Figure 2: Customer Segmentation against your Baseline
Champions: At the top are my dream customers: they exceed all expectations, accelerate their onboarding, use all the bells and whistles and surpass their business value targets. These are my champions and deserve dedicated attention:
I celebrate their achievements as publicly as possible: press releases, keynote speaker engagements, webinars, reference calls, innovation awards. For those who cannot be named publicly, we have an internal celebration to acknowledge the sponsor and other core members.
I synthesize their unique “essence”: Did they have a higher-level executive sponsor? Is their IT very nimble? Are they integrated with Software X, etc. This knowledge is priceless for our lead qualification and Sales plays, our best-practice knowledge base, and playbooks.
They form my customer council. They already pushed the boundaries of our solution and were ready for more. Their proposals drive innovation, and they are motivated to adopt new capabilities. They support the marketing of these enhancements as our vocal advocates.
I create a reference model for other customers and users to follow. Whoever is not in your top layer may want to get there, and now my team and I can guide them together to win the pot of gold at the end of the rainbow.
Cruisers: Hopefully the majority of your customers achieve (most of) the expected business value within the expected timeframe. These customers are on a stable course and perfect targets to point to a Champion who is a close fit to their ROI business outcomes, culture, and industry who they might model themselves after.
The Laggards who struggle to keep up, I further break down into Rescue, Recover, and Farewell, based on whether the ability to affect change is mainly on ourselves, joint, or with the customer.
Rescue
The first set of Laggards fell behind due to issues caused by us which significantly hinders their ability to achieve the agreed-upon ROI. If the root cause is product issues, the engineering team is on call. If the issue is a misconfiguration or misuse, the implementation and onboarding team is on call to get the customer back on the success track.
Recover
In the joint control category are accounts where the customer and the account team defined the business goals and the timeline was overly optimistic. What looked great at the beginning of the customer journey may not have considered some issues along the way. Adjusted ROI targets and more realistic time-to-value still create a positive ROI and stabilize these customers.
Farewell
“You can lead a horse to the water, but …” is a fitting catchphrase for these customers. The key to their success or failure is in their hands. Maybe they are lacking or lost executive sponsorship, maybe their champion is not influential enough, or their tools, processes, or integration links are not at the required level. Worst of all is a bad solution fit because their vision or expectations are not aligned with your actual product scope and mutually agreed-upon goals. In particular with a heightened emphasis on frugality, you should spend any resources on these customers with caution. They may not be worth the effort and a hard look is warranted instead of an all-out rescue effort to preserve every logo you have. This is not about a lack of caring, this is a hard reality. If those customers stay with minimal effort, ok: if they churn, wish them well.
Here is the updated customer segmentation with the strategy details for Laggards.
