As the thought leader in the field of Customer Success (CS), we want you to have all the information and insights you need to stay current and take your CS practice to new heights.

Despite the ups and downs of the economy, Customer Success continues to emerge as a clear priority because of its ability to drive efficient, durable growth. In our recent survey of tech investors and CEOs, the 2022 SaaS Market Report, respondents indicated that CS is the department least likely to experience budget cuts. And when asked what the most important metric is in response to the downturn, 46% of the SaaS CEOs said Net Revenue Retention—which happens to be the north star metric of customer success.

Whether you’re here for the first time or ready to uplevel your customer-centric capabilities, here’s a taste of our best content to kick off your new year. Whether you’re launching a CS team from scratch, looking for best practices, incorporating CS Ops into your repertoire, or trying to scale your digital CS tactics, Gainsight is the place to start.

Launching Customer Success

• Trust Is a Prerequisite for Total Company Alignment to Customer Success
• Building the Digital Customer Journey
• Own the Moment of Customer Onboarding: Launch the Love
• Achieving Alignment: Enabling Customer Success Centricity Within Your Organization
• Essential Considerations For Your First Customer Scorecard
• Aligning Responsibilities & Outcomes For Customer Success
• Creating An Onboarding Experience Customers Will Love
• Establishing Scaleable, Effective Customer Success Playbooks
• How to Build a Transformative CS Organization in Healthcare
• Rally the Troops: How to Win Cross-functional Buy-in for CS

Customer Success Team Management

• The Ultimate Guide to Becoming a Customer Success Leader
• 5 Steps to Evolve Newly Formed Enterprise Customer Success Teams
• Empower Your CSMs to Be Data Driven

Customer Success and CS Ops

• Why Forrester’s Business Case for Customer Success Management Is Even More Relevant in the Current Market
• In Economic Downturn, Adopt Durable Growth for Better Customer Experience
• Built to Last: Nurturing Customer Relationships That Will Survive a Downturn
• Customer Success Operations: The Hottest Career in the Customer Service Space
• How to be a Change Management Superhero

Best Practices for Customer Success

• Making Your CS Tech Stack a Critical Building Block in Revenue Growth
• Keep Calm and Double Down on Your Customers: The Path to Durable Growth for SaaS
• Six Steps to Level up Your Digital CS
• 7 Lessons From McKinsey on Recession-Proofing Your Customer Base
• All About Leveling Up Your Customer Success Game
• The Big Book of Digital Customer Success
• The SaaS Durable Growth Kit for Customer Success
• 10 NEW Laws of Customer Success
• What Experienced Customer Success Tech Buyers Know That You Should Too

Adoption, Retention, Renewal, and Upsell Strategies

• The Best Indicator of SaaS Success? Durable Growth, Says Gainsight CEO
• 5 Customer Success Trends That Scream for Data Democratization
• CEOs: It’s Time to Double Down on Your Customers
• Why Bridging the SaaS User-Buyer Divide Is Key to Improving Customer Retention
• Digital Customer Success Maturity Model
• NRR: Your Most Important Growth Metric
• Making Data-Driven Decisions for Sales and Customer Success Alignment

Scaling Customer Success

• Three Strategies to Scale CS That Are More Effective Than “Do More With Less”
• Best Practices for Building a Digital-Led Customer Success Strategy

Gainsight is always excited to share our acumen and newest information with CS practitioners and the industry at large. You can also join our community or find out about our events, webinars, articles, and ebooks in our Resource Library.

The post The Ultimate List of Customer Success Resources for 2023 appeared first on Gainsight Software.

The technology industry, specifically SaaS, is in a tricky position, but the companies that emerge stronger after the downturn will be the ones that take initiative now and preemptively prepare. Ready to learn how?

To help you prepare for the mindset shift and future financial uncertainties, Gainsight published a new ebook, The Essential Guide to Budgeting for Customer Success and Durable Growth. Here are our top three secrets from the ebook.

1. Position Customer Success (CS) as an Efficient Growth Engine 

Business author, speaker, and advisor Geoffrey Moore said, “B2B tech actually has the opportunity to thrive in a downturn if it focuses on solving urgent problems that have a short time to pay back.” Gainsight CEO Nick Mehta echoed this in a recent WSJ Business article, The Best Indicator of SaaS Success? Durable Growth. Mehta stated that the SaaS mindset has shifted to accommodate the expected financial downturn. He said, “A change in market multiples shows that the ‘efficient growth’ mindset has displaced the ‘growth at all costs mindset.” And that is where you need to be.

Gone are the days of indiscriminate spending chasing new logo. While it’s important to bring in new customers, SaaS experts suggest that businesses need to compensate for forthcoming economic “lean times” by focusing on increasing customer retention and expansion, which is the prime responsibility of the Customer Success organization. 

But how do you convince your Chief Financial Officer (CFO) and the rest of the C-suite to be more inclined to invest in customer retention by investing in CS? Start by telling them it will cost your company more than double to acquire new customers (CAC) versus generating additional revenue from existing customers, according to a recent KeyBanc study.

