The future of Customer Success

Speaker A: Hi Chris. Uh, very excited to talk to you today.

Speaker B: Yeah, nice to be here, Cedric.

Speaker A: Yeah. So today we're going to talk about, uh, customer success, the evolution about customer success. And who better to talk to about this with Chris, uh, who is a senior VP of Tatango, the customer success, uh, platform. Um, so Chris, maybe briefly tell a bit your journey until your role today.

Speaker B: Yeah, absolutely. So, um, I am the senior vice president of customer success at Tatango Catalyst. So we recently merged, uh, merged the two platforms which is pretty exciting. So maybe we can touch on that a little bit later. Um, I began my CS career, um, prior to really customer success even being a thing. Um, I started that back. I was at A company called on 24 for almost two decades. Um, they're a webinar based marketing platform. Um, when I started with that company I really kind of ran a lot of the enablement training support, um, technical account management. And then ultimately when customer success kind of became a thing, um, you know, we evolved those teams into a customer success motion. Um, and so it's been really interesting to see the evolution of customer success, um, over the last 20 years. Um, and it's been something that has been really helpful as I've gotten into, uh, leading the customer success team at a customer success company at Tatango and Catalyst. Um, it's helping us kind of move things forward as it relates to, you know, what is next for customer success space. You know, how are we going to evolve it from, from where we were, um, which was, uh, you know, even though it was proactive, uh, it wasn't as engaged, I don't think, as it is now when we start thinking about revenue and growth and the impact on the business. So yeah, it's been, been an interesting ride for sure.

Speaker A: Yeah, definitely. And I really want to cover with you the evolution about cs. And in my experience, um, a lot of companies, they moved customer support people into CS roles while the role, the content is completely different. So how do you look at where it comes from, how to start with it and then what is your take on the evolution of cs?

Speaker B: Yeah, it is interesting. I mean when we think about where CS started, um, as I mentioned, you know, I had a technical account management team and in evolving that team into customer success, it's the same and it's also very, very different. Right. Um, and that was kind of, I would call, let's call it CS 1.0. So early customer success, which was you, everybody was focused on, instead of being reactive, being proactive and really kind of driving, starting to drive More outcomes and paying attention to what really helps a customer achieve value with your product. So those were early on indications. Um, and what we found is a lot of times people who evolved from maybe support or technical account management into a customer success role can be good in certain areas and cannot be good in certain areas. Right. Um, what we've seen and when we think about the evolution of customer success and what we're seeing and what I'm seeing at Tatango Catalyst and with a lot of our customers and in the industry is um, that customer success really does need to start not just being proactively involved with their customer. It's not just about QBRs and cadence calls and things like that, but it's about really making sure that they're understanding the value that a customer is getting, driving that value and then ultimately driving growth and having a, uh, hand in what the revenue, uh, picture looks like for your company long term. Right. So it's driving that predictable revenue growth from your install base. And that only happens when you've got a customer that's really achieving value and are achieving their outcomes. Um, but that's really kind of where the engine starts and then you start building into that and getting the growth and kind of that, that predictable customer led growth, uh, that we like to talk about at Tatango and Catalyst.

Speaker A: So yeah, and I hear you talking that there's quite some, I'm going to call it hybridization between traditional account management functions and maybe traditional evangelization slash marketing functions moving into cs. Um, will there be like still a fixed barrier between um, uh, regional account managers versus CS or how do you see this evolving?

Speaker B: Ah, yeah. You know, it's interesting and it's not a one size fits all for sure. Right. Um, as we think about different companies, company sizes and what markets you're approaching, what verticals you're approaching, you know, there's certainly a case where you would have um, you know, an account manager, a regional account manager, somebody involved along with a customer success person. Um, in some cases that will be a combined role. Right. Um, as we look at the evolution of customer success and customer success managers being more directly involved in understanding some of the revenue play and how to drive growth within that, um, you know, there are going to be cases where you're going to need to consolidate that. I mean, if we've seen anything over the last year, um, you know, if it's taught us anything, it's taught us that, you know, there is going to be a consolidation of roles. You know, we're seeing a Lot of uh, teams kind of thinning out and being as efficient as they can with who's handling what within the customer journey. So um, you know, when we think about strategic and enterprise level account management there is a, there is a pretty strong difference um, in what that type of role would do, um, as it relates to that over you know, a customer success manager. And there's a lot of differences when you think about market segmentation and things like that as well. Right. So um, yes, I do see a collapse of some of those things in some markets, in some spaces, in some segments. But um, you know, when you start thinking about really large strategic enterprise, you know, accounts, uh, um, you know, I absolutely see a need where you would still have, you know, customer success manager, maybe an account manager, maybe an account executive, you know, in different overlays based on what you're doing and how you're doing it. So definitely not a one size fits all for sure.

