Lincoln Murphy: how Customer Success can boost Sales

Lincoln Murphy - listed as one of the top Experts to follow on LinkedIn - is one of the biggest names in what we call Customer Success. Today, he spends most of his time traveling throughout the world with one mission: helping SaaS companies grow by acquiring the right customers and holding onto them.

Lincoln Murphy's philosophy is called Customer Success-driven Growth, which implies businesses can use Customer Success to grow alongside their customers.

Sounds like a win-win situation, right? That’s because it is.

Kast had the honor of receiving Lincoln at our Brazilian office. Our very own Lilian Oliveira, head of Customer Success, got to talk to him and understand more about this relatively recent phenomenon.

On that chat, they also discussed:

  • the influence Customer Success management has on Sales;
  • how both can work simultaneously towards growth;
  • the relationship between CS, Sales, Marketing and Product;
  • the impact communication has in between teams.

Check it out!

 

Lilian: Lincoln, I’m very happy to have you here at Samba [Kast brazilian office]. Thank you so much for your time, for teaching us a little bit of the things you’ve seen on the market, and I think you’re the most appropriate person to talk about Customer Success for us.

So, we can start: tell us a little bit about what makes you Lincoln Murphy - who’s Lincoln Murphy?

Lincoln: First of all, thank you for having me here, this is amazing.

You know, look, the easiest way to describe it is I’ve helped hundreds and hundreds of companies all around the world grow through this idea of making your customer successful.

So, Customer Success - as we’ll get into, we’ll talk about what it is - you know, being able to grow your customer base from within your customer base making them successful, that really is one of the more powerful growth engines and for the last ten years (even longer than that, with my own company) I’ve basically helped companies grow in that way and then about five years ago Customer Success became sort of well known, became a thing, and I realized that’s actually what I’ve been doing. Now it has a title, it has a label, so I kinda took what I was already doing and applied that label to it. But even since then, I’ve sort of evolved that label to be called Customer Success-driven Growth, because I look at Customer Success as a growth engine - and so we’ll talk about that in a little bit, but, you know I’ve helped a lot of companies grow and have great success around the world and you know, that’s why I’m here in Brazil, to help Brazilian companies to do the same and I’m glad we get to spend some time together today.

Lilian: It’s pretty cool, but five years? It seems to be so new in Brazil… I’m terrified by this (laughs).

Lincoln: I mean, so, actually, it even goes back longer. It started in Salesforce.com probably 17 years ago, in 1999.

Lilian: Oh man! (laughs)

Lincoln: It didn’t really leave Salesforce until more people started leaving the company, starting other companies, becoming investors or whatever. And then they brought that Customer Success idea into other companies, and then as the Software as a Service (SaaS) market evolved, these ideas became even more important as it matured, as it was like “Hey, let’s not just acquire customers, let’s keep them longer and have them actually buy more. How do we do that? And we can’t just hope that happens, we can’t just, you know, just have faith that it will happen. Let’s actually make it happen.” And that was kinda how Customer Success became a thing. It’s just that some point, maybe 5 or 6 years ago, it actually started to really take off as a discipline, as a movement, you know. And I like to think that I had a little bit something to do with making sure that kinda grew around the world.

Lilian: Yeah, for sure, for sure! You’re so good. CS is a team that deals with customers. So we have a lot of information that we should give back to the rest of the company. How do you think CS teams affect Sales, Marketing, IT teams inside the company?

Lincoln: Yeah, it’s interesting. I mean, there is so much valuable information in the Customer Success management organization that is just sitting there most of the time. You know, the reality is today Sales, Marketing, Product, they’re not necessarily going to come to the Customer Success organization and ask for that stuff. So, Customer Success organizations need to proactively communicate that back to the rest of the company. I call that enrichment - because all of that valuable information that’s sitting there, we can actually enrich the rest of the company with that. We need to do that on a consistent basis, share the things that you’re learning. How are your customers talking about not only your product but what they do? Think about how that’s going to affect Sales and Marketing: the ability to really engage with and resonate with our customer/prospect. What are some use cases that are interesting and that our customers are finding successfully that maybe we never even really thought about before? We certainly don’t publicize, right? So, can we take that and give it to Sales and Marketing and let them build collateral around that and leverage that, right? And actually we can say what’s not working, right?

Lilian: Yeah.

Lincoln: So, what are the characteristics of the customer who doesn’t have success potential? Let’s make sure Sales knows not to close those and that Marketing knows not to attract those. So, there’s a lot we can provide that will ultimately let everybody be more successful. And Product is interesting because, you know, Product gets a lot of feature requests and they get a lot of, you know, they hear about bugs. You know, they don’t often really spend a lot of time or get to know the customers, so Customer Success can add context to those feature requests. Things like, well, that feature, what the customer is really trying to do is this - so whether they need that feature or not isn’t the point. They just need to achieve this goal. That’s context you can provide.

Lilian: Yeah, that’s really cool because we could give other teams another view that they don’t have [on a] day-to-day basis.  

Lincoln: Yeah.

Lilian: So, it’s really cool how to see how so different teams like Customer Success and IT should work together in order to make the customer’s life successful.

Lincoln: Yeah, imagine that, right? We all should be going in the same direction. And that direction should be to make the customer successful.

Lilian: Yeah, this is really basic and sometimes it doesn’t work at all, right?

Lincoln: Well, yeah.

Lilian: It doesn’t happen, actually.

Lincoln: It’s funny, it is basic. It’s common sense.

Lilian: Yeah.

Lincoln: But I have to travel around the world and tell people to do this. So it may be common sense, it may be basic, but you know, for some reason in some point we went the wrong direction in business and we don’t do this really basic, simple things.

