This article has been transcribed from a presentation given at the Customer Success Festival Sydney in November 2022.
In this article, I'm going to talk about the five customer value tips that can help you shine in the coming years.
But first, I have a question for you: if I were to ask 1,000 customer success professionals the meaning of value realization for their customers, how many different answers do you think I would get? 10? 100? 1,000?
The reality is that everyone has a different definition of value and value realization. To top it off, our customers have different definitions of value realization too. This makes value realization both a fascinating and challenging topic. When it comes to how we define value, there’s a quote from Warren Buffett that really resonates with me:
“Price is what you pay and value is what you get.”
Over the past couple of years, our stakeholders have been under immense pressure to optimize their technology investments, so we’ve seen an increasing need to help our customers realize value from our products more quickly than ever. All of us are talking about value realization, so it’s no surprise that according to the latest IDC report, the ability to articulate and deliver value is becoming a competitive differentiator for organizations.
Most customer success professionals would probably agree that value realization should be the foundation of B2B sales and there should be transparency about the value realized between buyers and sellers. We shouldn't be guessing whether or not value has been realized by the customer when they make millions using our technology. We need to look at the evidence.
When customers choose to partner with us, their reputation is at stake. We owe it to them to make them successful. They expect value, and they trust us to deliver it. Now, that value might be an increase in profits, it could be a reduction in cost, or it could be an improvement in employee productivity. Whatever kind of value they’re looking for, at the end of the day, the need for value is a very genuine need that must be supported and recognized.
At Adobe, our customer success organization’s charter is centered around the notion of accelerating value for customers.
In this article, I’m going to share my top five tips on how you can do the same and become a value champion:
- Tip #5: Demonstrate value at scale
- Tip #4: Value realization is a team sport
- Tip #3: Arming decision-makers with value KPIs
- Tip #2: Nurture value realization mastery
- Tip #1: Partner closely with product management
Tip number 5: Demonstrate value at scale
As organizations explore different ways to drive efficiency, ‘scale’ has become a buzzword. Many organizations are now looking at how they can create and deliver value summaries at scale. This means investing in new tools and capabilities so that value is proactively and programmatically shared with all customers – not just on an ad hoc basis.
The good news for us is that as more and more businesses follow a recurring revenue model, there's increased interest from third-party vendors in developing tools to track post-sales value. Some vendors are even providing self-serve options that allow you to produce a value summary at the click of a button
If you want to deliver value on a scalable basis and make sure your customers are aware of that value too, you should invest in either one of these third-party tools or an in-house solution to support your Customer Success Managers (CSMs).
Tip number 4: Value realization is a team sport
Many of us believe that the customer success function is the custodian of value. However, the reality is that a lot of different teams within your organization engage with the customer and in doing so, they create value. The customer success function is not the sole custodian of value. Just as customer success is a team sport, so is value realization.
Imagine a customer who is about to renew. That customer will reflect not just on their engagements with the CS organization, but on the interactions they have had with different teams throughout your company, and those experiences will influence their perception of the value they’ve received. When you keep that in mind, value realization becomes more of a collective effort.
In our organization, CSMs are doing a great job by breaking down silos, driving cross-functional accountability, and holding the account team responsible so that when value is realized, the CSMs know about it. I look at our CSMs as value curators, value orchestrators, and value influencers. Their role is about making sure that any value realized by the customer is collated, well articulated, and, most importantly, acknowledged by the customer.
A few CSMs take it a step further and hold customers accountable for sharing the value and outcomes they have realized on a quarterly or monthly basis. In that way, they're creating a culture of shared value. I feel that this is a great shift forward. Customers’ willingness to share the value they’ve realized also speaks volumes about the credibility and trust our CSMs have.
Holding customers accountable is a totally different approach – it's a pull versus a push. These customers are seen as strategic partners who help build our brand within their organizations by articulating the impact we have. The majority of these customer stakeholders are seen as rock stars within their own organizations, and we’ve seen that they often get promoted. Showing value in this way really is a win-win.
It’s amazing for our CSMs too – driving this impact on their customers’ organizations and helping their partners to succeed gives them enormous job satisfaction. It also shines a light on the impact of their role.
