Product Usage as a Vanity Metric

Last Updated March 17th, 2020

Chris Hicken, 'nuffsaid, product usage, vanity metric, customer experience
 

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Want to know if a customer’s with you for the long haul? Want to find your best customers? Want to predict who’s going to have a higher lifetime value than average?

For the answers, we often look to product usage. Who’s using the product the most, the most often, and the deepest?

 
Believe it or not, though, product usage is a vanity metric. It’s binary and therefore insufficient to paint a clear picture of the health of your business.

Instead, usage is one of 15 or more factors to assess.

And all of these factors belong in four succinct “buckets” that show what to track instead to create a risk profile for each account (or the likelihood to renew or churn).

 
That’s the idea that today’s guest brings to the conversation on The Customer Experience Podcast. He’s certainly got the UI, UX, and behavior testing background to back it up.

Chris Hicken, cofounder and CEO of ‘nuffsaid, brings 15 years of experience in B2B software as a leader, investor, advisor, and board member with companies Study.com, GitPrime, and TestRigor.

Most notably, he spent eight years as President and Chief Operating Officer for UserTesting, where he developed an expertise in creating great experiences for customers.

Now, at ‘nuffsaid, he leads a software company that’s integrating all those inbound messages you get across multiple channels into one smart, customizable, and AI-driven view.

 
In this episode, we dive into which business metrics are worth tracking and touch on these topics, among others …

What the four main buckets consist of: Customer Maturity, The Product, The Experience, The Pricing
Which questions to ask within each of those four buckets to assess customer health and risk
Why CS leaders should own more of the go-to-market strategy in the future
What to consider in pursuing product-led growth, sales-led growth, and marketing-led growth
Why free and freemium may not be a good fit for you
How to go upmarket from SMB to Enterprise

 
Listen to the entire conversation with Chris Hicken right here:

 

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Chris Hicken, 'nuffsaid, product usage, vanity metric

 

Full Transcript: Product Usage as a Vanity Metric

Ethan Beute:
Product usage is a vanity metric. That’s right. I’ll say it again. Product usage is a vanity metric. That’s an idea today’s guest brings to the conversation here on the Customer Experience Podcast, and he’s got to UI/UX and behavior testing background to back it up. He brings 15 years of experience in B2B software as a leader, investor, advisor, and board member with companies like Study.com, GitPrime, and TestRigor. Most notably, he spent eight years as president and chief operating officer for UserTesting, where he developed an expertise in creating great experiences for customers. Now, he’s the co-founder and CEO of ’nuffsaid, a software company that’s integrating all those inbound messages you get across multiple channels into one smart, customizable, and AI-driven view. Chris Hicken, welcome to the Customer Experience Podcast.

Chris Hicken:
Thanks, Ethan. An honor to be invited. Appreciate it.

Ethan Beute:
Yeah, really excited for this conversation. Obviously, that idea of product usage being a bit vanity. I’ve heard vanity metrics applied widely, but not to that, and so I’m really interested in your take on it. But before we get going, you studied engineering and computer science, but you say on your LinkedIn profile that you were born an artist. Tell me a little bit about that like maybe how that set you up for success.

Chris Hicken:
Well, growing up as a kid, I was constantly drawing, charcoal, painting, acrylics. I was mentoring with a guy from Industrial Light and Magic for a couple of years, and when it came time to apply for college, I had to make a choice. Was I going to follow a more creative, artistic career, or would I go more of the engineering route? I applied to about… 50/50. Half the colleges, I applied for an art major, and half, I applied for computer science. I just ended up loving Cal Poly so much, I ended up making the decision more on the school than on the program itself. So funnily enough, I only did computer science for about a year coming out of college, and so I guess I’m trained as an engineer. Although I’ve worked mostly as a business leader.

Ethan Beute:
Awesome. What an interesting combination of skills and strengths. From I guess a hobbyist view, are you still active in creating art?

Chris Hicken:
I do, but the way my… I would say the outlet that I use the most for art is that I build and design websites for pro bono generally for friends, family, or nonprofit organizations. That ends up being my main creative outlet.

Ethan Beute:
It’s awesome. I look forward to becoming friends. We’re going to start as we always start here on the show, which is your thoughts or characteristics, or your definition. When I say customer experience, what does that mean to you, Chris?