Speaker A: Yeah, definitely. And it also has to do with probably the size of the companies you selling, uh, into, um, how technical is a product? I was working for an integrator a long time ago and we had a service manager which was like the role of a customer success manager. That person was involved into all the um, uh, technical aspects, making sure that the contracts kept running and as soon as he spotted from his side, uh, upsell opportunities then uh, I was involved. Um, and I see similar things happening. Uh, there were similar things happening at indeed and so forth. So when we look then at, I don't know if there, you said there's no one size fit all but if you look at a regular um, mid sized company versus uh, an enterprise type of company, what would be like the difference in the setup?

Speaker B: Um, you know I would say that, that for many mid sized companies, um, you know what I've seen is that you'll have a CS team and this is where it's kind of evolving I would say, um, you know, to where the CS team is uh, more responsible for some of that revenue, you know, let's call it post sales. Right. But so an initial deal acquisition comes in, that deal has gone through the process and then the CS team is now um, you know, I don't want to say owning the customer, but they're owning that relationship, they're quartermacking that relationship as it relates to, you know, how to make sure that the customer is getting value, making sure that they're achieving their outcomes. You know, all the things that we really want to hold to as far as tenants for customer success that's really our, let's call it our North Star. Right. Um, the company the customer bought you for a reason. Um, you know, do you understand what that is? Do you understand what the measures of the KPIs are that they're trying to achieve and grow to or adjust to? Um, and then, and then the CSM is kind of responsible for that. But then you know, through that process that should ultimately result in, you know, in growth, protection of that revenue, um, and then, and then growth of the revenue as well. So um, I've seen in more of the, you know, smaller mid sized companies, um, you know that is typically, and we're seeing it kind of trend to where that's handled more by the customer success management team. It just creates some, some efficiencies. Um, like I said, when you start thinking about the larger companies, that's going to split out a little differently depending on what you're doing and how you're doing it. But um, yeah, just overall we are seeing, definitely seeing a trend towards customer success. Kind of owning more revenue on the, on the install base.

Speaker A: Yeah. And then we move into the nps. Right. So when customer success was initially uh, incentivized by having a high uh, NPS score, now we move into that um, revenue responsibility. So first of all is NPS still relevant to measure uh, CS performance? And secondly then what are then some typical metrics that uh, you can use instead?

Speaker B: Yeah, uh, I mean NPS is a, is a hot take, hot topic, uh, you know, that you could uh, have long discussions on. Um, you know it's interesting, the question that you asked directly. Is NPS a good measure for customer success? And I would say, you know, yes and no. Right. NPS is a measure. It is something, it is a piece of data within the puzzle that you're looking at to understand where you are with your, with your customer base. Um, that said, uh, you know, if you are driving compensation, you know, around NPS for our customer success manager. I feel like you're missing the mark. Right. Because NPS is a good baseline. It is a standardized question and it's going to give you insights. More importantly, you know, it's something that you can action um, as it relates to your business. And almost more important than the NPS score is typically the comments that you're getting from the NPS score and how are you reacting to that? Um, you know it's interesting. I've, I had a story a long time ago. Um, my wife and I went uh, to visit a theater, um, for the first time they just opened up, it was one of those years where they have, you know, food and things like that. And so we went in, we sat down, I ordered, um, you know, a cocktail. Um, the movie started and I didn't get the drink until almost the end of the movie, right? And it was like super frustrating. But I mean, not, not the end of the world. It was like, I got it, it was fine. But the next day I got an email with an NPS question. Um, and so I, you know, gave him a detractor score, um, added in the notes the reason why and hit submit and was expecting it to go into the black box that it normally does. I actually got an email and then a call from the manager of the theater the next day. Um, he wanted to know some specifics about the experience I had where it was, because he said, I want to make sure that we improve it. It wasn't to get anybody in trouble. Ah, we want to improve our processes. He sent me, you know, a couple of coupons so that I could get a new a free movie in the future. And I was like, okay. A lot of times we see NPS absolutely unacted on, and that's more frustrating than anything because you, you reply to it, you take the time to give somebody a comment and then it goes into the abyss. Um, you know, so somebody's using it as a measure to maybe beat up on their csm, but they're, but, but they're not really taking the data to really improve what it is that they're doing. So, you know, MPS is good. It is a company wide measure, right? It has to do with product, it has to do with your billing and your sales and your CS team and everything else. So.

