The document discusses the monetization of customer success services, proposing a tiered approach with baseline and premium plans to maximize customer value and revenue. It emphasizes the importance of customer success in helping clients achieve desired outcomes and discusses various service delivery principles to enhance customer experience. Key metrics for evaluating success include premium attach rates, renewal rates, and customer satisfaction scores.

1. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
SHOULD YOU CHARGE FOR
CUSTOMER SUCCESS?

2. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
Omid Razavi, Ph.D.
SaaS Customer Success
& Services Advisor
Nick Mehta
Chief Executive Officer
Gainsight
SHOULD YOU CHARGE FOR CUSTOMER SUCCESS?

3. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
SHOULD YOU CHARGE FOR
CUSTOMER SUCCESS?
YES!

4. ©2015 Gainsight. All Rights Reserved.
©orazavi
Customer Success Monetization Approach
1. Offer a baseline success plan to all customers at no charge.
2. Offer one or more premium success plans to all or targeted customers.
3. Allow customer to choose their plan based on the value (and price).
4. Develop and market the success plans and your services portfolio.
Included In
Subscription
Recurring
Services ($)
Project
Services ($)
Premium Success Plan(s)
Baseline Success Plan
Services Portfolio
Packaged Services
Success
Services
Value-Added
Services
…

5. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
“Customer Success is when your customers
achieve their desired outcomes through
their interactions with your company.”
– Lincoln Murphy

6. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
“Customer success is customers achieving
their business outcomes through their
experiences in their journey with you.”
Customer Success =0
∞
⎰ (Customer Experience + Business Outcome) dt

7. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
75%
of all interactions are with
Services
Source: Gartner, Agenda Overview for Customer Strategy and Experience Management
All
Others
Services Interactions Are More Important
than Ever!

8. ©2015 Gainsight. All Rights Reserved.
©orazavi
Archetypal Customer Journey Map
Buy Implement
Churn
Value Growth
Renew
Value Discovery
LEARN
Customers discover
your company and
your offerings
Value Definition
TRY
Customers evaluate
those products and
services
Value Delivery
BUY & DEPLOY
Customers buy
(hopefully) and
implement them
Value Realization
USE
Customers realize
the benefits and
the outcome
Value Validation
GROW
Customer decides
to renew, grow or
to leave
Value Advocacy
R-DaysEngage

9. ©2015 Gainsight. All Rights Reserved.
©orazavi
Customer Value Along the Journey MapCustomerValue
Time
Services
(Primary)
Services
(Shared)
Sales &
Marketing
Win! Go Live!
Try/
Pre-board
Buy
Onboard
Deploy
Use
Renew/
Grow/
Refer
Learn
Success Plan Attributes CSM Coverage Fee
Premium 2 Personalized/
High Touch
1 to 1 $$
Premium 1 Personalized
& Automated
1 to N $
Baseline Automated/
Tech Touch
Self-Service
or Pooled
None
Renew!
Premium 1
Premium 2
Baseline

10. ©2015 Gainsight. All Rights Reserved.
©orazavi
Traditional Services Disciplines
Consulting/
Professional
Services
Timeor
ProjectBased
Recurringor
SubscriptionBased
Support
Services
Training/
Education
Services
Managed
Services
 Sold as projects with deliverables and timelines
 Sold as a support plan with SLAs and entitlements

11. ©2015 Gainsight. All Rights Reserved.
©orazavi
Timeor
ProjectBased
Recurringor
SubscriptionBased
What About Customer Success Services
Free or for Fee?
Customer Success Management
A services portfolio to help customers
Adoption
Services
Business
Outcome
Realization
Expansion/
Renewal
Management
Accelerate their
adoption & productivity
Realize business value
from your solution
Maximize their
investment in you.

12. ©2015 Gainsight. All Rights Reserved.
©orazavi
Customer Value Perception & Propensity to Pay
Low Propensity High Propensity
Propensity to Pay
BusinessValue
Low Value
High Value
Adoption
Services
Business
Outcome
Realization
Mission
Critical
Services
Basic
Support
Services
Customer Success
Support Services

13. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
“Yesterday, we were mostly about support.
Today, we are about adoption and renewal.
Tomorrow, we will be mostly about
delivering business outcomes.”
- A VP of Customer Success

14. ©2015 Gainsight. All Rights Reserved.
©orazavi
• Total Value (ACV or TCV $)
Customer Segmentation and Tiered Success Plans
Business Sensitivity
IT Maturity
SLA Expectations
Large
Enterprise
Business
Critical
Mature
Low
Stringent
SMB
Non-
Critical
Limited
High
Limited
Price Sensitivity
Support Demand
Baseline Premium 1 Premium 2 Business
Critical
Basic
Customer Oriented Segmentation Market Oriented Segmentation
• Services Value ($)
• Revenue ($)
• Industry (Domain IP)
• Product / Technology
• Geography / Region

15. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
Customer Value is both
Intellectual and Emotional