Chris Hicken:
So I might have a little bit of a unique perspective on this because I was president of UserTesting, which was an enterprise software company that helped generally large companies improve the quality of their customer experience on their websites, mobile apps, and towards the last few years that I was there, more and more in-store experiences. I did a lot of reading and talked to a bunch of professionals in the space, and customer experience has a lot of different angles. Is customer experience the perception of your brand, or is it about making interactions easy and simple? Maybe. Is it about customer satisfaction? I think we’re getting closer.

Chris Hicken:
For me, customer experience is about how a customer feels about every touchpoint with your company. So it really is both pieces. It’s emotions, and it’s the actual experience itself. So when I say touchpoint, I really do mean every touchpoint with your company. So that means an advertisement, a newsletter, a customer support chat. It could be using the product. It could be browsing the website, trying to answer a question. It could be a store visit. So that’s what I mean by touchpoint, and the reason why the emotion is so important is that delighting customers is the quickest way to earn advocacy and ultimately loyalty from your customers. That’s why I focus on the feeling part.

Chris Hicken:
I think from that definition comes the tactics that you would use to delight your customers. So that’s where you would talk about things like communicating value, or a beautiful design, or having a fair simply user experience, or one-touch customer support. So after working with many Fortune 100s on their customer experience programs, I think this does the best job of encapsulating what most companies are trying to do. By the way, the companies that are leaders in the space are the ones that are truly are customers-obsessed. So without going into the details, no surprise companies like Amazon, like Microsoft, I mean, they have very, very advanced customer research, customer experience programs, and you see it reflected in their products.

Ethan Beute:
Yeah, really well done there. I think the reason there are so many approaches and definitions to it is because what you captured, the essence of there, the way people feel across every single touchpoint are influenced by every single touchpoint. Just the every single touchpoint alone creates so much complication and variance in the way different people and different seats in the organization view it, and so I love what you did there. Then, these thoughts and feelings are what turned into behavior for starters, repeat purchasing, or expanded purchasing, or positive online reviews, or whatever, and it’s a precursor to the stories that we tell other people in terms of, again, online reviews, and testimonials, and referrals, and things, so really well done. Before we go any further, I would love to spend a little bit of time talking about ’nuffsaid. I think you all are tackling a really interesting problem, and I think what you share here will give some context as we get more into some of these things around product usage. So what is ’nuffsaid, and who are your customers?

Chris Hicken:
So I’m going to answer that question, but let me give a little bit of context first. So the problem that I wanted to solve emerged as I was building UserTesting, and what I found consistently over time with that as we went from a five-person company when I joined to a 400-person company when I left, people went from being able to focus 100% of their daily work time on the work itself to by the time I left, it felt like we were doing… spending only a fraction of our time doing the actual work that mattered. It was because of information overload, communication overload. We have so many apps we have to deal with, daily reports, newsletters, text messages coming in, Slack channels we have to follow, and so I thought, “Okay. This problem is going to get worse in the future, so how are we going to make it easier for a knowledge worker to focus on work that matters?”

Chris Hicken:
So we looked at different ways that you could use AI to solve this problem to not only automate the work of knowledge workers, but also to help them focus. Given 50 things you could do at once, what’s the one thing that you could do right now to move the needle in your job? If you’ve ever seen the movie Iron Man, he wears that suite that’s like processing the world’s information, and synthesizing it, and telling the main character what he needs to focus on. He calls that AI Jarvis. So how do you bring Jarvis to knowledge workers?

Chris Hicken:
That’s the vision of where the company wants to go in the future, and obviously, we’re a relatively new company. We have to build baby steps to achieve that vision, and so the first product that we just released two weeks ago, we just announced our funding, is a product that centralizes all of your work communication, so pulls in anywhere where communication is happening: email, chat, SMS, LinkedIn, Salesforce. All these different places communication is happening, so it allows… Once we have all that communication in one place and once we know who the important people are in your work life, we’re able to do a really good job of prioritizing the communication in your life that matters.

Chris Hicken:
So that’s B1 of our product, which we just released, and then later this summer, we’re bolting an AI onto that product, and we’re bringing in data from other parts of your work life. For example, maybe your CRM. It could be from your… For example, if you’re a customer success manager, it will pull in your health score data. It will pull in usage data. It will pull in all these different forms of data and help you understand which customers are most at risk, where you should be spending your time today to improve the health of your overall portfolio. So that’s what the company is trying to achieve, and those are the first few stops to get there.

