Speaker: Chris Hicken, CEO & Co-Founder of Nuffsaid
|Let’s just say if you missed our first Customer Success Unlocked webinar of 2022, you’re going to want to keep reading and watch the session on-demand! Chris Hicken, CEO and Co-Founder of Nuffsaid, and Marley Wagner, Vice President of Marketing & Digital Customer Success here at ESG, dove head-first into the hefty topic of Customer-Led Growth. To help catch you up (or to relive the conversation’s glory) I’ve compiled all the questions from the audience and the useful answers Chris provided during this session.|
Q: Do you think customer led growth scares organizational leaders, because when they hear “customer-led growth” they feel that this will give the customer too much power in driving their business?
Chris Hicken (CH): Are our leaders worried? Well, what some leaders might be worried about is not being able to make decisions based on their gut because a lot of leaders like making decisions based on their experience. A lot of leaders think that they know better than customers, you often hear things like “if I asked my customers what they wanted, they would have said a faster horse,” right? The Henry Ford quote.
The reality, though, is that sure, when you’re making a product roadmap decision, you do need someone who can interpret a customer problem and translate it into the correct product. But most decisions that need to be made in the company are more tactical like “what should our pricing be?” and “what should our content roadmap be?” and “what types of customers should we be targeting?”. All of those things are better served with actually hearing from and understanding the customer.
The analogy that I use is – it’s the operating room equivalent of a surgeon coming into the room, looking at the heart rate monitor and the blood oxygen level sensor and then failing to ask the patient how they feel. And that’s absurd. You would never even imagine that a surgeon would do that, but that’s the way that we run our SaaS businesses. That’s what we do, we look at our product usage data, we look at our time-to-value, we look at all of these internal metrics but then we never asked the customer how they’re feeling. Isn’t that crazy? So anyhow, it’s just the state of how the world works today and, in most cases, when I’ve shared this feedback with executives, there is this moment of like “huh, yeah why aren’t we asking customers? That’s so obvious!” So, I think there might be some fear on the product roadmap side of things, but I think in most other decisions leaders will be very open to including customer feedback in the decision-making process.
Q: What components of Nuffsaid’s Customer-Led Growth rubric have the biggest impact?
CH: It’s probably three things: How the CS budget is determined, because you can’t make a big impact in CS if you’re always getting squeezed for budget and the CSMs are always in reactive mode. We all know what that feels like.
Next, you have to measure whether or not customers are getting value, the reality is you just cannot be customer-led until you understand the customers’ perception of value, full stop.
The last one that I put in terms of influencing other executives… I put Product at the top of the list. Product has so many different stakeholders screaming at them – Sales, the Executive Team, Customer Support on bugs and features, and they have their own items that they want to be able to implement, plus they have to worry about tech debt. So, the Customer Success team today at most orgs is a very poor steward of the customers’ needs and experience. It’s one of the ways where I think Customer Success can level up the most – is how they communicate requests from customers to the Product team. And we can talk more about that later as well, but those are the three that I would prioritize.
Q: How do we measure whether the customer has received value?
CH: First, you have to define a standard library of questions that every customer will get asked along their journey. So that’s step number one, you’ve got to know what questions to ask.
Step number two: those questions have to be asked. However you interact with your customers, it can be over email, chat, in person check-ins, QBRs. Wherever you talk to customers, those questions get asked and recorded. Typically, a response has two parts: on a one to five, or one to 10 scale, plus additional qualitative notes. Each response has to carry some kind of relationship risk. And that relationship risk has to be applied differently depending on the role.
So, for example, if you ask a question like “how much value does Nuffsaid add to your business?” and a buyer rates that one out of 10, how much risk are we going to assign to that, versus if a power user rates it at one out of 10? So that’s the risk level associated with each type of response.
And then finally, now you have this really nice database, you’ve got questions that are asked, qualitative responses, risk levels, the final thing that you do is make sure that the organization is armed to take action. So that will mean a couple of things, one is playbooks for CSM so when a really high risk comes in, what are CSMs going to do about it? And then, the data needs to be collated in a way that Product can digest feature feedback, Sales can digest ideal customer profile feedback, Marketing to digest pricing feedback or competitor feedback, and the Onboarding team can digest time to value and onboarding integration problems. And so that’s kind of step number four – the data is used to arm everyone in the company with action, things that they can do today to improve the customer experience. So that’s how we go from where we are today to building a data set of live customer data that can be used to drive and influence decisions.
Q: Chris, you mentioned that CS should have a number, how do you recommend starting that conversation?
CH: It depends on who the top CS leader reports to. If the top CS leader reports into Sales, it’s a little bit of a harder discussion because the Sales leader will want to ultimately own the overall revenue. So, I’d say it’s a little bit harder if you’re talking about the CRO but let’s talk about the easier case.
If the head of [Customer] Success reports into the CEO or the COO, it’s very easy. A CS leader could just say “look, our team is ready for revenue responsibility, we think we will have the best impact on driving overall net retention and revenue if we own the number because we have all the customer relationships. So, it’s time for the company to step up and improve its results on revenue, and we want to own that number.” For the CEO or the COO, that’s usually that’s usually an easy yes.
If the VP of CS reports into the CRO, that’s trickier and there’s some politics that come into this, because the CRO doesn’t want to feel like they’re losing power. And of course, the CRO is very sensitive to having power in the organization, so the best way to have the conversation with the CRO is to take it in little baby steps. So, say “look, we’d like to own renewals for our low-touch or our small customers first and show some success there.” Then you can go and say, “okay we’ve done a great job with the low-touch customers, let’s go out and do mid-market now.” And then, once you’ve shown some success in mid-market then say, “hey we’d like to take more commercial ownership of some of our enterprise accounts,” and so you can kind of build up. It’s unlikely to be everything at once, but with baby steps it’s not a big threat [to a CRO] to start off with owning renewals for the low [dollar, high volume] segment.
Watch the recording of this webinar to catch up on the full conversation!