16. ©2015 Gainsight. All Rights Reserved.
©orazavi
Goals for Premium Success Plans
Higher Adoption
Measure and Close Consumption Gap
Incremental Revenue
• Usage and Adoption Metric Targets
• 15% acceleration to value
• 50% attach rate in 2 years
Pilot Business Outcome Services
Improved Customer Experience
Run Customer Success as a Business
• Customer Business Performance
Targets (Value Realization)
• Self Fund Expansion at 50+% Margin
• Significant NPS/C-SAT Gains

17. ©2015 Gainsight. All Rights Reserved.
©orazavi
Service Design
UX
CX
Application Design
Mobile Design
Customer Success
Support Services
Consulting
Website Design
CX: Customer Experience
UX: User Experience
Education Services
Digital and Non-Digital Experience
Service Design
Create seamless customer experiences that drive differentiation and
long-term customer value.

18. ©2015 Gainsight. All Rights Reserved.
©orazavi
Service Design & Delivery Principles
Service Design:
 Easy to do business with and transparent in our operations.
 Scalable processes to on-board, retain & grow customers.
 Automation for identified repetitive, low-value activities.
Service Delivery:
 Expectation Setting with customers, early and clearly.
 Self-Service easy for customers to help themselves.
 Multiple Channels for customers to communicate, and for us to listen.
 Speed to engage, resolve, learn from mistakes and improve.
Customer Success
Support Services
Consulting
Education Services
Service Design
+ Simplicity

19. ©2015 Gainsight. All Rights Reserved.
©orazavi
Package Services Upgrade Cycle
Packaging
2015
Packaging
2017
Packaging
2014
Enablement
Sales
RevRec
Finance
CoE
Services
User Stories
Prod
Mgmt
Customer
Workshop/
Early Access
CoE: Center of Excellence
+ Success Science
Packaging
2016

20. ©2015 Gainsight. All Rights Reserved.
©orazavi
The 10 Stages of the Services Packaging Process
0- PORTFOLIO 1- ASSESS 2- ALPHA 3 - PILOT 4 - BETA 5 - GA
Customer
Success
Support
Services
Consulting
Education
Services
Others
“Prioritize “Develop “Test “Scale
6. PRICE
8. SELL THE
VALUE
9. DELIVER THE
BENEFITS
10. UPGRADE EVERY
12-18 MONTHS
Milestone #1 Milestone #2 Milestone #3 Final Milestone
7. LAUNCH

21. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
In SaaS, where product is developed
and distributed as-a-service,
Services are developed and
packaged as a product.
Product Service

22. ©2015 Gainsight. All Rights Reserved.
©orazavi
Premium Success Plan Pricing Example
ACV
$100K $1M
$10K
$20K
Cost (50% Margin)
Price
Customer Value
(200+% ROI)
$40K
Premium Success Plan at 20% of ACV for the 1st million and at 10% after
that, with floor price of $20K.
Not to scale

23. ©2015 Gainsight. All Rights Reserved.
©orazavi
Customer Success Tiers Landscape with Example
Tier 0
Tier 1
Tier 2
Tier 3
Included
10%
20%
30%
-
-
-
-
Baseline
Plans
ExtensiveLimited Plan Features, Programs and Entitlements
x
x
x
x
Premium 1
Price
Premium 2
Premium 3
Mission
Critical
x
x
x
x
x
x
xx
x
x
xx
x
Tier Ballpark
Range
Salesforce
Success Plan
Salesforce
Plan Rate
3 30+% Mission Critical Up to 35%
2 15-25% Premier+ 25%
1 10-15% Premier 15%
0 0% Standard 0%
(*) Computed as % of Annual Contract Value

24. ©2015 Gainsight. All Rights Reserved.
©orazavi
Services Pricing Models and Approach
Tier 1
10%
-
-
20%
-
-
-
-
ExtensiveLimited Plan Features, Programs and Entitlements
Price
• Market-based pricing is about what
customers are willing to pay
• Cost-based pricing is about making
your margin
• Competitor-based pricing is based on
observing the competition
• Value-based pricing is based on value
of customer business performance
improvement
More than one model is often
applied to price service offerings.
Cost+Margin
Curve
Value
CurveCompetitors
Range
Market
Ballpark
Price/Feature Sweet Spot

25. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
Key Metrics to Track
• Premium attach rate as % of new target accounts that opt
for premium
• Premium upsell rate as % of existing target accounts that
upgrade to premium
• Premium renewal rate of existing accounts
• Incremental C-Sat/NPS scores of premium vs. baseline
• Premium subscription bookings and revenue

26. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
Final Takeaway
If your customer success goal is to drive
customer growth,
then …
Packaged services are key to
achieving sustained business growth.
Packaging

27. ©2015 Gainsight. All Rights Reserved.
Should you Charge for
Customer Success?
Omid Razavi
Omid Razavi, Ph.D.
SaaS Customer Success
& Services Advisor
Questions?
orazavi@gmail.com
@orazavi
Nick Mehta
Chief Executive Officer
Gainsight nmehta@gainsight.com
@nrmehta