Customer Success Re-Invented: New KPIs and Tactics to Level Up with Verdane Advisor Niclas Staberg

To have Nicholas Daybrick, Chief Customer Officer of Verdain, join us for the session. He will be discussing customer success reinvented. We have 20 minutes and there will be time for Q and A. So please make sure to drop your questions throughout the session using the Q and A button within your button menu bar. Join me in welcoming Nicholas. Take it away.

Thank you. Gabriela. Hi everyone. Nice to have you all here. I'm as mentioned Nicholas Ramon Starberg. I'm the Chief Customer Officer at Hive Streaming, the video experience company and I also act as a CS advisor at Verdain, one of Europe's top growth partners for tech enabled businesses. Today I'm going to share a couple of very actionable things that you can do to level up your CS program. Get your SaaS business ready to scale and reach NRR levels like the top SaaS companies out there. And all of the recommendations that I will do here today are things that has helped me out a lot in the latest to the two latest scale up ventures that I've been part of over the last eight years. So hopefully this will actually come of big use to all of you. To give you an idea, I wanted to be very transparent and share a little bit with you about the NRR development for Hive Streaming over the last years. And so and if we can see we actually implemented some changes to our CS program in the beginning of 2020 so just before the pandemic and it's been having a pretty amazing result. Even though the pandemic has been hasn't really been easy on us to all the degrees. But all in all we reached amazing NRR level such as an annual level of 138%. Now before we go into the recommendations, I think it's extremely important to take a step back and actually assess what's happening in this world when we're talking about engaging with customers and the relationship they actually have to value. And there's one thing that actually dictates this more than anything and that is actually the fact that customers time is more limited than ever. So we actually need to rethink the way we are going about customer success and how we provide value to our customers. Just doing check ins, having regular cadence with customers or setting up QBRs as per se, that's just not going to be enough going forward. And I think we can all see that to a certain degree where we have customers who might become less engaged unless they're seeing value from the interaction that we're having with them. So to set the foundation for this session and for the recommendations, I think it's important to start with addressing value from the customer's perspective. And I took this just to add a little bit. I borrowed this one from an Okta report that actually illustrate the number of apps that are out there. Just to give you an idea, imagine if all of these companies are having their own CS departments. Of course everyone is wanting to time from the customer, but the customer's time hasn't really increased. We actually need to make sure that we provide more value to the customer in order for them to actually make sure that they invest that time with us. How can we actually go about creating value for the time that customers invest in us? Well, we need to break down customer value and I would actually like to break this down into a pyramid of three levels. I know that there's a lot of pyramids out there. We've all seen a fantastic one by Bain where they have breaking it out into a lot of different layers. But to just make it a little bit more manageable, I've decided to actually concrete this one into three different levels. So we have the first one, which is the functional customer value, if you put it that way, that's pretty much the value for the business. What is your product doing to help them achieve a business outcome? And then you have the more emotional value, which is more for the champions or the people that you work with. For example, how are you providing, for example, recognition to them so that they feel that the outcomes that they have achieved that they are now getting recognized by their peers. And then of course, we have the aspirational value, which is the ultimate value for the individual. Right? If we help them acquire new knowledge, learn new things, etc. How is that actually helping them progress and advancing their careers? With this being said, I'm now going to jump into four things that I think will really help you level up your customer success program. I'm going to start with the first one that actually has to do with evolving customer segmentation. And I know that a lot of the times when we talk about customer segmentation, we think a lot about trying to make a tier 1, tier 2 and tier 3 customers based on how much they're paying us at the moment, depending on the ARR level. I think that we're missing out on a lot of things if we're doing it that way, especially if we're having in mind that we need to create more value for all the time that the customer takes for us now. So I would like to suggest a new system that I Think works really well. That takes more parameters into consideration. And the first thing is to create what I call to refer to as a scoring system for customer segmentation. And of course each business might have different parameters, but I would like to suggest a couple of criteria that I know has worked very good in both of the different scale up ventures that I've been part of over the last eight years. The first one is to not only look at the ARR levels of the customer, but actually look at the aspirations and goals of them. What do they have in common? We know that more mature customers who have come a little bit further, who are more aspirational, of course their goals are going to be very different from someone who's just getting started, even benefiting from your product. It's also important to take into consideration the org structure of the customer because the org structure could tell you sometimes more than the vertical itself. I mean we could see that with is think about retail networks. For example, you might have automotive resellers who are having vast networks of dealers. And then you have real estate agents who also having a similar setup. Even though these two would be considered into different verticals, one being real estate and the other one being automotive, their organizational structure tells you that they have more in common being in the same customer segment than actually the vertical. Think about the company culture as well. Very important. Is it a progressive culture or is it a conservative culture? Will also dictate how you would need to go about your