All examples used in this article are hypothetical. They have been formulated through comparing experiences with my peers over a decade's work in Product leadership. Any resemblance to organisations you may know is purely coincidental.
This article is a 'long-read'. To read snippets, key ideas and examples, follow me on twitter: @AConsidineTong.
Introduction
In most organisations, it is not uncommon for there to be some degree of tension between Product and Customer Success teams. Sometimes a bit of friction can be healthy; but sometimes it is not.
Significantly, if Product and Customer Success teams can work together effectively, we can drive significant positive change in our businesses through impact on long-term strategy.
Product-Customer Success Tensions
I hear often that Customer Success managers might feel:
1. They don't get regular updates from Product about when new features are coming and when these can be delivered to customers;
2. They don't get the support to communicate new features and the long-term roadmap to their customers in terms of what they mean to your business and that of your customer;
3. They are not empowered to explain to a customer WHY the product is changing in the way it is, and how this fulfils your customers' aims;
4. They can't give their customers what they want, need and expect in the timelines they want need and expect, because it seems like the Product team isn't listening.
If this sounds familiar, then I can tell you your Product team is failing you. And you can tell them that from me, seriously. Send them my details. The very least you can expect from your Product function is to:
- Explain the roadmap, new features and what this means for the business and for your customers
- Strive to give customers what they want, need and expect, according to the timelines they want, need and expect.
Neither of these should be difficult because Product and Customer Success teams actually have the same key goals:
1. Give customers the best possible experience when interacting with our products
2. Derive more value from each customer (through upsell, increased volumes, and attitudinal loyalty)
That said, there are ways that Customer Success teams can get the best out of Product teams (and vice versa), and foster a mutually beneficial relationship. That is what this article is about.
Product and Customer Success collaboration
The reality is that good Product Leaders want there to be two-way communication between Product and Customer Success teams. We know you have insights that can help us, and we want to empower you to keep our customers happy. Good Product leaders have ownership of Product strategy that ultimately drives Business strategy, and we can't do that without help from other teams, and especially, Customer Success.
The question then is HOW do we inculcate this two-way communication?
How to help us help you
The answer is DATA. Why? We said earlier that Product and Success teams have the same aim, and we cn achiebe those aims through the same execution approach. Good Product teams, like good Customer Success teams need to be two things in order to best serve our customers and ensure their success:
1. Proactive
2. Predictive
And if we're going to be those things, we need to be analytics-driven.
If you work in a company that takes Customer Success seriously, or aspires to, then you probably already have access to and insight into a large range of customer success metrics. Many of these are invaluable to Product teams too. These include but are not limited to:
- Overall Customer Health scores
- Annual/monthly recurring revenue (ARR/MRR)
- Account profitability
- Product Adoption and Usage data
- Churn (customer and product)
- Upsell and down-sell figures
- Net Promotor Score (NPS)
Now we are going to look at some examples of how these metrics could be calculated and used for and by both Product and Customer Success to influence overall Product and Business Strategy:
Customer Health Score
Your Product team might not be interested in a particular customer's individual Overall Health Score on its own, but they will be interested in understanding a macro view of the underlying metrics that have been combined to create this measure, which may include:
- Product adoption
- Customer Support calls/interactions
- Self-sufficiency
- Community involvement
Why do these matter to Product Leaders?
Product Adoption
We want to understand which products - or features within a product - are being used, by which users and when. This provides insight into which areas may need further enhancements - either because they are heavily used and therefore making enhancements here will deliver the most value to the customer - or because they are not used at all and might be unfit for purpose, or simply not needed at all!
Let's look at a hypothetical example: you notice that your native reporting suite is not being used heavily across your customer base. Only 15% of the users you would expect to interact with the feature are doing so. Firstly, this insight can only be derived by CS teams sharing their data with Product, and Product analysing this at a micro level. This analysis then leads to an in-depth workshop with users who reveal the reasons:
a) The standard reports don't answer the questions they care about
b) This doesn't matter because most of your customers take an extract of raw data and file this into their advanced BI suites, where they run the analysis they want to.
So what do you do? It's not clear that there's a problem here: customers aren't complaining (yet) but this insight gives the Product team and Customer Success team a basis for a PROACTIVE change in strategy, which might include:
- Improving the performance of the standard reports by re-configuring or re-developing them to answer more pertinent questions, driven by customer demand
- Ensuring that taking an extract of raw data for customers to feed into their own BI suites is as easy as possible
By doing so, Customer Success and Product have worked together, using data to PROACTIVELY help and manage our customers' experience.
Customer Support calls and Interactions vs Self-sufficiency
If a customer is interacting excessively with customer support (in comparison to the overall norm), something is wrong.
It could be that they don't understand how to use the product and need more training.
It could be that the product doesn't actually solve the problem(s) they wanted it to.
It could be that there is something wrong with the product;
Or it could be all three!
Giving your Product team access to the number, type and duration of support requests will help the organisation to understand the issue(s).