Ethan Beute:
I love two layers here in particular. The first one is the idea that you have a vision for using AI to put humans in the best position to be of highest value, and then two, this idea of persona-based tweaks to this. Right? So when you sign up maybe a new… I’m imagining here out loud, so feel free to correct me or redirect me. As you bring on, say, a team of eight customer success managers, they’re going to be set up maybe with a default setting that is different than, say, if you brought on some product folks, or some marketing folks, or some engineers as a team of people. Obviously, then the AI will not only tweak and make that persona-based default better, and better, and better, but it will also probably get better, and better, and better by individual based on how they’re interacting with the different messages from the different sources.

Chris Hicken:
That’s spot on. So each AI that we develop will be custom-tailored to each function or role in the company. By doing that, we’ll be able to understand not only what you do at work, but we’ll know what your goals are, how you’re measured in terms of success, and it will able to prioritize work, data, and communication that helps you focus on the work that actually matters on moving the needle.

Ethan Beute:
I love it. That’s another layer that we’ve been talking about on the show. I’ve had a couple guests where we’ve had themes of this conversation, which is adapting your customers’ KPIs and success metrics, and making them your own. It sounds like you’re doing that or aspire to do that through software.

Chris Hicken:
That’s exactly right. That’s the vision of the company.

Ethan Beute:
Cool. I’m excited for you. It’s good.

Chris Hicken:
Thank you.

Ethan Beute:
In inclusion to this section, I think we can all say that Slack is not the email killer. It’s just more messages that we need to put into one.

Chris Hicken:
Well, here’s what I would say. I mean, we adopted Slack at UserTesting, and I think Slack solved a lot of problems that we had pre-Slack including making it easier for people to collaborate in groups, so you could create instant channels. People could collaborate around topics. I think the easy keyboard shortcuts and the emoticons, there’s a more emotional way to express yourself in writing. So I think Slack did a really good job with solving those problems, but again, the problem here that we’re going after is we don’t want to help people send more messages or connect more with each other. You’ve got lots of technologies to help you with that. For us, it’s about, “You got too much noise, so how can we help you focus on work that matters?”

Ethan Beute:
It’s good. Yeah, same thing. It has a number of benefits. But again, it creates some noise and distraction just like what we do with channels.

Chris Hicken:
It does. It does.

Ethan Beute:
I’m starting to see this at least in the initial launch phase before you really make it AI-laden as really being the tab killer, ’nuffsaid being a tab killer in that when I think about what you’re talking about, I think about the channels that I use. I think like those multiple tabs in Slack that are all open at the same time. Let’s get a little bit into product usage. Obviously, you have a deep and unique purview into the way people interact with software. Talk a little bit about product usage, and then maybe get into the vanity side of it. What is the vanity aspect of it?

Chris Hicken:
So product usage was typically absent from our previous understanding of customer health, and I’m going back probably six or seven years. This is pre-Gainsight or Totango era, customer success and account management. So the introduction of usage data in understanding customer health was really valuable. But I think as an industry, we’ve over-indexed on the value of usage data, but what we found and from talking to a bunch of success leaders, what we found is that usage data is it’s binary. So when your customers are not using your product, they are at risk, and they’re unlikely to renew, or you’re going to have some renewal challenges.

Chris Hicken:
If the customer is using the product a lot, it’s impossible that that insight isn’t enough to help you make any kind of prediction. So usage is only helpful to the extent that it’s binary. No usage, bad. Lots of usage, who knows? I think that for that reason, it’s very much a vanity metric because so many health scores are driven predominantly by usage, but usage is one of 15 factors that companies should be looking at to determine health and renewal risk, but we’ve all over-indexed on usage. So for that reason, I don’t particularly… Well, it’s not that I don’t value usage data. I just think of it as one of many elements that need to be considered as part of an overall portfolio health assessment.

Ethan Beute:
I love it. As I knew that we’re going to talk about product usage, I started thinking about like, “Okay. What if usage correlates positively with lifetime value, or NPS, or some of these other factors?” But what you offered here just unplugs that question because the best follow-up question now is, if it’s one of a dozen factors or 15 factors, what are some of the other factors that if we were going to try to build a model that says, “Likely to renew,” what are some of those other factors that belong in the mix?

Chris Hicken:
Yeah. I won’t share any of the secret sauce because I think somewhat this is the secret sauce of our company, but what I can do is talk about the categories that I think are leading indicators of health, and so the first bucket… I’m going to break it actually into four buckets: customer maturity, the product, the experience, and the pricing. So those are the four main buckets I would break it up into. Within each of those, I’ve got a series of questions that I think are important to answer in order to determine whether or not the account is at risk.