Speaker A: And the relationship you said as well, right?

Speaker B: Absolutely, absolutely. And then if you're taking it in real time and you're, you know, with Tatango, for example, we have our NPS scores. Um, if you were to fill out an NPS score, uh, it pipes into a slack channel that's internal that all of our executive team is on. And so I see every NPS as soon as it hits, as soon as it hits the database, right? And we look at it, we're like, okay, hey, what's going on with this customer? Why is this the case? They said they didn't like this. This was a problem. I thought we fixed that problem. And so we have a back channel dialogue so that we can make sure that we reach out to the customer, resolve the issue, um, and improve upon that. If we didn't ask the NPS question, I wouldn't get that data and I might be flying a little more blind. So, you know, am I going to hang bonuses and am I going to put all of my eggs in the NPS bas? Absolutely not. But, but can you glean some really important information? Yeah, absolutely. Again, it's, it's a piece of the data when you're looking at the overall health of your business and your customers.

Speaker A: Okay. And then if you look at some more, uh, relevant, uh, if, uh, I can call it, uh, metrics, then what would then be the things that, that you look at? Is it then pure retention? Pure upsell?

Speaker B: What are you looking at? Yeah, I mean, you know, retention is great, uh, and so is upsell, but those are typically your lagging indicators. Right. Um, from a customer success standpoint, um, you know, really it's about value and it's about, you know, what we would call business outcomes. So, you know, if you come, uh, you know, to Tatango, if I'm going to indeed, uh, I'm going to be purchasing that tool or that product for a specific reason. And so the question is, you know, why, why are you buying the product? And then the second thing is, what is your current measure? What are you expecting that product to do for you? Um, how is it going to improve whatever it is you're trying to improve? Right. And so then you look at that and you say, okay, let' let's get a baseline measurement. Um, and as a CS professional, my job should be to make sure that we have that baseline measure and that we're driving towards improving, that we're achieving the outcomes that you purchase the product for in the very first place. Right. So outcome attainment or value attainment, um, is something that is really, I would call it a North Star for customer success. Um, because if you can prove value, then when you come to a renewal discussion, it's a non discussion, it's a non issue. They're going to renew because you can show them the value or the ROI of the product that you have. And then it's just a matter of how much more and how much longer do they want to continue to get that value. Um, so it's interesting that we talk a lot about health scores and we talk a lot about utilization and product utilization and how many times did you log into my platform? What all features did you use? And those are all good things. Again, these are all pieces of data within the puzzle that are going to determine a picture of the customer. Um, but if you're strictly looking at utilization of a product, then you're again you've got some blind spots. They can be using your product right up to the point where they stop using it. Right. And we've all seen that and it's frustrating. So um, yeah, having truly tangible value based outcomes that you're measuring and scoring your customer against and kind of tracking through is really the key, the key measurement from my standpoint on customer success.

Speaker A: Okay. And then when we look at um, the expectations that the client had prior, uh, buying the solution, um, what is your take into that? CS has the authority to block a sale because they see from miles ahead that they will churn. Uh, and I've spoken with a couple of uh, companies and they say, okay, this is the position we are in right now. We let CSA know if we feel they will churn.

