The Dynamic Engagement Model: Benefits, Feasibility, and Risks

November 16, 2021

Marley Wagner

Category: Customer Experience, Customer Retention, Customer Segmentation Strategy, Customer Success as a Service, Customer Success Maturity, Customer Success Strategy, Digital Customer Success

Back in 2019, TSIA introduced a new framework to define and crystalize a movement in cost-effective scaling of Customer Success. They dubbed it the “dynamic engagement model” and recommend it as a way to align human and digital resources to maximize customer engagement as your business expands and grows. Its basic principle: consistently deliver the right resources at the right point in the customer journey. By doing so, you’re providing the best possible customer experience in the most cost-effective manner. The idea challenged how Customer Success organizations were approaching customer segmentation and human touch versus tech touch engagement.

In theory, this concept is incredible! A powerful way to both scale in a fiscally responsible manner and meet your customers where they are. But in reality, you might not be surprised to hear that many CS organizations have found the idea of dynamic engagement easier said than done.

While plenty of Customer Success leaders believe that it would be beneficial to adopt the dynamic engagement model as part of their CS strategy, the feasibility of such a feat remains a question mark.

Dynamic engagement? What now?

According to TSIA, the dynamic engagement model “allows free flow of resources and assets throughout the lifecycle of the customer’s relationship with your technology and services.” When you build in the flexibility to provide touchpoints throughout the customer’s journey based on their own preferences and priorities, you can dramatically enhance the customer experience. At the same time, scaling becomes easier because you’re building a Digital Customer Success program that incorporates tech touch across your entire customer base – not just your tail.

Traditionally, CS engagement strategies are based on customer segmentation. Enterprise customers who spend the most with you are placed at the top. They benefit from a high touch model, usually with a CSM assigned as their primary point of contact. Then, mid-tier customers are placed in a mid/low touch category, with a mix of automated messaging and a CSM for critical touchpoints along their journey. SMB customers are then placed in a fully automated bucket with little to no contact with a CSM. The dynamic engagement model tosses out this customer segmentation in favor of a fully fluid approach that matches resources to customers based on their individual needs or the value of human interaction at specific points of the customer journey, not how much they spend with you, how big they are, or any of the other ways CS teams are typically segmenting their customers.

This kind of dynamic segmentation enables your CS team to create collaborative success plans that drive rapid time-to-value. It gives CSMs the flexibility to map out the ideal balance of digital and human engagement based on individual customer needs, or based on criticality of the touchpoint, versus based on segmentation.

Is this really feasible?

The crux of this new methodology lies in digital engagement. Without a strong digital CS practice, including the right tools, data, and skillsets on your team, scaling with the dynamic engagement model doesn’t work. You need to integrate personalized digital experiences into your entire customer lifecycle. But what if you’re not at a place where you’ve already built out digital Customer Success capabilities like automation and self-service? Or what if you’ve already put in the work and grown and transformed your CS organization with traditional customer segmentation methods in mind?

Is it really possible to re-build your strategy around dynamic segmentation and interact with customers based on real-time data and individual preferences?
The answer is: it depends. As is the case for many things in Customer Success, what works for some might not work for others. But there is a reason TSIA’s State of Customer Success 2021 report identifies the dynamic engagement model as a critical path forward for the expansion and optimization of CS. It’s a flexible approach to making sure that you’re supporting each and every one of your customers in the best way possible without having to hire infinite CSMs.

Some innovators have already successfully established adaptations of this framework. They’ve used dynamic segmentation to improve alignment to customer business outcomes, automated onboarding to increase adoption with targeted customer communications, and even used predictive analytics to increase renewals.

Are we throwing the baby out with the bathwater?

Of course, the downside of the dynamic engagement model is that, if you’re really going to do it – go all in and reap its full benefits – you have to throw out your existing customer segments and start fresh. If anyone has spent a significant amount of time and effort building out your customer segments (a painstaking and lengthy exercise), they likely won’t be thrilled with the idea of throwing it all out the window. You might even feel like breaking out your customers by segment is too important to your current CS strategy and processes. Some on your team could be worried that you’re throwing the baby out with the bathwater.

Another potential drawback to this model is that, by its very nature, it’s a little murky. There is no one-size-fits-all version of this framework. Best practices are still being developed. If your Customer Success organization isn’t already standing on a solid foundation (where you know where you sit in the business and what works best for your customers), it might make integrating a model like this much harder.

One of the best parts of being in Customer Success is how we’re always concocting new ideas and new ways of doing business. The dynamic engagement model is an exciting take on what the future of CS could be. It’s definitely worth looking into if you’re searching for ways to scale and transform your CS strategy for the long term, but know that it’s okay if it’s not the right thing for your organization right now.