FINDINGS ON CUSTOMER SUCCESS BENCHMARKS

Transcription

1 FINDINGS ON CUSTOMER SUCCESS BENCHMARKS

2 We too dream of Customer Success SCOTT GOLDEN Gainsight PHILLIP ANDERSEN BCG MEINI HEUBERGER BCG

3 Questions we often hear... What is the role of Customer Success along the entire customer lifecycle? What drives effective collaboration between Customer Success & other roles? What org & funding models support a close collaboration? How does the role & collaboration change if provided for a fee vs. for free?

4 Objectives for today Data Insights Discussion Note: Data from survey with mainly Small to Mid-sized businesses in Tech sector, Insights from working with Large Enterprise businesses across industries

5 Copyright 2017 by The Boston Consulting Group, Inc. All rights reserved. 6 areas of focus Roles Workflows Accountability Organization Funding Monetization

6 Pre-sales solutioning Price quoting Price negotiation Implementation Customization Impl. oversight/qa Consulting services Initial training Adoption planning Adoption measurement Proactive training/ guidance Business outcome planning & review Tech support QA & issue escalation Expansion opportunity identification Expansion opportunity processing Expansion price negotiation Contract monitoring Contract management Renewal management Roles Customer Success focuses on Adoption & Renewal Land Deploy Adopt Expand Renew No CS CS Contributor CS Main Executor

7 Pre-sales solutioning Price quoting Price negotiation Implementation Customization Impl. oversight/qa Consulting services Initial training Adoption planning Adoption measurement Proactive training/ guidance Business outcome planning & review Tech support QA & issue escalation Expansion opportunity identification Expansion opportunity processing Expansion price negotiation Contract monitoring Contract management Renewal management Roles Split ownership for some lifecycle stages Land Deploy Adopt Expand Renew Marketing Technical support Sales Professional Services Customer success

8 Pre-sales solutioning Price quoting Price negotiation Implementation Customization Impl. oversight/qa Consulting services Initial training Adoption planning Adoption measurement Proactive training/ guidance Business outcome planning & review Tech support QA & issue escalation Expansion opportunity identification Expansion opportunity processing Expansion price negotiation Contract monitoring Contract management Renewal management Roles Customer lifecycle management is a team sport Land Deploy Adopt Expand Renew 0 internal roles 1 internal role 2 & more internal roles

9 Roles Effective collaboration with most roles Effective Rather effective Neutral Rather ineffective Ineffective Marketing Sales Professional services Technical support Product management Product development/ engineering

10 Roles... driven by frequency of interaction Daily Weekly Monthly Quarterly Rarely Marketing Sales Professional services Technical support Product management Product development/ engineering

11 Workflows Several key workflows for Customer Success Adoption planning Adoption measurement Proactive product training / guidance Business outcome planning / review Expansion oppty identification Expansion oppty nurturing Renewal management

12 Workflows Companies have 4+ cross-functionally designed workflows The higher the # of workflows, the better the collaboration between CS and other roles No Workflow 1 Workflow 2 Workflows 3 Workflows 4 Workflows 5 Workflows 6 Workflows 7 Workflows

13 Workflows Many companies without cross-functionally designed workflows 24% 31% 22% 31% 29% 49% 53% 35% 27% 36% 29% 20% 42% 42% 42% 40% 51% 25% 24% 25% 24% Adoption planning Adoption measurement Proactive product training/guidance Business outcome planning and review Expansion opportunity identification Expansion opportunity nurturing Renewal management Workflows established, business impact recorded Workflows established, no business impact recorded No workflows established

14 Workflows Positive impact from establishing workflows Business metrics Leading indicators Account Revenue Growth 84% Customer satisfaction/nps 57% % of advocates in customer base 70% Revenue Renewal Rate 78% Scale of adoption/ utilization 79% Scope of adoption/ utilization 63% Expansion Rate 87% Value added to customer 71% Increase Neutral Decrease

15 Workflows... and business performance impact is significant Account Revenue Growth Revenue Renewal Rate Expansion Rate Neutral + 1 5% % % 20+%

16 Accountability Land offerings / accounts Initial adoption Ongoing adoption / consumption Expansion rate Various critical lifecycle metrics Renewal rate Customer engagement Customer satisfaction Overall account growth

17 Accountability Customer Success skews towards more metrics 75% do not have at least 1 of these metrics for each role 1 company has 2 of these metrics for each role Avg.# of metrics 1 Marketing 1.5 Sales 2.9 Professional Services 2.0 Technical Support 2.0 Customer Success 4.9 Project Management 1.8 Product Dev / Engineering metric 8 metrics 1. Weighted average based on survey respondents

18 Accountability Customer Success incentivized based on Renewal & Expansion Renewal rate Expansion rate Customer satisfaction 51% 60% 74% Business Outcome Customer engagement Overall account growth 49% 47% Ongoing adoption / consumption Initial adoption 32% 45% Adoption process Land of new offerings / accounts 13%

19 Accountability Many companies added some of these metrics and experienced a positive impact on business outcome Customer success 68% Sales 34% Professional services 32% Technical support 26% Product management 17% Marketing 11% Negative Neutral + 1 5% % % 20+% Engineering 11% Account Revenue Growth Revenue Renewal Rate Expansion Rate

20 Organization >50% changed reporting structure of Customer Success in the past CEO 38% Organizational model Sales Support & Services 13% 25% Chief Revenue Office 9% Business Unit 6%

21 Organization Shift to... CEO Sales Support & Services Improve collaboration Improve decision power Accommodate Exec preference Prevent competing priorities Shift of focus to drive growth 14 14

22 Funding 36% 30% Funding model 15% 19% Opex COGS Combination I don t know

23 Funding Funding model not driven by current org structure but by the origin of the function Don't know Don't know Don't know Characteristics of activities Comb. Comb. COGS History/origin of function COGS COGS Impact on gross margin Opex Opex Opex Funding sustainability CEO Sales Support & Services Other

24 Funding... and changing doesn't do much <15% changed the funding model of Customer Success in the past 50% experienced a positive impact 50:50 in changes to Opex and COGS

25 Monetization Monetization model ¾ of companies provide all Customer Success activities for free ¼ of companies charge for some/ all activities

26 Monetization Mostly charged Mostly combination of fee & free Mostly for free Implementation Customization Consulting Services Initial Training Proactive guidance/ training Adoption planning Adoption measurement Business outcome plan & review Support issue escalation

27 Please submit your thoughts and questions via sli.do

28 THANK YOU

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