10 Customer Success Growth Hacks to Increase LTV
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This presentation - 10 Customer Success Growth Hacks to Drive Up LTV - is by renowned SaaS Expert and Growth Hacker Lincoln Murphy of Gainsight. The 10 Customer Success Growth Hacks to Increase LTV are: 1. Pitch your CSM Program 2. TTFV: Time to First Value 3. Success Goals Kick-off Meeting 4. Ban the Check-in Call 5. Mutually Assured Success 6. People-Powered Retention Engine 7. Orchestrated Advocacy 8. Accelerate Up-Sell Cycle 9. Churn Hazard Early Warning System 10. Celebrate your Customers’ Success 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. In fact, 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.
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10 Customer Success Growth Hacks to Increase LTV
- 1. Gainsight Confidential. 2014 Gainsight, Inc. All rights reserved. 10 Customer Success Growth Hacks Lincoln Murphy July 2014
- 2. 2014 Gainsight, Inc. All rights reserved. Lincoln Murphy - Gainsight Lincoln Murphy is Gainsight’s Customer Success Evangelist and is responsible for driving Gainsight's thought-leadership in the areas of Customer Success, retention, churn mitigation, and expansion revenue. Lincoln’s passion is creating efficient engines of growth for SaaS (Software-as-a-Service) and Subscription Economy companies. @lincolnmurphy
- 3. 2014 Gainsight, Inc. All rights reserved. Customer Success is…
- 4. 2014 Gainsight, Inc. All rights reserved. Customer Success…
- 5. 2014 Gainsight, Inc. All rights reserved. Growth Hacking is…
- 6. 2014 Gainsight, Inc. All rights reserved. Wake up!
- 7. 2014 Gainsight, Inc. All rights reserved. Transactional Economy Subscription Economy Vendor Success Customer Success Vendor Success Customer Success The New Chasm
- 8. 2014 Gainsight, Inc. All rights reserved. Vendor Can I get a reference? Want to buy more ? Ready to renew? Who are you again ? Transactional Economy Subscription Economy Success Retention Advocacy Expansion Onboarding Customer The New Customer Lifecycle
- 9. 2014 Gainsight, Inc. All rights reserved. Rethinking the B2B Funnel MARKET I NG SALES RET ENT I ON
- 10. 2014 Gainsight, Inc. All rights reserved. Rethinking the B2B Funnel • People at the top of the funnel get the glory and the pay... and we're saying, that needs to change • But we've said "if your job is in that little part of the existing funnel, you don't really matter. Support, service, even Customer Success; outsource, automate, etc. • We need a new metaphor; The "Funnel" idea is outdated • Never liked it anyway; too passive anyway M A R K E T I N G S A L E S R E T E N T I O N
- 11. 2014 Gainsight, Inc. All rights reserved. MA R K ETIN G SALES SU C C ESS The B2B Hourglass Higher Growth Rate Higher Multiple Higher CAC Frontier
- 12. 2014 Gainsight, Inc. All rights reserved. M A R K E T I N G S A L E S S U C C E S S The B2B Hourglass • Simple idea with massive implications • You'll get as much or more growth from the "bottom of the funnel" as you will the top • Clearly you need to get customers initially - top of the hourglass - but as you do, more and more of your growth will come from that established customer base • It you want to be a high-growth company, you can't grow just by acquiring net new customers
- 13. 2014 Gainsight, Inc. All rights reserved. Valuations go up…
- 14. 2014 Gainsight, Inc. All rights reserved. Retention Goes to 11 (> 100%)
- 15. 2014 Gainsight, Inc. All rights reserved. Success Maturity Model Revenue SuccessMaturity Adoption Retention Expansion Optimization Transformation $1 - $5 MM $5 - $20 MM $20 - $100 MM $100 MM - $1 B $1 B+
- 16. 2014 Gainsight, Inc. All rights reserved. … up and to the right 10 CSM Growth Hacks 1. Pitch your CSM Program 2. TTFV: Time to First Value 3. Success Goals Kick-off Meeting 4. Ban the Check-in Call 5. Mutually Assured Success 6. People-Powered Retention Engine 7. Orchestrated Advocacy 8. Accelerate Up-Sell Cycle 9. Churn Hazard Early Warning System 10. Celebrate your Customers’ Success
- 17. 2014 Gainsight, Inc. All rights reserved. Pitch your CSM Program • Promote your Customer Success initiative • Is it a differentiator? • Pitch that you're going to help them achieve success, not just functionally use the product • All customers get a Success review 6-months after implementation (continue the narrative) • Hack: Success Guarantee … throw your competitors a curve ball
- 18. 2014 Gainsight, Inc. All rights reserved. Time to First Value (TTFV) • Think of TTFV as a sprint; it’s the start that matters • When the deal closes, the baton just got passed to the next sprinter • Keep the same milestone-driven hustle post-sale to get customers to value quickly • Hack: Identify quickest win and plan to get there … we need more acronyms
- 19. 2014 Gainsight, Inc. All rights reserved. Success Goals Kick-off Meeting • Know the goal of your customer • Not the functional "job to be done" but the why • Ask them "what does massive success mean to you?” • Hack: schedule this meeting with your last customer (and all going forward) ...GOOOAAAAALLLLLL!
