Building a Customer-Centric Company: Five Best Practices for Growing to Multi-Digit ARR

Hello.

Hi. So, Nicholas.

Oli.

Nice to see you here today. We're here to talk about why customer centricity is so important to growing multi-digit ARR. So, I think a lot of times it's easy to focus on growth tactics. How do I, the demand engine, the sales team, and I think that one of the things that we think a lot about is how to make the company customer-centric and how important that is as a principle for growth. So we had a great coffee. [Speaker] We did. [Speaker] Not long back and had a discussion about sort of 5, we came up with 5 principles about how you can be better at being customer-centric. We're gonna talk a little bit about that today. When I joined, we were about 150. We're now 300, so I've seen some growth stage. What employee at Algolia?

I started at 2, and so we are now 300, about 302.

Wow, that's quite a journey you're taking.

Yeah, it's like a longer journey.

No, that's great. Well, I think when we talked, we had these sort of, you know, we don't have the perfect answers for you, but we came up with a lot of anecdotes and mistakes we've made. Things have gone well, things have gone not so well, and we had these kind of themes. The first was learning about your customer. The next was really being helpful to your customer. We also thought a lot about how do we create an experience which is consistent, making sure the customers become champions or advocates, and being really intentional with your culture so that people know that you're customer-centric. This is meant to just be relaxed, and we're just going to have a dialogue.

We actually have a slide.

Oh, that's wonderful. We didn't expect that. I had memorized that for no reason, Nicolas. But we're just going to just chat like how we did in the coffee shop about these things.

Let's do that. Let's go with the first one. Learn about your customers. So we're speaking about being customer-centric. So of course, the first step is to make sure you know about your customers. It's going to be critical to your success, obviously. You need to know your audience, who you are going to serve. It's going also to be a bit critical to defining who you are, defining your product, defining everything. So we are going to try to share maybe a few anecdotes, what we learned.

[Speaker:JULIA PIRIANO] Right.

[Speaker:BERNARD CHAUMONT] Failures, successes. And on this one, I actually wanted to share an experience I had last year. With a prospect in London, big media company. I was going there the day after my AE, my account executive, did all the work, like met everyone, pitched the product. Then the next day I landed there, I went to see our buyer, and because I was, you know, the founder, so that's a big, big advantage. You are the founder, People kind of expect to have great— just to chat with you. They don't expect as much formality. And so over 1 hour, we probably spent 30 minutes just chatting about our life. I learned he was a big gamer and kind of like related kids and so on. And then you start to speak a little business, and you get him to speak about his concerns, what's going on, what may make him do the deal or not. And I discovered that his biggest concern was the support he would get from SF, from 8 hours away from London, and was very worried about that. He had no idea— I mean, you get my accent— he had no idea that we had the huge base of operation in Paris, same time zone pretty much, and that we had the team local in London with customer success, solution engineers in London who could come on site basically 20 minutes away from their office. And like basically 2 weeks later, they closed the deal. And it was very simple. But getting to know them is not only about getting to know their business. Sometimes it's getting to know about them as people. And we are in a business where everyone is working between people. Like kind of, you are going to speak to human people, human beings. You don't need to fake like, any kind of professional face or anything. And that kind of actually helps you close the deal. And what about you? Did you have another anecdote to share there?

[Speaker:JESSICA YU] Yeah, well, what I really like about that is that it really ties to closing the deal. So it helps people see that there's a tie between the customer and the revenue. And I like that. I think knowing the people is exciting, actually. I still have friendships with customers from Salesforce and Offway and other companies I worked for. One other thing that I could sort of add is knowing the product of the customer. So, yeah, at Segment, I mean, it's kind of a true pleasure in some ways, but at Segment we think a lot about, we have customers like Levi's, and so there are a lot of people who are excited to wear their Levi's and feel very proud that that's our customer and that we can, learn about that product, but also sort of show that we're loyal to them. Another one is Glossier, which is really, if you don't know about it, fantastic makeup brand. Another amazing customer brand I found. [FOREIGN LANGUAGE] I'm wearing some Glossier today. So, and I'm trying to think of another. Oh, even in our tech stack. So if you think about my MarTech choices, Drift is our customer, so I pick Drift. Or if we're gonna book a room in the city and we have an offsite, I'm biased to pick a Breather because that's our customer. And so it's a funny way that I can learn, oh, this is how the Breather model works and this is me experiencing their product. And I think that's kind of a really nice way to learn about our customers. I don't even know if they know that we do that, but that's a thing with us for sure.