Speaker B: Yeah. You know it's interesting. I hosted a panel, uh, discussion, kind uh, of a hot take session earlier this week, um, with uh, with Kevin McIntyre, who's the CRO from Dealfront, um, and we were discussing ICP, um, you know, your ideal customer profile. Um, and as we were talking about you know, is this the year of customer success or is it the year of sales? Uh, the answer was it's the year of the ideal customer profile. It was kind of where he landed. And what's interesting is um, as a CRO, he's um, looking at it saying not every customer is the right customer for your product. Now does the CS team have the authority to block that? That's an interesting discussion and certainly another potential hot take. Um, but as a sales leader, um, as a CS leader, you know, we should be involved in looking at and understanding hey, what is the value that a customer is working to attain and if it's a misfit customer, if we're bringing them in and we know that this is not a long term relationship customer. You know, we need to have eyes wide open. We don't need to have expectations on you know, a big, you know, lifetime value out of that customer because quite frankly it's just not going to, not going to exist. So um, you know they're definitely, definitely thoughts on, on how to control that um, and how to measure it. It's always hard, you know, I mean like at the end of the quarter everybody's trying to get those sales in so um, you know, telling somebody they can't have, ah, they can't sell something because you know, because it's not a fit is, is going to be a tricky conversation. Um, but, but it is something that needs to be paid attention to as you're looking about the, the long term success of your business.

Speaker A: Yeah, yeah. And it is a hard um, thing right, because if you want to have your number you say I want to have that client in. But then ultimately to success, the lifetime value, the time you spend in the customer acquisition cost and nobody is really thinking about this when you try to get that sale in. So it definitely is important to look at it. So we've been talking already a couple of times around sales and marketing roles and what I call the hybridization, um, um, between them. So when we look at collaboration between marketing and uh, CS and then I think about evangelization, having strategic sessions with uh, uh, a client, what would then be a good approach in having a strong collaboration between marketing and cs? And what role would sales and or account management then have into this?

Speaker B: Yeah, it's a very interesting topic that uh, I've had a lot of conversations on with different people. It's interesting when you think about marketing, sales and cs. Karen Budel, who's our cmo likes um, to call that the three legged stool. Right. I mean those are the, some of the tenants when we think about go to market. Um, and if you look at the sales and marketing relationship, you know, kind of pre sale pipeline generation, things like that, that's typically a pretty well, uh, well refined machine. Right. I mean that has been done over and over again. It's, it's been kind of long standing. So those relationships are pretty well forged and typically running pretty well. Um, when we think about the marketing in CS for marketing to your customer base and how they support the CS function as it relates to protecting and growing your revenue, that's typically a little more of an untapped function.

Speaker A: Right.

Speaker B: Um, and it is something that in our organization, Karen and I are working very closely on to make sure that you know, hey, how do we do this better? How can we work better together to make sure that we are driving an efficient and effective motion for our customer base? And how does marketing play into that? Um, and it can be a number of different functions. But one of the things we do, um, which I think is super helpful is a customer advisory board and that's driven by um, our marketing team in collaboration with myself and with the CS team. Um, and it's really helping us to get a better sense of not only the market, um, where we want to go directionally, not just from a product standpoint but just from an industry perspective. Um, and that kind of alignment really helps kind of drive A good focus for our customer, for our customer base, um, for where we're going as a product and a company. Um, and then when you start folding in sales into that, if you're looking at, for example, let's talk about expansion motions, um, you know, so now you're looking at a, whether you're a land and expand kind of motion function or if you're just trying to organically grow your customer base, um, if you're folding sales into that specifically on more of that land, expand motion, having marketing provide air cover on that, um, is a key aspect. So if you start thinking about getting uh, those three teams tightly aligned on how to execute, um, you'll definitely see the fruits from that.

Speaker A: Yeah, and as I said earlier, it's definitely not one size fits all. Because I'm thinking about like if you have global account directors, uh, in the land and expand the motion, the role that CS plays in identifying the upsell, um, it becomes really on the one hand a project management approach and on second hand, like collaboration even with the client and how to successfully expand your business, uh, with the client, uh, into their uh, install base.

