Customer Success Upsells, Cross sells and Expansion

So hello everyone, I'm Santi Subatovsky, general partner with Emergence Capital and I've been in the SaaS space for, I was counting almost 15 years. I started a SaaS company before it was even called SaaS. It was aspect for those of you who remember it and started in Argentina, so had nothing like this before. So Jason, thanks very much for putting this group together. What's this? We have a cake here and I think, I mean that's Jason. He's been sending emails back and forth. He said he was going to bring in a cake to celebrate that I've been promoted at Emergence. So thank you. And I thought he was just kidding. So thank you Jason. Feel free to get some cake after the panel. I have the pleasure of sitting in this panel with great people who've observed the customer journey in great companies. Sarah at CornerStone, April at BetterWorks, and David at Radius Intelligence. I'll let them do a 30 second intro on themselves on the companies that they are with and I'll. I mean the question that I'm asking you is when why did you decide to join this companies that you're in, you could probably join any company in the world and you're at companies that you picked. So we're great to hear a little bit about your journey, Sarah.

Sure. I'm Sarah Jacobson. As Santi mentioned, I'm with Cornerstone on Demand. For those of you who are not familiar with Cornerstone, we're a provider of talent management solutions. So essentially we allow organizations to manage the employee life cycle. So recruiting, training, performance, et cetera. I actually joined Cornerstone 10 years ago when we were pre venture funding around 7 million in annual revenue. And today? Well, we're announcing earnings tomorrow. So if you want to know what our revenue is for 2015, you can join in on our earnings announcement. But I joined Cornerstone for the people.

Actually.

I was so impressed by the people and so impressed by the culture that it just seemed like an awesome place to an awesome company to be a part of. And I was excited to join a startup at the time and be a part of a journey and part of a fast growing company. And for those reasons I haven't left. It's been a fast growing company ever since and I still continue to work with amazing people and love what I do.

Thank you.

Hi everyone, I'm April Ohman. I'm currently the head of customer success at BetterWorks. I spent five years at Salesforce, spent a bit of time at Cornerstone On Demand and then I was at Zora most recently for three years. I joined BetterWorks, which is an enterprise goal management platform that really is intending to ensure openness, connectedness, transparency, and organizations tracking aspirational goals so that ultimately they become efficient and effective at whatever their mission is. I've been in customer success my entire career and am really excited to be here on this panel.

Wonderful. Good afternoon. I'm David Obrand. I'm CIO at Radius, and we are a BetterWorks customer.

Thank you.

Love your product. Spent 10 years@salesforce.com and then several years at a company called Yammer and have been at Radius for a little bit over a year. And in my capacity, we look at customer success, and sales is just one organization called the customer organization. So pleasure to be part of the panel today.

Thank you. And we're gonna start with the very basics. Remember when I joined Emergence five years ago, I was looking at SaaS companies from an investor point of view, and we spent a lot of time looking at upsells, cross sells, and expansions. And what we've noticed is that a lot of the entrepreneurs just focus on new logos, and that was the only way they. They saw they could grow their companies. And what we're trying to do when we're looking at those companies is figuring out new logos matter, but then expansions, cross sells, and upsells matter a lot, and they help you grow more efficiently. So we're gonna start with the basics, and we're gonna ask Sarah to just share the basics. What do you mean when you talk about upsells, cross sells expansions. And is that part of the sales organization? Is it a customer support, customer success? Is it the same people who need to track those metrics?

Sure.

So upsell, the way we define upsell, that's really the addition of additional licenses that a company may purchase for existing products that they have. Expansion for us is if you have multiple products to sell that you're able to sell those additional products to your. Your customers. And cross sell. I'm sorry, cross sell is selling additional products if you have additional products to sell your customers. And expansion is the ability to sell your solution into other subsidiaries within an organization. So oftentimes you may sell into one subsidiary or one department, and expansion is really the ability to grow that relationship.

And is this part of the same organization? Does all fall within the customer success organization or is it part of the sales. Org?

