Embedded Analytics in Customer Success

© 2013, Pentaho. All Rights Reserved. pentaho.com. Worldwide +1 (866) 660-7555 1

October 22, 2013

Pentaho Webinar Series: Changing the Game for ISVs


Advantages of Embedded Business Analytics for Customer Success Users

The Impact Embedded Analytics Can Make on Your Bottom-Line

Presenters: Kevin Dobbs CEO, Montclare Nick Mehta CEO, Gainsight


• Recognized leader in business analytics & data integration • Subscription-based business model • Achieved critical mass:

• Over 1,200 commercial customers • Over 10,000 production deployments • Over 185 countries

• Stewardship of most important open source analytics projects

About Pentaho

INDUSTRY RECOGNITION OVER 160 PARTNERS GLOBALLY


Speakers

Kevin Dobbs, CEO, Montclare Kevin is the founder and CEO of Montclare, a leading advisory firm exclusively focused on building profitable SaaS businesses. Kevin is an Oracle alumni who started his career working with industry icons Marc Benioff, Craig Conway and Tom Siebel. He also held executive management positions with Edify, Workscape, Kadiri and Workstream where he was responsible for developing each company's new SaaS products and businesses. Active in the SaaS community, Kevin is frequently a speaker at SaaS and Cloud Computing industry events. He has published many popular papers on building high value SaaS businesses and is the author of the Smart SaaS blog.

Nick Mehta, CEO, Gainsight Nick is the CEO of Gainsight, the leading Customer Success Management company helping businesses reduce churn and increase upsells with a complete, data-driven view of customer health. Before joining Gainsight, Nick was an Entrepreneur-in-Residence at Accel Partners where he focused on developing opportunities in the enterprise applications and infrastructure markets. Prior to Accel Partners, Nick served as CEO of LiveOffice, leading the company’s profitable growth in revenue and successful sale to Symantec. Prior to LiveOffice, Nick was a Vice President at VERITAS Software. Nick holds a master’s degree in computer science from Harvard University.


Kevin Dobbs, CEO

Leveraging Embedded Analytics To Gain Advantage In Customer Success


Customer Success Market is New “It’s the next big category” – Geoffrey Moore, Chasm Group

‘Analysis shows that an incremental 2% increase in retention leads to a 20% higher multiple, and an incremental 2% increase in up-sell leads to 28% higher multiple’

It is more difficult and costs 6 to 7 more times to acquire a new customer than it does to keep an existing one.

For private SaaS companies in 2011, we found an average renewal rate of 78 percent by total customer renewals and 87 percent by total dollar value

Sources:

SaaS CEOs: Measure Customer Engagement – Increase Conversions & Lower Churn, David Skok, 2011

The SaaS churn challenge: How to hold onto your customers, Viralheat CTO Vishal Sankhla, 2013

SaaS Benchmark Report, OPEXEngine, 2013


Customer Success Management

Customer Lifecycle Management

Customer Engagement

Customer Success Analytics

Market is Evolving Quickly

Gainsight Raises $9M Series A

April 2013

Customer Engagement

Customer Lifecycle

Management

Customer Success Analytics


Customer Success Tips & Tricks Reducing churn and increasing customer satisfaction

1. Automate Onboarding Easy to use forms

Pre-configured workflows

Checklists

2. Track Activity Monitor logon’s

Transaction volumes

New users

3. Self-Service Training Videos

Wiki’s

Recorded webinars

4. Health Checks Monthly activity

Key features used

New features

5. Engagement Communities

User meetings

Interest groups


Customer Success Tips & Tricks

1. Automate Onboarding Easy to use forms

Pre-configured workflows

Checklists

2. Track Activity Monitor logon’s

Transaction volumes

New users

3. Self-Service Training Videos

Wiki’s

Recorded webinars

4. Health Checks Monthly activity

Key features used

New features

5. Engagement Communities

User meetings

Interest groups

Reducing churn and increasing customer satisfaction


Common customer issues with all types of Customer Success and Service products:

• Data overload

• Hard to gain visibility across large amounts of data

• Tools can be complex and hard to use

• Information resides in many, disconnected systems

• Can't easily implement newest capabilities

• Slow time to value

Challenges to SaaS Customer Success


Leveraging external R&D team for non-core technology

• Deliver quickly; dramatically improved time to market

• Commercialized open source products, large developer community supporting the products and increasing innovation

• Keep ISVs development team and investments smaller

• Embedded or OEM model

• Tap into needed domain expertise

Challenges Facing SaaS Companies


Delivering a Superior Customer Experience Understanding the importance of adoption and consumption