Bottom line: Who finds revenue opportunities in your install base? Customer Success teams. 

2. Articulate How CS Team Goals Directly Impact Revenue

In today’s market, it’s critical to prevent customer churn and lower customer acquisition costs (CAC). But that’s not all Customer Success does. 

CS plays a huge role in adoption and guiding customers along their journey with your company.  

They help customers find value in your product, become successful, attain their goals, and meet their expectations, while keeping them satisfied. Increasingly, they also manage digital customer success efforts: scaling your digital, automated, and self-service endeavors. Lastly, there is the responsibility of driving outcomes and improving cross-sells by generating qualified leads from your install base. Who better to lead in these efforts than Customer Success teams? 

The truth is that CS is essential for your business, especially to hit your goals for the next year or two. This guide will help you armor up to step into any meeting and justify CS budgetary spending and prove its value and ROI. 

3. Move From a Reactive to a Proactive Stance

There has been a long-standing understanding in customer success that to be effective in retaining customers CS should move from a reactive to a proactive motion. Unfortunately, right now, you can no longer wait for customer retention to happen organically through basic CS motions. You must pursue it and prevent attrition of your customers by planning your budget for the future. Never has there been a more imminent time to do this. 

Gainsight’s new guide will demonstrate how to use the evidence found in data to get CFOs to agree to CS budgetary proposals for new team members and initiatives. Remember to prepare to answer this question from your C-Suite: “How can this help me right now in terms of retaining revenue or cost?” 

As Nick Mehta, CEO of Gainsight, recently stated, if you aren’t securing funding for CS, you may not be making the right pitch. CS is well-positioned to become an efficient revenue driver during lean times, but CS leaders need to make a data-driven case for the new hires and technology they need.

Learn more in our The Essential Guide to Budgeting for Customer Success and Durable Growth.

The post Three Secrets to Secure Budget for Customer Success and Fuel Durable Growth appeared first on Gainsight Software.

“It’s tough to make predictions, especially about the future.” – Yogi Berra

Given the uncertainty right now, it’s hard to predict what will happen in January—let alone all of 2023. But here goes nothing … here are 10 Customer Success (CS) predictions for 2023 by Nick Mehta, CEO of Gainsight.

1. CS Is More Important in a Downturn

Customers will scrutinize outcomes and value more, making CS critical for retention. While many companies recently “battened down the hatches,” the first place for new investment will be CS.

2. More and Better CS Exec Hires

Lately, I’ve seen an uptick in CS exec searches. Companies want execs who are extremely performance-driven and will hire CS leaders who understand the SaaS economic model deeply.

3. Digital as Strategy

Digital CS will be core to every company’s playbook. They will start applying digital strategies even to high-touch motions, freeing up time for higher-value activities. New hires will combine CS skills, marketing techniques, and data orientation, so their businesses do more with less.

4. Ops Gets More Important

Digital CS will often become part of the broader CS strategy and Ops function. CS Ops teams will continue pruning CS activities and wasted effort—CSMs can’t be a catch-all.

5. Digital Hub

Many companies have a fragmented set of sites—training, community, documentation, self-service, etc. “Digital hubs” will bring the experience together and facilitate easier collaboration with clients.

6. Monetization

While not for everyone, many established vendors will combine premium CS with premium support, training, and professional services credits into a recurring value realization offering. This self-funding model will be important for margin improvement in SaaS.

7. Outcomes Focus

We’ve talked about outcomes FOREVER in CS, but the time to deliver is now. Given economic pressure, customers are cutting any spend that’s not tied to value.

8. Relationship and Commercial Skills

CS teams will invest in mapping client orgs, tracking stakeholder changes, and generally building more relationships. With every company trying to save money, CSMs need to learn the basics of pricing and negotiations. Even if they aren’t on point, they must be comfortable enough to set their commercial colleagues up for success.

9. The CFO Is the Decision Maker

In the new world of economic turmoil, the CFO is the decision maker for all vendors. CSMs need to get better at reaching out to CFOs, speaking their language, answering their questions, and arming their champions to do the same.

10. Vendor Consolidation

CFOs are pushing to reduce the number of vendors they deal with. If you are a point solution company, the platform players are coming for your customers. Vendor consolidation will also cause CSMs to become more familiar with competitive and adjacent solutions in the market.

What would you add? What did we miss? Join the conversation on LinkedIn.

The post 10 Customer Success Predictions for 2023 appeared first on Gainsight Software.

Growth Molecules

In today’s market, companies need to do more with less. For SaaS organizations, that means it’s becoming table stakes to invest in product-led growth (PLG) and operationalize customer success (CS) with digital touchpoints. But how does a company scale without sacrificing the customer experience?

Enter digital customer success. Digital-led CS allows businesses to deliver fast, personalized customer touchpoints without having to manually handle every customer interaction. Automated processes save time, enabling customer success managers (CSMs) to be more productive with higher accuracy. But where do you start, especially when the pressure to implement digital scale is NOW?! 

Aligning Your Digital-Led Strategy to Customer Moments of Truth

One of the greatest challenges is knowing where to start with your digital-led strategy. You have to answer questions like:

• Which customer segments should we start with as a pilot?
• How well do we actually know our segments?
• Which customer personas (admins, executives, etc.) should we include?