Chris Hicken:
For example, under maturity, I would say one of the most important questions in that bucket is, who advocates for the product? What’s their authority, and has it changed? every customer success manager would love to have the answer to that question. None of them do, but guess what? If the advocate for your product is an individual contributor and there’s only one of them, they could have all the usage in the world. It doesn’t matter. They could be the happiest customer in the world, but as soon as that champion leaves the company, boom, that account is gone. So it’s another example of how usage is not a good indicator of risk. The risk is actually quite high on a high-usage individual contributor or account.

Chris Hicken:
Part of how I’m approaching solving this problem is looking at… I think I’ve got 15 or 16 different elements that I’m looking at saying, “Okay. If we can gather this information both in an automated way through your communication, through surveys, through integrations with your CRM, can we build a picture of different aspects of the overall customer journey with your company and the customer’s overall engagement with your company to give you a true risk profile of each account?” So that’s one of it.

Chris Hicken:
I’ll give you another example. Under the product, sales is the one of the four categories. One of the questions I want to answer is, “Does the product solve a severe ongoing problem for the customer?” Shame on us that we can’t answer that question for everyone of our accounts. If one of our customers feels like the problem that’s being solved is maybe ongoing, but not severe, you potentially have some risk there because that customer might not feel like they need your product in the future to solve that problem. Maybe there are good alternative workarounds, or maybe it’s a very severe problem, but once they solved it once, the problem goes away, and you don’t need it anymore. So again, that’s another example of a problem where if you can answer that question, you will have a much better insight into the actual health of that customer. Health is not a good word. The risk profile of that customer.

Ethan Beute:
Really, really interesting, the severe thing. It just really rings true for me here at BombBomb. We make it easy to get face-to-face and places some of your typed-out of text because it doesn’t communicate as clearly. It doesn’t connect with people, and ultimately, whether it’s a minor conversion or a macro conversion, the more personal you can get, the more yeses you’re going to get ultimately, which is ongoing. Every time you click “Send,” there’s an opportunity to be more effective and more personal, more human.

Chris Hicken:
Agree.

Ethan Beute:
But it’s not necessarily felt in a severe way. It’s interesting. For our customers, it’s the ones who make it a habit or the ones who are like, “I can’t imagine my life without it.” I don’t even think… I don’t know if they would call it severe. It’s really interesting as a challenge. What are a couple questions under the experience bucket?

Chris Hicken:
Okay. I’ve got four major questions here. The one that I’m going to bring up today is around expectations. So did the product and service match or exceed the customer’s expectations? This is really important because the customer… When the customer is going through a sales process, they have a certain expectation of what the product will be able to deliver and the problem it will be able to solve. A lot of times, the actual product itself does not match what was promised or sold as part of the sales process, so it’s really important for you to understand very early in the customer’s engagement with you. Maybe not during onboarding, but maybe within three months of the original contract sign date for you to get a good understanding of that customer, how the customer’s expectations match what they were sold during the sales process. That is a very early indicator of whether or not a customer is likely to renew in the next nine months.

Ethan Beute:
I love it. That also gets to a theme on the show, which is making sure that sales and CS are on the same page with regard to what’s being sold, how it’s being sold, how expectations are set and managed, and disappointment is exclusively a function of expectation. So if you manage it well, you’re setting yourself up. It’s cliché or trite to say, but under-promise and over-deliver.

Chris Hicken:
I might have an unusual perspective on this in that I believe that the success leader wholly is responsible for driving those conversations. The success leader is the main conduit, the main lifeline between company and customer, and they need to be in a position… It doesn’t happen as much today as it should, but I think in the future, customer success leaders need to be driving strategic and tactical conversations with their peers on each staff around which customers do we need to target? What type of offering, what type of sales offering leads to the best overall engagement with the customer? Which products and features need to be developed based on what we’re hearing from the customer base? I think today, generally, success leaders don’t have the tools that they need to advocate for those positions, but I do think it is their responsibility to drive those decisions in organizations.

Ethan Beute:
Really, really interesting, and I think you’re right. I feel like that is the leading view, and it’s from the status quo to a better future. I think it’s probably one of the reasons we’re seeing a lot more titles and structures around revenue in general that are responsible for the full customer lifecycle because obviously, in a traditional sense, CS just takes whatever happens and makes the best of it, you know?

Chris Hicken:
Yeah.

