The Success League Customer Engagement Model

Over the next 4 weeks I’m going to introduce a customer engagement model that is designed to help growing businesses think about where they are in terms of customer success.  I’ll be covering one stage each week, from the bottom to the top of the pyramid: Each layer builds on the one below it.  Good things come in pyramids!  

“But wait,” you say, “Customer Success doesn’t show up until the 2nd step.  Why should I read this post if it’s just going to be about product this week?”  If you read my recent post on goal-setting you know that there are things that customer success can control and other things we influence.  In this model, while customer success only controls the 2nd stage, it can influence the other 3 stages.  It’s important to talk about all four stages of customer engagement, because you need to know what stage your company is currently in and how to help move your brand to the peak of the pyramid.

How the Model Works

The 4 stages on the pyramid are different areas where customers engage.  Product (you can easily substitute Service if you have a service organization) is your customer offering. Success Team includes all of the customer-facing parts of your organization – support, sales, training, professional services, customer success.  Company is your organization as a whole, or how your customers view your brand.  Community is the group of customers who use your product or service, and how they engage with each other.

The bullet points on the right hand side of the model are statements a customer should be able to make about a particular stage.  For example, you want your customers to be able to make the statement, “Your Success Team teaches me how to better use your product.”  Take the perspective of a customer and start saying these statements out loud, starting from the bottom of the pyramid and moving up.  If you have a good feel for your customer base, and you’re being honest with yourself, the point at which those statements become false is where your company stops on this model.  Think about your favorite brand – they are probably at or near the top of the pyramid.  Most organizations are somewhere in the middle.

PRODUCT

Let's take a look at the base of the pyramid this week, and talk about how customer success can influence the product or service you offer.

“Your Product provides value that justifies the cost.”

Most customers won’t buy something in the first place that they feel isn’t worth the cost, so this isn’t usually an issue for new customers.  However, many organizations have a base of customers that has been around for a while.  If this is the case for your company, it is important for the customer success team to perform regular temperature checks on current customers to see how they are feeling about the price vs. value of your offering.  In addition, it is critical that the customer success team be aware of competitor pricing as well as new customer offers and discounts.  The success team should be the canary in the coal mine if customers start to become unhappy with prices, so make sure they have a way to communicate this back to the rest of your company.

“Your Product does what I need it to do.”

This one seems pretty obvious, and again, may not be a problem for new customers.  However, there are 2 cases where the customer success team should step in.

• Product was oversold – in these cases the customer success team owes it to the sales team to clearly communicate what went wrong. Most of the time it is simply a lack of product knowledge on the part of a salesperson or an error of omission. Make sure that the sales leader knows what happened so they can work to prevent it in the future.

• Product has aged – as the market for a particular product develops the needs of your customers will develop as well. If your product hasn’t kept pace the customer success team needs to let your product team know where the gaps are. A formal feature request process can help you make sure this information is getting to the people who control those changes.

“Your Product is easy to learn and use.”

This is the product half of customer adoption.  If you glance up the pyramid you’ll notice that there is also a training component that falls into the Success Team stage.  However, if your company is depending entirely on your customer success team to make your offering understandable, your product has missed the mark.  If this is the case, customer success should be reporting the questions that commonly come up during training or on-boarding to the product team.  This information, combined with data on customers who don’t make it through on-boarding or customers who quickly churn, can be a powerful call to action for your company.   Tools like WalkMe can make it easier for customers to find their way through even a complex product.

“Your Product makes doing a great job easier.”

Everyone wants to be a rockstar.  Your customers expect that your product is going to make them look good, or they wouldn’t have purchased it.  This is another area where your customer success team should be doing regular temperature checks.  Happy customers let you know they feel like rockstars by giving you referrals and participating in customer stories.  They want you to show off their great work.  If customers aren’t willing to share how they are doing, this may be a sign that your product isn’t delivering on this promise.  If this is the case, customer success can dig to try and find out what the show-stoppers are.  Again, a formal feature request process can really help the product team know what to do to fix any problems.

Next week we’ll talk about what the Success Team can do to make sure customers are engaged, and continue to work through this model.  I'd love to hear about what you and your team are doing to make sure your Product is engaging your customers!

