Once upon a time, in the heart of England near to Sherwood Forest, we kid “gamers” (no consoles then) would spend our time in outdoor adventures. With the kids on the block we’d invent new games, role plays and mini Olympics and we’d be recognised for our success. I was proud to be crowned “Maid Marian of Boomerangs”! I was fascinated by the deft of my boomerang whizzing through the air and spinning right back into my hands. It was magic and rewarding! The trick was mastering how to launch enough spin and orientation to ensure the boomerang would keep coming back gracefully into my hands.
Now that I’m all grown-up (well, in age at least), I’m pleased to be involved in yet another kind of “boomerang” activity, now more commonly known in business as “customer success”. Let’s face it, the role of the “boomerang team” would have sounded a little strange, don’t you think?
My enclosed infographic (above) revisits the traditional marketing and sales revenue funnel metaphor with what I have called the “recurring revenue boomerang”. In traditional funnel depictions, as soon as the bottom of the spout is reached, i.e. when the contract is signed, this is usually considered the end of the journey. To compare to my childhood pastime, it’s a bit like my bosom pal “Robin Hood of Arrows” meeting his bulls eye targets!
In those days of bows and arrows, a customer implementing a solution had to spend a huge amount of money for the implementation phase and had to keep it several years, irrespective of the success because the investment (software acquisition cost) was huge. Now in the recurring revenue model, there is no more upfront cost. A customer can easily decide to opt out of using a solution early if it is not giving returns.
In a recurring revenue model, the contract signature is just a part of the way through the customer journey. The customer experience starts right from the outset of their interaction with your company and continues across their on-going journey with your product, company and internal teams. While customers continually gain business value from their renewed investment, vendors increase their customer life time value (CLTV).
Research shows that loyal customers are worth ten times their first transaction value and it’s 65% easier to sell to them than first-timers. As my infographic shows, gained life time value is a recurring process where both customer and vendor benefit in a business win-win relationship of health and wealth:
Demand ‘n’ Turnaround, Expand ‘n’ Boomerang!
The recurring revenue boomerang maps the typical macro milestones of the customer journey and which vary in name and granularity depending on the organisation. The revenue boomerang also shows the role of the customer success team in the vendor relay to partner the customer with their expected business outcomes, create loyalty and generate health and wealth for both customer and vendor alike.
The left arm of the boomerang (demand and turnaround) illustrates the typical macro “hunter” funnel relay activities between marketing and sales teams. The right arm illustrates the “farmer” type activities of the customer success team in relay with sales and marketing teams to reinforce expansion and the boomerang effect of returned gains!
The product team covers the whole customer journey. While this team may not be directly client facing, they are the innovative backbone of all team relay interactions: client feedback and requests, user product experience, competitor benchmarking, market listening, product advisory council etc. It’s simple, no product innovation and the boomerang will plummet straight to the ground with a great big plump! The financial team is depicted from the signature onwards. In the recurring revenue model, depending on the agreed payment frequency and organisation, this team also works in seamless harmony with customer success and/or sales teams.
So what do we mean by customer success? Whilst the role of customer success may be perceived differently across countries, sectors, company sizes and business models, it is about vendors partnering customers to deliver a customer life time experience of business value and ROI to continually meet current and future expected outcomes. For positive returns and a boomerang effect, this is the result of vendor top down strategy, mindset and committed synergy between all company roles: marketing, sales, product, finance and customer success teams. This latter population is the name given to the actors who partner the client after contract signature to achieve their expected outcomes.
Depending on the company size, organisation, maturity and product implementation complexity, customer success can include several actors fulfilling different roles and names (professional services, delivery, support, on-boarding teams, account management, education, support, renewal teams, customer success…). To simplify my recurring revenue boomerang illustration, I have used the term customer success team to envelope all of the above.
For the customer to be successful and the boomerang to come full circle with returns, customer success starts right from the journey outset, when the boomerang is thrown with eagle-eye precision.
This post was originally posted on the Success Track Enterprise blog. For a brief trip through the main macro milestones of the "recurring revenue boomerang" customer journey, see the second part of this post.
About the AuthorFollow on Twitter More Content by Susan Nabeth Moore