A great place to begin is by understanding your customers’ lifecycle. Many organizations don’t take the time to map out the various steps a customer experiences while engaging with their products. It’s critical to understand this journey to clearly see how the customer receives value and solves pain points with your products. It also helps to identify potential risks that can happen along the journey, and how you can keep the customer on track for successful adoption and renewal. 

Throughout that customer journey, you’ll find moments of truth when value is either realized, or the opportunity to provide value is missed. These moments define whether or not the measure of success is reached. These are vulnerable times in the relationship with your customer, and this is the time to really zero in on the customer experience.

Here are examples of moments of truth in each phase of the customer lifecycle: 

Source: Gainsight: How to Manage Your Customer Lifecycle

By strategically aligning the digital strategy to moments of truth in the customer journey, businesses can create digital interactions that add up to highly successful and engaging customer experiences. 

Digital-Led Strategies Require Human Accountability

Once you’ve identified the moments of truth you want to build your digital CS strategy around, the next step is to revisit (or create) a RACI matrix for the customer journey. You’ll need to consider how roles and responsibilities change from high-touch playbooks to segments with more digital touchpoints. Here’s more context on the different roles to map out in your RACI: 

Source: Growth Molecules

Mapping each role to your moments of truth provides clarity around the responsibility that each role has within the RACI matrix. To get started, leverage the example below: 

Source: Growth Molecules

Mapping out these roles ensures clear communication and seamless workflows within your organization. For your digital strategy, it helps define the playbooks, CTAs, and workflow communications that you’ll need to craft. It’ll also help you identify which human touchpoints to maintain as a priority to ensure high-value outcomes are reached. 

Self-Service Resources Fuel Digital Customer Success at Scale 

Self-service resources are imperative to a digital customer success program. Your digital-led strategy should enable users to have greater access to the tools, resources, and support needed to onboard and adopt your product. In turn, this empowers you to serve more customers with fewer people.

With effective self-service resources in place, CSMs have the ability to spend more time focusing on the human touch elements that build personal relationships with users and decision-makers within their customer organizations. With those stronger relationships comes greater retention, expansion opportunities, and the ability to identify the ROI and impact your product is making on your customers’ businesses. 

So how can you balance the personal human touch at scale while driving greater efficiency with digital touchpoints? This can all be accomplished while also keeping the customer at the forefront of all that you do. By strategically aligning the digital strategy to moments of truth in the customer journey, businesses can create successful and engaging customer experiences. 

Want to learn more about creating a well-oiled CS machine? Check out our interactive tool to align your organization around customer success.

The post Customer Moments of Truth Are Your Map to Digital Scale appeared first on Gainsight Software.

Or perhaps you’re about to whip up a delicious meal, but realize that you don’t have all the needed ingredients, and are forced to get creative.

Well, in more ways than one, Customer Success (CS) teams today are probably facing something similar with everything that seems to be going on in the elusive economic landscape.

Needless to say, businesses are being more conservative and careful with where they are spending their money and allocating their resources. For CS teams, this means consolidation or reduction in tools and potentially hiring freezes as well.

Now, although this is very much a cause for concern for companies and teams that are not in the best shape financially, it also presents an opportunity. A chance for teams to get creative and “do more with less.”

We’ve heard this phrase a lot lately, but what do we mean by it?

To paraphrase the words of Tim Urban from the infamous “Wait but Why’” blog, there are certain times to act like “the chef” and other times to adopt the ways of “the cook.” The chef works from principles and tries to come up with novel ways to combine ingredients and experiment with cooking techniques, while the cook relies on the good-old copy-and-paste approach, using what has already worked before.

Here are a few ways that Customer Success Managers (CSMs) can adopt the “do more with less” mindset—at times proudly donning the chef’s hat, and at other times embracing the hustle like a good line cook.

Stay Proactive, But Predictable

First and foremost, developing a decent risk management protocol and staying on top of early-warning signals of churn is essential. It may be required to connect regularly with certain customers and get them to better engage and maybe even rediscover the value that your solution brings to them. 

Here is where monitoring customer health closely, particularly for at-risk accounts is vital. A comprehensive health scoring tool that effectively tracks changes against a baseline to alert CSMs ahead of time and also offer prescriptive action steps to mitigate the risk can be a game-changer in more ways than one—not only reducing the burden on CSMs, but also standardizing actions across the larger team.

Think About Scale and Repeatability

As we know, one of the core responsibilities of a CSM is to ensure the right data is reported and reviewed in business review cycles. Executive Business Reviews (EBRs) and Quarterly Business Reviews (QBRs) are essential checkpoints along the customer journey and can also serve as forums for conversations about potential renewal and expansion opportunities. However, CSMs typically deal with multiple customers or they service several long-tail customers at a time in a pooled CSM model. This invariably makes it challenging to prepare for all of the business reviews.

Imagine this: What if there was a way to automate the process of preparing EBR and QBR decks as much as possible and replicate the templates across the entire customer pool? Having ready-made snapshots of key metrics and reports to include in QBR decks sounds like a life-saver for CSMs striving to do more with less.