Ethan Beute:
“Hey, regenerate this revenue. See what you can do to keep it.”

Chris Hicken:
Yeah. Actually, I think it would be a mistake to put it in revenue also because revenue leaders…

Ethan Beute:
Interesting.

Chris Hicken:
Well, I mean, revenue leaders generally have grown up within sales, so they’re thinking, “I’ve got a quota. I’ve got a number to hit. I’m going to do what it takes to hit the number,” and they’re less connected to the actual customer. A revenue leader is more likely to make compromises in the selling process in order to hit their number because ultimately, they’re fired if they don’t hit their numbers. That’s all that matters. The customer success leader has the benefit of actually caring about the customer themselves. A lot of times, they don’t have a number or at least they’re co-selling with the sales team, so they have the benefit of… that you could give them other metrics to drive towards that aren’t about revenue that allows them to really focus on what would help a customer be successful.

Ethan Beute:
Really good. Good stuff. So we’ve covered three of the four buckets. Might as well go for the fourth. What are one or two questions you really like around pricing?

Chris Hicken:
So I’ve got three major questions that I ask within pricing. Probably the one that’s most interesting for today’s conversation is alternatives. So do competitors offer more affordable alternatives? The way that I think about answering this question and probably ’nuffsaid is uniquely positioned to answer it. We’re able to scan all communication between the customer success manager, the customer support team, and the customer. So we’re able to track mentions of competitors. We don’t require the CSM to document anything.

Chris Hicken:
This is all tracked automatically, and so we can see when a customer is asking a question like, “Hey, I heard X company offers this feature or X company is offering the same thing for X price.” So it’s important for the product marketing team within a company, but especially for the head of CS who has to do the renewal to know what the real competitive landscape looks like, where the pressures are coming from, whether that’s pricing or feature-based pressures. Then, the company can proactively react to that rather than being caught off guard when they lose an account to a competitor that they didn’t even know that they were in competition with as part of a renewal conversation.

Ethan Beute:
It’s good. I like these affordable alternatives because it really sets features on the side a little bit. I mean, parity, of course. Talk a little bit. I mean, you’ve been in this space for years. Talk a little bit about product parity, and maybe have you seen it… My impression is that it is dramatically accelerated. Would you say that that’s true in your experience or observation?

Chris Hicken:
I’d say that’s generally true. A lot of companies now are not trying to differentiate on straight features. They’re trying to differentiate on quality of the experience that they deliver. So two companies might have identical feature sets, but one is much easier to use than others. In fact, UserTesting was able to leverage that differentiator between itself and other competitors in the space because we invested so much time in building a really great experience. So even though competitors could offer the exact same thing at a much lower price, the UserTesting experience overall was so much easier to use. So I think there is a general trend towards looking for other differentiators outside of features and crowded spaces.

Ethan Beute:
That’s good. So you are getting… You’re building this company. We’ve chatted a little bit about this before we hit “Record.” I’d love to know your thoughts as you’re… Where I’m going here is this product-led versus sales-and-marketing-led growth conversation that seems to be pretty popular to have these days. Obviously, if you’re an established company with, let’s just say, $40 million ARR, and you’ve been going to market for years, it’d be difficult to make a transition from one to the other as an early stage and as you are putting this together. How did you think about those two options? Are you doing a hybrid approach? How do you think about product-led versus sales-led?

Chris Hicken:
Yeah. I think of product-led, sales-led, and marketing-led. So I wouldn’t forget that option too, and I think different types of companies are best suited for each of those three. The questions that I would ask before determining which strategy to go with are questions like, “How quickly can you deliver value in a self-service customer experience?” So if a customer is trying it for themselves, how quickly can you get to value? How senior is the end user of your product? This is an obvious one. Are you selling into SMB mid market or enterprise? How much cash runway do you have? How quickly do you need to grow?

Chris Hicken:
I think all of these questions factor into which decision you make, and so when I was thinking about ’nuffsaid, I mean, ultimately, we plan on selling into… We’re selling an AI product for knowledge workers, and ultimately, we’re going to be selling into a senior executive of each department, but the users will be predominantly individual contributors. So there’s obviously a path for us to build a product-led growth product, which is the one that we just launched a couple weeks ago, the Inflow product.