Time

Cha

nge

Man

agem

ent

Unaware

Aware

Understand

Positive Perception

Initial Use

Adoption

Institutionalization

Internalization

Preparation

Perception

Acceptance

Commitment

Go Live

Communication

Source: Product Adoption and Consumption Curve. Glenn Oclassen, 2012



Time

Cha

nge

Man

agem

ent

Unaware

Aware

Understand

Positive Perception

Initial Use

Adoption


Internalization

Preparation

Perception

Acceptance

Commitment

Go Live

Communication

Training




Time

Cha

nge

Man

agem

ent

Unaware

Aware

Understand

Positive Perception

Initial Use

Adoption


Internalization

Preparation

Perception

Acceptance

Commitment

Go Live

Communication

Training

Support



Flexible Analytics Propel SaaS Products Increase Customer Adoption and Consumption


Adding New Customer Success Capabilities Quickly • Rate of change has increased and customers expect rapid innovation

• Competitive advantages are hard to maintain

• Adding complimentary capabilities; no internal expertise in areas like Analytics, BI or Big Data

• Looking for new features that engage users

• Support for mobile

Addressing Customer Adoption Challenges

Sin

gle

Sig

n-O

n

Inte

grat

ion

Anal

ytic

s

Mob

ile

Soc

ial

New Features “Plug & Play”

ISV SaaS Platform


What types of Customer Success products does your company use?

Poll

Customer Analytics

☐ Communities

☐ PSA

☐ Call Center

☐ Customer Lifecycle

☐ CRM


Examples of OEM Products SaaS Add-On market is growing

Security / SSO

Integration

Big Data

Social

Mobile


Customer Communities

• In-line reporting

• View user activity

• Spot trends

• Build automated reports with charts

• 'What if' analysis

Communities Use Case Connecting with customers


Customer Support

• Review issues quickly

• Identify problem trends

• Understand quality of resolution

• Quickly determine cost per interaction

Customer Service Proactively engaging customer service issues


Installation and Onboarding

• Resourcing • Scheduling • Project Management

Professional Services Automation How Embedded Analytics Can Help


Learn More About the SaaS Model and Market

Montclare is a leading provider of SaaS resources including research, services and a SaaS-focused online community. The Montclare team has been actively involved in the SaaS industry since it's inception, profiling leading firms, speaking at industry events and providing business guidance to a full spectrum of software companies.

The Montclare Community has been design to help software professionals gather more information about SaaS. This new beta community allows members to them watch current SaaS video content, learn what's happening in SaaS through news feeds and information shared by industry thought leaders, they can also connect with their peers and share industry best practice ideas and information. Visit Montclare.com for more information.

The Montclare SaaS 250 is a report identifying the 250 most influential SaaS companies in the world. The document provides analysis of the industry as well as individual companies. These companies are categorized by revenue size, solution type and geographic location. The report is a critical tool for competitive analysis, go-to-market programs and market segmentation.

Montclare's SaaS 250 is a valuable tool for software executives, investors and analysts due to it's insight within this fast-paced market. The Report is available exclusively through the Montclare site at: montclare.com/saas250.

Become a member for free today at montclare.com


Nick Mehta, CEO

Customer Success Experiences


success noun \sek-’ses\

© 2013, Pentaho. All Rights Reserved. pentaho.com. Worldwide +1 (866) 660-7555 26 26

How?


Starts With Culture


1. Create org 2. Define customer health 3. Tier customers 4. Manage customer data 5. Define interventions 6. Get predictive

6 Steps to Success


1. Org – Assign an Owner


1. Org – Where Do You Fit?

Business Maturity

Prod

uct C

ompl

exity

Firefighter

Sales-Oriented

Service-Oriented

Integrated Model

Partnership Model


2. Measure Customer Health

Financial Health: Payment history, credit score

Contract: Term, spend

Relationship: Surveys, key sponsors

Adoption: Usage, features

Interaction: Support, other contacts, social


Which one of the following business problems resonates best with you?

Poll #2

☐ Identifying at-risk customers early

☐ Scaling Customer Success / Account Management teams efficiently

☐ Finding up-sells and advocates


High Touch

Low Touch

No Touch

High Touch

Low Touch

No Touch

JUST-IN-TIME

AUTOMATION

PROACTIVE

STRATEGY

3. Tier Customers

Key Issues

Just revenue? Reference-ability?

White space? Network effect?