Enter Success Snapshots by Gainsight.

Success Snapshots is a tool that empowers CSMs to export meaningful client data into slide templates that can be seamlessly dropped into business review decks. Not only can CSMs save these templates for future use, but the tool also allows teams to share and experiment with various reporting best practices. 

Be Human-First (With Automation, of Course!)

Gainsight has always had and advocated for a human-first approach to doing business when engaging with customers. In challenging times, it’s understandable to wade through the uncertainty in an effort to reduce everything to numbers and equations. But it’s probably more important to remember that behind those ARR numbers and CRM records are human beings who are most likely in the same situation as your team weathering today’s economic headwinds. 

Taking time to reach out to those people with personalized notes and messages can go a long way in nurturing those relationships—granted that can be a taxing process with a large customer base. But that’s exactly when leveraging automation tools like Journey Orchestrator to send out those check-in and follow-up emails can make a huge difference. CS teams can automate simple email outreach programs or useful engagement surveys. These automation capabilities can be further leveraged to dynamically plan and personalize customer outreaches as needed.

CS teams can become a durable growth engine for their organizations despite the economic conditions, but they have to focus their efforts efficiently.  Digital tools allow CSMs to maintain frequent customer touch points and report on customer health data—without constant triaging and daily human heroics. With digital customer success tactics, CS teams can do more of what matters most, with less burden on the CSM team. 

Learn More

Want to be the first to learn the latest digital customer success tools and strategies? Save your spot at Evolve, the Gainsight product event.

The post How CS Teams Can Adopt the “Do More With Less” Mindset appeared first on Gainsight Software.

An old maxim among courtroom litigators states that you should only ask a question of a witness when you already know how they will answer. Otherwise, you might be in for an unpleasant surprise. For this reason, effective prosecutors and defense attorneys engage in various pre-trial activities, including “witness prep,” to help them take control of the narrative.

As many SaaS companies look to increase Net Revenue Retention (NRR) to compensate for weak or declining sales, they may want to adopt and adapt this maxim to say: “Before we ask existing customers to renew or expand their subscriptions, we will pursue customer success (CS) strategies and activities (‘customer prep’) that help us avoid unpleasant surprises and increase the number of successful outcomes.”

Now comes the tricky part. What kinds of customer health data should you collect and analyze to help you avoid unpleasant surprises? And which strategies and activities should your sales and post-sales teams pursue in response to this data?

A DEAR Solution

The post Use Customer Health Data to Grow and Forecast NRR appeared first on Gainsight Software.

I’m sure partly, we will reflect with shock. How did we ever think GameStop was worth tens of billions of dollars? Why did we believe in crypto scams like FTX? And whoever thought an NFT of a “Bored Ape” would be valued at millions? What were we thinking?

On the flip side, we might have some nostalgia for the halcyon days of SaaS when everything was worth 100x ARR, regardless as to business model! No matter what, we are in a new and more real world. And the real world demands that businesses eventually make money.

Having led SaaS companies for almost 15 years now, I can tell you that profitability in SaaS comes down to three variables:

• Net Revenue Retention: How much will that client grow or shrink over time?
• Gross Margin: What’s the gross profit you will make on that customer?
• Customer Acquisition Cost: How much Sales and Marketing expense does it take to get a new client?

Other things—like R&D cost and G&A—matter. But they naturally scale down over time for most businesses.

Let’s reflect on each of those three levers and see how customer success (CS) and churn fit in.

1. Low Net Retention Means Your “Steady State” Model Isn’t Very Profitable

In the early days of companies, growth is usually fast, often with ARR doubling or tripling the prior year. But inevitably, “gravity” sets in. You reach the frontier of your market and your growth will slow down. As that growth slows, your core question becomes: What is the “terminal” growth rate and how profitable will the company be at that time? The terminal growth rate is the constant rate that a company is expected to grow into perpetuity. Investors will already be wrestling with this when they value your company. Some businesses at scale grow 20% and have 40% operating margins. Others grow 5% and barely make any money. What’s the difference?

I’d argue the biggest issue that makes terminal growth not very profitable is when you have high churn.

Let’s imagine there’s a SaaS company named LowChurn that matures at $200M revenue (pretty good!). If we assume 80% gross margins (world-class), this means LowChurn has $160M of gross profit. At scale, R&D might be 20% (or even 15%). 20% of $200M is $40M of R&D. And let’s assume G&A is 10%, or another $20M. So LowChurn’s Gross Profit minus G&A minus R&D is $100M. Sweet!

If churn is 10%, LowChurn has to “refill” $20M of revenue to get back to the prior year’s revenue. If we target 10% terminal growth, you need another $20M on top of that, so $40M total. If their Customer Acquisition Cost (CAC) has a 1:1 ratio to revenue, that means about $40M of Sales and Marketing. Take that out of the current year’s revenue, and LowChurn now has $70M of EBITDA (earnings before interest, taxes, depreciation, and amortization) or 32% EBITDA margin. Add that to the 10% growth rate, and you get a 42 on a Rule of 40—pretty good (though not amazing).