Chris Hicken:
I don’t like product-led growth as the main driver of growth, and the reason why is product-led growth takes a really long time to spool up. It can sometimes take three to five years before it’s generating any meaningful revenue. Sometimes it could take 10 years plus before you see all of these overnight success companies develop when really, they’ve been building a product-led growth engine for 10 or more years. By the way, I think a good example of that is Qualtrics who everyone knows the story. They exited for $700 billion. One of the biggest tech exits ever, but the reality is Brian Smith and his dad started this company doing surveys for colleges 20 years ago, and they’ve been stuck in that product-led growth engine for a really long time.

Chris Hicken:
So where I’m going with this is what I think for our company, and I would not advocate this for every other company, but for our company, we’re going to start with a sales-led growth engine in the early days to kickstart early market adoption, to get customer feedback, to grow the company from its current revenue to, let’s just say, somewhere between 30 to 50 in ARR. At that point, I’m hoping we’re five or six years in. The product-led growth engine has had enough time to spool up and we can leverage the product-led growth engine to drive future and uprise sales.

Chris Hicken:
By the way, when we say product-led growth, all we’re talking about is who generates the leads? Are you paying product to generate the leads? Are you pay marketing to generate the leads? Are you paying sales to generate the leads? So I’m hoping that by the time we get to that level of revenue, the product will be mature enough where it will be generating a substantial portion of the inbound leads, and we’ll be able to, at that point, reduce or at least hold steady our investment and sales.

Ethan Beute:
Good. Sounds healthy and balanced. I like the way you described the led growth scenario. There’s like, “Who’s generating the leads?” I mean, it goes straight to the definition of it, but I never thought about it that clearly before. It’s interesting. I mean, to your idea of like time to first value, and can people realize it in a self-serve way? It’s interesting. In our space, there’s a lot more free in freemium than there was, say, two, three, four years ago, but it’s interesting.

Ethan Beute:
As I talk with executives that are thinking about implementing a simple, personal video strategy inside their organization like, “Yeah, I got to tell you. We already tried video before.” I was like, “That’s interesting. Tell me more.” “Well, we used X company.” I was like, “How did it go?” “Well, not well because we’re having this conversation now,” and it’s, “Okay. What kind of onboarding and training did you get?” “Ah, we didn’t really get any.” “If you don’t mind my asking, what did you pay for this, and how long was the commitment?” “Oh, it was free.”

Ethan Beute:
So this idea of like just throwing it out there doesn’t mean it’s going to stick, and that’s part of probably… I mean, for where it sticks and where it doesn’t stick, that’s probably part of like the long spool up that you described is like getting that feedback, knowing what’s working, knowing why what’s working is actually working, which is the most important thing to know, and it’s probably… You get users faster signed on. You get email addresses faster is what I should say in a free or a freemium scenario, but it doesn’t mean that it’s going to stick.

Chris Hicken:
Ethan, I love that example. It’s really at the crux or the core of a successful product-led growth strategy. Product-led growth only works when you can narrow your audience to someone who feels the pain, the pain that you can solve. They feel the pain really intensely, and the product does a wonderful job of alleviating that pain. The problem with freemium, of course, is exactly what you said, which is that anyone can try it. Most people have a terrible experience. On social media, they’re going to go tell all their friends it’s worthless, and now, suddenly, video, which is a very powerful tool to a lot of people, comes across as an ineffective tool when actually, it can be very effective. So I agree with you, and actually, for that reason, I think for a lot of businesses, freemium does not make any sense, especially if they’re using a product-led growth strategy.

Ethan Beute:
Yeah. Interesting. I call it burning the field before anything has been harvested.

Chris Hicken:
That’s right.

Ethan Beute:
Like, “Dude, we got to replant this whole thing, man.” Before we wrap up here, and I really appreciate your time and your insights, I just want to hit one more thing just based on your experience, especially as a board member, advisor, or an investor, and maybe even as you initiate this new effort with ’nuffsaid. Talking about going from like downmarket to upmarket, I mean, you covered like SMB, mid, and enterprise. You’ve probably seen people make transitions or start somewhere and wind up in another kind of go-to market position from a size of customer standpoint. What can you share with folks that maybe want to transition?

Chris Hicken:
Well, first, read the book Crossing the Chasm because I think it’s a good framework for how to think about the transition from SMBs who tend to be more entrepreneurial in their adoption of products. They can make decisions very quickly to a more mid-market or an enterprise buyer who makes decisions very, very differently, and the proof points that they need to make a decision are also different. So I’d say, first, read the book Crossing the Chasm because that will give you a good framework to think about how you’re going to make this jump into more of an upmarket buyer.

