In response, more and more technology companies have deployed customer success managers (CSMs) with a charter to help build a robust, enabled community of users that derive the stipulated business value from a product or solution.
Yet, Alexander Group’s client experience suggests that enabling a robust CSM’s capability is merely table stakes for building a successful subscription revenue model. Leading XaaS companies are extending the concept of Customer Success beyond a single role to a broader organizational mindset. If the goal of a subscription revenue business is to maximize customer lifetime value (CLV), then the organization can’t merely focus on Customer Success in the adoption phase of the customer buyer journey; it must embed a Customer Success focus as a mantra across functions and points of interaction with current and prospective customers.
To illustrate the concept of Customer Success as an organizational mindset, let’s consider the modern tech buyer journey. Alexander Group defines this journey as ILAER, which is simply an acronym for Identify, Land, Adopt, Expand and Renew. As previously noted, CSMs serve a vitally important function in the adoption phase, but in true Customer Success-centric organizations the concept is embedded into all aspects of the buyer journey and across multiple functions. Below are some of the most common applications of Customer Success concepts across the I, L, E and R steps of the buyer journey and the functions that utilize those concepts to enhance customer experience and deliver higher CLV.
It is increasingly clear that building a Customer Success management organization is a linchpin in fostering a viable recurring revenue business; the financial implications of customer loss from suboptimal solution adoption are self-evident. Accordingly, it should not be surprising that extending the concepts of Customer Success throughout the organization has benefits for customers and prospects across the buyer journey. Revenue leaders should be asking themselves how they are embedding a customer mindset into the entire organization, from product development and R&D, to marketing and business development, to sales, account management, and customer support. Not only does an organizational ethic of Customer Success drive better CLV, ARR growth and valuation, it serves as a strong, differentiating signal that an XaaS vendor is genuinely invested in the business outcomes of its customers.
Are you looking to transform your organization to center around the 24×7 customer experience? Alexander Group will continue to pursue this topic further at our 20th Annual 2020 Executive Forum November 18 – 19th. Learn more about the event or contact us to discuss your specific Customer Success situation.