Presenter

Presentation Notes

At Gainsight, our goal is to provide technology to help analyze and automate the entire lifecycle of Customer Success and Account management – all from within the Salesforce.com system you use today. Our customers typically start with our Retention Management module, which leverages all of the data you have about customers in terms of product usage/adoption, support interaction, survey scores, contract information and payment information to give you early warnings about customers at-risk – so you can take action before it’s too late. Retention Management provides a success pipeline for CSMs / AMs to get alerted about customers at risk and then assemble and track an action plan to bring them back to health. After solving the pressing need of at-risk customers, our customers often next leverage our Adoption Management module to view individual customers in terms of usage / adoption across key performance indicators, benchmark them against other customers, build client scorecards and compare metrics to key milestones (e.g., go-live, training) in the customer lifecycle. Customers use our Lifetime Revenue Management module to analyze the full revenue stream of customers across their lifetime, breaking down changes in customer revenue owing to new business, up-sells, down-sells, price increases, price decreases and churn. Companies can look at this data for individual customers or across all customers. Gainsight includes a Feedback Management module to allow CSMs and executives to measure customers satisfaction, leveraging the NetPromoter methodology and/or custom surveys. Surveys can be created, delivered and analyzed. In addition, since Gainsight runs in Salesforce.com, survey responses can be analyzed against any SFDC data including customer revenue or contact role (e.g., survey scores by decision makers). Finally, customers can combine Feedback Management and Retention Management to automatically create alerts based upon survey feedback. For example, CSMs can immediately be alerted when decision makers in customers fill out a survey with a Detractor response, while Customer Reference Marketing could get a notification when customers fill out a survey with a Promoter response. Finally, the Gainsight Growth module allows CSM teams to collaborate with Sales teams to identify up-sell opportunities. Up-Sell alerts can notify sales and CSM teams when customers hit license threshholds or other indicators for add-on. Our Adoption reports gives you a birds eye of active customers that are ripe for purchase. And our Renewal Dashboard helps you identify upcoming customer renewals and the health and risk of each renewal. Through all of the modules, the Gainsight platform includes two key components: Customer360 – we leverage our predictive analytics technology to capture, integrate and analyze all of the sources of data you have about your clients Playbooks – our Playbooks workflow technology allows you to define standard interventions for customers based upon scenarios (e.g., what to do when a customer hasn’t logged in for a month)


PSA System Late go-live, go-live and no usage, …

Support System Lots of P1s, long TTR, no cases, …

Product No usage, decline, key feature, …

Billing Invoices past due, credit card declines, …

Survey System NPS, post-case, post-onboarding, …

CRM System Products, renewal date, pricing, …

??? QBRs, reference, conference, …

4. Manage Customer Data

Key Issues

Common customer ID Sync frequency

Aggregation level


4. Manage Customer Data

Raw data aggregation

Operational store

Reporting

Presenter

Presentation Notes

Segment integration is in beta; Middle stack is in beta and GA when we complete SFC security review (should be October) Right stack is GA now with incremental enhancements to extend middle stack value


5. Define Interventions

High Touch

Low Touch

No Touch

Customer Prep

JUST-IN-TIME

AUTOMATION

PROACTIVE

Nurture

STRATEGY

Early Warning

INTERVENTION

Presenter

Presentation Notes

(QBR, Best Practices, etc.) (early warning, adoption, etc. (nurture, webinars, etc.)


Intuition

Best Practices

Data Science

Alert Rules and Playbooks

New Insights

Counter Intuition

Confirm Intuition

6. Get Predictive


Phase Hard Problems

Data science strategy What data to start with?

Feature extraction How do group / aggregate data?

Feature selection Which data matters?

Machine learning Which algorithms to use?

Iteration Where do we go next?

Alert configuration How do we operationalize this?

6. Get Predictive


Data Set Selection •Isolated data to customers with at least 9 months of history •Split customers into two – “Test” and “Control” groups •The “Control” group compared Churn vs Active •We back-test the prediction model against the “Test” •> 40 usage features, NPS, support, account data

Time Selection •Narrowed focus to “normal” active periods •Compared 3-month time frames to find secular trends

Case Study: Methodology


Alert Rules and Playbooks

No proactive outreach within 6

months of renewal

53% decline in number of sessions in middle of

subscription

15% decline in key usage

metric

Case Study: Findings

Average NPS score of churned customers = 7.2 (scale is 1 to 10) Only a small number of churned customers had highest level Support tickets


We Drive Customer Success for the Subscription Economy


Q & A


Ben Hopkins, Product Marketing Mgr [email protected] Tel. +1 415-525-5540 pentaho.com

Kevin Dobbs, CEO [email protected] Tel. +1 510-336-0019 montclare.com

Nick Mehta, CEO [email protected] Tel. +1 408-623-2645 gainsight.com

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