It’s time we all started leveraging our ecosystems to create that value. Think about who is on your value team. Look at ways you can include the customer as part of your team too. At the end of the day, this is going to help everybody win.
Tip number 3: Arming decision-makers with value KPIs
A few years back, I had a retail client who always spoke about how well they were using the product and what a massive help to the team it was. However, as the renewal date drew closer, the customer expressed that they needed some more time to decide. Does that sound familiar?
The reason these situations are so common is a concept known as the paradox of choice. In 2000, some researchers ran a study to find out more about this concept. They gave out samples of jam to supermarket shoppers. When they shared 24 samples, only 3% of those who tasted it went on to buy jam. When they had only six different jam samples, surprisingly, almost 40% of shoppers ended up purchasing the jam.
The conclusion the researchers came to is that as the number of choices increases, customers get overwhelmed. They're unable to process this influx of information, so either the decision is parked or they make no decision at all. This is no different for your customers. When multiple vendors approach them, they’re going to struggle to reach a decision too.
Thankfully, it doesn't have to be this way. Having value as a KPI can be a game changer for your organization. If the customer consistently sees the value being delivered, when the time comes for them to make a decision it's a no-brainer – you’ve already provided them with a hundred reasons to choose you.
Over the next couple of years, I predict that we will see enrichment in value KPIs. We’ll also see more value summaries, and the quality of those summaries will continue to rise. While traditional metrics like customer health, adoption, retention, and churn will continue to be tracked, there'll be a new focus on new KPIs like time to value, time to go live, and time to initial value. Let’s all start thinking about the value KPIs we should monitor going forward.
Tip number 2: Nurture value realization mastery
Across many organizations, the customer success charter is focused just on adoption, whereas customers these days are fixated on getting value. They're asking for insights on the outcome of their investments. This means we need to nurture a value mindset.
CSMs are currently seen as value creators, value orchestrators, and value influencers. As we look to the future of value, CSMs have to become value engineers. This means building mastery so that they can have an in-depth understanding of the customer's needs, tie them back to the product capabilities, and create a path to value that will help the customer realize measurable impact.
A lot of our CSMs are not there yet, so this is a muscle we need to build. As CS leaders, I would strongly encourage you to give your teams the bandwidth to start exploring value realization techniques and methodologies.
Evidence shows that once customers receive value summaries, there is an increase in retention and expansion. In fact, within Adobe, there was a 10-point increase in expansion and retention for those customers who were consistently getting value summaries, so start thinking about how you can help your CSMs master value realization and better document that value to share with your customers.
Tip number 1: Partner closely with product management
Want to know an even better combination than peanut butter and jelly? Product and customer success.
Product teams define our promise to the customer. The product then manifests itself into such a compelling value proposition that the customer is willing to pay for it on a recurring basis. That makes product teams the backbone of value realization. The role and the remit of CS teams is to fulfill that promise and to make sure that they realize that value.
Product teams and CS teams work towards a single goal: delighting customers, the key to which is product adoption. When both teams work together to achieve that goal, they can do wonders.
Product and CS are also interdependent. Customer success teams depend on product teams to create a low-friction solution that they don’t have to spend hours explaining to customers. Product teams also hold the key to prescriptive and predictive analytics that will inform our strategies for each account.
Meanwhile, product teams depend on us to understand the voice of the customer and share product feedback. Product teams also want to partner with us to drive participation in beta programs and pilots. They need us to showcase the product roadmap to customers too.
In an ideal world product management and customer success teams should have a shared adoption target. This will create better collaboration on quick wins, adoption, and use cases. It will also lead to clearer alignment between go-to-market and value realization strategies.
Value realization is dependent on adoption, and adoption is dependent on the product. Over the last few years, there has been an advancement in the adoption insights available, thanks to product teams, and this has advanced the field of value. I strongly encourage you to start looking at the ways you can build a better partnership with your product teams and make it a win-win for both functions.
Like this article?
Then why not check out the real deal? You can watch a live presentation – either in-person or virtually – with CS experts like Aishwarya from global companies like Adobe, Microsoft, LinkedIn, Amazon Web Services and Google by attending a Customer Success Festival.