If the issue is training, Product can work with Customer Success to ensure users are better educated.
If the issue is that the product doesn't solve the customer's problem(s), Product can help by championing changes to the set up and configuration of the product for that custome.
If there is something wrong with the product, then Product is the team to investigate, define and design the needed improvements, and get those prioritised and onto the roadmap.
And here, again, data is key: being able to quantify the cost of NOT making these changes (i.e. the amount of time and money spent on support calls) will enable Product to make a strong case for making these changes sooner rather than later, in turn enabling your customers' success.
Finally, tracking and sharing Support data between CS and Product teams on a regular cadence will allow both teams to PREDICT when issues may arise and change strategy to avoid churn and customer disappointment.
Community Involvement
Customers who engage in the community channels you make available to them are likely to be more knowledgeable and stronger evangelists for your product(s). Giving Product leaders access to such forums - both physical and digital - and the data generated through them gives them insight into what really matters to customers. In doing so, we can all appreciate what works well and what does not, and an on-the-ground understanding of when, where and how our product is used.
When it comes to testing out new products, features and concepts, Product teams need this qualitative feedback, and we want Customer Success to help us obtain it. These forums are fertile ground of genuine interaction, let's share them.
Outside of the Overall Health Score, Product Leaders need to understand the financial metrics associated with each of your customers/customer segments. And here, even more than the metrics above, the macro view needs to triumph over the micro to deliver value to the business.
ARR/Account profitability and Contract Growth
Understanding the ARR associated with each account (and, more, the macro view across all accounts) allows Product teams to make long-term strategic decisions about which products need further investment and attention, and conversely which may need to be sun-setted.
In this example, if the data indicates that those accounts using Product A are barely profitable, but those using Product B are highly profitable, it alerts Product teams to the need to investigate. This is an outcome that might not have been obvious on an account-by-account basis and again indicated the need for CS to share data with Product on a macro level.
It might be that the Product A isn't fit for purpose, or that it hasn't been deployed to the right customers or configured in the right way. Product B, may be fit for purpose, but perhaps it could be even better, or perhaps it could be tweaked in order to sell it in new markets and/or to new verticals. As such, a number of potential strategic approaches are revealed for consideration:
1. Seek out user/customer feedback on Product A: what does it not do that users want it to do; what aspects of the product inhibit users from their aims; what would users like the product to enable them to do?
2. Explore potential new markets (verticals and geographies) for Product B: where could Product B be sold; to whom could it be sold without extensive feature/product changes; how could it's stickiness be increased within existing customers?
In this way, Customer Success-owned financial metrics are directly used to inform Product Strategy PROACTIVELY, and again, this approach is only possible when CS and Product collaborate.
Churn
Similarly to account profitability, Product teams want to understand account churn. The obvious reason is to play a role in PREDICTING and PROACTIVELY preventing/managing churn where possible - for example by championing a customer's desired CRs or improving a sub-optimal offering.
Let's say that Company X has 3 products, all of which are based on a single platform. As the company grew, Product A was sold to Customer Group A, Product B to Customer Group B, and Product C to Customer Group C. Over time though, these products have been cross-sold and now customers may take one, two or all three products in combination. At the same time, the need to maintain and support all three Products has grown and become increasingly complex and difficult. Recently, it has emerged that those accounts using only Product B have seen a significant amount of churn and more churn is threatened due to an emerging competitor. Those accounts using only Product B are also less profitable than those using Products A and C or a combination of two or three.
An obvious decision in this scenario might be to nix Product B - it's costing money to maintain, and not providing any significant return. However, if Customer Success and Product teams work together a more nuanced picture may emerge that provides more effective decision making for the business. Through the sharing of usage data, customer journey and needs, and the dependency of these factors across the portfolio, a number of scenarios become apparent:
Those customers using Product A or C with Product B are dependent on the additional functionality and integrations Product B provides, even though it is ancilliary.
Those customers using Product B alone are not aware of how it can be integrated with other products - belonging to Company X or not - and therefore usage is low, and pricing is based on usage.
Those custmers using Product A or Product C alone could benefit from a Product B 'add-on'.
These scenarios lead to a number of possible Product strategies: perhaps Product B needs to be re-vamped, or perhaps it needs to be sun-setted so that the Company can concentrate its on-going investment into its more profitable products. But in this situation, it is only through sharing data between Customer Success and Product that we can make a proactive and strategic decision about how to address it. In this scenario, if CS or Product had not collaborated and instead made independent decisions then the business would have missed out on long-term succss.
CONCLUSION
This is a long article, so here's what I'd like you to take away:
1. Product and Customer Success teams want the same things.
2. Product and Customer Success need to be both proactive and predictive.
3. Product want and need input from Customer Success in order to facilitate data-driven decision making.
4. Data is key - be that quantitative or qualitative.
5. When Customer Success and Product leaders work together we can be one of the most powerful drivers of business strategy. Use this power!
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