Let’s imagine a similar company with a great name like HighChurn—with 30% churn (ouch!). They have to “refill” $60M just to get to 0% revenue growth and another $20M to grow 10%. At a 1:1 CAC ratio, that means $80M of Sales and Marketing. So now HighChurn is only making $30M EBITDA or 14%. Add that to the 10% growth and this company has a mediocre “Rule of 40” of 24.

And it only gets worse …

2. Churn Means Your CS Costs Get Higher—and Maybe Gross Margins Get Lower

You might be asking at this point: “Where are your Customer Success costs?” Great point. Let’s assume they are in Cost of Goods Sold (COGS) in this example (whether they are in Sales and Marketing or COGS is irrelevant since the bottom line will be the same).

LowChurn likely has a sticky offering and doesn’t have to throw tons of free resources at customers to save them. So maybe their CS cost as a percentage of revenue is like 5% out of that 20% COGS in the example above.

But HighChurn is in trouble. They need to hire an army of people to reach out to clients and save them. They haven’t built proactive processes into the business. They haven’t used CS as a way to improve the product. They haven’t built an end-to-end journey.

So HighChurn probably says they “need to do whatever it takes to reduce churn.” Maybe they are spending 15% of revenue on CS—or 10% worse than the low churn company. This means the Gross Margin is now 70% instead of 80%. Guess what? Your EBITDA margin now dropped to 0%. Rule of 40 score is now a pathetic 10%.

Now you may be asking another question: What is the marginal value of CS investments? In other words, instead of high churn leading to high CS costs, you may have high churn because you have low CS investment. Modeling when a CS investment is accretive is an interesting question, though different from the point this post makes. Either way: high churn drags down all indicators of success—EBITDA, Rule of 40, etc., and a successful CS department can be directly tied to churn reduction.

But buckle up … we’ve got one more step.

3. Poor Customer Success Increases Customer Acquisition Costs

We assumed HighChurn has an efficient customer acquisition motion, showing up in spending $1 on Sales and Marketing for every $1 on new revenue.

But a high churn company won’t have this in their cards. HighChurn likely has lots of clients that try them and then leave. Shocker—those customers aren’t likely to come back. And when they switch jobs, they aren’t likely to buy HighChurn again. So you are effectively burning through the market like a forest fire. Eventually, you run out of trees.

HighChurn will have to do increasingly-desperate things to get new clients. They will price at the lowest level possible. They will use aggressive sales tactics. They will spend a ton on paid marketing.

Most likely, HighChurn has a much-worse CAC ratio of 2:1. So in our doomsday example, “refilling” $60M of churn and adding $20M of growth means $160M of Sales and Marketing! So now our once-profitable SaaS business is losing $60M. In other words, it’s worth approximately as much as FTX these days.

Conclusion

I don’t want to be a naysayer, but hopefully this post is a reality check. If your SaaS business has persistently high churn, you will likely never make money. And businesses that never make money aren’t worth 100x ARR or 10x ARR or even 1x ARR—they are literally worthless.

The post Three Reasons Why a High Churn SaaS Business Will (Probably) Never Make Money appeared first on Gainsight Software.

At Gainsight, we’ve seen firsthand that the most successful digitally powered B2B companies focus on delivering a positive product experience (PX) to their customers. Positive PX is an important pillar for any organization looking to deliver a superior customer experience and orient their business toward product-led growth (PLG). That’s because the most direct, efficient, and intuitive interactions with your customer happen within the product. Product adoption is a great example: self-serve onboarding processes and personalized workflows empower the customer to take care of their own journey and become emotionally invested in your product, creating a stickier customer experience. 

Essentially, the product itself takes over the heavy lifting of helping customers to realize value from your offering. And while that puts product managers front and center, it also makes them part of the team along with more customer-facing roles like Customer Success. Product-led growth actually helps focus the entire organization around the customer experience.

What Product Experience Means for Customer-Centric Businesses

PX and PLG have long been areas of focus for SaaS startups, but enterprises are only just beginning to understand their potential to cut costs and drive growth. For established companies, that means product teams are suddenly on the hot seat, with new responsibilities to lead the charge on customer experience outcomes that used to be the purview of Sales, Marketing, and Customer Success. 

What organizations need are insights and best practices for how to shift an organization in the direction of product-led growth. With that in mind, Gainsight has sponsored a report from Harvard Business Review Analytic Services, based on surveys with 275 business leaders who have built digital products at their own companies. 

Here’s what we found.

The PX Revolution Is Already Underway …

Delivering a positive product experience is no longer a “nice to have”—it’s a core priority for any business interested in growth and profitability. According to the report, 86% of respondents have already implemented a digital product experience, or are in the process of doing so. Companies are implementing these strategies because product-led growth leverages the product itself to acquire and retain customers and drive conversion and expansion. This approach is not only more efficient in terms of resources, it is also more effective because it targets customers where their attitudes and decisions are actually being formulated—that is, within the product. 

