Alan Armstrong, Founder and CEO at Eigenworks
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We have taken the key insights from the pods and put them into "Bite-Size" chunks.
We have taken the key insights from the pods and put them into "Bite-Size" chunks.
Key quotes (play the relevant audio link to hear Alan expand on each point):
We help people understand the story behind churn. There is so much data available to Customer Success teams and we know a lot about usage but there is a point at which that leads to a dead-end and we don’t understand really what we need to do to improve the key metrics of Customer Success like retention, up-sell and cross-sell.
We have coined the term “Green Churn”, which are cancellations, downsize or net-negative churn that occurs even when usage or healthscores are very high. It points to context (or what we call the story, dialogue or journey) and the metrics may look green but the story in fact is a different matter.
There is a big difference between the reason for churn or cancellation and the trigger....When we look through the reason codes that show why a customer cancelled, we’ll hear things like “the budget was cut”, or “the price was too high”, or “we re-organised”, and so that’s written down as the reason for churn. In fact, that was just the trigger that enabled the organisation to rethink what they were doing....The reason for churn is that they weren’t getting value.
The customer said “I would have defended this, regardless of price, if I had people who said they needed this tool to do their job”, so price was not the reason for churn – a hard-to-use product was the reason for churn but the first excuse that they tell a CSM is the price is too high.
I think it starts with the hiring process and think about the profile of the CSM that you are hiring; are we hiring people who are there to please or find people who also have more “detective-type” skills?
If we get clear on the question(s) and clear on the segment, we can then conduct 20-30 conversations within that segment and that will then give us intelligence that we can lean on and we’re getting beyond anecdotes. There’s a famous phrase “data is not the same as the plural of anecdote”, and in the qualitative research world, 20-30 conversations is a magic tipping-point where you reach saturation.
Customer Success really has to be a function and a mindset of an entire company; who should own that? Probably the CEO.
Customer Success brings us in to analyse churn - not because they don’t know why - but because nobody else will believe them....It’s amazing how teams will react to the truth.
Read the full podcast transcript below (please note that in some cases the wording has been slightly altered for ease of reading but the emphasis remains exactly the same):
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