In this episode, our host Anika Zubair chats with Markus Rentsch, CEO at Remark-able about how to grow customer success while focusing on customer outcomes.
Many companies talk about customer-led growth and customer-focused business plans. But what does that actually mean? For example, how do you measure customer outcomes and what is the limitation of those metrics?
Podcast enquiries: sofia@planhat.com
In this episode, our host Anika Zubair chats with Markus Rentsch, CEO at Remark-able about how to grow customer success while focusing on customer outcomes.
Many companies talk about customer-led growth and customer-focused business plans. But what does that actually mean? For example, how do you measure customer outcomes and what is the limitation of those metrics?
Podcast enquiries: sofia@planhat.com
Hello everyone. I'm your host, Anika zer. And welcome back to the next episode of the customer success channel podcast brought to you by plan hat, the modern customer platform. This podcast is created for anyone working in or interested in the customer success field. On this podcast, we will speak to leaders in the industry about their experiences and their definitions of customer success and get their advice and best practices on how to run ACS organization. Today. We are speaking to Marcus wrench, CEO at remarkable. He's a customer success consultant and keynote speaker. And today we are speaking about customer outcomes. Many companies talk about customer led growth and customer focused business plans. But what does this actually mean? Marcus has helped a number of SaaS businesses create the customer value led growth business model, which is unique approach to delivering, growing, and monetizing customer value. Let's chat to him all about how he is able to grow customer success while focusing solely on customer outcomes. Welcome Marcus to the podcast. I'm so very excited to have you here with us today, but before we get into today's topic, it would be great. If you could tell our listeners a little bit more about yourself, how did you kind of end up in customer success?
Speaker 2:Yeah. Thanks for invitation. Aika yeah, I'm a customer success consultant, uh, running my own company here in Austria at the outskirts of Vienna. How did I get into customer success? You could really say it's been a coincidence. So when I started my consulting business, about five years ago, I started on consulting in a different scope and set for SaaS companies. So my focus back then was called the company's positioning. So you could say the top level of customer success. And it's been roughly two years ago when I've come to realize that there are so many companies that really struggle from setting these customer expectations until the point where they really can deliver on the promise to the customers. So, and that's when I really yeah. Started to get into customer success and learn more about it. Yeah. And, and finally decided, okay, that's, that's the right call. So I into customer success consulting.
Speaker 1:Yeah. Awesome. And you didn't originally obviously start in customer success. Where did you start and why customer success?
Speaker 2:Customer success has really been fascinating for me. It's like an man. You can always do better that that's, what's fascinating me and that's, what's motivating me. And I think there are so many companies to today that really, really could do better when it comes to delivering on customer value and customer experience.
Speaker 1:Awesome. And is that what made you start remarkable as a company? Is that what inspired you? What actually inspired you to start becoming, becoming a consultant in the customer success space?
Speaker 2:Like most people that I'm consulting. I have a, yeah. Corporate history day chef continuously faced back then was that yeah. I wanted to deliver the inputs to move forward, but yeah, things didn't didn't happen the way I, I would like them to. So I usually ended up in companies where yeah, whether the mantra was to preserve the status quo, even though there will be many, many things that you really could improve. So that's what I said. Okay. I, I want to do more. I want to work with customers that want to move forward and
Speaker 1:You mention a lot around customer value led growth, which is what we're gonna talk about in a little bit more detail today at some point. But what kind of business would be one that's focused on customer value, led growth? Cause you, you mentioned you work with quite a few of them.
Speaker 2:Yeah. So basically that framework would work for every company. But my focus is on sales companies for a single reason. And that's because the SA business model itself is built on customer success and customer value because it's part by retention and only reason why customers would keep paying for your product is when they become successful customer success is business success. It's more true SA than anywhere else.
Speaker 1:I couldn't agree anymore. And I think the last few years has really shown that the customer success industry doesn't need any kind of proof. The proof is really in the pudding, as you just said, every business that's focused on their customer will lead to some level of success. So I, I completely agree. You mentioned that the very start of our conversation that you've been based in Vienna and that's where you've, uh, started up your business and your consultancy, why Vienna and what's so special about the area. Not everyone thinks of SAS or customer success first when they think of Vienna. I think of music personally, but what's so unique about the region that you're in.
Speaker 2:There is absolutely nothing unique. It's simply where I live.<laugh> all my life. So that's where I started my business. And yeah, initially I've also worked with Austria companies, but in the SA space, yeah. You quickly, um, come to an end of, because there are only a few companies to work with. So here the startups seen it. It's yeah, it's really slow. So it's basically, it's a mix of the, the mindset here and the bureaucracy. So, but we are really, really far behind, unfortunately in, in the startup industry and in SA says too,
Speaker 1:But I'm guessing you've obviously worked with businesses across Europe and maybe into other parts of the, the world, us Australia, et cetera.