Lilian: No.

Lincoln: So that’s what I do: I have to tell people very simple things. But sometimes the simple things aren’t so easy. You know, it’s a challenge sometimes but if you shift your mindset and think about just making sure the customer achieves the desired outcome, that’s a good start.

Lilian: Speaking of CS giving back to other teams, let’s talk about Sales. Because I think it’s a team that’s always really complicated inside companies, you know, the sales process. And how do you think CS should make sales more accurate, or CS could improve Sales’ work?

Lincoln: So I will say that Customer Success should really be in the DNA of a company. What I mean by that is should be really at the core of everything we do. The reason I say this is because it’s ultimately cross-functional: we need everybody moving in the same direction. But, very often, everybody might be moving in the same direction - although that’s not always the case - but sales is going in a whole other direction. And that’s a problem. It’s often a leadership issue, actually. You know, this needs to come down from the CEO and other leaders that we are in the business of making our customer successful, right? Well, that means Sales needs to be acquiring customers with success potential. So the way that we do this is we need to help them understand - and Marketing as well - that they are really at the forefront of Customer Success. It’s not the job of the Customer Success management organization to help the customers be successful, I mean they can’t do that if Sales is acquiring bad-fit customers. It’s really everybody’s job to make sure that what we’re doing is ensuring that customers achieve desired outcome. Sales starts with that by ensuring they acquire customers with success potential. So that’s number 1, what has to happen. Now what that means is you have to go through the process of understanding what success potential means, what the characteristics of a good fit customer are, communicating that to Sales… You know, I often hear that, like, that salespeople would just go do whatever, you know, as long as they’ll get a commission. But I don’t believe that. Incentives don’t drive behavior. Leaders do. Now, they might use incentives to, you know, help things along. But if incentives are all that drove behavior, then quotas wouldn’t even be needed because everybody would just exceed expectations all the time because incentives are driving them to do everything they can and close as many customers as they can. But rather instead we need quotas just to help them do the minimum, right? So incentives obviously don’t drive behavior, leaders do.  

Lilian: This makes a lot of sense.

Lincoln: Yeah, and we need to make sure that the leaders are communicating to the salespeople and to Marketing. This is your job. Your job isn’t to close as many customers as possible; your job is to bring in customers that help them be successful. If we understand that - and we can leverage the customer intelligence that we’re getting from our customer success organization to make sure that Sales are bringing good fit customers, but also give them information on how to make sure that those customers, well, make sure that we bring in not only customers that are good fit but give them information on how to really align with those customers, how to resonate with those prospects (that could become customers). Tell them, “this is how our customers are talking about what they view, what our product is. These are the use cases that are valuable, that our customers are finding success with.” Give them that information that they can use to close good fit customers. But a lot of times, none of that has been communicated to Sales, so they’ll just close any customer that will do business with them. So it’s often a leadership and it’s a communication issue, more than anything.

Lilian: Yeah. Critical. Speaking of communication, what do you think that happens when bad communication between Sales, CS, IT, Marketing happens? What are the major results of this bad communication?

Lincoln: If… Let’s look at what happens when we get it right. When you get right, it’s a growth engine. Customer Success - this whole idea of Customer Success as an operating philosophy, the growth engine. So when we’re all aligned, we’re all ensuring that customers achieve their desired outcome…and by the way, it’s part of that achieving the desired outcome that means our customers are gonna grow. They’re going to end up buying more, they’re gonna stay longer, buy more and bring us into other parts of their business. That’s a growth engine. So, if we get this right, that’s what happens. If you get it wrong, it doesn’t mean you’re gonna fail - let me be very clear about that. There’s a lot of companies doing just fine. But I don’t think anyone started a business to do just fine. And I certainly didn’t come to Brazil all the way from the US to help people be average, you know. I came here to make you really successful. How can we - instead of like, incremental growth, what could drive exponential growth, right? So if we get these things right, that’s what’s possible. If we get it wrong, again, you might not fail. But you’ll just be average. Like, let’s be better than that. You know, that’s what it’s all about.

Lilian: Yeah, who’s comfortable with being average, right? A lot of people, but you shouldn’t be comfortable being average.

Lincoln: I think it’s… you get complacent. You start making assumptions that this is just the way it is, we start saying “you know, there’s just a lot of churn in our market. That’s just the way it is.”

Lilian: “It happens”.

Lincoln: Eh… There may be some, but I guarantee you - I guarantee you - the amount of unavoidable churn, that churn that is gonna happen no matter what you do, I guarantee you that is a lot lower than you think. But you’ve just basically taught yourself - by not putting in the effort and having customers churn - you just basically taught yourself that that’s the norm, that’s just gonna happen. And then you go talk to other companies, you read other companies talking about this, or you read surveys that come out with average numbers and you say “oh, we’re just average, we’re just doing as good as those companies”. But those companies aren’t putting in the effort. Don’t be average. Go look at the companies that are doing amazing things, that are growing exponentially within their customer base. That’s why you should be looking at Customer Success - you should be taking note as a growth engine. Not just,”let’s just keep our customers from leaving”. That’s not good reason. I mean, yeah, you don’t want your customers to leave, but you want them to actually buy more and be successful and go out and tell the world about their relationship with us. That’s what we want. Somewhere on the line we went wrong.

Lilian: Yeah, way to go.

So, thank you again, it was a pleasure to have you here at Samba headquarters in Minas Gerais and hope to see you soon!

Lincoln: Absolutely. Obrigado! [thank you in portuguese]

Lilian: Por nada! [you’re welcome in portuguese]

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Did you relate to any of the scenarios Lincoln described? Does your company have a Customer Success organization - and if so, how do they interact with Sales? Tell us!

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