Lifetime Value(s)

Most of you have probably heard of the business metric "Customer Lifetime Value." (If you haven't and you're still reading my blog, then you're probably my mother. Hi, Mom!) Essentially it's the projected worth of your customers during their time with your company. It's meant to make people take a long-term assessment of a customer, rather than just the revenue he or she is paying right now.  

Fireside Chat with Charles Brewer, founder of Mindspring, and the incomparable Sanjay Parekh at the Atlanta Center for Civic Innovation on March 2, 2015 | Photo: Mike Whitacre


Fireside Chat with Charles Brewer, founder of Mindspring, and the incomparable Sanjay Parekh at the Atlanta Center for Civic Innovation on March 2, 2015 | Photo: Mike Whitacre

I was thinking about this metric the other night at "Fireside Chat with Charles Brewer," an event hosted by the Center for Civic Innovation in downtown Atlanta. Charles is best known as the founder of MindSpring and the creator of a set of Core Values and Beliefs held in almost fanatical reverence by MindSpring employees and entrepreneurs alike. (He also founded a town in Costa Rica, but that's a whole other discussion.)

MindSpring was founded in 1994 and merged with EarthLink in 2000, so everything Charles did with the company happened 20 years ago at this point. 

And yet, on Monday night when Charles was to speak, multiple former MindSpring employees, investors and partners showed up to see him. And every single one spoke up about how the core values changed their lives. 

Let me repeat that -- changed their lives. They didn't say they liked them, or thought they sounded good, or were generally helpful. They said those core values impacted everything they did after MindSpring. 

That's some pretty compelling stuff. 

It made me start thinking about SalesLoft and our core values (positive, supportive & self-starting). Right now, we're a startup with a small team. We try to embody our values every day, and we've all found ourselves applying them in our personal lives. They are the basis for how we run our business, how we work as a team and how we interact with clients. They are the backbone of our company. 

But what if they could be even more? What if they could also change our lives to the point that we are just as passionate about them in two decades as we are now? What if they are so powerful that they impact everything we do after SalesLoft? What would that look like?

I think it would look a lot like Charles Brewer and MindSpring.

Want to read all of Charles Brewer's core values and beliefs, as outlined by Brewer himself in an inspiring 2001 speech to Southern Institute? Check out Lance Weatherby's post, "Leading with Values."

When you hear Charles explain his core values and beliefs and where they came from, you get it. You understand why people reacted so strongly to them, and why the creation of those values influenced his employees' lives. At an event some of this is, of course, Charles himself and how brilliantly he engages the audience, but the values hold up on paper as well. They stand alone and are self-motivating.  

The values seem simple enough when just listed out, yet somehow most companies never find their way to them. I can personally attest that it's a lot easier to talk about your core values than it is to follow them, but I can also attest that it's worth it.  

Following strong core values and beliefs has a wide impact, from business to family to faith. Applying that level of accountability to an entire company can mean great things, both for the employees and the customers. It can, as Charles has shown, grow exponentially beyond where it started and affect your life years down the road. So that leads me to ask:

What is the lifetime value of the right core values?

Based on the compelling story of MindSpring, I'd say it's pretty damn high. 

Excerpt from Charles' explanation of where his core values came from:

"The values exist for me because… well, you know, they came out of experience. I think most people, almost all people, want to do something great with part of their life, they want to contribute something significant, they want to get satisfaction from it, they’re willing to make sacrifices and work hard to make that happen. But I also think that, for most people, it doesn’t happen. And it’s something about the way things happen inside of an organization that keep it from happening. Something insidious, something not on purpose, but the status quo is not that encouraging, and many, many, people eventually give up on getting satisfaction from the work part of their life. They spend at least half their waking hours working, but they give up! They get the satisfaction from family, hobbies, or something else. That’s a pretty big tragedy.
So when I saw some of that happening around me in my early work experiences, I was thinking, how to avoid that? You’re going to have a company, how do you make it different from the rather depressing status quo? And I don’t think it can be just picking some special, magical people because I don’t think the people are the problem to begin with. It's not a special, magical line of business or anything else, and really the only candidate left after you go through all of the things it couldn’t be was the philosophy, the values, the intent of how people in the company are going to work together and interact with each other and with the customers and the world at large. And so the particular values we had at MindSpring got carried on to our subsequent companies and on to Las Catalinas, my current venture, which is a town-building exercise in Costa Rica.
They came functionally from the three things I think are most important. One is respect for the individual — I believe that if you treat people with respect and give them responsibility, that’s the way to get the best results. Not everybody agrees with that, some people think you have to micromanage your way to the best results, but that’s number one. Number two is honesty and integrity. Number three is making commitments with care and living up to them. And when you look at when things are going wrong in an organization, and people are not able to attain the results and satisfaction they’re looking for, if you keep looking deep enough, I think you will probably find some lack of honesty where employees are not telling each other the truth, not telling their boss the truth, their bosses aren’t telling the employees the truth, the company’s not telling the customers the truth, and it just builds on itself. And it becomes inevitably a poisonous thing.
Some of the other values are just more quirky, individual things. One of the core values is frugality. I'm frugal, I can't help it. Some companies compete with big, flashy style, but that’s just not me, so that’s going to be on my list for core values and beliefs. 
Work is an important part of life and and should be fun. Being a good businessperson does not mean being stuffy and boring. And that was a very visible one at MindSpring. We ended up attracting a visibly quirky collection of people working there. A lot of times they were people who just didn’t fit in at other organizations because they just couldn’t be them! They could come to MindSpring and it was okay to be them. Anything was okay, as long as it was consistent with our core values.
And those people who fit in the least well in the normal corporate environment oftentimes turned out to be the people who were the absolute best, most enthusiastic, most effective leaders at MindSpring because, for once in their lives, they found a place where they could be themselves and it was okay."

Finding Your Digital Voice

Can you tell the difference between these four statements?

alyintheatl_no1.jpg

Yeah, exactly. Neither can I.

We might be intending to convey any of these: 

alyintheatl_no2.jpg

But how can you tell? More importantly, how can your audience tell?

Communicating through text alone, you lose those subtle audio-visual cues that you take for granted and subconsciously process during in-person interactions. This causes misinterpretation, aggravation and plain old confusion as everyone projects their own biases and assumptions on the digital conversation.

It's a little bit like learning to read the formal version of another language, and then trying to have a chat with a native speaker. Your words themselves may be correct, but there's going to be some cultural miscues, unintentionally offensive phrases and general bewilderment over colloquialisms. ("Bless your heart" is, um, a lot less nice than it sounds.)

This is why emoticons were invented --  to help people bridge the gap between cold, clinical type and warm, fuzzy emotions. (Think something will be taken the wrong way? No worries, put a smiley face after it to ensure the recipient knows it was a joke!) And as text messages became more popular but remained laborious to construct, and social media allowed fewer and fewer characters, and our attention spans got shorter,  people wanted an even quicker way to get the point across. Thus were born emojis. (I'm not going to get into those now, but let's just say that, as a former copy editor, they're not my most favorite thing in the world ... sorry, Katie!)

But I digress.

This divergence between what you are trying to convey and what your recipient actually comprehends is one of the single biggest sources of confusion in communicating online, and one of the hardest parts about my job. Minus a broad spectrum of emoticon and emoji offerings in your standard support desk software (that's a joke, I'm totally not advocating that), what's a client success manager -- or anyone who interacts primarily online -- to do?

It's all about finding your "digital voice." First you have to define what you want your voice to be, and then you have to learn how to express it.

When I'm working on our support desk, my digital voice is meant to be friendly, approachable, helpful and reassuring. I want people who talk to me to be comforted and feel like they're in competent hands, even when I may not have an instant solution. I want them to trust that I will either have the answer, or I will find it. (Please note here that it isn't always, unfortunately, the answer the client wants, so then there's a whole new dimension of letting people down gently and offering acceptable alternatives.)

This can be a lot harder than you anticipate. It takes a lot of practice, and not getting defensive when something that you think makes perfect sense turns out to be, in fact, entirely incomprehensible. (I work for a SaaS company. This part is really hard.) You have to learn how to adjust appropriately to your audience's demographics, and integrate feedback into future communications.