Speaker B: Yeah, yeah. And that's something too that, you know, one of the things that we've seen, uh, as you start getting into that level of intricacy across sales, across customer success, across marketing, um, and this is the shameless plug for Tatango and Catalyst. I mean that is what we, that's what we do, right? We've got a platform that is specifically designed to try to help support the technology and the infrastructure and alignment of those teams post sale that help you not just understand and identify where those opportunities are. But then how do you, you know, how do you tap that market and how do you help really um, evolve and grow that in a way that scales. And so, you know, um, there are certainly a lot of tools out there that do it. Um, but, but having people aligned on that technology, and that's where we see a lot of the problems, is that you got sales on one thing, you got CS on something else, you got marketing on something else. And so people are working in disparate systems and you may do some integration and that's good. But when you can get everybody aligned and in sync on a, on a single kind of sheet of music, as it were, a single source of truth, um, then you can create some significant efficiencies of scale there.

Speaker A: Yeah, strongly believe it. And then, um, when we move then slightly into your role into uh, CS leadership, um, briefly we spoke about uh, prior to the recording about your role as a CS leader. So when I was selling into tech, my um, leaders, they always told me, I'll go talk to our CTO or CIO to know how to talk to, how to speak the language. Um, I assume that your salespeople are, um, coming a lot to you to ask, uh, everything about cs, how to be approached and so forth. How do you go about this?

Speaker B: Yeah, um, well, as we discussed, I mean, uh, you know, being a customer success leader, um, in a customer success industry for the customer success platform is a little bit, uh, meta, as it were.

Speaker A: Right.

Speaker B: I mean it's definitely, it's definitely interesting. Um, and it gives us a chance really to uh, you know, we've started, and especially with the recent merger with Tatango and Catalyst, um, we've started all sorts of motions just to really, you know, make sure that we're being our best customer. Right. Um, you know, it's easy to get into the, the phrase, the cobbler that doesn't have shoes. You know, um, it's kind of similar to that. It's easy to get into a motion where you're spending so much time supporting your customers that you're not able to do that internally yourself. So, you know, making sure that we're kind of driving those motions and understanding the value of that is certainly key. And then collaborating with our internal teams, with our sales teams. I mean, I spend a ton of time with my sales counterparts, you know, discussing approach and what are the needs and what do CS leaders really want and what are they looking for, um, when it comes to a solution. Um, and it's interesting too, um, the CEO of Catalyst, who's now our co CEO, uh, Edward, he, um, was a CS leader as well. I mean, that was where he started and he was in a situation where he needed a technology, um, to help support him as he was supporting the business. So he comes from a background of customer success, which helps us really make sure that we're pointing in the right direction, um, as it relates to the product and the evolution of where the practice is going as a whole. So, yeah, it is fun. Um, it's definitely fun being uh, in the industry that you're supporting. Um, and it gives me a chance to really talk to a lot of folks internally and externally, um, about the direction that we're going and how we can support people in that.

Speaker A: And when we go then a bit deeper into your role, ah, as a CS leader, um, we spoke already about the key metrics, but then when we talk about leadership coaching and leading other CS leaders. What are some, um, basic processes that you have, how you coach cs, uh, leaders and CS people? Can you go a bit deeper into this?

Speaker B: Yeah, um, you know, I mean I would say that when I think about just coaching CS leaders or CS people, it is more, it's understanding and I'm going to go back to the value conversation, but it's really understanding the value of your customer. And then we look at it and we talk to the customer as customer success. Our goal is to make sure that we're very acutely listening to our customer and what their needs are. Um, and so if I were to coach any CS leader and say, hey, what's the first thing you need to do? It's spend an incredible amount of time talking with your customers. Right? Talk with them to find out what their needs are. Talk to them and find out what are their expectations. Um, and as we said before, how are you measuring the success of those expectations, um, and the attainment of those? And so listening to your customer is by far the best thing you can do to level and skill up on certain aspects of customer success. Um, and then when we think about the evolution of customer success and where that's going, um, you know, being open to having those revenue based conversations which I know a lot of cs, uh, leaders have kind of kept at arm's length and they want to be the trusted advisor but they, you know, they don't want to ruin their ability to talk to the customer because they're afraid if they get into a negotiation that that's going to, you know, taint how they support them and um, you know, and that just really shouldn't be the case. So um, you know, we have to have real conversations about um, about how to best do that, how to best manage that and, and make sure that you're, you know, aligned across your entire organization, you know, in that front. So you know, I would just say, you know, be a good partner internally with your product team, with your marketing team, with your sales team. Those are places where you have to start as a CS leader, um, and even as a CS individual contributor or director, um, you need to understand not only the internal functions within that, but then also what are the needs of the customer and how can we make sure that we're supporting them m as the voice of the customer internally.