- 20. 2014 Gainsight, Inc. All rights reserved. Ban the Check-in Call • “Just calling to check-in" doesn't work anymore • Customers expect you to know how things are going • They want you to call with value suggestions • Check-in call means you don't know what's going on (and usually has selfish motives) • Hack: Identify a value-added reason to call your top 10 customers today (then do it) … please leave a message
- 21. 2014 Gainsight, Inc. All rights reserved. Mutually-assured Success • Take goals captured in the kick-off meeting • Agree on how you'll measure the goals • Have a regular, consistent, and frequent process to review these • Reinforce the goal and the progress • Hack: "is that still why you bought?" and "are we delivering what we said we would?" … win-win
- 22. 2014 Gainsight, Inc. All rights reserved. People-powered Retention Engine • Identify 3 people on their end • Identify 3 people on your end to reach out to them at least once per month • If someone leaves, there's relationship redundancy • Systematize and automate this • Hack: Identify your 3x3: 3 people from your top 10 customers, and 3 from your team; meet … B2B is still P2P
- 23. 2014 Gainsight, Inc. All rights reserved. Orchestrated Advocacy • Identify your raving fans and become their fan • Focus on 9s & 10s on NPS • Send them a thank-you gift, ask them to talk with a prospect, ask to speak at your conference • Advocacy actually leads to higher satisfaction • Hack: Identify the "Promoters" on your last NPS and become their fan …fans beget fans beget fans
- 24. 2014 Gainsight, Inc. All rights reserved. Accelerate Upsell Cycle • When adoption is slow, it hurts up- sell velocity • When adoption is fast, upsell comes quicker • Create the same hustle around up- sell as around initial sale • Hack: Create plan to get 5 newest customers to first upsell point in half the normal time … license to use
- 25. 2014 Gainsight, Inc. All rights reserved. Churn Hazard Early Warning System • Not just usage; they don't buy to use, they buy to get value • Look to all the signs of disengagement (unsubscribes, not attending webinars, poor feedback, support issues) • Hack: Identify 5 non-usage churn threats and build an alert system around that … C.H.E.W.S
- 26. 2014 Gainsight, Inc. All rights reserved. Celebrate your Customers’ Success • Customer Success Gong is bigger • Ring on Renewals • Ring on other Customer Success milestones (Funding, New Clients, M&A, Personnel Changes, etc.) • Hack: Buy a gong! … their success is your success
- 27. 2014 Gainsight, Inc. All rights reserved. 10 CSM Growth Hacks 1. Pitch your CSM Program 2. TTFV: Time to First Value 3. Success Goals Kick-off Meeting 4. Ban the Check-in Call 5. Mutually Assured Success 6. People-Powered Retention Engine 7. Orchestrated Advocacy 8. Accelerate Up-Sell Cycle 9. Churn Hazard Early Warning System 10. Celebrate your Customers’ Success … up and to the right
- 28. 2014 Gainsight, Inc. All rights reserved. Matrix Data Architecture Reduce Churn “Headwind” Increase Up-Sell “Tailwind” Scale Team Efficiently Source: Measuring the ROI of Customer Success Management Solutions - Mainstay Company What? 5% points 3% points 25%Why?* How? Aggregate Gainsight Customer360 Analyze Gainsight 4-D Analytics Automate Gainsight Predictive Playbooks Gainsight Drives Growth
- 29. Gainsight Confidential. 2014 Gainsight, Inc. All rights reserved.
- 30. Gainsight Confidential. 2014 Gainsight, Inc. All rights reserved. Q&A Lincoln Murphy - Gainsight Lincoln Murphy is Gainsight’s Customer Success Evangelist and is responsible for driving Gainsight's thought-leadership in the areas of Customer Success, retention, churn mitigation, and expansion revenue. Lincoln’s passion is creating efficient engines of growth for SaaS (Software-as-a-Service) and Subscription Economy companies. @lincolnmurphy
Editor's Notes
- Notes from slide: Goldman Sachs did a study a couple years ago showed that recurring revenue business that have a higher retention rate are valued at a higher multiple Not only do you grow faster, you get valued higher... win-win -------------- And heck – our company claimed a 97% retention rate, so I figured it would be smooth sailing. What I didn’t realize is: Every company claims a 90-something retention rate Customer retention doesn’t just take care of itself Eventually, I learned that sales was only the beginning of the story in SaaS. Managing retention, renewals, references and the rest of what recurring revenue required became a big part of my day, in partnership with our awesome Client Services team. In SaaS, product and sales aren’t enough. For once, I learned that my dad’s advice was wrong. Well, that wasn’t the only time. After a happy ending to the story with the sale of our company to Symantec, I met Gainsight. When I heard about the opportunity to become part of this massive Customer Success movement, it was a no-brainer
- And heck – our company claimed a 97% retention rate, so I figured it would be smooth sailing. What I didn’t realize is: Every company claims a 90-something retention rate Customer retention doesn’t just take care of itself Eventually, I learned that sales was only the beginning of the story in SaaS. Managing retention, renewals, references and the rest of what recurring revenue required became a big part of my day, in partnership with our awesome Client Services team. In SaaS, product and sales aren’t enough. For once, I learned that my dad’s advice was wrong. Well, that wasn’t the only time. After a happy ending to the story with the sale of our company to Symantec, I met Gainsight. When I heard about the opportunity to become part of this massive Customer Success movement, it was a no-brainer