It also can require a bit of exaggeration. I often compare my support digital voice to wearing stage makeup. It might be over the top if we were talking in person, but you actually need the extra oomph to correctly reach across the distance. I'm not saying end every sentence with a smiley face (though used judiciously, those can work well), but rather be cognizant of things like how abrupt a really short sentence can sound, and pad in a few extra kind words to soften it up. 

You know how you respond to a friend or partner (or your mom...) asking for feedback on a somewhat iffy dish they've cooked? It's kind of like that.

You can also use formatting like bold and italics, of course, but since those don't always translate across platforms, I try to ensure the wording itself can stand alone.

Here are some variations of the relatively ambiguous "No!" in the first graphic: 

alyintheatl_no3.jpg

Or you could always go around the word "No" altogether, with something like, "I'd love to help you with this, but unfortunately we can't ______. However, we can offer _____."

Now obviously, these are mostly specific to my job, but they're a good place to start thinking about how you sound to others. In many situations, this is going to be important. You don't have to be on the support desk to want to communicate effectively with your clients, coworkers or even your friends.

A good rule of thumb for me is if you think something might sound rude, then it probably does. It's worth taking an extra moment or two to rephrase something at this step; it'll likely take even more time to fix a miscommunication later. And as my mother always says, good manners cost you nothing! 

How do you ensure your audience is getting the right message? Have you found your digital voice?

EVENTful | #TechNightOut

If you follow me on Twitter, you know I love networking events. New people, new places, new things to learn -- what's not to love?

The best part of these meetings is that they're usually centered around a particular topic or industry, which means everyone there starts with some common ground. While I will definitely talk to the proverbial brick wall without this mutual understanding, it does generally mean the other attendees are more open to chatting with random strangers about random topics. 

You never know where the chance relationships made at these events will take you. Among other things, I've had job leads, service discounts and product beta tests offered, and in general just had some really excellent industry conversations. There's plenty of research around the benefits of networking, but that's another post for another time.

Anyway, since I attend a slew of different networking events across ATL, I wanted to start recapping and sharing as I go. There are many options in the city every night of the week, and hopefully this will help bring one or two to light that you didn't know about but would love to try. (If this is not your thing and you prefer another thought-piece on client success or startups instead, you can skip this and I'll deliver something more in-depth in a few days, I promise.) 

Last week, I went to #TechNightOut and spent some time chatting with ATL tech folks. Hosted by General Assembly Atlanta and Hypotamus, the premise is "bringing together the whole Tech community once a month to let loose and have fun at Tech Night Out."

While I'm not sure that the tech community needs that much loosening up (most of the tech spaces I'm familiar with are full of casual clothes and beer ... LOTS of beer), I like the premise. The tech world does have a tendency to get immersed in work to the detriment of  things like social relationships. 

This month's #TechNightOut was at Ormsbys, but the location changes each time, so you get to find little corners of the city you didn't know existed. 

And although Atlanta's a big city, the tech scene is a small town -- while standing in line to check in, I ran into one friend-of-a-friend, one Atlanta Tech Village member, and someone I'd previously met at a Zendesk user group. Small world!

The ATV member and I had passed in the halls but never really talked, so we finally had a chance to swap names and companies. He was a recently appointed Client Success Manager, and as the only one at his growing startup, he asked for some advice. We had a really in-depth conversation about making clients happy versus successful, how to track metrics to show value to your boss, and where churn risks vary from industry to industry. He learned something, I learned something, and we both came away feeling a little smarter.

He also introduced me to a PR writer who was interested in a startup position, and I got a business card that I passed along to my marketing department. (We're looking for a full-time content writer, but it appears those are harder to come by than you'd think, what with the decline of newspapers and all.) Side note: That is exactly what these events help with, but I've found that often people only hit them up when they're job hunting. I really recommend building your interpersonal connections before you need them, and then these events will click into place at the right time. 

Over an intense game of shuffleboard, I met a programmer who knew some of  the engineers at SalesLoft, and begged him for some hot leads if they had any to spare (we're hiring engineers too. Shocker, I know). Fortunately, he had good things to say about SalesLoft, and promised to send some people our way. 