Speaker 2:Yes. That's true. So I've quickly yeah. Looked for, for working with customers outside of Austria and yeah. Focused on Europe. So I have customers from, from Sweden Netlands UK. So yeah, I think it's customer success. It's, it's a global movement anyway. So I don't even want to restrict myself to, to working only with companies in my country
Speaker 1:Makes sense. We have customers all around the world. Why can't, why can't every business do the same. That's so true. Customer success is something that is budding and, and growing. But here on the podcast, we like to talk about how customer success has influenced growth. And we're gonna talk about that in more detail, but you mentioned that your, the companies that come to you for your services and your help, that's what they're looking for. What's kind of the common denominator. What's the main reason behind that search for customer growth?
Speaker 2:Yeah. There are basically two different groups of issues for co for my customers. So one is the ongoing battle between being proactive and reactive. So that, that usually comes from the customer success teams itself. But for me, customer success is not the responsibility of a singing team, but customer success. It's really a mindseted operating system for the whole company because it takes more than, than delivering services to your customers. So you also need to have a great product. You need to work with the right customers. You need to set the right customer expectations. And only if you put these things together, customers will become successful. And that's, that's something you, you really often see. So that, that the company is focused on, on really on growth. So they, they rush out product features. They acquire every customer pulse. So, and in the end they really have very bad economic side drug rates and they have face all kinds of issues and they are most importantly, they, they are running dryer funds very quickly.
Speaker 1:Yeah. And I couldn't agree more about the fact that you just said the reactive to proactive. I think that's something every business struggles with, I think you end up stemming customer success from a level of support and customer success. Like you said, needs to be a company wide strategy. And it's usually not, it's a desire. Don't get me wrong. I think a lot of companies desire to have customer success as a company wide strategy, but we tend to operate from the inside out. Like usually, like you said, reactive based on churn rather than on net dollar retention and growth. So in your opinion and your experience, how does a company start to think about customer outcomes first or, you know, thinking more in the company wide strategy of success?
Speaker 2:So I would like to elaborate a bit more on, on what we've talked before. So it doesn't happen that often, unfortunately, but I really love working with the CEO because if the CEO is approaching me, I know the CEO will yeah. Participate in, in the whole strategy. And that's really important. So if the CEOs buy in, everything becomes way easier because it's much easier to get buyin from marketing sales and product. And
Speaker 1:What do you mean by buy in there? Because I think we talk a lot about that. Get the CEO buy in. How, how do you actually then get the CEO buy in and what, what does a CEO have to do to really make that shift and change?
Speaker 2:Yeah. So I have said, ideally, the CEO already has the mindset, but lack of, of the means to execute in it. But most of time, the people who approach me are the VPs of customer success or head of customer success. So when they want to become more proactive to create the results that will get them to buy in from the CEO. So it's, it's really often the problem that, that, that the leadership of the company really can see what's the ROI of customer success. And the problem that most CS teams have to really turn it into a company-wide initiative is that it don't really create the results and it will get them to buy in. So they focus on, on optimizing their processes, getting their net promoter scores, sky high, et cetera, but these are not business results. So what CS teams need to, to create, they need to really create business outcomes. They need to create revenue. They need to create the high renewal rate. You need to get customers to expand and upsell. You need to drive advocacy. And if you have these numbers and something to, to show your to a leadership, it's much easier to get the buyin. You give them a taste of how the future could be. If they had, you had the buyin more resources,
Speaker 1:You kind of nicely just transition into what I wanted to ask you next, all these things, advocacy, getting the buy in, showing the right metrics. This is super key. Like you said, for a customer success leader or team to bring up to their leadership. But how do you start to report on customer outcome metrics to senior leadership or to the board? Like which metrics really matter here? If I was, you know, a VP of CS and I was trying to make my CEO buy into customer success as a company wide strategy.