[FOREIGN LANGUAGE] So there's another thing that I can share on getting to know customers. How do you do support? You know how we, so it's very important to get to know them and the best way to know them is to have interaction with them. So how do you make sure that everyone in the company get that customer-facing experience? For us it was support. So of course it changed as we were scaling. When we started, every single person in the company was doing support. It was a way to make sure everyone was in touch with them. And then, uh, I mean, we are a technical product. Our audience are developers like yours. And so we kind of switched to, um, having only our engineering doing support. And we only created a support team last summer. So until last summer, uh, we had no one dedicated to support. That doesn't mean that we were not doing support. That just meant That just means that everyone was doing support, making sure that our engineers felt the pain, the challenges, the needs of the customers. So that's also a small trick, difficult to scale forever, but that can help you make sure you, you get to understand them.

Yeah, I, I couldn't agree more actually doing support shifts myself at Envoy. I learned a lot about that, that side.

I was wondering if you do it for that segment, but no.

No, no, I, I, I would be happy to do them for, it's the thing where you learn you learn so much about the customer. And you also learn how they're experiencing the product in a way which is different than you might imagine. The kinds of questions that come up, you think, oh, I never thought that someone would think that. And so from a marketing perspective, it helps me think a lot about how people actually are experiencing the product. And then to the vein of our next point, which is about being helpful, I think that there are different ways that people experience product. And so one of the things we think a lot about at Segment is how can we be helpful to the customer in ways that are convenient for them. So for instance, one thing that comes up with companies early stage trying to learn and sometimes coming upon Segment is analytics and how do they make analytics work. So we built an Analytics Academy. And so that is something that people have a pretty good reaction to. We're really excited about, and we we keep innovating on it, presently doing so. And I think it's just a way for us to— we're not trying to sell you anything. We're just trying to give you some helpful material in a way that you might find valuable.

Awesome. OK, maybe it's time to share a failure on my side. We said we would share a few. Yes. Feature adoption. When you help customers, you help them to do something. In that case, we really didn't really monitor how customers were using us, at least not enough. We knew anecdotally, but we were not monitoring that too closely. And what happened is that some of our high-paying customers were not really using the most valuable features of the product. So in a way, they were paying too much for the value they were getting. And we missed it until we got the first churn because of that. You know, when a customer churns, not because they are closing doors or like whatever, but because they don't get value enough from your product, it's a big wake-up call. So now we do have that monitoring dashboard where we can see the adoption of every single feature. And it even became part of the playbook of our CSMs, kind of like the key objectives of the CSM is to ensure that our customers are actually leveraging the product and getting the most value possible from that. Yeah, so it was a big wake-up call when we realized that we lost the customers just because we were not making sure they were getting value.

Yeah, I think that's a key point on the being helpful. I think similarly at Segment, we had an epiphany about this where you get the customer to be a customer and that seems like the important thing. But you don't want to lose the customer. So one thing that we do at Segment, which I think is something I'm excited about, is we have a team of people that focus on activation. So they're really thinking about how do we make this customer successful? What are the usage patterns that if they, for instance, have this type of source, they're going to probably want this type of destination, how do we get an email to them? People after they become a customer. So they've already, you know, we've already got them in the door, but if they don't get use out of the product, if we can't find ways to get them onboarded and to make the experience also delightful of being a user of the product, then it isn't customer-centric and it also isn't going to help us in the long run.

Speaking of experience, kind of like a good transition to our next point too. About providing a consistent experience. You know, one important thing for customers, it's really to create trust in the brand, in the company. And that also comes from consistency of your experience. Wherever that can be, with the product, with the support messages they could receive, even with the people interactions they have with anyone working for the company. I don't know if you have any good anecdote there.

[Speaker:JULIA PIRIANO] I do. I think sometimes, because I'm a marketer, I look at marketing a lot. And I don't know, how many of you have had an experience where you know a lot about a product, but you maybe never used it before? And when you go in the app, you're kind of surprised by how it actually looks. So I've had that experience before, because I think that what happens is you don't necessarily tie the idea of a whole customer journey beginning with the marketing going into the product and even after the product, like the events they attend or the other activities. And one thing I think that can cause that that I've seen in companies I've worked for, which is different at Segment, but I think is that design runs marketing differently than design runs product. Two different people. Maybe they don't even talk to each other. So I think the unification of the experience from edge to edge is something that is becoming a trend now, and I think that it really helps.

How did you solve that? Do you have a unique team?

We have at Segment, we have just one person that runs design both for marketing and product. So one mind over the whole of the lifecycle, which somebody very talented and amazing too. I'm really excited to be able to work in that way.