While the benefits of PLG are clear to industry insiders, implementation is lagging behind. That’s good news for product managers, who still have the potential to gain first-mover status within their sector. There is plenty of room to grow, and companies that start moving now have the opportunity to gain a competitive advantage.

… but the Challenges for PLG Implementation Are Real.

The challenge for many companies is that the transformation to PLG is lagging for real reasons. At the top of the list is finding the right people—39% of respondents said that it was hard to find talent with digital product experience, skills, and expertise. Labor shortages caused by the Great Resignation are only exacerbating the lack of qualified product professionals.

Compounding the problems that exist within the Product team are larger organizational capabilities and attitudes toward digital experiences. 33% of respondents said they had difficulty developing a digital product experience-centric culture and mindset. It is often responsible for procuring and managing digital solutions, and they often prioritize technical criteria—such as ease of deployment and operating efficiencies—rather than user-centric considerations.

The Right PLG Strategies Build Positive Product Experiences …

Fortunately, leading organizations are already adopting strategies to make positive experiences a core business capability. One approach is to close the PX knowledge gap by educating Sales, Marketing, and other teams on the 360º customer perspective. 43% of respondents said they were increasing their focus on improving workers’ knowledge of digital product experience. Getting people out of their siloes and helping them visualize the entire customer journey goes a long way toward turning product-led growth into a company-wide, team effort.  

Another strategy that facilitates cross-functional collaboration is putting the right people in charge of product experience. There are many ways to go when it comes to PX leadership, as some companies opt for IT, Customer Success, or some other function to head up the effort. 93% of survey respondents say product teams should have some responsibility for contributing to an organization’s revenue growth. Gainsight agrees with this approach because product teams are usually best positioned to understand how customers are actually using the product.

… and Positive Product Experience Is Built on Data.

Underpinning successful PLG efforts is the extensive use of data-driven PX solutions. Organizations are proactively using data to understand customer behavior and sentiment, giving them vital insights into how to drive product growth, increase conversion, and reduce churn. In fact, 40% of survey respondents are providing product teams with better data insights to deliver a more effective digital product experience. 

Data should be gathered throughout the product experience. That includes both analytics on usage data, as well as qualitative data from user surveys and in-product feedback. These days, there is no shortage of solutions for gathering and processing customer data, so there is no reason for product managers to be in the dark about customer behavior and sentiment.  

Given the effectiveness of data-driven strategies, we anticipate that reliance on data-centric solutions will only increase going forward. 

The Tipping Point for Positive Product Experience? Company Culture.

Our experience indicates that company culture is the single most important factor that predicts the success of product-led growth—and the HBR survey agrees. 95% of respondents strongly agree or agree that a corporate culture that recognizes the value of digital product experience is critical to business success as a whole. While data-driven solutions and other technological capabilities make a huge difference operationally, you need the right people—with the right mindset—to achieve an understanding of customer behaviors and turn that understanding into actions that actually drive revenue.

Product experience culture is built on collaboration, resilience, and agility. PLG is a high-performance environment that constantly challenges the status quo, and it is often more art than science. This innovation-driven culture can be a tough sell for larger enterprises, which is why it is so important that transformation is supported from the top. Senior leadership needs to be all in for PLG initiatives to truly infuse the entire organization. 

Product-led Growth: The Throughline From Product Experience to Revenue

No one said creating positive digital product experiences is easy. But organizations who have done their homework are in a prime position to succeed. With smart strategies in place, the right data-driven solutions, and a commitment to building a customer-centric culture, any organization can be well on their way to achieving greater product experience success. In these times of economic volatility, product-led growth is an opportunity for product managers to reset their organizations for durable growth over the long haul. 

To learn more about creating positive product experience, we invite you to read Achieving Growth With Positive Product Experiences, a Pulse Survey from Harvard Business Review Analytics Services, sponsored by Gainsight.

The post Harvard Business Review and Gainsight Report on the New Responsibilities for Product Leaders appeared first on Gainsight Software.

What separates the elite operators is their thorough preparation or the ‘practiced plan’ for the foreseen risk and their ability to adapt to unforeseen risks. He essentially explained the old army adage: The more you sweat in peace, the less you bleed in war. 

What does all this have to do with Customer Success (CS)? In today’s market, where Net Revenue Retention is a leading valuation metric and companies are prioritizing efficient and durable growth, companies that have a proven risk management process in place will retain more customers. It’s as simple as that.

In other words, designing and implementing a risk management process during the heydays is that peacetime sweat or the ‘practiced plan.’ Implementing that plan with an at-risk customer is the battle to keep/win the customer.

Designing a Risk Management Process 

In today’s complex operating environment, the risk to a customer relationship is a composite of multiple occurrences (leadership change, non-responsive customer, etc.) which need to be tracked and remedied simultaneously. As a result, the risk management process also becomes complex and multi-faceted. 

Let’s start with identifying the key ingredients of an effective risk management process:

1. It should be simple to understand and adopt
2. It should be data-driven but allow for risks not captured through data
3. It should allow for escalation, when required 
4. It should inform customers health scores
5. It should be cross-functional and give leaders visibility toward the risk

Now, let’s understand the process and the different decision points. The flowchart below elucidates the process.

