Customer success is still in it's early days, but there's a lot of upside potential for SaaS startups. Many operate with a myopic focus on pouring more prospects in the top of the funnel. They fail to notice a giant opportunity for growth in their own backyard: their existing customers.
Systematizing and measuring customer success is hard, but well worth the effort.
If you provide great customer support, your customers will view you as a great vendor. If you help them to succeed, they will view you as a business partner with aligned interests. Which would you rather be?
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SaaS Customer Success Lessons We Learned At Gainsight Pulse 2014
1. CUSTOMER SUCCESS
More and more SaaS companies are implementing customer
success strategies and hiring dedicated customer success
managers (CSMs). We recently attended Gainsight Pulse, the
preeminent gathering for customer success professionals. Here
are some of our takeaways from Pulse 2014:
WhatWe Learned At
Gainsight Pulse 2014 Conference
2. Umberto Milletti
CEO of InsideView
• How does the customer define success? What
metrics/revenue does the customer consider a
"success"?
• The goal is to move all the customers to the top
and right in that chart.
InsideView scores customers on a chart:
X axis: how well are customers adopting the product?
Y axis: how good is the relationship between us and the
customer?
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Most important question you need to ask yourself:
3. • Identify measurable customer success metrics,
and share them with your customers.
Example:
One customer success metric for Close.io is how
many minutes our customers save each
day/week/month because they use our app.
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How to quantify customer success?
CUSTOMER SUCCESS
WhatWe Learned At Gainsight Pulse 2014 Conference
4. Tien Tsuo - Zuora CEO
(Employee #11 at Salesforce)
• The term customer success was coined at Salesforce by Marc Benioff.
• Ask yourself: What does a customer need to setup a successful process? What are the typical needs of
the customer to become successful in the general area where you are offering your service?
• Zuora has identified 9 keys to customer success
• Customer success at Zuora = helping customers achieve these 9 keys. They track the progress the
customer is making towards these nine keys over time. They measure the value they provide based on
this progress.
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5. Roger Lee
BatteryVentures
• Focus on reducing revenue churn instead of customer churn.
• Revenue churn is what matters most.
• When doing cohort analysis, look at revenue, not number of
customers. What matters is how a given cohort's revenue
expands over lifetime. This helps you understand whether
you had positive or negative churn within a particular cohort.
• Your goal should be to achieve net-negative revenue churn
within each cohort.
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PHOTO
6. Harrison Miller
Summit Partners
• Net revenue churn is the most important metric.
• Investors care about dollar expansion.
• Don't try to close accounts that don’t expand. Sales should be
compensated on accounts that have expansion revenue.
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PHOTO
7. Jason Lemkin
Storm Ventures
• You can hire your first CSM as soon as $1 million in ARR (annual
recurring revenue).
• You should have one CSM per $2 million in ARR. So if your SaaS
is making $10 million in ARR, you want to have five CSMs on
your team.
• Customer success is 5x more important than sales.
• 80% of EchoSign customers came from word of mouth. The
CSMs are your advocates for creating that word of mouth.
• Visit your customers. Your CEO should visit your biggest
customers. When he was CEO at EchoSign, they never lost a
customer that Lemkin personally visited.
• Visit 5 customers every month (more than 1 a week).
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PHOTO
8. Mark Organ
• Customer success is underfunded.
• Find out what the customers' goals are. Track their progress
towards these goals.
• Reward CSMs based on the long-term goals their customers
achieve.
• The CSM wins when the customer wins.
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PHOTO
Co-founder of Eloqua and Influitive
9. Customer success is still in it's early days, but there's a lot of upside
potential for SaaS startups. Many operate with a myopic focus on pouring
more prospects in the top of the funnel. They fail to notice a giant
opportunity for growth in their own backyard: their existing customers.
Systematizing and measuring customer success is hard, but well worth the effort.
8 of 8
How to quantify customer success?
CUSTOMER SUCCESS
WhatWe Learned At Gainsight Pulse 2014 Conference
If you provide great customer support, your customers will view you as a great
vendor. If you help them to succeed, they will view you as a business partner
with aligned interests. Which would you rather be?
10. THANK YOU
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