[Speaker:JASON M. LEMKIN] Yeah, I would share too that making sure that the voice of the company is consistent, not only stops— doesn't stop at design, but kind of like should go everywhere, including even your outbound messages. Like if you're doing outbound to reach out to customers, This first interaction is also key. If they don't recognize the same brand they are going to work with after, I mean, it's going to slow you down. It's going to create doubt in their mind. In our case, we make sure that the outbound messages are also consistent with the brand, going as far sometimes as preparing videos that are tailored to the customer website, the customer context. Well, we do search. So we're going to capture a video about how we think their search worked and could be better. Again, exactly back, being helpful right away.

Yeah, being helpful, but then when the video comes through and it's consistent with how Algolia is, that also is like the double whammy, right? You get this really impactful moment. That too, going to the next point, it's how do we— create advocates, but how do we honor the advocates? And I would say that there's a mistake that I can talk about, which is that I think sometimes you tend to focus on the people that are vocally really happy. They're the ones posting the happy tweets about how much they love your product. And that's where you go to find your champions. And I love a story, because that's a mistake mistake that I make. And you have a story that we talked about, which I thought was really cool.

Yeah, yeah, I was sharing with Holly before. We had that customer, a Lebanese customer, who was, I mean, super, super demanding, like very hard negotiator, always wanted more, always wanted more. And then shortly after, we were starting to raise our Series A, and we asked him if he could be a reference, like speak about us to our prospective investors. He accepted, and actually was such a crazy champion for the company. He had basically committed to use us, and I don't know, he just became a champion. He spoke about us in a really great way. We closed the Series A. We sent him— you know, do that also for your champions. We sent him a small gift just to thank him for being a reference. Normal. Well, a few weeks later, we received an email— in the mail, huge boxes of Lebanese sweets. Delicious. It took us like 3 months to get— to finish them. We basically had created a champion for life, whereas at the beginning, we were really wondering, are— do Do they actually like us? And we took the bet, the risk, because the use case was great. Actually, that's the reason we asked them, because the use case was a media use case, super good illustration of the capability of the product. And it ended up as a big advocate, big champion for our Series A and later. So be careful about, yeah, people who may be so nice that don't really think about it, whereas like people that are the real fan may not be as visible. Visible.

That's definitely a mistake I've made. I don't look at the power users that are not as vocal in appearing happy. So I like that learning from you. Thank you.

What do you do for your champions?

Well, actually, we have this one champion at Segment who has been with us since the very beginning, always giving us feedback. Every company this person goes to, they take Segment with them. And it's something that we've learned about our champions is that they do— once they become positive and they become getting meaningful use and value out of the product, that they will not only advocate to people they know, but they will actually take the product with them to other companies. And one champion every single segmenter knows, and he's almost like an icon in our company. Whenever we talk about the champion, we talk about this particular person. And I think those are great. And I think that too, having those people come and be part of your company activities, for instance. We have customer champions and customers come to our company all-hands and talk about how they're using Segment. And I think that helps the company see that these people mean a lot to us and that this is what we're all working for. We're working to make sure these people have helpful experiences, and it makes it more vivid.

Probably going to reuse some of your, like, hacks about the champions later on, like, when I go back. Yeah, inventing, like, your customers at events, internal events, is a good thing. We actually had a couple of them coming to an offsite we did last week, sharing their experience. That was really valuable. Maybe another thing, it may be a little more controversial, is, How do you respect your early customers? And by that I mean grandfathering them. So I know, like, of course if they get to use the product more, getting new features, it's normal they would upgrade to new plans. But if they don't, if the product they signed up for is still the right product for them, why would you ask them to pay more? Whereas they actually trusted you, took a risk on you when you were much smaller. So maybe that's a kind of philosophy here, but so far we have always, always tried to grandfather the early ones because they are also part of your champions, because they are the one who took the risk, the trust. Actually, earlier today I was in the speaker lounge speaking with another speaker, and he just shared, hey, we've been customers of Algolia for more than for years. And like, wow, I had no idea. And having that feedback and knowing that they still love us was so good to hear.

Yeah, the original customers, right? The people— I love that idea though. These are the ones who took the risk on you before you got to be where we're growing to be today. And I think that that's just kind of a form of loyalty. It's really— it's nice.