Speaker 2:So the biggest issue I've identified for customer success teams is that they are frameworks and processes and playbooks. They are not based on the customer, but they are, they are built from their own point of view. Most often it's really built from the point of view of what fits with the technology. So we have these companies that are obsessed about net promoter scores, user activity, and health scores. But here's the thing, none of these metrics really matters unless they translate into real customer outcomes. So if you could say every customer with a net promoter score of eight or nine buys more from us every year, but the truth is it's not going to happen. So high net promoter score doesn't even mean that customers will renew. And obviously renewals are up the lowest hanging fruit when you want to achieve growth with expansion upsells. And so we need to make a shift and then rethink customer success from the customer's point of view. And that means our customer success metrics need to measure customer outcomes. So customers buy our product for example, because they want to increase their revenue or our save time. So we need to measure how our product contributes to the goal, because that's what customers do too. They are not paying just for fun to use our product. So they, they will evaluate our product and then measure the ROI. And we need to align with the customer on the same metrics. And if we then can say, okay, we've helped 90% of our customers to grow their revenue by 10% annually. And then we measure the correlation between achieving these outcomes and the revenue impact. That's when we have something to show for.
Speaker 1:That's amazing. I love hearing that that's a unique way on obviously metrics. Like you said, normally people would say, okay, our customer health is at, you know, this percentage, which is good or bad or, or in between. And then we have an NPS score of this. So it means that we have healthy, happy customers, but it's great to align to customer business goals. Is there anything else that is in your experience, how you measure on customer outcomes, cuz you were just talking about a customer, increasing revenue. Are there other metrics or other ways that we can make sure that we're measuring customer outcomes instead of just a, a metric that satisfies internally?
Speaker 2:Yes. We need to talk to customers. We need to identify what they care about. I mean, in, in some situations, like I said before, if they're buying a sales tool, it's quite obvious why they bought the product, but in other cases it's quite different. If you're selling a, let's say a learning tool, a learning platform, it's, it's quite, it's way more complex because customers could bite for, we are probably hundreds of different reasons, so different goals they want to achieve. But the important thing is we need to find out to find out why customers bought the product and what they're expecting of the product. And then we align with the customer on these metrics. And
Speaker 1:You just mentioned something that I wanna ask as well, a little bit more in detail. You mentioned that there's hundreds of reasons why a customer might purchase a software. They have hundreds of reasons for outcomes with that software as a CSM. How do you narrow down that list? I'm just thinking like, okay, if a customer came for a hundred different reasons, how do I make sure that we're focused on the right outcomes?
Speaker 2:So ideally the customer tells you exactly why they bought the product. I I've brought up that example with the learning platform because I had a customer in the past that had exactly that kind of problem. There were so many options and then their customers were not able to, to nail down exactly why they bought the product and what they are trying to achieve with it. In that case, you need to grow into the, the consulting, uh, consultant and talk to your customer and say, okay, if you Don don't know what, what outcome you want to achieve. We have 10 of your peers working with us already for years. And they cared about these five metrics or these five goals and measured it with these five metrics. So as I've said, ideally, customers are telling you straight away what they want and what they care about. But if not, you need to identify the customer goals. And the important part of it is to create accountability so that when you have your, your QBR. So however you call it, when you meet with a customers, you need to be able to say, okay, three months ago, six months ago, we both agreed that this is your goal and that's how we are going to measure it. And then you discuss, okay, are we on track or did we fall behind? Did we exceed the goals already? So we really need to have this well discussion all the time. We really need to track customer value throughout the whole customer life cycle.
Speaker 1:I have two questions that are probably playing a little bit of devil's advocate here. One is how do you identify goals proactively or prescribe goals to customers when they don't know, like you said, or they don't have a clear understanding of everything the software can do. And how do you make sure that those goals are not aligned to what we want, but rather what to, what customers want?
Speaker 2:Yeah. So we, maybe we don't have to because if we can, yeah. Push the customers in our direction, it's a great thing for us. So if they don't know what they want, and if you say, okay, your peers wanted these and that outcomes, do you think that applies for you as well? Because it's, it's obviously great for us because we already have the experience with 10 different customers before that wanted exactly the same thing that we have experience with the processes and the goals and, and the metrics.
Speaker 1:I completely agree. I think that using best practice and case studies of other customers that are using your software in similar ways and how they've seen outcomes and success with your software is a great way to bring on customers that either have too many goals or they're just, you know, they're unclear of, of the ROI they're trying to get with your product. So I completely agree with that. The other question I had as kind of a devil's advocate moment is what if you're not speaking to customers, you mentioned speaking to your customers asking them questions, but what if you have a product led growth company and you have not hundreds, but thousands and tens of thousands of customers, how do you handle customer led outcomes in that scenario?