Speaker A: And do you see then also an evolution in uh, the different types of sub roles within cs? I mean, uh, I know companies that have evangelists within cs. Other people are more very strongly in usage, uh, of uh, products and Others are better into, well, starting those commercial, uh, conversations. Do you see this as part of the entire skill set of CS or do you see it becoming segmented?

Speaker B: Yeah, you know, I hate to go back to it depends, but it really does. I mean, you know, if you're in a smaller organization and you've got, you know, a dozen 20 CSMs, you're not going to be able to separate those out by certain criteria. So if you've got hundreds of customer success managers and you can have some that are specifically focused on various aspects of the business, well then of course that would make sense. Um, when I grew the team at, on 24, um, we had specific CSMs that were over certain segments, um, and then we had CS team that were overlays based on certain products or certain features and functions. Um, that helps provide you some of the technical expertise, expertise in those scenarios. But again it very much depends. Um, but you know, we all know that, that certain people have gravitate towards maybe it's more technical as opposed to more um, you know, contractual or commercial discussions. Um, and that's okay. Um, you know, and, and given the, the size of your organization, you may be able to cater to that. Um, you may not, you know, um, so those are, those are things you have to kind of look at in a, on an individual basis, just depending on, you know. And we were talking about this before, uh, the podcast. How technical is your product? How mature is your product? Um, you know, how evolved is it? You know, if you're a startup company and you've got a lot of fast changing product, that's got a lot of adjustments. Okay, you're going to need more technical, you know, CS resources to be able to help support that. Yeah, obviously.

Speaker A: Clear, Clear. All right, so um, I would like to limit the podcast to 30 minutes. We are almost there. So let us uh, start from the beginning and we've been talking about ideal organizations, what we're looking at. But then let's say uh, you talk to a founder of a startup, they're looking into building uh, their first CS team, the first three, four people, how to start, where to start. And maybe it's also very uh, holistic question, but what's the theory and how would you do it?

Speaker B: Yeah, um, I would start with um, a set CS leader, um, that is somebody that obviously if you, you, you need to get somebody who has done this before. So if I was, if I was in a startup and I was uh, hiring a CS leader, I would be looking at some of their skills and making sure, that, that I've got a little bit of a holistic approach, um, you know, for that resource. So um, somebody who is, is, has done uh, some of the commercial negotiations, somebody that is technically skilled, um, and able to handle that. Um, but also, you know, one of the key aspects of customer success is being able to manage that customer. So you have to have very solid skills as it relates to, you know, dealing with escalations, dealing with customers who are upset about certain aspects of things. Um, so you need to have that kind of a temperament, um, in a CS leader, um, and then, you know, and then start building the team after that, um, with people who can scale and grow, um, and grow those teams. So obviously how you would do that if you had three or four people on your CS team, you would have a few CSMs, you would start being able to segment out. Um, maybe you're doing it by ARR at first. And so you're saying, okay, here are my larger customers. I'm going to have a smaller book of business for each one of those CSMs on those so I can protect that revenue. Um, and then for your long tail customers, the smaller ones, uh, maybe I have one to many or maybe I go for a full on just a digital motion. Um, and that would be something that we do a lot of um, at Tatango is supporting people in kind of a scale digital motion that allows you to run campaigns and things like that. So having one of those CSMs really be able to function initially and drive programs through systems and things like that would be uh, a critical first step if I were, if I were building a team from scratch. And then as that evolves, that person becomes more of your customer success, operations person. They're driving digital campaigns and things like that. And then you can kind of expand from there.

Speaker A: Wow. Very solid. Thank you for your advice. That was uh, extremely helpful. And uh, thank you also for the conversation. Chris. Uh, I really learned a lot and I wish you all the best with the Tatango and the merch with Catalyst. Awesome.

Speaker B: Thank you Cedric. I appreciate you having me on.

Speaker A: Thank you. Have a nice day.

Speaker B: All right, you too.