Chris Hicken:
The other thing to think about is enterprise… So SMB sales, if you’re doing SMB sales, they tend to be very transactional. The deal lengths I bet… Your deal cycles are probably 30 to 45 days. You’re probably selling a product that’s 5 to 15K a year. Well, you start talking about enterprise sales. It’s a very different selling motion, so it’s 90 to 180-day deal cycles. The deals are bigger. You’ve got three or four different key points of contact that you have to be in touch with in order to get the deal done. So it really takes a big investment in building a team around enterprise selling.

Chris Hicken:
One of the hardest things for CEOs to deal with in the early days is to make the financial commitment to building the team that’s necessary because in order to do true enterprise sales, you need to have account executives. You need to have probably some kind of solutions architect or sales engineer. You probably need to have a legal team that’s with a really sharp legal… really good contract negotiator. You’re going to need to have a security team that’s dealing with security audits, and so the investment isn’t twice as big to sell enterprise. It might be 8 times or 10 times bigger.

Chris Hicken:
So I think just in terms of mentally preparing for enterprise sales is one of the pieces of advice that I would give. Also, and this is another difficult thing for generally the CEO to stomach is that the team that you built in the early days to deliver well on SMB sales is very unlikely to be the team that’s going to take you into enterprise. That’s hard because you probably have key lieutenants, people that you really love at the company who have delivered great value for you. But unless they have a world-class mentor, it’s very unlikely that they’re going to be able to learn about going from, for example, SMB focuses… Let’s talk about marketing for a second.

Chris Hicken:
SMB marketing is all about content strategy, and free trials, and PR. But when you start moving into enterprise, you do much less content marketing. It’s more about success stories, case studies, sales enablement for the sales team, account-based marketing. It’s a whole different set of skills that you need to onboard into your company in order to make that transition. So anyway, those are some thoughts for CEOs that are thinking of making the transition to consider before they make that decision.

Ethan Beute:
Great recommendation and great caution there, and I’ll just button that one up with what got you here might not get you there.

Chris Hicken:
Most certainly.

Ethan Beute:
It might, but it might not, and it requires a lot of training and adjustment really for everyone involved. This has been great, Chris. I was excited about this, this conversation. It did not disappoint in any way. You’re just a wealth of knowledge, and I really, really appreciate your time. But before I let you go and because relationships are our number one core value here at BombBomb and here on the podcast, I’d love to give you the chance to thank or mention someone who’s had a positive impact on your life or your career and to give a shout-out to a company that you really respect for the way that they’re delivering for you as a customer.

Chris Hicken:
That’s a great question. Can I ask first what the core value is?

Ethan Beute:
Yeah, it’s relationships.

Chris Hicken:
Forever? Just relationships?

Ethan Beute:
Yup.

Chris Hicken:
Is there like a bullet point or a type of behavior that you espouse or that you advocate for in order to build relationships?

Ethan Beute:
Yes. I will read you a short snippet. Relationships are the foundation of our business. Relationships are built upon conversation, active listening, and honest feedback. Our business is all about people and helping people reach their goals through building relationships.

Chris Hicken:
Wow, thanks for sharing that. Our first core value is also we build 30-year relationships, so good overlap there. So yeah. So let’s talk about… Maybe I’ll first talk about companies that I want to give a shout-out to. The first one. Well, we’re doing a Zoom call right now, so I want to give a shout-out to Zoom for a couple of reasons. One is as the company has scaled rapidly, onboarded tons of new customers, they’ve gone IPO, the quality of their core service has not diminished at all, and I’m just so thankful for that because we’ve seen other companies in the space go through similar transitions, and it has not gone well for them, so many thanks to Zoom largely I think probably because of Eric Yuan’s obsessive customer focus. I mean, he is 100% all about his customers all day long. He wakes up every morning and asks his senior staff to let him know what customers have said about Zoom yesterday. That’s what he’s all about, so I want to say a big shout-out and thanks to Zoom.

Chris Hicken:
That’s the bigger company. The smaller company I want to give a shout-out to is Rippling. So we use them for… They are our HRIS system. I feel like they’ve built a product in a way that has anticipated all of my needs as an early-stage company. Tax forms, insurance, asset tracking, payroll. All those things are built-in and easy to use and integrate. So I want to say a big shout-out and thanks to the team at Rippling. I really appreciate what you’re doing over there. By the way, it’s not just in the product. They offer self-help tutorials. Their website experience is very intuitive. So anyway, that team is doing a really great job.

