)Health ScoreActivities that improve HS • Training sessions • QBRs • Calls
Trends in Customer Success
Question #7 7. In the Portuguese translation of the Customer Success book, which author’s name appears first? A. Nick Mehta B. Dan Steinman C. Lincoln Murphy D. BenWatkins
Question #7 7. In the Portuguese translation of the Customer Success book, which author’s name appears first? A. Nick Mehta B. Dan Steinman C. Lincoln Murphy D. BenWatkins
CustomerSuccessTrends 1. CustomerSuccessdrivesSales
Why hire 10 reps when you can hire 10K customers to sell for you?
CustomerSuccessTrends 1. CustomerSuccessdrivesSales 2. Becomingprescriptive
Customer SuccessToday One-size- fits-all Custom suit
“We’re a little bit different than most companies…”
CustomerSuccessTrends 1. CustomerSuccessdrivesSales 2. Becomingprescriptive 3. CSisacompanywidepriority
Everyone Else… Responsible for “Customer Success” It must be their fault…
CS = CO + CX
CS > CSM
Everyone is in Customer Success