Crafting an XaaS customer success strategy that drives growth
Successful companies realize that customer success is a mindset that places the customer at the organization’s center.
Any job search platform these days will show there are thousands of customer success (CS) positions waiting to be filled. According to research by Gainsight, a customer success software platform, “companies that invest 10% or more of their revenue into the CS function have the highest net recurring revenue (NRR).”
This supports the argument that there is a need for not only having CS jobs, but deploying more of them. Simply put, these jobs serve a critical role in tech companies today.
Like most functions, CS continues to evolve, and is not a “one-size-fits-all” model. Deploying the right archetype requires careful consideration to ensure CS teams are focused on the right activities, offer a seamless experience across the customer engagement model, and bring value to the end users. Successful companies realize the CS is not just a job or even an organization; it is an organizational mindset that includes actions, investments and coordination across multiple departments, including product development, management, marketing, sales, and technical and customer support.
The customer success job archetypes
In an XaaS model, net recurring revenue (NRR) is a key metric for success. It measures the overall impact your existing customers have on revenue generation — more simply, it measures expansion net of churn.
NRR is dependent on retaining and expanding your footprint. If a customer does not adopt and realize value from your solution, they will not renew or expand their contract. This was why technology companies created customer success to drive adoption, usage and value realization about 20 years ago. Since then, many companies have implemented one or more types of customer success roles.
Companies should not design their customer success roles in a vacuum.
Initially most customer success roles were oriented around adoption or service, and were fulfilled by talent from the services organization. However, the adoption sales motion naturally results in retaining customers and expanding sales. Today, many companies are designing more commercially oriented customer success roles that focus on renewals and upselling, and a few even focus on expansion.
Companies mostly deploy two or more customer success archetypes. They usually vary by customer segment, business versus technical focus, and sales motion focus: adopt, renew, upsell and cross-sell.
While these jobs may vary from company to company, three primary customer success role archetypes exist:
This role predominantly focuses on adoption. It usually also provides insights to help the core seller or renewal role drive expansion or maintain renewals.