More than anything Customer Success is a philosophy. Of course, there is an organisational element to it; real disciplines, applications, platforms, career paths. But more than anything else Customer Success is a mindset that focuses on ensuring customers achieve the maximum possible benefit from the solution or service offered.
Gainsight Chief Customer Officer, Dan Steinman shared his experiences with 30+ members of the Notion Capital portfolio on the critical importance of customer success and the transformational impact focusing on customer success has on companies and their clients.
It is one of the biggest buzzwords in B2B, but unlike other fleeting terminology, Customer Success isn’t going anywhere. In fact, it’s becoming one of the most important factors across all types business—the difference between a company going broke and achieving mega-growth. Nick Mehta, CEO of Gainsight
Dan describes this as the consumption gap:
However, the paradox is that the business in whole – and product management in particular – is constantly innovating to increase what is possible with the product and so in reality – if the company is innovating the gap is never fully closed.
Long term success in a subscription business is predicated on a number of key principles:-
Customer Success is a revenue driver in the same way as is sales and marketing. Every part of the business needs to be imbued with the fundamental ethos that everything they do is ‘pre-sales’ in so much is it is critical to the ongoing acquisition, retention and growth of high margin customers.
Rapidly growing any successful business is predicated on knowing your ideal customers:-
A constant refrain for any customer success leader facing up to key challenges of retention and expansion is “are we selling to the right customers?”, followed swiftly by the question, “are we nurturing the right customers?” and only then do we consider the appropriate allocation of resources and actions.
Assuming we are selling to the right customers then the next step is to put in place the five pillars of customer success:-
Important to consider customer success in terms of both the lead indicators and the lag indicators.
Lag indicators include the obvious such as churn and revenue expansion but also the less obvious such as 2nd and 3rd order revenue.
While lead indicators focus on:-
Customer success is now a business imperative for any SaaS company and a key driver of company value.
Customer Success is not some kind of warm, fuzzy phrase that CEOs like to say because it makes them and shareholders feel better. For recurring revenue businesses, Customer Success is very real and absolutely critical and is quickly becoming that new hot career opportunity as the subscription economy continues to transform all B2B. Dan Steinman, Chief Customer Officer at Gainsight.
A Customer Success Primer Slides
Posted by Stephen Millard, Chief Platform Officer at Notion Capital.
Join our network of 1000+ subscribers to keep updated with our new investments, partner insights and portfolio news.