Need help figuring out where your company is on this customer engagement model?  The Success League is a customer success consulting firm created to help companies build customer-centric brands.  www.TheSuccessLeague.io

Customer Success at Scale

By Jeremy Gillespie

Do you know about Hiroshi Mikitani’s Rule of 3 and 10? Essentially, the rule states everything in your company breaks as you grow 3x and 10x. And there aren’t any exceptions to this rule. He means everything. Each time you reach one of these milestones everything needs to change... and that includes your customer success engagement model. 

I would argue especially your engagement model. After all, 70-95% of your revenue comes from renewals and up-sells. But you knew that!

So how do you build a scalable Customer Success engagement model? I’ll show you with these 4 steps to success:

Measure Usage

I’m sure you’ve heard the famous Peter Drucker quote, “what gets measured, gets managed.” Well he’s right. Start with actively measuring usage. I say actively because this is something you should be using on a daily basis to drive engagement, measure risk and provide insights to your team.

At the beginning you’re looking to set a baseline for stages of the customer journey. Each stage of the journey will have a success goal, which is your desired outcome for the customer.

“At the end of this phase, customers should be ______.”

This graphic from Totango, is a great representation of how to map your customer journey. Across the bottom, you can see they’ve defined each stage. Develop a similar timeline for your product and benchmark engagement for each phase. We’ll put this to good use in a second. :)

ACTION ITEM: Develop a baseline of usage at each stage of the customer journey.

Score

Now that you’ve defined a goal and usage baseline for each stage, the next step is to create a scoring system. Think of this score as the health of an account. In fact, if you’re using Customer Success software to track engagement, it is usually referred to as a ‘Health Score.’ This health score will measure their propensity to upgrade, renew, churn, etc.

Your scoring model is derived from usage patterns you see across accounts. The score will use a number of signals and roll them up into one clear and easy to understand number.

  “Accounts with a score of ___ are likely to _____.”

The beauty of a score is that you can very quick measure and more importantly, manage risk across your customer base.

Make sure to segment accounts by their score and which stage they’re in. This will make next step a breeze.

ACTION ITEM: Develop a Health Score and segment accounts by their score and part of the customer journey they’re in.

Message

Onward. Use your score to automate communication with your accounts at each stage. Typically, you’ll have a messaging stream for accounts in Good, Average and Bad health. This allows you to serve them relevant communication to actively move them on towards the next phase. Do not be afraid to breakdown your stages into additional segments. For example, if your company serves companies large and small, break your Onboarding stage into six different streams.

Onboarding - Enterprise Accounts

• Good Health

• Average Health

• Bad Health

Onboarding – SMB Accounts

• Good Health

• Average Health

• Bad Health

This might seem like extra work, but it’s well worth the time. Remember, your communication should be relevant.

Since this post is about scalability, here’s a few ways you can take a one-to-many approach.  Do some testing to figure out the best way to engage your customer base.

1. Email additional product information

2. Email a personal reach out and check-in

3. In-app message

4. Offer in-app chat

5. Invite them to join a webinar

6. Invite them to a customer event

ACTION ITEM: Build automated messaging streams for customers with Good, Average and Bad health at each stage of their customer lifecycle.

Action Plan

Your messaging should not happen in a silo without informing key members of your Customer Success team. Use alerts and tasks in your CRM to make sure everyone is on the same page and accounts are contacted in a timely manner.

At this point, the team should implement an action plan to make sure the customer hits their milestones. These plans will be tweaked and unique for each customer, but you should have well-defined ‘playbooks’ for the team to work from. This will provide consistency and structure for scalability.

ACTION ITEM: Build Customer Success playbooks to define actions a Customer Success Managers will take to provide value to your customers at each stage of the lifecycle.

Put the Pieces Together

To engage customers at scale you need to take build a strategy that doesn’t break as you add new team members and/or customers. This model will not be built overnight and it will need optimized, but the hard work will payoff.

Don’t wait until for the Rule of 3 and 10 to bite you. Take action today!

1. Measure Usage - develop a baseline of usage at each stage of the customer journey.

2. Score - create a Health Score and segment accounts by their score and part of the customer journey they’re in.

3. Message - build automated messaging streams for customers with Good, Average and Bad health at each stage of their customer lifecycle.

