There’s no such thing as post sales
At Crane we absolutely love working on all things Go to market with early stage European Enterprise software startups.
What founders, startup executives and (especially) investors typically mean when they refer to “Go to market” is how best to plan, organise and utilise your (often limited) resources for effective Sales and Marketing.
The accepted wisdom being that if you have a great product that offers value and you can nail your Sales and Marketing (or “Go to market fit” as it’s sometimes referred to), then customers will come flooding in and the long term success of your business is all but assured.
What we’ve learned at Crane however is that even when companies have a great product and have built a successful Sales and Marketing motion, long term success is far from guaranteed. That’s because having a great product and attracting and converting prospects is really only half the battle.
To truly have any chance of becoming a company that can grow to millions in (sustainable) recurring revenue, you not only need a great product that you can market and sell effectively, you really have to figure out (and invest early in) how you are going to keep and grow those customers forever.
So the answer would seem to be pretty obvious — create a Customer Success team right?
Well yes….and no (if only life were so simple!)
We discussed this recently with over 40 founders and executives from the Crane portfolio at one of our regular (virtual) “Go to market” breakfast sessions.
These breakfast sessions are designed to share ideas and learning from across the portfolio, and in this instance we heard from three of our companies who have a particularly strong track record of ensuring that their customers become a healthy and predictable source of new revenue growth.
There were a number of key patterns that emerged from the session that really helped to explain why these companies in particular are doing so well.
Buyer vs deployer
Not all customers have outcomes in mind when they purchase software. At face value this might sound a little ridiculous — after all, why would anyone spend tens or even hundreds of thousands of dollars on software if they don’t have any outcomes for it in mind?
The first pattern that emerged from the session was that these companies have realised (and accounted for) the fact that there is often a very big difference between the buyer (who definitely has specific outcomes in mind) and the people tasked with deploying and eventually using the software (the “deployer”).
The larger the customer the more disconnected the buyer and deployer groups tend to be and if the latter has little or no context on what the software is for, why it was purchased and what outcomes it is supposed to deliver, then a whole host of challenges begin to arise that ultimately impact your ability to grow new revenue from them.
The most common of these challenges is that deployers have typically been “given” the task of realising the purchaser’s desired outcomes on top of their (already busy) day jobs. Unless they are personally invested in making it a success, it’s quite common for them to be unresponsive or slow moving, resulting in deployments dragging on for a long time or never getting started. At best you might have to “resell” the solution to them which takes up additional time and effort.
The purchaser may also be unresponsive (or unwilling) to help get things moving as a result of what I like to call “deal fatigue” (orchestrating and closing a deal on top of a busy day job can be an exhausting process), or they may be frustrated at the lack of progress (which is always the vendors fault!) thus eroding their faith in you and damaging your ability to grow revenue with them.
Understanding the “distance” between the purchaser and the deployer/end user and preparing to close it during the sales process is something each of these companies do particularly well. Specifically, together with commercial and technical discovery in the sales process, they also –
- Assess how capable (and willing) the customer is to deploy, configure and onboard the solution in a timely manner
- Educate the customer on what skills, knowledge and resources will need to be in place, and work with them to identify the right “deployers”
- Start building a Customer Success focused relationship with the purchaser and deployer(s) at the right time, setting expectations and closing any skills, knowledge and resourcing gaps
Alignment, alignment, alignment
Another key pattern that emerged from the breakfast session was that each of these companies has a very tight alignment between their Sales and Success teams. This has less to do with reporting lines and org structure and much more to do with using territories and incentive structures to drive the right (long term) behaviours.
For example, these companies align their Sales and Success teams by either a common geographical territory, customer segment or industry vertical so they form an “account team”. The account team is then tasked to meet regularly to prioritise activities on what is now a “shared book of business”.
This structure ensures everyone has the necessary context on deals, customer stakeholders and potential blockers and in most cases eliminates the need for a “hand over” as the Success Manager can be introduced to the purchaser and deployer(s) at the right time in a more “organic” fashion.
If issues do still arise after the deal has closed, then the Success Manager is now much better placed to engage the original purchaser to get things moving because they are both known to one another (which in turn frees up the Sales rep to fully focus on new revenue opportunities).
A key way these companies ensure the effectiveness of the account team structure is by driving the right behaviours with shared incentives.
For example, one of the companies makes part of their Sales reps’ compensation conditional on customers being fully deployed in a certain time frame thus creating a strong incentive for them to engage with their aligned Success Manager to ensure the right customer discovery, education and relationship introductions have taken place.
Similarly, a percentage of their aligned Success Manager’s compensation is based on attachment to opportunities of a certain size and ensuring deployments are completed within the first 30 days.
In a high volume sales environment, the account team can also prioritise which deals get this high level of engagement versus prospects that will be engaged in a more “low touch” fashion with say relevant collateral or introduction to a deployment partner .
Painting a picture during the sales process of what things will look like after the deal has closed can also help create a lot of customer enthusiasm and additional momentum to get the deal done.
Success is not a department
Finally, the most important pattern that emerged from the breakfast session is that these companies have founders and executives that view the world on a much longer timeline than the current quarter.
In particular their view of what “Go to market” means is not just how to market and sell effectively, but how to ensure that everyone is organised, aligned, measured and incentivised to create the conditions to keep and grow revenue from every single customer.
Instead of viewing a customer’s long term success and well being as the responsibility of a particular department, these founders and executives operate on the basis that long term value for both their own business and their customer’s can only be achieved if the mindset of customer success is part of the “fabric” of their entire organisation.
Or to put it another way, they believe that “there is no such thing as post sales” but rather there is the first sale with a customer, the next sale with them and so on, and in order to maximise the conditions for this, Customer Success has to begin in the sales cycle.
This belief that “success is everyone’s business” is dependent on a whole host of factors including the experiences and influences of the founders (and in no small part what their investors are telling them) and is something that we’ll explore further in a future post.
In the meantime, if you’d like to learn more about how we work with our portfolio at Crane or are interested in brainstorming ideas about your own Enterprise software company then feel free to grab a slot at my regular office hours here.