To Charge or Not to Charge, Now THAT is the Question Image

To Charge or Not to Charge, Now THAT is the Question

By Angela Scott

Angela is the VP of Customer Success at SaaS vendor Reevoo in London. Prior to Reevoo she spent over 15 years at Oracle Corporation, most recently as a member of the senior management team within the EMEA Customer Success organisation.

I am 90 days into my current role. The term ‘Customer Success’ is about 100 days old at Reevoo, my current company. I am juggling a lot of balls as you can imagine! Whether or not to charge for some or even all of the services of a CSM is high on my agenda.

Had I been asked to comment on this topic only 6 months ago, my answer would have been an emphatic NO and this would have been a very short article indeed! Why should customers have to pay an additional charge on top of their subscription fee?

My response when asked this question now is “it depends.” I’m not usually one to sit on the fence so let me share with you the questions I am mulling over.

1. What type of solution are we offering?

There is a big difference between solutions that companies must have to survive day-to-day and solutions they need to stay on the leading edge ahead of their competition.

Mission critical solutions like Financials or HR are often still budgeted for solely out of a technology spend budget calved out for that line of business. This is despite the fact that these solutions can make a huge impact on a company’s overall ability to innovate.

Innovation critical solutions that can reposition brand perception often have no involvement or budget from IT and are driven purely by their business owners who have to justify spend along with numerous unrelated projects.

When looking inwards at how your company operates, you first need to determine what expectations you’re setting with your customers on the type of solution they are getting – from sales to product teams, from the implementation team and customer success, in fact anyone who is in contact with your customer.

If you’re not at the core of helping your customer innovate through technology AND service, it will be very hard to charge them for something they think they are already paying for.

For a deep dive on monetizing Customer Success, check out the 58-minute archived webinar with Gainsight's CEO Nick Mehta, “Should You Charge For Customer Success?”

2. How do our customers realise value?

Customer Success should be about getting your customers to realise the full potential and value of their investment. It’s not only about onboarding and adoption, stickiness and growth come at the point value is realised.

When looking outward to your customer base, having C-level buy-in has a huge impact on whether your customers have an appetite to pay for additional services. If your CSMs are not building relationships at the right level of influence, then any kind of expansion conversation will be difficult, perhaps even the renewal one.

Being seen at the heart of company strategy sets you up for offering your customers more, both platform and services, and they will be much more willing to pay a premium for this. If you’re seen as tactical or nice to have, then you don’t yet understand how to show the true value of your solution and help your customers realise it in their own business.

3. What’s your maturity level?

If your CEO and / or CFO see Customer Success as an overhead or cost centre, then you may be driven down a path to charging your customers for completely the wrong reasons. Customer Success done correctly ensures renewal and growth in your customer base and this should help to shift the traditional reactive view of customer service towards KPIs that are right at the heart of what make the customer and your company successful.

If you are coming out of the legacy of a client services or account management model, your company may first need to get to grips with the basic concept of customer success. First determine what activities CSMs do as standard, and then what is a premium that customers need to pay for.

On the flip side, if your customer base is growing and your churn is heading towards the negative, now could be the time to think about premium services which could be offered to newly signed customers at an additional cost. While this provides an additional revenue stream it becomes harder to control what is delivered and by whom. This is why the standard foundation needs to be laid first.

Learn more in the archived webinar “Should You Charge For Customer Success?” featuring Gainsight's CEO Nick Mehta and SaaS Advisor Omid Razavi.

4. What segment do they fit into?

As part of any customer success strategy, whether you decide to charge for additional services or not, you cannot offer a one size fits all approach. As customer success scales in your business, one of the ways to differentiate (besides considerations such as current revenue and potential lifetime value) is appetite for growth with your solution.

You may have a number of top tier customers where your engagement is very tactical, others may be on the journey with you inputting into your roadmap and driving innovation in the products you offer. Both may have the same potential but their likelihood for growth will be vastly different.

If you’re able to make this distinction in your top tier accounts easily then you may have the list of customers most open to premium services whatever you then define these to be.

I don’t claim this is an exhaustive list of considerations by any means, but these are some of the important factors I am taking into account when deciding if and how my own customer base should pay for customer success in the future.

About Reevoo

Reevoo, a leader in enterprise level content marketing solutions, helps brands turn the voice of the customer into business value. Reevoo collects trusted user generated content to provide businesses with a platform for consumer engagement, advocacy and customer intelligence. Reevoo’s Ratings & Reviews, Social and Customer Intelligence products work together to help businesses engage with, listen to and learn from their customers. Millions of shoppers use Reevoo to make better buying decisions in their everyday lives. Today, Reevoo is seen in more than 60 countries and in 30 different languages. Reevoo is headquartered in the Southwark borough of London, UK.
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Angela Scott VP Customer Success, Reevoo
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  1. Steven Wilson
    Apr 13th, 2016Reply

    I’ve seen that customers who pay for Customer Success resources are more successful with the product (adopt more, sooner) than those who receive it for “free”. There are probably several factors at play, but customers who pay are interested in getting value for their money. They have skin in the game and the owner of the budget where the CSM fees land wants to show a benefit. The result is that the customer commits the right resources to make the most of the CSM investment. The CSM can more easily get the attention of a higher level audience and, assuming the CSM is able to effectively communicate vision and value, often a bigger commitment for wider, faster adoption.

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