CS program of this customer. The growth potential and the growth readiness. Two extremely important aspects of the new customer segmentation as well. And just to show you a little bit like at high streaming for example, if we were to do the similar system like this, this is what it could look like for our customer segmentation. So we would look at for example tier 3 customers. We know that they might care more about cost savings rather than the really aspirational ones that are in the tier one segment that really wants to go about increasing employee engage and they very rarely are mixing up a three in score with the number one. So if we look at these ones, we know as well that if we have a customer that is expecting us to talk a lot about employee engagement, of course it makes more sense to bundle them up with someone who's interested in that as well so that we can actually be more efficient about our customer success operations. Then the second thing that I would think is extremely important in this case is to know the customer white space that you have. When we think about white space, a lot of times we might only think about the number of products that the customer is using or the number of available additional revenue that we can get from this customer. While this is of course something you need to start with, I think it's extremely important to expand on that a little bit more because there's so many things more that goes to that white space to give you more control over how you go about your CS operations as well. And a couple of things that I think is important when it comes to white space is to look at the usage levels, the engagement levels, the advocacy levels, the knowledge levels of the customer. We'll get back to this in a little while as well. And also the value. Right. If we look at these a little bit more holistically, we take advocacy as an example. If we know that this is a customer who has scored amazingly good on an nps. Yes, but that's only part of it, right? I mean, what about the customer story? Is this customer open to actually engaging a customer story to create that together with you? Is this someone who will talk to your future investors? What are the different levels of advocacy that you can reach with these customers and where are you at so you know where you are today and where you can potentially be. It will be so much easier to actually make sure that you focus on the right activities versus only waiting and see what's happening. So an example what this could look like. If you're talking about white space attainment, you could have different customers and then you can try to find If I reach 100% on each one of them, what would this look like? And then you would have a table trying to define what percentage you're at in relation to where you could be. I can take a very concrete example that we look at the type streaming, for example, when it comes to usage, of course, in the best of worlds we would say we're obviously engaged when it comes to live video streaming. And there's no real physical limit that you know how much live video you can actually participate in, apart from the numbers of hours that you can be awake during a day. But if we would take an example, we tried to think about it. If every employee in one of our customers organization would participate in at least one live event per week, that would be considered as like maximum engagement or maximum usage of a product. If you think about how they're, how much they are participating in live events, if we know that one, and then we're starting to see that we have a customer, enterprise customer with 20,000 employees. And we can see that at least 10,000 of these ones are engaging in a live event per week. Then we know that we might have, if we have that consistently, we know that we would have a usage adoption on that one of 50%. So we still have a 50% way to go that we can really get there. So it will help us direct our customer success team in a much better way as well. Now the third point that I think is extremely important, and this goes back to the emotional value that we talked about in that pyramid, is really helping our customers in getting recognized. And this is a topic that is very close to my heart because I truly believe that a lot of times we talked about how can we generate more advocacy with our customers. I think we should really rethink this one and try to think about how can we help our customers getting more recognition for the outcomes they have achieved with our product. And the reason this is so important is that a lot of the times if we only go about thinking about how we can talk about our product or our features, there's no real incentive for the customer to participate in those stories. But if we rather make them the hero of the story and talk about their achievements rather than our products, the things changes, the dynamics with the customer changes and it will just become so much different. And I think as well, when it comes to customer advocacy or customer recognition in general, I think it's important to see this from three different perspectives. One is helping the customers get, you know, being exposed and getting recognition within your own company. Customers love to engage and talk with the product team. Talk in front of your employees. And we do this as hype streaming, for example. We do it every month. We do monthly, what we call the video experience, Chronicle sessions where we invite one of our champions, put them on stage and actually talk about their achievements for in front of all of the company. So this allows them to as well really engage with all of our employees and creates that emotional connection both for the customer, but also for our employees. When you're thinking about enterprise companies, they can be massive. We have some of our customers have more than 300,000 employees. And in those cases, if you have a champion helping them, getting that recognition within their company for their achievements is an extremely important thing. And that will also make sure that they actually speed up the advocacy that you get from that customer. And then of course, within the community and within the industry, extremely important. Everyone loves to actually get recognized by the peers. So if you can get someone in a similar role, talk to someone else and get that recognition, or in front of the People who are in the same situation, it will be a lot, you will gain a lot from that as well. Now I'm going to have another point here that I think is extremely important and it can be a little bit controversial to some, but I would actually see that we've seen this with much better