I also had a quick chat with a woman who coordinates events and does branding awareness for General Assembly itself. She sounds like she really loves her job, and I know they're hiring for a variety of spots, so if you or someone you know is job-hunting, I'd check out the postings here. 

Finally, I wrapped up the night getting to know the friend-of-a-friend and a few of his colleagues better, and now I have a new connection or two on social media. He's a networking addict too, so I'm sure we'll see each other at the next event. Not to mention that I made a new friend myself!

Overall, solid networking show. Good logistics at the event itself, which is key, though maybe a little more fanfare upfront to bring it to people's attention. I'll definitely be looking for the next #TechNightOut. Hope to see you there!

 

Client Success and the Bottom Line

"Can Exceptional Customer Service
Lead to Higher Conversions?"


That was the Tweet I stopped to read this morning. And while yes, I'm intensely interested in client success/service/support and all sorts of minutiae related to that topic, the Tweet caught my eye because of the "higher conversions" part.

Why? Well, because it directly related client success to revenue.

Sales reps and SDRs. ... Okay, maybe this is a bit of an exaggeration here, but you get the point. Photo | Henrik Sorensen/Getty Images 

Sales reps and SDRs. ... Okay, maybe this is a bit of an exaggeration here, but you get the point. Photo | Henrik Sorensen/Getty Images 

Let's be honest here. The rock stars in most tech companies, especially SaaS companies, are the sales reps and the SDRs. They're incredibly visible because they're setting up and knocking down big deals. It's easy to track back their efforts to a direct impact on the bottom line, and that makes them popular people. 

Client success, on the other hand ... well, you often only hear about us when things are going wrong. With a few exceptions here and there, most people don't go online to rave about the support agent who told them how to reset their password properly. But people hit social media to talk about things like ridiculously long phone calls to cancel their cable account. I love what I do and I know it makes a difference for our clients, but it's a bit quieter than other roles.

So when unbounce ran this article by Len Markidan, the head of marketing at Groove, that purported to link solid client success to conversion rates, I was in.

The article discusses the results and potential implications from Groove's 2013 SaaS Small Business Conversion Survey. When Groove, a helpdesk software company, asked 1,500 SaaS companies which channels they put the most focus on, they found that those who cited an emphasis on customer service also reported approximately 11% higher overall conversion rates on their websites.

Since I'm a research-loving kind of girl, my favorite part of this article is the next paragraph, from Len:

"An interesting data point, but is it enough to conclude that focusing on support equals higher conversions? Probably not on its own. Let’s look at some more data…"

(Is it weird that my enthusiastic reaction to this was, "YES, LET'S LOOK AT SOME MORE DATA!!" ... never mind, don't answer that.)

So what Len did next was look at data from Proposify, a proposal software company. CEO Kyle Racki had put a lot of time and effort into their customer service, part of which was reducing customer effort by scattering help widgets throughout their site. He tracked the results with KISSmetrics and found something surprising:

"Over a period of two months, the company’s overall average trial-to-paid conversion rate was 9.85%. However, users that clicked on one of Proposify’s help widgets converted at 25.23%!  That’s a 156% increase in conversions, simply from making customer support easily accessible."

Len goes on to say that the Groove team had had similar results, learning that trial users who reached out to support were nine times more likely to convert to paying users. And then Groove cleverly used this to create an alert system to reach out to users who were stuck on certain steps, which resulted in conversion rates of more than 350% higher than their average free trial users.

Pretty compelling data, wouldn't you say? Sure, it's a little on the anecdotal side, and it's certainly centered around SaaS companies, but I think that the basic concept is sound here. 

People want help. And when they get it (especially before they even realize they need it!) it reduces frustration and increases the inclination to commit.

I don't think this is especially surprising -- when was the last time you wanted to give your money to a service that annoyed, stymied and defeated you? I'm guessing never. But for excellent experiences (think about a restaurant you really like, for example), people will pay a little more, tip a little higher, and return to that company. All good client success does is take that concept from the brick-and-mortar side and apply it to the SaaS world.

So maybe client success isn't the loudest voice in the room. But it may be one of the most persuasive. And that, to me, sounds a lot like the bottom line.