Reorienting the Next Battle Ground of Competitive Differentiation


5 min read
26 May


In this interview, Nimesh Mathur (Customer Success Leader, Pluralsight) talks about the evolving role of Customer Success as a competitive differentiator and why companies have started to look at it as a growth engine.



Vincent: Nimesh, thank you so much for joining us today and I truly appreciate your time. In your opinion, what is the key factor responsible for exponentially increasing the popularity of Customer Success over the last few years?

Nimesh: Thank you for inviting me, Vincent. Glad to be here. In the subscription economy, as the company grows, the contribution of recurring revenue to the total revenue increases massively and typically reaches 70% to 95% in most cases.

Without a good customer retention rate, companies won’t be able to grow or even survive for that matter. It’s like filling a bucking which is leaking heavily – doesn’t make sense, right?

Unless you want to do business with a customer only once, it’s quite obvious that the majority of your revenue with a customer happens post the initial first sale. You shouldn’t think of your customers as resources to be harvested (for the next up-sell or cross-sell opportunity) rather think of them as partners looking to meet their desired goals and outcomes using your product and services.

Showing customer what they can achieve on the platform is half of the battle, the other half, is helping customers achieve it.

Vincent: Do you see Customer Success as a competitive differentiator for companies?

Nimesh: Absolutely. A good product is necessary, but not always enough to keep and grow the customers. In this age of empowered customers were finding alternatives is just a touch or click away, you need to ensure that the delivered value and engagement remain strong during the entire journey from onboarding to renewal.

It’s not uncommon for competitors to copy product features and attract your customers with similar offerings at cheaper price.

However, an extraordinary ability (and genuine interest!) in delivering measurable outcomes consistently through a proactive and consultative approach can contribute significantly in creating insanely high defensibility – and that isn’t an easy aspect to mimic for competition considering it requires a complete change of business operating principles from a customer-centricity standpoint.

A business promise is good only if it’s kept and therefore Customer Success is truly the emerging battleground of competitive differentiation

Vincent: At what stage should companies consider hiring for the Customer Success team?

Nimesh: If your sales team has started getting paid customers, you should consider hiring someone in the Customer Success team. I find it absurd that some companies wait for the churn rate to reach ridiculous levels before investing in Customer Success. If you're a growth-focused organization, the genesis of something as proactive as Customer Success shouldn't be reactive.

It takes time and effort to bring all employees on board to imbibe the culture of Customer Success oriented business. To accelerate the process, make sure your top management has bought into it first.

If your CXOs start talking about it often, the probability of it trickling down through the organization increases in a humongous way.

There is no point building a Customer Success team if you don’t have a genuine emphatic interest in your customer's success

Vincent: You talked about helping customers meet their desired outcome. How difficult it is for Customer Success Managers to know the customer’s desired outcomes?

Nimesh: It’s a discovery process in which you uncover the facts gradually by asking the right questions. It’s important to have a deep understanding of why the customer decided to invest in your product/services and how the individuals you are working with are measured in their job roles (their KPIs and KRAs). The answers to these questions will help you resonate with their priorities, which can then lead to deeper insights into their potential desired outcomes.

The biggest mistake CSMs make at this stage is by jumping to conclusions by telling the customer what their desired outcome should be without asking them any open-ended discovery questions.

Once you have the clarity on customers’ desired outcomes, work collaboratively with them on a realistic success plan – which is iterative in nature as your customer’s priorities and challenges may not remain the same during the whole engagement cycle.

Without knowing customer’s desired outcomes, and a mutually agreed success plan, tracking and actionizing based on metrics in your health dashboard won’t be efficient.

We live in a world of catchy expressions and engaging tagline, but the reality of every company is the customer's well-being and success

Vincent: In addition to increasing the CLTV (Customer Life Time Value) of existing customers, does Customer Success play a role in acquiring new customers as well by collaborating with the marketing team?

Nimesh: Yes, a big role! If you think about it, making existing customers successful should ideally result in them turning into your brand advocates. Their success stories in the form of podcasts, videos, blogs, testimonials, case studies, references, etc., will connect incredibly well with your prospects. I see this as a great intersection point for Customer Success and Marketing teams to collaborate.

It’s no secret that a validation coming from an industry peer facing similar challenges is far more credible than a clever advertisement or email subject line you expect customers to click. The insights from existing customers are mostly (and rightly so!) the greatest asset your marketing team can have.

If you don’t have it already, include a dedicated slide on Customer Success in your sales decks and marketing collaterals – tell your prospects about the value they bring. I also recommend Customer Success leaders to track the percentage of customers who signed up because of an existing customer’s referral or influence – that’s probably the best way to measure advocacy.

There is no point in having an amazing NPS score when in reality your customers don’t advocate or promote your product. That’s delusional.

Vincent: Continuing on the topic of Customer Success’s collaboration with other internal teams, what are your thoughts on the interesting love-hate relationship between Customer Success & Product team?

Nimesh: Principally, product managers understand the importance of including insights from customers in the product roadmap iteration process. However, CSMs need to be considerate of the fact that not every product feature request from customer will align with their company’s long term strategy and vision.

The product team should ideally act as an evangelist of the company’s long term vision internally – that way Customer Success team will be better equipped to set the right expectations with the customer.

If you set unrealistic expectations, and your product does not evolve in the way you suggested to your customer, it makes them feel like their feedback is useless. You need to place customers at the center of your ecosystem, realizing that you cannot move forward if your customers do not feel as if they are part of a partnership.

Things typically go wrong when Customer Success or Product team makes an attempt to be a control freak on everything product related. When it comes to communication, it’s not only external, but it’s also internal with other functions within the organization. It's important to have that internal transparency, trust and mutual respect.

CSMs should learn to convert subjective feedback into data-driven insights. Data is a common language that can enable more efficient communication between Customer Success and the Product team.

Vincent: What one advice would you want to give to people who recently started their career as CSMs? 

Nimesh: Besides building expertise in the product and being empathetic, I would strongly encourage budding CSMs to invest time in understanding the industry domain their customers operate in and nitty-gritty around it. Otherwise, they will struggle to be seen as trusted advisors by their customers. 

There is a reason your point of contact has never approached you for a strategy discussion or given you an opportunity to meet/address their leadership team—that’s because they don’t see you as sufficiently strategic. They aren’t confident if you will be able to do a great insightful conversation with a broader high-level perspective.

If your customer reaches out to you only when they need a usage report or query on some product feature – you know you need to up your game.

Vincent: That’s great advice. What is your favorite Customer Success quote? 

Nimesh: There are many quotes that I love, but these two by Richard Branson and Jeff Bezos resonate really well with me. 

Richard said “The key is to set realistic customer expectations, and then not to just meet them, but to exceed them - preferably in unexpected and helpful ways.” Jeff said “We see our customers as invited guests to a party, and we are the hosts. It’s our job every day to make every important aspect of the customer experience a little bit better.”

Vincent: Thank you for all the insightful answers, Nimesh. I learned so much during this discussion and surely, this will be useful for all the readers. 

Nimesh: It has been a pleasure talking to you, Vincent. Thank you again!


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