It's kind of like the loyalty you want to build because it's going to help you down the line. And it's also so easy to lose it if you don't, you are not too careful enough, which leads us maybe to our last point about being intentional. You know, the company grows and as you get to a certain scale, you probably have the risk of losing touch with the customer and you have a quota to reach. The quota becomes sometimes more important than solving a problem for them. And I mean, that comes with a lot of risk because of course if you lose that customer centricity, it's the future of the company you are possibly putting at risk. Do you have like anything you are doing in your culture or in the values of how you—

Like the values, definitely for certain. We have, we're very values-focused. Focus company. We have 4 key values and kind of one of the values in there is that we will be helpful, unassuming, and trustworthy with our customers. And the interesting thing— I think what makes it vivid for the company is just that we have the highest award you can get in our company in terms of like performance. It's not monetary, but it is the highest, most recognized award. We call it the Citrus Prize. It's a very tall— it must be 6.5, 7 feet tall— gold trophy. And a sash is pink. And it says, "Props to me." So then you can wear it. But the point of the trophy is to show that it's somebody who's— you can only win this prize if you are uniquely expressing our values. And since one of our core values packed in there is to be helpful, trustworthy, and assuming to customers, you basically can't win this prize unless you have that customer-centric view. And I think that helps convey to the company, it's this intentional way of conveying that customers are part of our values and our culture. And in a non-monetary, it's really just a lot of fun and people feel very proud of it, but I think that's one thing we do.

[Speaker:JASON M. LEMKIN] Yeah, something that's maybe not as fun but that happens to all of us, is bugs or problems in the production. Even the best companies have these. And you know what? This intentional, like, intentionality in your culture is so critical here. For us, it's the trust and that it's transparency with customers. So if a customer has problem, is down, we are going to communicate communicate with them. We are not going to try to hide anything. Really, the goal here is to be transparent. Own your mistakes, because at the end of the day, it's on you. Even if it's not your fault, you need to be responsible here. Um, and as you get through that interaction with them, being transparent, of course they are not happy, but you can really build a new, um, relationship, a new rapport with them that can be even beneficial. So what I've seen is that Sometimes customers that don't have a perfect product, everything is working, they don't know about you more than the product. It works, it's perfect, they're happy, are not as loyal as the ones who are going to face some failures that leads them to discuss with you, to interact with you, to see who you are as people. And because of that people interaction, despite the fail, they're going to be become way more loyal, way more like a fan of the company because they had that connection, because they saw that you cared about them. So it's maybe counterintuitive. Well, I wouldn't recommend anyone to create failures on purpose just to create this connection. Not a good idea. But still, every opportunity, every occasion is a good opportunity to connect better to customers And show them who you are as people, and show them that you care about them, care about their success.

[Speaker:JULIA PIRIANO] I too think this is especially important, the kind of— if you think about the news cycles now about what we're learning about people talking about companies and how they're treating their customers and how they're doing their business, there's a stronger eye on is this company being honest with me, is this company being transparent? So I think that what you're saying of just, hey, even if it doesn't work, even if there's a bug, we can just say that, and we can say exactly what's going on. People may not be very happy with it, but it makes them understand that if it happens again, that you will also be transparent again.

So that's—

[SPEAKING CHINESE] Yeah, it's reliability in a way, even though you're being open about your failures. So I really like that. Especially in the kind of environment we're in now. It's great.

Yeah, speaking of— maybe I have a last anecdote to share, speaking of authenticity. Getting back to one of these meetings with prospects, you know, like kind of being the exec sponsor and so on, I was going to meet a prospect, a pretty big marketplace, and I kind of like ended up like in a trap of some sort. Their search product managers had already prepared a long list of demands, of like things that were not going well, questions about the product, and started to be on the receiving end, and whoa, okay, so answering and kind of showing again that you are open, that you care, try to solve their problem, and so on. At the end of the meeting, I didn't know for sure if it went if well or not, to be honest, difficult to judge. And then we connected over LinkedIn the next day with this product manager. And what she shared was, I still remember not the word, but what she shared is that that was the first time she had a partner that was so open, so ready to help, so ready to try to solve their questions, their problem, that it was so refreshing. And that basically created the trust that we needed to move the deal forward because she trusted us to have their back. She trusted us to help them get to a better stage with the company. And the deal closed a couple of weeks later. And a few months later, they were already having +20% conversion of the marketplace because of us. That was like a big, big win for us and for them.

I think that's a great way to almost wrap up because you're touching on so many of the things, you know, the understanding, the being helpful, and the really being authentic and real too. I think it's kind of built in there even though we didn't explicitly call that out, and how that yields a really great customer relationship for the business.

And I think the business here is maybe the important piece that we have not spoken too much about. All of that is not— of course, it's great to be nice, but all of that at the end of the day brings more business. It's just a very good way to help the company grow, because these customers that you are going to close, that are going to upgrade, like adopt the features, are going to be your revenue of today and tomorrow.

Yeah, I completely agree. I think it's a customer— like revenue is an accident of customer centricity. In a sense. And I think it's an easy accident because of all the things you get to learn about your customers and how actually enjoyable it is to have those relationships. So thank you for being here today. Thank you.

Thank you, Holly.

Nicholas. And enjoy the rest of your experience at Zaster.