Speaker 2:Yeah. One important thing is you always need to understand your market and the audience so that you can narrow things down. And the second important thing is to work with samples. So you really need to identify the goals and the processes, um, from, yeah, let's say 10% of your audience and then apply it for the rest of your customers. So that's also something I often run into these companies. They want to, they want to scale everything really quickly, but the problem is they don't, they don't really know whether these things, uh, work out. So, but if you don't know, if the content you provide or the services you provide leads to customer success, it does make sense to automate these things. So you really need to start doing it manually the beginning and then really scale it for the thousands of customers you've said before, but you need to be constantly learning about your customers. So you, you don't, you're not allowed to work with assumptions. So that's, that's something I often see. So companies work with assumptions and then that's when they end up doing all the firefighting and bandaid and quick fixing, that's really all that kind of reactive stuff. So because it's really the consequence of, of guessing wrong of doing the wrong guess you really need to know it. It doesn't matter if you, if you work with small companies, enterprises, high touch, low touch, you really need to understand what's going on with your customers to provide the right services and to be effective and efficient in the same way.
Speaker 1:And you mentioned that being able to understand your market and, and really know kind of what your customers are doing, is there some metrics or something a customer success manager should be tracking? Is that like number of logins is features used. Is there anything that's kind of standard in the industry that's best way for a CSM to measure customer outcomes when they have such a large scale book of business?
Speaker 2:Yeah. So one interesting thing I always run into is I sign up for some kind of application and the application asks me, okay, what industry do we use it for? Personal use? Are we a company, et cetera, et cetera. And what I don't see is that in these applications, the vendors actually ask what customers want to achieve. So that's something I really understand. I mean, if you can ask me these, these useless questions for yeah. Statistical purposes, why can't you ask customers questions that help you to understand what they need and where they want to go? So my advice is to really, if you provide these low touch services, you really need to start asking your customers in the application itself, but ask them smart questions, ask them the questions you need to ask to help them achieve the course.
Speaker 1:Yep. Agreed. I think just asking whether that's in a survey or in a one-to-one conversation, asking the question, what is it you're hoping to look and get after our, our software? I hope what are you hoping to get out of? Everything can make a big difference to how you're building those goals and outcomes. Marcus, we have been talking a lot about customer outcomes and, and goals and how to achieve them, how to build them, which is great. But I think another thing our listeners can benefit is how to actually start to build customer success playbooks in order to ensure these metrics are being met. Because like we talked about earlier, a lot of times customer success teams will see a health score dip, and that's the playbook that they then start working on, which is, you know, correcting customer health or a customer didn't log in. So then they have a playbook on that as well. How do we start to build playbooks that ensure customer outcome metrics are being met?
Speaker 2:Yeah, the problem with playbooks is the same. As I've mentioned before, they are really based on assumptions and they are not really based on, on outcomes. So the best way to create playbooks by far is to reverse engineer them from your best customers. If you understand how your best customers became successful. So if you understand the processes and the activities they did and, um, the templates they created or whatever, and then you, if you can then customize these, these playbooks, these processes to your other customers, you will see a, a really, a huge shift in, in, in performance increasement. So, but if, if it, if that's not possible, we really need to under understand every step of the, of the wave. So we need to create a customer success plan. So customers there some point the journey now, and there is a big gap between where they are now and where they want to go. And we need to understand, okay, what are the steps in between? So what are the milestones you need to achieve? What are the problems to solve the tasks to complete? And most importantly, what are the skills and knowledge customers need to build to be able to do these things, to complete these things? So the real problem I have with this playbook is they are, yeah, they are all, they are reactive and they're not, not customer-centric. I
Speaker 1:Can see that being a point there on the reactive, cuz like we just said, oh, something happens. And then the playbook starts rather than focusing on the outcomes regularly, which kind of leads to another question I have. Marcus is around. How long do you think it would take to achieve these metrics? Most companies track metrics on a yearly basis. We're usually looking at NRR over a year or churn that year or renewals. But like you said, these are not customer outcome metrics. These are internal metrics for the business. How long does it take to really see a metric over time, especially with customer outcomes,
Speaker 2:The easiest metric you can create the fast impact for is what I've said before. It's the customer outcomes. So if you have the customer who wants to, to grow their sales, you can measure it every single month. And after 12 months you can say, okay, that customer grew their sales by 20% year over year. So that that's the easiest way. So that's, that's your, your leading indicator and the revenue impact. It's the selecting indicator because at the end of the day, what we want to achieve is that customers stick with us and buy more from us and, and refer us. But all these things, you will only get all these things if you help customers to become overly successful. So really most companies did the focus on, on their own fortune. But if you focus on the customer's fortune, that's when you will create the most profitable growth for your companies, you will ever see.