4. Action Plan - develop Customer Success playbooks that define the actions Customer Success Managers will take to provide value to your customers at each stage of the lifecycle.

Need help identifying and implementing technology to support your customer success efforts?  The Success League team specializes in success tech!

Jeremy Gillespie - Jeremy is a growth-oriented marketing geek, technology enthusiast and customer evangelist. He loves using complex data to build creative retention solutions. By leveraging technology, Jeremy excels at creating scalable retention marketing programs.  He works for LinkedIn, holds a BA in Communication from the University of Pittsburgh and MBA from Point Park University.  He is a proud former Pittsburgher, but currently lives in San Francisco, CA.

The 7 Tell-tale Signs of Churn

By Ashley Hall

Dun, dun, dun. Time to talk about the dreaded topic: Churn. As a Customer Success professional there is not a day that goes by without a discussion about either retention or churn. Whatever you decide to call it, it’s important to track it and categorize it so you can quickly learn from it. In this post I’ll cover how to uncover the signs of churn.  Next time I’ll talk about how to tackle those issues and prevent it.

When you’re hired as a success professional the one question often missing from the interview process is, “How are your detective skills?” You’ll need to quickly learn from suspicious and repeated customer behavior which things commonly lead to that dreaded cancellation call.  It’s important to keep an evolving list of your own in order to track and ultimately mitigate churn. Here are 7 areas you should consider as you start your own telltale list.

1.  Negative feedback - Using a tool like Wootric gives your customer a direct line to provide feedback - good, bad, or ugly. Although you cannot solely rely on a tool like this, it’s a great way to collect user sentiment and NPS. Companies that repeatedly provide low scores and negative feedback could be at risk for churning.

2.  System use - If you work for a technology company there are probably features in your platform that can show you how clients are using it.  If not, solutions like Totango can help you figure out what customers are doing in there.  Whether it is logins, timestamps, clicks, usage reports or standard activities, think about the actions (or lack thereof) that might indicate a customer is unhappy with your product. 

3.  One-off feature requests - Feature requests can be an amazing feedback tool that can have an incredible impact on your product or service. On the other hand they can make for some tough decisions when it comes to which requests you can and cannot accommodate. A customer with a large number of requests that do not align with the vision of your brand should raise some red flags.

4.  Company changes - New leadership, an acquisition or even changes in staff are things that a success team should be wary of. You’ve worked hard to develop a relationship with your champion at a company, but what happens when if they leave the company or get promoted? New leadership can come onto the scene and start evaluating all vendors, which leads to a re-selling cycle or churn.

5.  Requests for future pricing - Although this can be a completely innocuous request it could also indicate to your team that the customer is shopping around for other options. Additionally, if budgets are being reviewed saving money could become more important than the relationship your client has with your company.  Once you’ve provided your response regarding future pricing, be sure to follow up with some questions to help you decide whether or not this is a true churn-related red flag.

6.  Contract requests - If you get a request for a copy of the contract there is a problem. At a minimum, you probably aren’t working with the right contact person. If the customer is new, they might have misunderstood what they were purchasing and need to be re-sold.  Worst-case scenario, you have customer who is trying to find out how long they have to stick with you before they move on.

7. Contact goes dark - Your company has a great relationship with the contact – they share about the product, they engage with the success team, you know their kids names.  Suddenly, nothing.  Weeks go by, you’ve reached out several times, and still nothing but (at least according to LinkedIn) they are still working for the company.  Is it a long vacation or churn risk?

After reading about these 7 signs of churn you can probably recall some interactions with your clients where there were red flags. Get started on a list of your own, and be sure to include any distinct elements of your product or service that are a tell-tale sign of churn for your brand. Building an evolving list for you and your team will give you the basis for a unified and systematic approach to alleviating churn. Next post I will cover how to build a churn prevention strategy based on your list.

Need help identifying and strategizing around your tell-tale signs of churn? The Success League is ready when you are! 

Ashley Hall - Ashley loves to lead account management teams; from training newbies to building processes out of chaos to working directly with customers. With an eye on the future she is a powerhouse in building scaleable frameworks that support and drive growth.  Ashley is currently working for Sparkcentral and holds a BA in Sociology from the University of Colorado, Boulder.  She lives in San Francisco, CA.