Source: Krishna Reddy Katipelly, Gainsight

1. Identify the Risk

The first step is identifying the risk. Risks can be identified when the data shows warning signs or the CSM reads warning signs in their interactions with the customer. Of course, for this, you need access to the right adoption, support, consumption, survey, entitlements, and contract data. 

Sometimes your data may be lagging or out of sync with the reality of your customer situation. For example, if a new stakeholder joins your customer, your data can make you believe that everything is hunky dory in their first few months, but there might be changes brewing in the background. Or a CSM finds out that the customer doesn’t have any budget for your solution the next year. In such situations, CSMs should be able to raise the risk as well. 

There are two ways to raise a risk: 

1. Automation: Triggered when the data shows an anomaly such as a drop in usage month over month, low likelihood to renewal survey score, etc.
2. Manual: When a CSM (or any customer-facing person) detects a risk and raises it. 

2. Raise the Risk

Once you’ve identified a risk, you need to bring it to the right people’s attention. To raise a risk, CSMs need to identify the reason for the risk accurately so that the organization can course-correct to improve customer experience. For example, if most of the risks are raised with onboarding as a reason, you should consider improving your onboarding experience as a whole and not try to solve it on a customer-to-customer basis. 

How do you raise a risk? By adding all relevant information on the risk, creating a call to action, and a timeline for resolution in your customer success tool. CSMs must be required to put in weekly updates against the progress on the timeline. We recommend using a timeline template to drive consistency.

3. Escalate the Risk

Sometimes CSMs are unable to resolve risks on their own and the risk needs to be escalated to managers and leaders to provide visibility to the leadership and receive guidance and help. When should a risk be escalated?

• Frustration: The customer expresses frustration and the CSM observing this frustration does not feel equipped to manage it effectively. This can be something expressed directly by the customer or something sensed by the CSM, such as a negative tone in an email or conversation.
• Escalation Request: The customer specifically requests escalation for an issue they are facing.
• Non-Responsiveness: Customer is non-responsive for five business days unless there’s a known reason (e.g., vacation, end of the quarter).
• Renewal: A renewal is in process.
• Internal escalation from Support/CAM/Executive.
• Delays: If a customer is at risk by your department’s definition (e.g., delays in the project plan, delay in reaching first value). 
• No Clear Path to Resolution: Ask yourself, “Could I write an email articulating the next steps, who owns them, and their ETA?” If not, you need to escalate the matter.
• Catchall: Escalate when you feel less than 100% equipped to manage the risk independently as a CSM.

It is important to emphasize that escalating a risk is not a reflection of CSM’s ability to do their job. Escalating should be encouraged and celebrated because it allows the organization to dissolve the risk sooner rather than later.

4. Update the Customer Health Score

As soon as an escalated risk is raised, the scorecard should be configured to automatically turn the overall health score to “Red.” Your health score should reflect the reality of the customer’s situation immediately. This is an important step that your admin should be able to configure. Check out this link on how you can configure this in Gainsight. Note that the exception should take effect only when there is an escalated risk to avoid red herrings.

5. Next Steps

Risk Not Escalated: If the risk raised is not escalated, CSMs should continue to work with customers and cross-functional colleagues to drive the risk to closure. A good example of a risk that does not require an escalation is a low NPS score from the end users, who will most likely not influence renewal and the ongoing relationship. CSMs can offer to meet the end users and understand the adoption and product challenges. Escalation of this particular risk is not required as it is contained and can be managed easily by the CSM.

Escalated Risk: If the risks fall in the escalated bucket, CSMs and their managers must discuss it in weekly risk reviews with cross-functional leadership with specific asks. A good example of an escalated risk is if a customer refuses to renew unless a certain product enhancement is delivered. In this case, during the weekly risk review, the ask would be to the product leadership, requesting them if they can modify or update their product roadmap to accommodate the enhancement.

6. Unmitigated Risk

If, despite your best efforts, a customer churns, make sure to interview the customer using third-party partners to understand the root cause of the churn. Customers are generally more open to a third party than an organization they have just churned from. Learning from churn will help identify gaps in process, technology, and/or resources. 

At Gainsight, we have seen the above process work over the years, not just at our company but also for hundreds of other customers. By using this process, leaders and CSMs can identify risks quickly, understand the impact of a risk on the overall business and ask for help cross-functionally. 

Always remember, risk management isn’t just a CSM or even just a CS responsibility. Cross-functional leaders should be informed about critical risks and must play a critical role in removing hurdles, establishing exec-level connections, mobilizing resources, and identifying recurring risk themes to be resolved at a more holistic level. 

Learn More

For more on how to minimize churn risk, check out our Essential Guide to Churn and download our Durable Growth Playbook.

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The notion of having to scale or be more efficient with resources by leveraging digital channels and programs is one that excites any customer organization, big or small. Yet, there are so many possibilities that it’s hard to get a structured program going. Where do you start? There’s so much theory out there but few practical examples with results. 

We’re sharing five actionable strategies from our Pulse Europe 2022 panel.