Ethan Beute:
Sounds incredibly valuable and probably… I mean, this gets to the other key factor there. In addition to product parity, we’ve been talking a lot about hyper-competition and how much easier it is and how much faster companies can go. Starting today, I just think about you starting this company today versus our co-founder starting our company in 2006 and what it took just to organize some of that legal stuff, the tax documents, and all of that. It’s like this idea that you can build a company to solve a very specific and acute problem like that helps all the other companies that sign on with them get to their market, get to their customers, get to their value faster.

Chris Hicken:
Unlike your founders, I probably have spent a grand total of 45 minutes dealing with all these tax and other forms, so very thankful that Rippling has solved all that for me.

Ethan Beute:
That’s awesome. That’s great. Chris, I’m going to let you go, but before I do, if people enjoyed this conversation, they want to follow up with you, they want to follow up with ’nuffsaid, where would you direct people if they want to learn more about what you’re up to?

Chris Hicken:
Easiest thing is just to go to nuffsaid.com, N-U-F-F-S-A-I-D.com. It tells you a little bit about the product. It’s where you can go sign up for our early access list. If you sign up now, we’re basically committing to giving you a lifetime price point of 10 bucks per person per month. So when we launch, it will be a higher price point than that, but you can lock it in at a lower price for being an early adopter of the product. Actually, I feel like I should also… You asked about someone who had an impact in my life. Do we have time to answer that question because I feel like I need to give a shout-out to Ken Weller.

Ethan Beute:
Yeah, please.

Chris Hicken:
Ken was the SVP of Sales at Best Buy and especially during their big growth years. So that’s when they went… They grew to $20 billion-plus in sales. He’s also the CEO of a company called the Good Guys. I don’t know if you remember that business, but they were like an electronics retailer. He now [inaudible 00:39:58] that business to Carlos Slim, but when he would visit stores… You’d think the head of sales would be 100% focused on sales and sales improvement, but when Ken walked into the stores, he would judge the quality of the store by the number of lights that were out on the ceiling.

Chris Hicken:
Best Buy has these big warehouse-like offices with no natural light, and so they took the time to invest in a really night lighting system so it felt very bright inside the store, and so when he walked into a store and saw that a light bulb was out, he knew that the manager of that store was not obsessing about the quality of the customer’s experience. So anyway, I always thought it was fascinating that a guy like Ken was so focused on customer experience and so detail-oriented that he noticed lights being out. I felt like that was a good lesson for me about what true customer obsession actually looks like, so thank you, Ken. I really appreciate that.

Ethan Beute:
Yeah, it’s really good. It’s a great story. I mean, it’s like overlooking the blocking and tackling. I mean, that’s another thing we’ve had on the show is just being slightly better than average almost all of the time gives you a great experience. So when you start making exceptions like, “Ah, yeah. We’ll get to that late some time.” As soon as you start making exceptions, you’re immediately out of the running for being slightly above average almost all the time.

Chris Hicken:
That’s a great way to summarize it, and I wholeheartedly agree.

Ethan Beute:
Cool. Chris Hicken, thank you so much for spending time on the podcast today. Folks, check out ’nuffsaid. I assume that everyone listening to this faces some version of the problem that they’re tackling out of the gate. AI will just make it even smarter and better. I hope you have a great rest of your day, and I hope you have a great rest of your week.

Chris Hicken:
Many thanks, Ethan. I appreciate the invite to join the show.

 

 

Video Highlights: Product Usage as a Vanity Metric

Check out the top five video highlights from the whole discussion with Chris below…

 

1. The Overindexed Value of Product Usage Data

 

 

2. CS Leaders and Go-To-Market Strategies

 

 

3. Product-Led Growth vs. Sales-Led Growth vs. Marketing-Led Growth

 

 

4. Free and Freemium Cautions

 

 

5. Going Upmarket from SMB to Enterprise

 

 

You’ll Also Enjoy:

 

Please Subscribe, Listen, Rate, and Review The Customer Experience Podcast

 

 

Chris Hicken, 'nuffsaid, product usage, vanity metric

 

 

Ethan Beute

Ethan Beute | About The Author

Chief Evangelist at BombBomb, co-author of Rehumanize Your Business, and host of The Customer Experience Podcast, Ethan collects and tells stories of clearer communication, human connection, and higher conversion with simple, personal videos. BA: University of Michigan. MBA: University of Colorado-Colorado Springs. Fresh air & clean water.