So great question. And I think in order to answer that, it's important to understand the client lifecycle. So at Cornerstone, we think about this initial sales process, and then once that contract is signed. What that post sales process is, and I like to think of it as a dating. Then the marriage or the contract is serving is that wedding and then beyond that is the marriage. So during the.

Exactly.

You have to deal with the family.

Exactly. And sometimes tension for that matter. So during that dating phase, if you think about it, you're really selling on aspiration. You're selling on vision, you're selling on the dream. And that's its own unique skill set. Once that contract is signed, you, you're then selling on reality. So your client's going through implementation. They're learning what it's like to work with you and partner with you and you have to sell through that. And sometimes there's. And you all know there's going to be challenges. Things don't work perfectly. This is software. And so it's a different skill set that's required to help to manage that relationship and to sell through that experience that a client has had. So for us, it's two unique functions that sit within the sales organization. One that's very much focused on that initial sale and then one that's really, really focus on the expansion, upsell and cross sell in what I call the marriage.

That's cool. And April, you work for some of the best SaaS companies in the world. So you've seen this customer life cycle at these different companies. Do you feel that, that customer success is a function within a company? Just like, I mean, the sales group, they get the new logos and then they hand it over to you guys to do whatever you want to do? Or is it more than just a function within a company?

Well, let's start off with it is a function. This can be a very real career for many of you out there. I wouldn't have a job if we didn't have customer success. So I think customer success really is both a mindset and it's a function. When you think about a prospect who first starts to understand and be aware of your brand and of your company, you need to woo them and you need to understand why they're buying, what it is that they're really looking for, and the challenges that they are in fact trying to address. So when I think about customer success, if you don't have that mindset in both the marketing organization and the sales organization, you're not going to be successful because you are selling the dream and you are at that point really trying to understand why they're buying and what their aspirations are in terms of them purchasing. Your solution. The idea of customer Success in a post live scenario is the implementation, it's the nurturing of that relationship which then gives you, if you've done it well, the right to ask for the upsell, the cross sell and the expansion. You would also expect your customer success team to be responsible for retaining that customer, ensuring that churn does not occur, getting the customer to advocate on your behalf even when you're not in the room, and that those two things will allow you to grow in the market.

And David, this is a question for you. You hired a lot of people for different sales organizations and when you think about customer success, what are you looking in that first customer success hire and when is it too early, when is it too late and when is the right time to have to bring in that person?

Sure. So I don't think it's actually ever too early. I actually think that if you were starting a company, you would start with engineering and product, you'd prove out the thesis, but you would want actually to start building out customer success even prior to building out sales. And in those early days, customer success is a critical role because you're actually soliciting feedback from those early adopters that go into the product roadmap. And you think about how you iterate with repeatability for a broad base of customers as you start to expand the tam.

Isn't that the role of the CEO at those early stages?

Well, I think in the early days it's the role of everybody. Right. Because you know, you have a, you have some bright engineers and product people, but you have to figure out if the thesis is even valid. And so you want to talk to a wide range of different prospects. You don't have any customers by definition when you start, but as soon as you bring that first one on, ultimately your goal is to harness that customer army. Right. So you have thousands of customers selling on your behalf, but it starts with the very first one. You know, one gets you two, two gets you five, five gets you 20, and so on. And so it's really important that you understand that customer journey with the new product. And it's very different when it's those early days of the product versus when you're on, you know, version 10, 12, 15. So for us, what we think about from a competency perspective is we think about just raw intellectual horsepower is the first thing we look for. Technical aptitude. Most of the products we are building and taking the market today fit within an ecosystem. They're not a silo. So you have to understand the ecosystem that it fits within the Third one is you really want to look for a genuine passion for customer success. So for example, we actually, anybody we hire in a customer facing role, we look for two customer references before we bring them on board. It's really important. The fourth one is that consultative mindset. I think for most of us we've moved away from selling features and functions and we're selling around use cases. And so really understanding that consultative mindset and how customers behave today and absent any constraints, how would they like to operate, to move faster, be first movers in their market. And then the fifth one we actually look at, we call it, it's the athlete or the musician variable. Right. And for us, we want people that really understand delayed gratification, that won't take the deal down as soon as they can get it, but actually want to make sure it sticks. Because ultimately as you think about customer success and churn and renewals, really what you want to do is you want to make sure that customer is as self sufficient as quickly as possible with your technology and has been able to measure the value they've been able to extract from the investment. If you can get that done in the first 90 to 120 days of a relationship, you're almost guaranteed to get the renewal on the upsell.

