Guest presenter Kate Leggett, Principal Analyst from Forrester Research, shares The Economic Value of Customer Success. In this presentation she goes into the real economic and monetary impact that having a Customer Success focus brings to a Subscription business like Enterprise SaaS. In fact, the most successful Enterprise SaaS companies know that growing revenue only through new customer acquisition is the less efficient way to scale. Rather, they understand that growing revenue within your existing customer base - through up-sells, cross-sells, and expanded use - is the most profitable way to scale. Enterprise SaaS companies that grow revenue - and company valuation - by expanding revenue within their existing customer base also know the key to making this work is to focus on - and operationalize - Customer Success.

1. The Economic
Value of
Customer
Success
June
2014
#customer
success

2. 2014 Gainsight, Inc. All rights reserved.
Housekeeping
• Q&A panel on your right
• Recording for colleagues who can’t make it
• Attendees will receive slides and final
Forrester report
• Twitter hashtag #customersuccess

3. 2014 Gainsight, Inc. All rights reserved.
Your Speakers
Lincoln Murphy
Customer Success Evangelist
@lincolnmurphy
Kate Leggett
Principal Analyst
@kateleggett

4. 2014 Gainsight, Inc. All rights reserved.
What We’ll Cover
1. The State of Customer Success
2. The Economic Value of Customer Success
3. AKA CSM

5. 2014 Gainsight, Inc. All rights reserved.

6. 2014 Gainsight, Inc. All rights reserved.
The Conversation
PULSE2013

7. 2014 Gainsight, Inc. All rights reserved.
The Roles
5500 companies hiring

8. 2014 Gainsight, Inc. All rights reserved.
The Curriculum
access.gainsight.com/csm-university
Summer Session starts June 30

9. Making Leaders Successful
Every Day

10. The Economic Value Of
Customer Success
Kate Leggett
Principal Analyst, Forrester Research
@kateleggett
kleggett@forrester.com

11. We have entered the “age of the customer”
Source: October 10, 2013, “Competitive Strategy In The Age Of The Customer” Forrester report
1900 1960 1990 2010
Age of Manufacturing
Mass manufacturing
makes industrial
powerhouses
successful
Age of Distribution
Global connections
and transportation
systems make
distribution key
Age of Information
Connected PCs and
supply chains mean
those that control
information flow dominate
Age of the Customer
Empowered buyers
demand a new level
of customer obsession
Beyond
• Ford
• Boeing
• GE
• RCA
• Wal-Mart
• Toyota
• P&G
• UPS
• Amazon
• Google
• Comcast
• Capital One
• Macy’s
• Salesforce.com
• USAA
• Amazon

12. Our world is moving to a subscription economy
Credit: www.zuora.com

13. Our world is moving to a subscription economy

14. And the business model for technology is
moving to subscriptions
14%
January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

15. And the business model for technology is
moving to subscriptions
21%
January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

16. And the business model for technology is
moving to subscriptions
13%
January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

17. The subscription model has tipped for many B2B software
categories
January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

18. The subscription model has tipped for many B2B software
categories
January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

19. The subscription model has tipped for many B2B software
categories
January 2014 “TechRadar™: Software-As-A-Service, Q1 2014”

20. And because of this relationships are becoming more
important
Product Focused Relationship Focused
www.zuora.com

21. Good relationships have business value
March 2012 “The Business Impact Of Customer Experience, 2012”

22. Relationships improve business metrics
April 2012 “Define the Right CRM Metrics”

23. Customer success
managers actively manage
customer relationships to
reduce churn, increase
existing revenue and
influence new sales

24. CUSTOMER SUCCESS
MANAGEMENT REDUCES CHURN

25. Companies follow a standard growth trajectory
25

26. Where are you in your growth?
26

27. Where are you in your growth?
27

28. Along the way, you tier your customers
28

29. As you grow, revenue from
existing customers becomes a
larger and larger part of your
company’s economic value
29

30. Calculating the impact of customer churn
30

31. The negative impact of churn can be quantified
31
revenue
time
95% retention rate
- Acquired 600 customers
- Lost 30
80% retention rate
- Acquired 600 customers
- Lost 120
$2M difference

32. Churn is dependent on deal size
32

33. CUSTOMER SUCCESS
MANAGEMENT INCREASES NEW
REVENUE

34. Data-driven conversations make cross-selling and
upselling easy
• Product utilization data. Can be used to have data-driven conversations on
the economic benefit of the purchased solution
• Active users exceed purchased users. Indicates a customer who is utilizing
their purchased products beyond the negotiated terms of their contract.
Customer success managers can use this data in customer conversations to
showcase the value of their purchase, as well as drive upsells and upgrades.
• Active features exceed purchased capabilities. Indicates a customer who
has a greater need for product capabilities than what is purchased.

35. Find the white space

36. CUSTOMER SUCCESS
MANAGEMENT INCREASES
ADVOCACY

37. Brand advocates are more valuable than average
customers

38. Happy champions will buy you again
38

39. CUSTOMER SUCCESS
MANAGEMENT DRIVES TEAM
PERFORMANCE

40. You can amplify the effects of each team member

41. Teams automate manual reporting and task
management to deliver more value.

42. ENGAGEMENT
STRATEGY
ENGAGEMENT
PROCESSES
ENGAGERS
ENGAGEMENT
LEVERS
Customer success management takes coordinated
effort across four dimensions

43. ENGAGEMENT
STRATEGY
ENGAGEMENT
PROCESSES
ENGAGERS
ENGAGEMENT
LEVERS
Customer success management takes coordinated
effort across four dimensions

44. What data do you need?
44
Customer
Goal
Inactive
users
Provisioned
users
Contract
Terms
Renewal
Realized
economic
value
Audit
records
Feedback
Advocacy
Support
feedback
Customer
feedback
Active
users
Measures
of success
Features
Alerts
Calls and
tickets
Onboard
ing

45. What do you do with data?
Integration Validation Visualization
Analytics Exploration
Workflow
Data
Insights
Action

46. The Advanced Playbook
LOB
Data
Enterprise
Insights
Outside-in
Action
• Customer360
• Alerts
• Surveys
• Automated Email
• Health Scorecards
• Playbooks
• Workflow
• Embedded Apps
• External Sponsor Alerts
• Automated Customer
Presentations
• Mobile
• Data Science

47. ENGAGEMENT
STRATEGY
ENGAGEMENT
PROCESSES
ENGAGERS
ENGAGEMENT
LEVERS
Customer success management takes coordinated
effort across four dimensions

48. Thank you
Kate Leggett
Principal Analyst
kleggett@forrester.com
@kateleggett
Thank you

49. 2014 Gainsight, Inc. All rights reserved.
Download Your Free Copy Now