In 2013, the US venture capital community committed approximately 50 million to fund companies developing solutions specifically focused on helping companies to retain their customer relationships. The exact figure may be higher, as there are a number of firms still in “stealth” mode at this point. This amount does not include co-founder self-funding for smaller start-ups, or investments made by companies to expand or extend their existing products to add customer retention functions and features.
All across the SaaS industry, companies have been hiring people dedicated to the retention of customer relationships. The titles vary widely, Customer Success Management being the most common, but all have a common mission: to stop/reduce churn. The Customer Success Management Forum on LinkedIn, the premier online discussion forum for the emerging profession, began the year with 1,800 members worldwide. Today, there are more than 3,440 — with more than 150 newcomers every month. A new professional organization has formed, The Customer Success Association, and it will hold its first conference, Success-con East, in Boston on December 5th. Success-con West and Europe will follow early in 2014 (January 23rd and April 3rd)
If 2013 was a fast ride, what’s to be expected in 2014? More new vendors, vastly increased numbers of new CSM roles in SaaS companies globally, some industry “giants” taking very serious looks at formally building their own customer retention programs and teams… hold on to your hats and place your bets!
Customer Success Map Check
Have we hit the tipping point as a role/profession? If not, it won’t be long. The more important question to ask at this point is: … Read the rest
The question: “Where should the Customer Retention / Success Management team (by whatever name) be placed in a SaaS organization?” — is one of the top queries being asked all over the global software industry. Should CSM be a part of Sales? Operations? Professional Services / Implementation / On-Boarding? Does it report independently to the CEO? Worldwide, examples of all of these approaches are easy to find. To make matters even more interesting, it’s not uncommon to find a migratory path being followed by the team through the corporate structure over time as the role develops.
The Customer Success Management Organization
A corollary issue concerns the component functions of the team. What other roles might be co-located with Success Management? Why? Should Support be a part of the CSM group? How about Training? Underlying all of this are far more serious challenges: Can organizational models developed under the traditional on-premised perpetual licensed business model truly fit the new realities of SaaS? When technological features & functions can be easily duplicated by competitors, what is the true product being sold? What kind of company structure is required to produce and sustain it?
Strategic Drivers and Constraints
Whatever you want to call your “customer retention and expansion effort,” the mission/strategy charter needs to be clear-cut so that it can serve as a firm foundation for establishing and managing the process and organization of the team. There are two key design drivers to be carefully considered: A) to ensure a seamless and consistent customer experience/relationship throughout the company, and B) maximum effectiveness of utilization of employee skill sets and knowledge.
As … Read the rest