Can I add one more thing to what you said? I think the other skill set that I would look for in a customer success professional would be aptitude to understand when things are not going well and be able to turn around the relationship, but also learn from the experience. So if you're in a fairly young company and you have a customer success professional, I would ask them to really understand the customer journey and understand what the customer's really trying to do at every single touch point in their relationship with you. Because once you understand what their experience is, you're going to learn from that. And that will tell you how you need to price and package, how you need to go to market, how you need to service them, what services are actually needed for every different segment of the market that you are actually trying to target. Because your SMB space is a lot different to serve than your enterprise space. So that might be one more thing that I would add to the wonderful list that you created.

Yeah, I agree. And I think it's, you know, for us, as we went on this journey at Radius, we actually used betterworks and while I think customer success is a function, I actually think it's a core value and we actually use BetterWorks to help drive that core value. Because I do think it's thank you. You're welcome.

I think this wasn't planned.

You know, it wasn't. I wasn't paid for that. It's like Peyton and Budweiser. But, you know, I think that in those early days, you're going to fail fast and you have to learn along the way. And it's not just the customer success team that you want to represent your customer. You want everybody in the organization to genuinely feel passionate about making sure that customer is successful, whether it's the product marketing content or the product itself or the pace with which you iterate, how you give support, how you represent it.

From a sales perspective, engineering how they build the product.

Absolutely.

Yeah. Especially.

And what's the most important metric that customers customer success owns? I mean, there's a lot of metrics like renewals, churn, nps. If you have to pick one metric, the one that everyone in your organization is going to look at every day.

Retention.

Agreed.

Retention.

Yeah.

Especially early on because it's all about those customers that you have at the beginning because they're almost doing the sale for you. They can talk to how they've been successful with your solution. They can serve as a reference for you. You need your earliest customers to be raving fans for as long as possible. So in the early days of Cornerstone, we would do everything possible to retain all of our customers. That was our number one priority.

Yeah. And I would add, as part of that user engagement. Right. If you have user engagement, you should get retention as a byproduct of it. But to me, those two sort of go hand in hand. Right. Ultimately, you want to make sure you retain them so you don't have Churn and you can continue to triple and quadruple every year. But at the same time, you really want these customers extracting so much value that they're calling you wanting to be a reference so they can tell their story. I think that's what Salesforce did a great job of with Customer Heroes, for example. You know, customers wanted to be a reference, and you want that passion in your customer base around the products and services you deliver.

And at this early stages, retention is important. So would you go out of your way and provide a lot of consulting professional services just to retain customers? I mean, it's not that we haven't.

Seen that before early on. Absolutely.

You need a few flagship customers that are going to help you expand in the market. Now, I think the question, I think that many of us struggle with is how much to invest before you really start losing your shirt. So Part of it is understanding your cost to acquire and then also your cost to serve. Those might be two metrics that I think are worth looking at. And then I think you have to understand the value of that customer in your ability to get new prospects to sign to customers. So you might decide to invest in a particular logo or a particular geography or a particular vertical so that you can demonstrate success in that particular area, which then feeds on your ability to get more customers in that respective market. So you just have to be intelligent about how far you're willing to go in terms of that investment and what does that actually look like. And typically, most organizations, I would assume, of your size, this is what I have done, which is you throw services at it and then it kind of tells you, which is cool, is that you kind of learn what level of service you have to provide in order to ensure different segments of your customer base are successful. Again, your SMB is going to be a lot different than your enterprise customer.

