The 3 Layers of Customer Success

Hi, Markus here. Welcome to a premium edition of the Customer-Value-Led-Growth Newsletter.

Every week, I share strategies, guides, and frameworks to help you create exceptional value for your customers and company.

If you are not a paid subscriber, here’s what you might have missed:

• 5 highly effective Tools every CS Team needs to use

• The not-so-Secret to high Product Adoption

• How to build a Customer Success Metric System that rocks

• Customer Onboarding that drives Growth

• How to build a dedicated Customer Success Plan

Customer Success is not a single team, it’s an outcome. It is the result of the join efforts of all team within a SaaS company.

That sounds to be too good to be true and it often is. If you’ve made the same experience as I did it happens like once in a million.

Ok, I’m exaggerating a bit but I think we can agree that you don’t see it more than 1 in a 100. Still not a great ratio, isn’t it?

In the average silo-operated SaaS company, CSM teams are on their own and it sets them up for failure.

It’s like having a football team where attackers, midfielders and defenders all play a different game.

Misalignment on Customer Success is the costliest mistake companies can make. Without exaggeration, it can lead to leaving 80-90% of revenue on the table.

In today’s post you’ll learn why and how to build an orchestrated CS motion.

1.1 Positioning and Value Proposition

Where does Customer Success even start? The first thing that comes to mind for most people: After the purchase has been completed. Wrong answer. It starts as soon as people read your value proposition.

Because that’s when you start raising customer expectations. The mission of all your CS efforts is to fulfill these expectations. The problem is that most SaaS companies don’t have proper positioning and resulting value proposition.

So they are promising stuff like “supercharge your …” that leaves an infinite space for various interpretations. As a consequence, customers often come with the wrong expectations.

In CSM we are often quick to blame Sales for overselling the product. But if there’s no clearly defined value proposition in place, it’s only the logical consequence.

1.2 Ideal Customer Profiles

For too long SaaS companies have been led by greed and ego. Too many founders and execs play the game for getting to a big fast exit and sailing into the sunset.

Therefore their Ideal Customers are everybody who can afford their product. Because the larger your “TAM” the faster and further you will grow.

The most successful SaaS companies don’t do that. They understand that this is not how things work. They are not acquiring everyone with a pulse. They are picky.

They ask 2 questions:

• Who cares the most about the value we have to offer?

• Who gets the most out of it?

If you want to help your customers to e.g. reduce sales cycles your offer will be most attractive to those where they are really long.

Reducing them from 10 to 7 days will likely not have the same value as reducing it from 100 to 70 days.

1.3 Product Design

If you know what you want to deliver and who it is for you can build you can build a dedicated product. But that’s not how most products are built. People put some features and functions together and think about marketing and selling afterwards.

“No market need” is the most common reason why SaaS startups fail. If your product is more or less a random mix of features and functions it’s ultra hard and super expensive to find the right audience and craft a compelling value proposition.

Despite a lot of people thinking Product-Led-Growth is the holy grail of SaaS the business model is still built on retention. If we can trust the research, up to 50% of people log into a product only once and 75% are gone within the first week.

Why does that happen? Weak onboarding aside, people simply find out the product is not what they need after the purchase. There’s no Any-Led-Growth with these economics. There’s only noise.