Planning for Customer Success - Goals

Last week I wrote about how to define a clear set of metrics for your Customer Success team.  Now that you know the metrics you own, you’ll need to translate those into goals for your team.  Metrics are the key numbers you’ll be reporting to your leadership team and board (like churn, expansion revenue, renewals).  Goals are what you’ll use to manage your team to those metrics (like signing up 10 customers for training, closing 5 upgrades per month).  Here is the framework I use to translate metrics into goals.

SMART Goals

A post about goals just isn’t complete without a little note about SMART goals - they are goals that are Specific, Measurable, Achievable, Relevant and Time-bound. So, what does this mean in terms of customer success goals?

• Specific – A goal to “reduce churn” is not specific enough. A goal to reduce churn by 2% this quarter is. Statements like “reduce churn” or “improve revenue” make great company initiatives but terrible goals.

• Measurable – I’m going to tackle this one in it’s own section below, but basically if you can’t measure something, it shouldn’t be a goal. For example, “improve customer engagement”, without a series of surveys and tools, is not a measurable goal.

• Achievable – If your company has only ever had a 50% renewal rate, increasing to a 95% renewal rate in one quarter is probably not an achievable goal. A goal to increase to 60% may be more realistic.

• Relevant – This is where history sometimes gets in the way. If you’ve always given your CSM team a goal of 40 calls a day, that’s great, but if that goal doesn’t help you achieve your metrics, maybe it isn’t relevant any more. All goals should tie to metrics in some tangible way.

• Time-bound – Goals should reflect the timeframe for the changes you expect to see in your metrics. For example, you might want to have monthly goals related to expansion revenue (if revenue for your company is evaluated monthly) and quarterly goals related to customer satisfaction (perhaps because that is how long it takes to gather statistically valid information).

 Goal What You Control

This is a tough area for many customer success teams because they are often responsible for metrics that are pretty broad.  Churn is a great example.  One of my clients, Jazz.co, has the customer success team accountable for the churn metric.  Like many technology companies, churn is impacted by a variety of different things – month-to-month customers who can leave at any time, customers who aren't using the product anymore, customers who dislike aspects of the system, customers who are acquired.  Some of this the team can control (getting people moved to agreements, providing amazing customer service) and some of it the team can only influence (changes to the product). 

Giving a team a goal based on something that they only influence leads to frustration.  It is important to break down metrics into manageable chunks that can be turned into goals.  At Jazz.co, we decided that the 2 biggest things the success team could do to reduce churn were to move customers to annual agreements and to provide solid churn data to the product team.  While the success team still pays close attention to the overall churn metric, goals are based on the things the team can control.

What is Measurable?

Measurable is the M in SMART, and this is one of the areas where I’ve seen companies really mess up when creating goals.  There are some awesome articles floating around about the metrics you "should" be paying attention to (think "10 Important Metrics for SaaS Companies"). Those articles are great to reference, but if you’re working for a start-up, there is a very good chance that you don’t actually have the tools, processes or systems in place yet to translate those metrics into goals.  Alternately, if you’re working for a more established company you may have such an overwhelming set of data that you aren’t sure which most accurately reflects the metrics you’re responsible for.  In either situation, you need to consider a few things:

• Tools – If you aren’t capturing customer information it’s going to be difficult to build goals. If you’re still getting your CS tool set in place or your CRM system set up think about having your initial goals be getting those systems and processes working, then transitioning to metrics-driven goals down the road.

• Methodology – There are lots of different ways to measure things. Make sure you understand what is typical for your industry and consistent with the metrics you’re trying to drive. Your aim should be measures that most accurately reflect the status of your client base.

• Alignment – Make sure that everyone who will be seeing your metrics understands and agrees with how you plan to measure results. It’s no fun to be in a leadership meeting where your results are being questioned because of how you measured them. Get agreement ahead of time.

A final thought - don’t go too crazy with the goals.  People can only deal with about 3-5 goals at a time.  Choose the most important, the most impactful.  Those are the goals that will create exponential growth and change for your team.   

Are you struggling to build or refine your goals?  The Success League can help!