Yeah. And I would add to that, especially in the beginning, it's really important that you be thoughtful about who you want to bring on as customers. So it's no longer just about who's going to be willing to give you money because you might end up spending more money and more cycles just trying to keep a customer that wasn't a good fit in the first place. So I think it's really important to be thoughtful about what that ideal customer profile looks like and making sure you're bringing on customers that not only you're a good fit for, but are a good fit for you. You based on where you are in your evolution as a company that's about.

Being focused and understanding your market and where your product is going to play well versus where your product's not going to be well. And you're trying to jam a square peg into a round hole.

Exactly.

Can you share an example of a time to be any company that you work with where you brought in a customer just because it was a great logo or I mean, big check, or your investors were saying, oh, you should bring in more revenue, and then you ended up firing that customer?

I think someone's uniquely suited to answer that question on this panel.

Merrill Lynch Salesforce would be the one that I would use that was our first flagship customer, our first customer in the financial services space. We didn't fire that customer, though. But there were. There was quite a bit of turnover on the account and I was very fortunate at that time to. Who is now the CEO of Zora. He was my Executive sponsor for a short period of time. And what we learned, and this was in 2007, 2006, 2007, when I owned that relationship, what we really had to do to ensure that they were absolutely successful is really run it like a program. So every single week, any person that had any sort of touch point, including sales with this customer, I ran a call and we went through every single goal that we were trying to accomplish for that respective week. We made sure that we were absolutely aligned on the message and the approach that we were going to take. And then following that, I had actually a call with the customer and ran through everything so that there was a very methodical way of managing the relationship. And the other one, maybe, perhaps. Funny story, it's still kind of funny to me. But when we managed that relationship, there were a couple of escalations. You can expect that when you're managing a customer who knows that they're dramatically important to your ability to be successful as a company that, you know, they threatened to call. What I had already arranged with Parker Harris, as most of you know, is one of the founders of Salesforce, that if the customer called him, he was not to call them back. He was to call me first. Then we would decide what he would say and then he could call them back. So having alignment across your entire organization in terms of how you're going to manage these very critical customers to your business is. Is really important.

I mean, that's easier for larger organizations where you can fund the growth with capital coming from other places. But what do you do when you're like a small startup? Would you kill your company by saying no to a large customer who's handing you ton of cash?

Do one of you want to answer that?

We were never good at that. We were, yes. People, early on, to be honest with you, especially when clients had really crazy enhancement requests, we would go above and beyond to make it work. Early on, once we got to a certain point, we started to push back and set expectations around what we were capable of doing. But early on, we would do what it took to win the deal. And I'm not saying that's necessarily the best thing to do. That's just what we did.

Yeah. So I do think it's important that you do everything you can to make your customers successful. That being said, that you want to make sure that you are not architecting yourself into a corner or taking yourself off of your roadmap. What's really important. And we experience this at Yammer, right when you're building for Thousands of companies or millions of users is you start building one offs, it slows down your cadence and your ability to innovate and iterate. And you have to start testing all those. Right. All of those one offs. You have to test every time you come out with a new release. And so now your burn goes up cause you have more QA people, your development cycles get longer, your pace of innovation gets longer, your roadmap extends for years now rather than months and quarters. And so it's important to have that consultative conversation with the customer of I understand this is what you may need or want, but let's talk about other ways that we can solve that problem in a way that's repeatable across the broad customer base. Because ultimately part of the reason you chose our technology is our pace of innovation. And we can't provide you that if we're basically building custom consulting engagement and.

We didn't make one off solutions, we would just add that to the roadmap and deploy that to everyone, right?

Yep.

Sometimes it just wouldn't happen as quickly as the client would like, but we would just.

You can build the product. Exactly.

Yeah.

