In the only podcast dedicated to the ‘Subscription Economy’, hosts Tom Krackeler, SVP of Products & Rachel English, Director of Customer Success at Zuora talk to innovators, entrepreneurs, and analysts about the business shift towards recurring revenue.
Our first guest on the Subscribed podcast is Dhaval Moogimane, Partner at Waterstone Management Group. Tune in and learn why customer success is integral to your SaaS recurring revenue business! Subscribe.
Rachel English: You mentioned you work with technology companies and I know that you’ve noted their recent focus on customer success. When did that trend emerge and what do you think brought it about?
Dhaval Moogimane: Arguably, the notion of customer success has been around forever. Everyone wanted to be ‘customer first’, etc. Historically, the balance of power between a tech provider, particularly an enterprise tech provider and their customer tended to tilt towards the provider.
Because, as a customer, if you put in a large amount of dollars for the license fee upfront for hardware or software, your incentive to switch gets lower. Even if you did switch, the economic implications on that provider was minimum – 70 to 80% of the revenue had already been gained through the initial license sales.
Today, that has fundamentally changed. What we’re seeing is a real interest in customer success on account of two fronts:
1) Traditional legacy tech companies have fundamentally evolved a model to sell more subscription offerings. So, their revenue mix is changing – 50 to 60% of their new bookings is around subscriptions and it’s a recognition that to operate as a subscription company, they need to engage with customers through their life cycle.
2) Pure -play SaaS providers, when they started out 3-5 years ago were heavily focused on the acquisition of new logos. And maybe mid market and SMB. Now, as their revenue base grows, as their revenue mix is almost 70- 80% existing base against new logos, as they’re attacking and trying to get into the enterprise segment, their recognition of the importance of customer success has also gone up. The confluence of both those trends over the last 2-3 years has really created this momentum around customer success.
Listen to the full podcast or read the transcript here.
The Subscribed podcast evolved from the Tom Krackeler and Rachel English’s success with Frontleaf’s Customer Success Radio (Frontleaf was acquired by Zuora in 2015). CS Radio featured Catherine Blackmore, Chief Customer Officer at Bluenose Analytics, Denis Pombriant, Managing Principal of Beagle Research, Tomasz Tunguz from Redpoint Ventures, Nir Eyal, author of Hooked: How to Build Habit-Forming Products
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“I have been listening to this podcast from the start and get a lot of benefit from each episode. The conversations are high level but with practical tactics that any company can use to improve their relationships with customers. The discussion is focussed and to the point with actionable information that will get you thinking on steps you can take to improve the support and experience of your customers”. – Robert Williger
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