Nov 6, 2015

Read Time 2 min

Rules, Data, Instagram and HelloFresh


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Jason Lemkin, who writes a lot on customer success, has an older post that is still great advice. He advocates hiring one customer success manager for every $2M in ARR (annual recurring revenue). He also breaks down the style and philosophy of your team based on the size of your deals. Good reading.

Take a deep breath… So. Much. Data.

forEntrepreneurs did an exhaustive survey of 300+ SaaS companies. So nuggets:

  • 40% use Amazon Web Services to deliver their application
  • The median cost of delivering the application  is 6% of revenue
  • The average company spends 33% of its revenue on sales and marketing.
  • Median annual contract size is $21,000.

This and lots more…

So how did Instagram do it?

This incredible company with an app that has simply taken over photo sharing: what are their secrets? Honestly, there’s no magic in this article, but for us customer success folks, the section of customer churn is interesting. It turns out that making sure new users “followed” well was the key. And it went beyond leading them to popular users. It was important to really personalize the follow recommendations.

Focus on the employee experience as well

This author argues that the road to customer success is a great employee experience. He uses the example of a sales team:

Your salespeople should always be able to work away from their desks. To connect and engage with customers, and make processes a choice rather than a chore, salespeople need the right tools to perform tasks in the field. Whether it’s providing a quote in real time, having a client sign electronically, or taking mobile notes, the best companies are supplementing their current processes with products to best serve their end users and allow them to do business more efficiently with customers face-to-face.

HelloFresh’s IPO and the metrics behind subscription meal “kits”

HelloFresh, Blue Apron and a bunch of other subscription services will now send you pre-portioned ingredients so you can prepare home-cooked meals. The idea is you can make delicious recipes with exactly the right ingredients and without the hassle of shopping. (I do agree that it feels silly to go to a store so you can pull items off a shelf that someone spent time making pretty). These businesses are booming but are they sustainable? Or is their growth propped up by their enormous spending? The key, of course, will be in the churn. If the company is merely propping up their growth because users don’t stick around, then cue the sad trombone.


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