I mean that means that really you have to demonstrate ROI very early and make sure that you have a really strong champion and in some cases more like a program lead, the person who handles some of the day to day stuff. But if you've demonstrated quick wins, customers getting ROI to some extent, and you've got a really strong executive champion economic buyer, for the most part, you can manage those expectations. But you still sometimes have to deliver stuff that you're initially like, why am I doing this?

And you don't really want to do in place the first, first place.

And with a background in economics, people respond very well to incentives. So when you're hiring your team, if you're telling them retention is the number one metric and you're going to get a bonus if your retention rate is over 95%. I mean, how do you make sure that they're retaining the right customers and not just retaining 95% of the customers to get their bonus?

Don't sell to the wrong customer.

But that's a problem with sales. I mean sales sold to the customer.

I mean, even though I'm head of customer success, I'm still, I've got one boot in sales and one boot in the customer camp. I think that in terms of how do you want to compensate your customer success organization? Do you want to compensate them on renewals? Do you want to compensate them on the upsells? The Expansions. And I think the answer is, in my experience, I've worked in organizations where we didn't compensate customer success and in organizations where we did. And I think the answer, at least I think you should. It doesn't mean that they're salespeople. It's a very, very different role. But you do want to motivate them to ensure that when the customer's coming up for renewal that they're having that renewal conversation and that they're looking for those expansion opportunities even though they may not own the sales campaign. The sales. The account executive may own the sales campaign, but you need them to be in there making sure that they're having those conversations with the customer and seeking those opportunities out. Because you don't want to distract your account executives with upsells and expansions when their primary function should be new business. But they should partner very, very closely together. Anything to add?

We separate it out. As I spoke to earlier, we have sales team that's focused on the initial sell. We have a sales team that's focused on the expansions and the upsells and the cross sells. The retention, I think is we incentivize people not so much on the retention piece, but more on the upsell and the renewal and achieving the renewal.

Do they carry a quota?

Yes, they do.

They do. Have you seen any comm structures for customer success that were messed up, David?

Yes. So I think it's really important as you think about comp for customer success, you rethink comp for sales as well. So one of the things that we've moved to is for our sellers, we're actually paying them a portion of their commission when they close the deal, but the rest of it with a premium when the customer is deployed and referenceable. And so when you think about it, the only person that really celebrates when a deal is done is the salesperson. Finance isn't paid yet, so they're sort of holding their breath. The engineers built this great product, but the customer's not really using it yet, so they don't celebrate. The customers spend a bunch of money, but they don't have any value yet. So the only person that's really celebrating is the salesperson. But once that is deployed and the customer's referenceable engineering feels great because they've effected change in a company based on code they wrote. Your finance guy or gal are happy because they got paid. The customer gets value. So they feel really good about it. So that's a great rallying cry for everybody. So as you Reorient sales compensation, you can start to reorient customer success comp. I think it is very important for customer success to be able to sit down with the customer and say, look, I don't care if you don't ever buy anything again. My job is just to make you wildly successful with the investment that you've made. Now they should be observant enough and where they see opportunities for more use cases and upsell and cross sell, they should be able to guide back to the the sales rep and say, hey, I think there's an opportunity here. But ultimately, if you are compensating customer success on retention, that's great. You know, I think that's a great metric that they can feel good about. They affect change in the organization, but they can still stay true to their vision.

Yeah.

Which is make the customer wildly successful.

Yeah.

As quickly as possible.

Exactly.

So I want to switch gears a little bit and move into how do you manage this customer success teams where you're going into different industries. And David, you had great experience with freemium models. April, you're looking at enterprise customers. And Sarah, you've seen the entire customer journey. But how do you do this differently when you're focused on SMB, enterprise and freemium? Is there any difference or is it just same thing?

Let's go first.

You've seen the whole. Yeah, you do have to address their different needs. Your SMB is a lot different than the enterprise, especially with respect to expectations. So we should probably talk about one to many strategy. Do you want to talk about that? Yeah, sure. So.

