Your Business Model Dictates Your Customer Success Model

We come across a wide variety of SaaS vendors in the marketplace. We often see their Customer Success teams struggle to align themselves with the specific needs of the business they are in and understand what their Customer Success model should be.

 

The symptom can also be seen by one’s (in)ability to describe what our friend Nils Vinje calls the “Four P’s”:

 

  • Purpose: why does the Customer Success team exist? To drive renewal revenue? Customer satisfaction?
  • People: what type of person is best suited to the needs of the team?
  • Process: what are the core processes the team must support?
  • Platform: what automation will enable these people and processes?

 

 

First clue: start with your selling model

 

One way to answer these questions is to start with how your products are sold and deployed in the first place.

 

Are you selling online without sales assistance? This implies a relatively inexpensive product and a low-touch provisioning process. Your post-sale experience should (must?) be low-touch as well. What will the role of your Customer Success people play in this case? Perhaps to operate systems like online communities and marketing automation tools to enable “digital touches” only.

 

For the sake of contrast, imagine instead that you’re selling a complex product using outside sales resources. Your annual contract value is closer to $100,000 and your Professional Services team does the implementation. In this case, your Customer Success team is probably at the center of the post-sale experience. They’re delivering a high-touch, consultative experience to a low number of customers per CSM.

 

Many SaaS vendors sit between these polarities. In this case, your Customer Success team might need to support a multi-tier customer model, delivering a different level of service for each tier. Or, you might employ approaches that blend your people resources with programmatic outreach through marketing campaigns and the like.

 

Which leads to another way to look at the problem.

 

Second clue: charting your growth journey

 

Another way to define the Customer Success team’s mission is to consider where you are in the growth journey of your company.

 

Most young SaaS vendors are operating a single, low- or no-touch selling motion. Your product is a basic version of what it will become, and your money constraints mean that expensive sales resources aren’t affordable yet. Your customer success model is probably low-touch or no-touch in turn.

 

As you reach later years of growth, your customer base has become heterogeneous. Small customers continue to come through the front door, because who would stop using an efficient, online sales model to acquire new customers?

 

However, your outside sales team is now landing larger customers too. And some customers grow year-over-year thanks to up-selling. The customer success model in this case is multi-tier. Digital touches are used for the lowest tier. People-driven touches are used in the highest tier. A combination of the two is used for customers in the middle.

 

Last, we see some larger SaaS vendors start to look homogenous again later. Their product has evolved into an Enterprise offering with high touch selling and high ACV’s. Small customers are no longer attractive to the acquisition sales team. And this determines the high touch Customer Success model that follows.

 

Summing it up

 

As your define your Customer Success team according to the “Four P’s”, the first question to answer is whether you’re aligned to the selling model. If not, what are the gaps and how to close them?

 

Last, has Customer Success evolved along with the business to support a multi-tier model? Has your business become a single-tier model again, thanks to very large customers? Are there gaps to fill?

 

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