Speaker 1:I love that focusing on customer's fortune over your own fortune, which is really great. And I think we spend a lot of today's conversation talking about customer outcomes and the metrics around customer outcomes. And then you know how to make those metrics successful for a company-wide success strategy. But I do believe metrics are great. They're super important. Data is super valuable, but data also has limitations and metrics are great, but also have limitations. So what's kind of the limitation of these customer success metrics that we talked
Speaker 2:About. So we need to understand that data has two parts. So you have the what and the why. So you, you, on one side you have numbers and on the other side you have the context. So if your customer saves 20% time doing something, that's great, but we also want to understand why it happens. And more, more importantly, in other scenario, we want to understand why it didn't happen. Why did customers fail? So, and the context is the main ingredient that is lacking in literally all customer data today. So we, we have this, what I've mentioned before the net promoter scores, the product usage, the health scores, they tell you what's going on, but there is no context. So there's no context that says, okay, if a customer gives you a net promoter score of five, that's bad. If it's six, it's better. If it's 10, it's great. So because there is no no standard for, so one customer gives you maybe a seven and you think, Hey, okay, we are doing really okay. We could do better, but that customer's not at risk. But what we don't know is that for that customer, every product they can give a higher score about nine or 10 or nine, five, let's say is a failure. So we don't know the standards of the customer and that's, that's what's really makes anything different, uh, difficult in customer success. The most CSMs that don't hunt for the context, they only see the metrics and come up with interpretations. So one of our favorite examples is that so many companies think, okay, product usage is a sure sign if customers are successful or not, but there may be customers that log into the product only once per week and create a ton of success because they're highly efficient. And on the other side, you have a customer who is literally online day at night, but they are not successful. They just keep trying and trying without success. And in these scenarios, we would think, okay, the customer that, that is only online once a week is the trend risk while the other customer is a, is a sure renewal, but in reality, it's the exact opposite. And there are back again, we are guessing based on these, on these numbers without any context, but we really need to understand what's going on. We need to know. And to me, all this guessing and assuming in customer success, it needs to become an OGO because it really creates so much negative impact. And that's really the reason why so many customer success teams are completely stuck in reactive work.
Speaker 1:And would you say that's kind of like your biggest tip or your biggest takeaway in learning from all of this when you're speaking to companies about customer success and customer outcomes.
Speaker 2:Yeah. That's something I promote over and over. You need to really abandon all that, that guessing and assuming, and drill, start talking to our customers and really find out what's going on. So you really need to, to mind the context, you need to understand what's going on and why it happens super
Speaker 1:Helpful. What and why? Super, super helpful. Thank you so much, Marcus, for sharing so much with us today around customer success and customer outcomes, very much learned something new today. I think our listeners did as well, but as we wrap up, I wanna challenge you to our quick fire questions. So the next few questions I'm gonna ask you. I want you to try to answer them in one sentence or less. Are you ready? Yes. Okay. Awesome. First question is, what do you think is next for the CS industry?
Speaker 2:I really hope it's, it's going back to common sense and really focusing on the customer again.
Speaker 1:Awesome. I think that that should be the basis of our direction and, and how we work because customer is the first part of success. The next question is what is your favorite app you cannot live without, and this could be on your phone or on your laptop?
Speaker 2:Yeah, that's probably LinkedIn. I really love spending time there writing and reading.
Speaker 1:<laugh> awesome. Spending way too much time there. I spend too much time there.<laugh> amazing. And then the next question is what sort of compensation should a CSM get? Should it be a base salary or should it be a base salary plus a variable
Speaker 2:Base salary and a
Speaker 1:Variable. Amazing. And my last question for you is what is your favorite part of customer success or being a CSM?
Speaker 2:That's really easy to answer. It's celebrating wins with your
Speaker 1:Customers. I love that. I love, love, love that. I totally agree. I love celebrating my customer's wins. I almost feel like they're my wins. So thank you so much for sharing that with us today. Marcus really appreciate the time. If our listeners have any questions or wanna get in touch, what's the best way to reach out to you?
Speaker 2:Yeah, the easiest ways to, to talk to me on LinkedIn.
Speaker 1:Awesome. Thank you. And we'll put everything down in this show note. Thank you again, Marcus for your time. Really appreciate it.
Speaker 2:Thanks for invitation.
Speaker 1:Thank you for listening to the customer success channel podcast today. We hope you learned something new to take back to your team and your company. If you found value in our podcast, please make sure to give us a positive review and make sure you subscribe to our channel as we release new podcasts every month. Also, if you have any topics that you would like me to discuss in the future, or you would like to be a guest on the podcast, please feel free to reach out all my contact details are in this show notes. Thanks again for listening and tune in next time for more on customer success.