You know what? Go first.

I'll go. So I think when you asked about freemium. Right. And we saw a lot of that at Yammer. So freemium is great if you think about the different Personas that are involved in bringing the technology into a company. One of the challenges it has is building a product and then being a cheerleader for its adoption. The nice thing about freemium is you don't worry about that because you've already seen user engagement and you know what you deliver the users are going to like because they self discovered the product and they've applied it to their own business case or use cases and you've seen the right intelligence level of engagement. It's important in freemium to understand that users use. But companies buy. Right. And there are some companies their users can buy individually. But ultimately you have to roll that up. And as you roll it up, it's a different set of criteria that you have to engage the, you know, the organization in discussions around, and so it's very helpful. But a lot of times, and you remember we found this at Yammer. Some of the fastest sales cycles were not the one ones that started with freemium. They were the ones where the companies didn't allow it at all. But then when we went in and we established value and we talked about Orion and the technology around accelerating specific use cases, that's where we started to see quick buy in and then drove the adoption. Whether it's freemium or enterprise or SMB, you still have to think about a company's cultural ability to consume, change the deployment plan. You want them to be able to get value quickly. So it's that crawl, walk, run, Right. What are use cases that we can deploy quickly that don't affect a large change within the organization, but they can get value quickly, solve quick pain points, and then it's all about communication to the organization, deployment planning, and then it's.

It's just success metrics to ensure that once you've deployed that you've shown that.

ROI and the transparency in communication, what works, what doesn't. We want to have that transparency with the customer. We want to have that transparency, transparency back into the engineering and the product organization, to the support team and to the sales team as well. Right. We want to tell the sales team, hey, look, this was a great deal, but we actually found some use cases we didn't think of. Had we thought about those earlier on, maybe we could have expanded the deal size or shortened the sales cycle or differentiated against the competition.

But with freemium. Let me ask you a follow up question.

Sure.

You said that sometimes when companies were using the free part of the product, that made it harder to upsell or to convert them to the paid. So should you throttle down the functionality of freemium just to make sure that people upgrade?

No, I don't think so. But I think you have to be thoughtful. And one of the great things about Yammer was our ability to actually see the adoption rate of freemium within companies at the both macro level and individual user level. And you have to be thoughtful when you want to insert yourself into a discussion. I think it's important as you drive a technology like Yammer that changes a behavior in a company, there's a degree that you want to be thoughtful about around being prescriptive. And so the longer you let that freemium go and odd behaviors start to display themselves and how they're using the technology and where they're oriented around it, sometimes it's harder for you to reset around the right set of use cases.

So I would say for freemium, my advice would be to set some certain user thresholds and timeframe of when they actually get to use the product for free before you actually touch them. With a sales reach out that says, hey, we see that you're using, we see that you're using this way, let's talk about why you're using, what brought you to whatever solution it is that you have. The one thing about freemium that I think most organizations sometimes aren't necessarily cognizant of is that freemium doesn't work for every type of product. You really have to be careful about when you want to offer freemium. What's your criteria for the complexity of the product? How long do you want a prospect to be using the freemium product before you actually start an engagement with them to then try and convert them over to a paid customer? Think about my experience at Zora, which is a commerce, billing and finance platform for subscribers, subscription businesses. We didn't offer freemium because you can't. It's really hard to offer a billing engine as freemium. But betterworks as an example, is launching a freemium product in like the next two months. And so it's going to be a situation where sales is going to own that relationship with the prospect until they buy and then we'll go through the sales cycle and then I'll take even responsible for them. But even in terms of freemium, if they submit a ticket, who's the person that's going to answer the ticket? Is it going to be somebody on the customer success team or is it going to be a sales development person? And we've elected to have a sales development person answer the freemium tickets because that's where the person is in their relationship with you at that point.