results and that is actually that if we're talking about customer stories as part of advocacy, I would actually really recommend to try to make your CS team accountable for winning these ones and not the marketing team. And I know that this is not very traditional, but the reason being is that your CS team knows the customer better, they know the dynamics of it. And if you make them accountable for winning these stories, they will actually make sure that they focus on the right activities to get a good narrative to win that story by the end of the day. And it will just be so much easier to win these stories. I can give you an example. So here's a screenshot from our salesforce. I've taken this out, of course, blurred out some of the graphs in here, but if we have a look at the bottom left corner, we can see that we actually have a pipeline for each csm. So we can see how many of the customer stories have they identified, how many have they qualified, how many of them have they agree, read the scope with the customer and how many have they actually won and managed to get published. And I think this is extremely important because this also makes sure that you don't lose track of actually winning these ones. You actually make them part of the goals for each CSM and it creates an enormous amount of productivity for your CSMs as well. And yeah, of course there is a list where you can then go in and see who's being created, who is accountable for it, what stage, etc. And that of course rolls up into the dashboard. Now the fourth point that I would like to finalize this session with is connect your customers and their knowledge within their community. And I think this is extremely important because a lot of the times we try to always come up with how many customers can we deal with per CSM and until we need to hire the next one, etc. But I think that that is a little bit outdated thinking. I think we really need to rethink, do we really need to be the masters of knowledge sharing that one in one to one conversations with every customers, or can we find other ways of connecting customers with existing knowledge that exists within other customers? And I say that this is important because a lot of times I think that in the SaaS world we forget to talk about scalable network effects. If we think about each customer segment, those customer segments can actually contain several so called micro communities customers who according to the new scoring system might be within the so called tier one customers, but they might have different aspirations. And if they have different aspirations, try to pair those up as part of micro communities, the ones that have similar ones. Because there's so much more you can do where you can actually have a one to many conversation and they can actually talk to each other in a much more scalable way. So you don't have to worry too much about whether you can have 20 or 30 enterprise customers per CSM. But it's actually more how do you manage the the time and provide more most value out of that and consider each customer to actually be a source of knowledge because a lot of the times customers they're sitting there with the knowledge, we recycle a lot of that knowledge, try to use that, try to connect that with other customers and what they're looking for and new metrics and KPIs that can be looked for when you're trying to implement a system like this could be the number of micro communities that you actually have, the number of connections between your customers and the level of engagement between them as well. Because obviously that says a lot. And to give you an illustration, I tried to set this up just to illustrate it. So if you look at the we can see here that you might have one CSM or the purple circles here might be managing and feeding knowledge to one of the tier one customers, but then you have this, you know, this bundle or this micro community of tier one customers where they can actually share information in between each other. So therefore the CSM can only have to be a moderator of that knowledge, but they don't have to be the owner of it and therefore just facilitate to make sure that they become master facilitators of access to knowledge. It's a very, very scalable way of dealing with this and it's something that actually triggers both the emotional value for the customer because they get recognition from the peers, but it also goes into the aspirational value because they actually get to take part of more knowledge within these communities that they otherwise might not would have get in the same way. So with that being said, I'm actually going to summarize the main takeaways from this session. So first four ways to get your business ready and scale faster to improve your nrr. Well, evolve your customer segmentation and think beyond ARR and vertical there's so many more criteria that you can take into considerations. Know all of your customer white space. Don't just look at the number of products or skus per customer. Think as well about the usage levels, the advocacy, the knowledge, the whatever you can come up with that is relevant for your business. But try to really think about that one. If you know your white space, you know what you need to work for. You can also look at what is your average across your customer base. So you, if a customer is in a good place or not and help your customers in getting recognized and they will advocate for you, think about that instead rather than thinking about going about advocacy right away. If you help them getting recognized, they will be more open to advocate for you and you will have a much more impactful existing customer base. And then finally connect your customers and their knowledge within the community. There is a wealth of knowledge in your existing customer base. Don't just leave it there. Make sure that you actually get your customers to engage with each other. We actually had. It was an amazing thing. My first year at live streaming, the most frequent question that we got from our customers was when can we talk to other customers? So there's a huge actually need from customers that they really want. They really want to talk to other customers because they feel that they want to talk to people who are in the same situation. And I think that that should not be underestimated. Really take that opportunity, look into your customer base and try to connect that knowledge. That's something that I would really, really recommend. Thank you everyone.

Thank you so much. Nicholas. That was a great presentation. We have so much more great content today. So we hope to see you all in our next sessions. Have a great day everybody.