1. Standardize and Simplify Your Onboarding Journey

This first strategy comes from Sonia Leighton, Chief of Customer Success at Arbor Education. The company has two products, a Management Information System to automate school workflows, saving teachers time, and benchmarking analytics to identify areas of concern and reduce time to intervention. Using Gainsight Journey Orchestrator, Salesforce, Calendly, and group webinars, the company was able to convert its drawn-out and highly personalized onboarding journey into a standardized, templated digital journey. This adjustment enabled Arbor Education to onboard four times as many schools in half the time. 

“We hit hockey stick growth this year and onboarded a typical year’s worth of schools in one quarter. We couldn’t have done this without the digital journey,” says Leighton.

Sit down with your CS team to think of the necessary content, timeframes, and milestones a new customer should properly go through to have a successful onboarding and repeat!

2. Ask Yourself: Can This Be a Digital Touchpoint?

Our second strategy is from Ky Ismet, Director of CS at Ometria. Ismet wanted to reimagine the existing tech touch program to improve inefficiencies and provide a better customer experience. Ometria introduced more digital-led touchpoints leveraging Zendesk adjacent to Support creating a Success Hub for its tech touch customers with the intention of strategic guidance, enablement materials, and quarterly product roadmap materials hosted there. 

“We’ve scaled out valuable CS lead interactions through intentional en-masse messaging in the app or via the monthly Success team-led newsletters,” says Ismet.

Here are some of the ways Ometria scaled education and support:

• Monthly Success team-led newsletters
• Utilize Monday for bespoke projects and creative work requests are handled via Monday with Slack form requests enabled for easier internal handling
• Utilize Zoom for customer engagement upon request with on-the-spot how-tos driven through Loom

3. Let Your Customers See How They Stack Up 

The third strategy comes from Mari-Frances Bentvelzen, SVP and GM at SAP Concur SMB. Bentvelzen and team wanted to help customers better understand how they stacked up against others in their industries by utilizing benchmarking and customer-specific data. They did this by leveraging Gainsight to send outcomes-based email journeys to our digital customers. 

“We essentially pulled conversations that our CSMs were having live and broke them down into a series for our digital customers. These emails extrapolate specific customer data and compare it to what others in their industry are doing,” she says. “For example, for a customer who is looking to drive employee experience, we call out their average days to reimburse their employees and then those of their peers.”

The team also includes embedded digital assets and opportunities for customers to engage live if they have questions or want to know more (1:many sessions that are hosted). 

This type of specific and tailored benchmarking content isn’t something your customers can find through a Google search and will be more valuable than generic tips and tricks.

4. Keep It Engaging With Short-Form Content

Is our attention span that of a goldfish? No. But is it getting shorter with technology? Probably. Our fourth strategy comes from Anika Zubair, VP of Customer Success at Karbon who is giving customers with these shorter attention spans the option to learn at their own rate. Zubair’s team was looking to increase engagement opportunities outside of the team’s KBRs (Karbon Business Reviews). 

“KBRs (Karbon Business Reviews) have been key for us. We have always seen a direct correlation between customers engaging with us on how they use Karbon and how sticky they are as a customer. Knowing their usage, upcoming roadmap, and how to better utilize our product is key. So we have started to use short-form content to engage our customers that are not on traditional 1-1 KBRs,” she says.  

Some of the ways Karbon has created short-form content is:

• Videos shorter than 90 seconds
• Emails with two sentences and a report
• Auto-generated usage reports that include how customers how each one of their users use Karbon and how they can do so better

However, Zubair emphasizes that even with digital touch, human interaction is critical. The automated email and report with a link to a video and the community may be the initial touchpoint but CSMs, RevOps, and the Data Analytics team are all tracking open and click rates to see what is performing well and who is interacting with what content.

5. Back to Basics: Segment, Set Milestones, and Monitor Health

These steps may seem like obvious strategies when it comes to DCS, but there are some companies who may have not yet worked on the basics. The final strategy comes from Amy Manning, SVP of Customer Success & Support at Comeet. Manning has worked at companies where there was no segmentation at all and she had to create those customer buckets herself. She came into Security Scorecard with 400 customers all on the same customer journey. 

Once digging in and looking at ARR, she found about half the customers belonged in a tech touch bucket. From there, Manning and the CS team built a digital onboarding journey based on milestones met or missed. If you hit a milestone, you were moved to the next step. If you didn’t hit a milestone by a certain time period, you got automated reminders. 

For those looking for more support, the team held monthly open office hours where users could sign up for one-on-one time. If there were repeated questions, the team would incorporate that content into the onboarding. 

Once onboarding was complete, a user was either placed in a mature or immature bucket and receive content targeted for their respective persona. 

Finally, in addition to these user segments, customers’ health scores were continuously monitored for growth opportunities or risk. If the latter, a digital CSM would reach out.

But the point is, different users will want and need different levels of support and not all of your customers will need a dedicated CSM to walk them through every step of the way. By segmenting smart, you can not only give your customers what they want, but also be more efficient with your CSMs’ time.

Learn More

Looking to build a digital customer success program? Download our guide!

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