And with SMB, it's really all about making it as easy as possible for the customer to implement your product, to use use your product. You just have to think about how you make it easy for them. They're not research rich like some of the larger enterprise companies are. When implementing SaaS solutions, it's usually one person who has multiple responsibilities. So for them, it's all about how do I do this quickly, how do I do this easily, and how do I make this work and start to recognize value as soon as possible. And so simplifying the process, that's something that we've learned at Cornerstone to create implementations that are very turnkey and very simple for our smaller customers. That was key to success as we move down market and making it easy for them.

And Cornerstone, even though it's a horizontal platform, you guys have started going after specific verticals that you're targeting.

Absolutely.

How does it change the way you manage your customer success teams? Is it the same team that's focused on the horizontal play, that focuses on verticals, or do you need a different set of skills?

I think from a client success perspective.

Over time we started to differentiate or have people very focused on specific industries to manage those relationships. I mean, early on, because we were the horizontal play, we supported all clients, no matter what industry they were in. But once we had enough clients from a specific industry, we would play off of them. So I used to manage several of our healthcare clients. And so once I understood the healthcare market, how they were using our solution, it was all about gathering stories. It was all about understanding how they're using our product, how they're driving success, recognizing value and taking those stories and sharing them with other clients in that same industry who may not be using that product. That was my opportunity to really cross sell, was to apply the stories and the successes from one client in the industry to another. And it's just all about sharing the stories. And I would also do that when we had clients that were struggling. So if I had one customer who was really struggling to use Cornerstone well, I would connect them with a client that was super successful so they could understand why this other client was having tremendous success and recognizing tremendous value out of Cornerstone where they were not. Sometimes the client needs to take a step back and realize for themselves that they've made their own mistakes and that they're their own worst enemy. And they're not going to take it from us, but they'll take it from another client when they hear about what they've done to be successful.

That's really powerful when you do have that opportunity to start to verticalize, because you're going to start to identify best practices by industry. You start to identify the skill sets that you might really need to service an enterprise, a healthcare company versus a financial services company, and then you'll be able to start to generate those user stories that you need to go sell more into that into that respective industry. So over time, as customer success continues to grow as a function, I can see lots of people then, if they've got an accounting background, wanting to work with financial services companies, or if you've got a healthcare background, servicing customers who've bought your platform that happen to be in that respective industry, because not every company is the same but if you can create a common path in terms of how they're using your solution, it's so easy to connect those two companies together. Example Sarah, because there's common language, there's deep empathy for what the customer's trying to do and why they actually bought your platform.

Beyond the conversations that your teams are having with a customer to identify upsell, cross sell and expansion opportunities, what metrics are you tracking within those customers to initiate those conversations and what tools are you using to track those metrics?

Usage.

Yeah, usage and adoption.

So I would take a look at. I'll share the experience that I had at zora. So we had this thing called subscriber identity. It was really understanding the full picture of who your customer is, why they bought, when they bought, how and when they bought more for them. The way they priced and packaged was they you paid a platform fee plus you paid for usage that you had put through the system. So we would monitor how much volume a respective customer was putting through the actual system relative to what was they contractually had bought. And you could start to predict three months, six months in advance when they were going to actually hit the threshold of being over for what it was that they actually purchased. And so if you have a tools in place, there's, you know, ZORA has subscribed insights. At BetterWorks, I use Gainsight, which is a customer success tool. I use that product to understand how customers are using and when they're using. And then if a customer by chance usage drops, then that triggers an alert to the respective CSM who owns that account. And then they go and run a playbook with that respective customer to understand why their usage dropped. That's the primary one.

Yeah. So two things. We do something very similar. So we capture user engagement on the back end that actually feeds into Mixpanel, which feeds into Gainsight, which feeds into Salesforce. And so customer success for us starts halfway through the sales cycle. So we don't have a handoff at the end. It's just one contiguous process, but everybody who's customer facing on any account. So Merrill, like we had this at the time you're doing Merrill, it'd be a lot easier, right?

Yes.

