CX & Customer Success resources

I recently wrote about the importance of leading indicators to improve customer retention and expansion rates in B2B environments.  Waiting for financial results is too late; it behooves every company to embed a simple and repeatable set of steps that strengthen customer relationships over time. To achieve this, many companies start with “mapping the customer journey” in order to understand the complete set of processes that customers go through to be able to fully use (“adopt”) the product.  While that works well for consumer B2C companies (where, by and large, you’re only as good as your latest transaction), relying on journey mapping is dangerous and far from ideal for B2B companies. Instead, B2B companies must learn to develop and strengthen relationships.  Here’s why and how.

Success = Outcomes

Let’s start with a definition of Customer Success: “Success” is simply, “The accomplishment of an aim or purpose.”  Focusing on the word “accomplishment” is the key (the CS industry has more commonly used the word, “outcome” or “result”).  In other words, Customer Success is NOT a matter of making sure that end-users adopt the product. Although product adoption could be an accomplishment and might very well be required to drive the right outcome, stopping there doesn’t necessarily mean you’re enabling a business outcome for your customer and strengthening the relationship. Even with high utilization, it’s entirely likely that your customer is not realizing the outcome they require.  Why?  Your products and services might be fully in use, BUT:

• What is the customer journey once onboarding is complete: Does your company have processes and programs that keep key contacts engaged with you so your company continues to be top-of-their-mind? If yes, are they sufficient to meet customers’ expectations?  Or are you just hitting them with automated emails?
• Your key stakeholders (i.e. the Buying Committee) might be far removed from the day-to-day usage of the product, never logging on to see the beautiful dashboard that displays the Key Performance Indicators (KPIs) being produced by the end-users.
• Even with the visibility on your KPIs, the business value – the return the customer realizes on their investment – might not be crystal clear (your executive sponsor needs clear results in order to get promoted!).
• Perhaps your customer relied on poor practices that merely automated old workflows, rather than embedding new processes that take advantage of new capabilities that your products have enabled.
• The key contacts might be changing due to a re-org or departure of an executive sponsor, leaving your future uncertain (followers of David Skok’s For Entrepreneurs blog know that loss of an executive sponsor is a key reason for churn).

“Check-in” <> Success

To address these problems, you might be inclined to “check in to see how things are going.”  It’s a nice idea to be able to lob an email over the wall and feel comfortable that everything is going well.  But,

1. With whom are you “checking in” – are you reaching out to the contacts that matter most? Are you reaching out to contacts that assess and manage to business outcomes?
2. Are they being responsive to your inquiry? That is, did the “check in” actually add value, or are you merely marking off a to-do list item?
3. Do they understand where and how to make changes or improvements to their business processes in order to acquire the necessary outcomes?
4. Are your company’s products and services meeting their expectations?
5. Critically, how much can you do individually to meet expected outcomes?  Do you need other people within your company to help?

It’s not enough to “check in” – you need to have a clear process to understand what’s working and not working – and you best not rely on the customer to drive it on their own. Having a process that allows the customer to share their perceptions of success and value is the first step. But pay attention to item 5:  You are only one person, yet it takes a whole company to drive value (otherwise why does the company need all those other employees??).  Every person in the company needs to be wired towards adding value for the customer, and it’s the job of Customer Success org to ensure that happens (if not you, who?). The key is to equip employees around your company with clear descriptions of what is working well and what needs improvement, straight from the customer. Sharing customer perceptions directly, without passing through anyone’s personal (perceived or real) filter, is the fastest path to get everyone on the same page.  When it’s direct, trustworthy, and without concern for bias, customer feedback is tough for your colleagues to ignore, helping ensure you’re aligned internally.

Acquire Trustworthy Insights

So, the second piece is to make sure that you are acquiring and distributing trustworthy feedback from your customers. Trustworthy means representative. If you are sharing one comment from a customer survey then what’s expressed is true for that one person, but you cannot conclude that the entire population feels this way.  Although there’s great opportunity to follow-up and strengthen the relationship with that one contact, only by acquiring a sufficient amount of feedback from the right people can you extrapolate to the whole. Implementing a Voice-of-Customer (VoC) program that collects the right feedback from the right people at the right time is the third key.

We also know that response rate is a powerful leading KPI that can predict churn and drive expansion. Research has shown that silence (non-response) from your B2B customer contacts indicates there’s insufficient “what’s in for me” to respond. In other words, there is a value equation for the customer that has both a numerator and a denominator:

1. Numerator: You are asking for feedback, but what is the level of investment (time, energy, and exposure) you are requesting?
2. Denominator: Have you shown your customer participating is worth their time, energy, and exposure? Are you going to do something with the feedback?

When you put these together you get your value equation for your customer to provide feedback.  Your customers won’t respond if their perceived value for participating isn’t sufficiently large. In other words, response rate means something.  Are you confident that you’ve clearly articulated that it’s a short process and that you are committed to listening and (at least) addressing any issues – i.e. you’ve expressed the numerator of the value-equation?  Are you confident that you’ve even sent the request for feedback to the right people (note: a thorough description of the “Active Recruiting” process to drive high customer response rates can be found here)? If you have done this then silent customers are telling you that it’s not worth it to them. Don’t throw out these data points. Instead,

1. understand that silent accounts are far more likely to churn, and place resources on those accounts that you might be able to save. Make sure that you leverage a feedback tool that highlights these as risk and opportunity.
2. accurately indicate how much revenue was represented by the feedback process and include the revenue-at-risk from these silent accounts. Companies make decisions all the time based on zero data. Bringing evidence to the table should certainly help move the company in the necessary direction.

Consider these 2 images from a real-world client: TopBox was used to acquire feedback from the Buying Committees (decision makers and key influencers of renewal decisions) at each of their accounts to gauge overall sentiment.

• Image 1 shows the average ACV of accounts that are happy (green), moderately happy (yellow), unhappy (red), and silent.  We clearly see in this case that happy accounts tend to spend far more than others.
• Image 2 shows the total amount of ACV from each of those account sentiments.  We clearly see a huge blind spot from the silent accounts.  We also know that silent accounts are far more likely to churn than accounts that participate in your request for feedback. Assigning resources to strengthen relationships with those accounts should be a priority.

In summary, as a Customer Success organization your job is to ensure the customer is perceiving business outcomes.  Perception is your customers’ reality, so any time there is a gap in expectations vs reality, the “fix” can be

• Communicate appropriate to close the perception gap, and/or
• Execute differently to close the perception gap.

Only customers tell you if they perceive value. If they do then you’re in a good position to consider an expansion opportunity.  If they don’t then you had best shore that up.  It all starts with customer feedback:

1. Understand if there is a gap in expectations vs. delivery/results
2. Understand why there is a gap: is it real, or just perception?
3. Create a plan to address the gap

Execute the plan.  Reap the rewards of increased retention and expansion.  Then rinse and repeat.  A more detailed explanation of this process and the associated KPIs is at https://waypointgroup.org/the-power-of-leading-indicators-in-customer-success-heres-what-to-measure/