We can now see it. Everything's green, yellow and red. We can see user engagement, we can see new users that come on. We can see how they're consuming the technology, how many segments they're building, how many net new leads they're deploying and all of that. The other thing that I think is really valuable, where it's Appropriate, given the technology or service that you have, is use your own product. You know, for us, Radius on Radius. I'm sure BetterWorks uses BetterWorks. Salesforce. Use Salesforce. Yammer. Use Yammer. But you get tremendous in insight and empathy when you actually go through the journey of using your own product on a daily basis. And it's a great story to actually chronicle and then share with customers and prospects as well.

This is a question that we struggle a lot when we're looking at companies. And the answer is not that clear. Is customer success part of cogs or is it part of sales and marketing growth?

It is growth.

Yeah.

I would say that support is probably cost, but a customer success manager who is managing that relationship and is responsible for retention, responsible for identification of upsell and expansion and getting that customer to advocate, that's a growth. That's growth.

So it's not cogs.

No, it's not cost.

I love the philosophy of thinking about it as cogs though. But I do, I think it's growth.

I do too. I mean, our client success reps, they're selling, so.

Yeah. And I mean, we have 30 minutes. So do you think what's happening in the markets is going to affect your groups and the way people are going to look at the efficiency and the leverage that you can generate for the businesses?

I don't think so. Yeah, I don't think so either.

I think it does largely depend on if your solution is a must to have versus a nice to have. I think of Cornerstone as more of a must to have solution. And so no matter what's going on in the market, companies still are going to have a need for our solution to manage processes, to manage their employees. So they're going to invest in the product. I mean, they're going to invest in the solution.

But what about your function? Is customer success going to be more important or less important?

I think it's going to be more important. I mean, to drive retention, to drive the growth through the expansion and cross sell and upsell. I think we're critical to the success of the business in terms of from a revenue perspective, I can't see us going away anytime soon.

And April, you mentioned customer support as part of cogs and customer success as part of the growth engine. Remember, when I started the company 15 years ago, it was all about customer support. I mean, there was no customer success. Isn't customer success just a fancy term for customer support?

I define support as your agents who are answering tickets that are submitted by customers. They're typically Break fix, performance type questions. It's how do I, how do I do X, how do I do Y? Provision me for this, turn on this feature, turn off this feature. That is support. Typically support is part of a customer success success function. But if you want to break out the, you know, the finances of it, I think fundamentally because support is a transactional relationship that should be part of cost. When I think about the customer success manager, they're driving the implementation, they're driving the retention and everything that, you know, Sarah and David have already said that's cool.

So we're running out of time. Do you have any final comments for the audience along? Lot of people in the audience are starting companies so starting to think about customer success and they, I mean I remember when I started the company it was usually product and sales and customer success was an afterthought which was a mistake back then. So any words of wisdom.

The only thing I would say is when you think about customer success, it really needs, it's not a silo within your organization, it needs to be pervasive throughout every single department department you have and every hire that you make. If everybody that you hire in the company is genuinely passionate about making your customers successful, it's a great cultural rallying cry. It will ensure that you are bringing in the right customers and the right revenue. So your cost of maintaining those customers and growing them is much lower. And if the mindset across the organization is driving value and so self sufficiency for the customers, what you will find is you can get to that 4x5x year over year growth much faster because your customers will actually take on a large burden of that selling and marketing for you.

Look, the world has shifted. If you think about like the subscription economy, how many of us are buying things today? We're typically subscribers. So if you're not out there nurturing that relationship and continuing to give them value over time, they're going to go find some solutions that actually does. So I want to encourage all of you to really seek to understand who your customer is and by listening and engaging with them, you'll know how to price and package, you'll know where you can grow, you'll know how to service them. So don't think about it as a back office function. It's really a growth function.

And I would also add that your customer success folks ask them questions, find out from them what they're hearing from customers, what challenges they're being faced with on a day to day basis and take that information to improve experience for them.

That's cool. Sarah, April, and David, thanks very much. This has been super helpful for me as well.