Thoughts from my journey

Today, I’m happy to announce that Totango has analyzed the customer engagement and optimized the sales and customer success interaction with more than one million prospects!

We sure learned a lot from our beta stage and this is the place to thank all our wonderful customers who were taking part of our beta stage.

Out of the massive data we’ve gathered, here are 4 main conclusions that could help sales and customer success teams to understand where to focus in order to increase revenues: from new sales, expansion sales and renewals.

• Free trial users who are still active during day 3 of their trial were 4 times more likely to convert into paying users than the average customer

What can I do with that information?
SaaS sales teams could use this insight by focusing their time and close more deals

• Active trial users who were contacted by a sales rep were 70% more likely to buy the paid service than those who weren’t

What can I do with that information?
This proves that timely and contextual engagement with prospects results in more sales

• A full half of paid SaaS customers log in less than once a month or do not use their paid service at all. Another 19% is using their paid service less than once a week. Only 14% of paid customers use their service weekly and only 17% use it daily

What can I do with that information?
Have customer success team focus on the non-active paid users and the sales teams to focus on the frequent users to increase upsell

• Most cancellations were preceded by a period of non-use

What can I do with that information?
SaaS customer success teams could use this insight to configure alerts for inactive users and to pro actively reach out to these customers and offer help

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<a href=”http://www.totango.com/blog/?p=1915&preview=true” _mce_href=”http://www.totango.com/blog/?p=1915&preview=true”><img src=”http://www.totango.com/blog/wp-content/uploads/2012/01/PR-Infographics.jpg” _mce_src=”http://www.totango.com/blog/wp-content/uploads/2012/01/PR-Infographics.jpg” alt=”4 Conclusions from our Aggregate Customer Analysis – Infographics” title=”4 Conclusions from our Aggregate Customer Analysis – Infographics” width=”388″ height=”518″/><br/><a href=”http://www.totango.com” _mce_href=”http://www.totango.com”>Totango – Real Time Customer Engagement for SaaS and Web App</a>

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This week, I’ve interviewed Charles Hudson, CEO and Co-Founder of Bionic Panda Games about how he uses analytics system to increase free to paid conversion.
Charles indicates that they’re trying to find a pattern of the paying customer and try to build a profile around the way users behave and try to predict what they’d like to see in the game they’re going to pay for.

I like the way of finding a winning card and then replicate it and this is why it is very important to know what have caused to that engagement. Measuring the right metrics here are crucial to understand your customer behavior and a comprehensive research should be done on the route which caused the free user to convert into a paying customer.

Charles also talks about the advantages of the freemium model versus the enterprise – what can a freemium offer that Enterprises can’t? for the complete interview see below:

Is there a Pattern for the Free to Paid User? from Totango on Vimeo.

To read the full transcription of the video, click here

Video Transcription:
This is Charles Hudson from Bionic Panda Games. We use our analytic system internally to identify that subset of customers that converts and spends money in the game, and to better understand their behavior and we take that information and then go try to acquire more customers who look, behave like the ones we find that monetize well.

If you look at some of the really big freemium consumer success stories, part of what makes them work is that it allows customers who have a problem, to use your service without having to pick up the phone, without having to have a salesman so i think what enterprise companies can learn is that making your service free and available to consumers who have a defined need is a great way for customers to self-select.

Then you can always go back and follow up directly with the people who are using your service.

I declare this week as the “Top 10″ Practices week in Totango!

After yesterday’s post on Top 10 Requirements for an Effective Client Lifecycle, Today, I’m going to review Jeff Bennet’s top 10 must do’s for young SaaS companies.

Jeff Bennett, who is the founder and CEO of ServiceVantage, has a lot of experience working with SaaS companies in various sizes and being part of the SaaS Industry myself, I see eye to eye with his key strategies and therefore thought it would be interesting to share:

1. Easily Consumable and User Initiated – have ALL of your customer experience as easy as possible. This includes software trials, sales, on-boarding, training,  support etc.
2. Hold off on the elephant hunt – Don’t start off with the big shots companies, take it step by step and wait till you’ll have a more mature infrastructure
3. Configure, don’t customize – Rather than customizing, allow configuration which do not change the core product yet provide some tailoring to specific customer needs
4. Marketing can close deals – Sales are all about conversion from lead to paid. Incent your marketing to close deals!
5. Understand your cost of sale – Push deals by their cost – bigger deals to outside sales and smaller to marketing
6. Understand usage rates – Learn to measure customer engagement and usage data, you can use specified SaaS dashboard to do it for you!
7. Have a Client Lifecycle Program – Especially important for SaaS businesses that need to ensure customer retention and recurring revenue
8. Don’t be an island – Aspire to integrate your solution with other solutions to increase dependency on your service
9. Broaden the impact of your SaaS solution through services – Provide service offerings to compliment your solution
10. Make client retention a corporate mantra – this is not only the concern of your Support group – have the entire company focus on client retention and reducing churn

For the full version of the tips, please refer Jeff’s post on ServiceVentage blog

Do you know how to measure your Customer Engagement?
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We’ve held yet another very interesting lean-startup meetup on Thursday to discuss free to paid conversion best practices for cloud applications.
First, please find within the presentation I’ve used. It’s a collection of many ideas we’ve been working on at Totango collected into idea presented by this presentation.

I emphasized during the talk the need to focus on the ‘evaluating’ users – the ones that their actions indicate genuine intent to come up with a buying decision.
Many people still wanted to understand what to do with the other group. The short out of the sleeve answer would be: “It depends ”. Seriously, this question deserves a blog post on it’s own which I’m going to write later this week.

In the mean time, please feel free to enjoy the presentation. You will be able to learn a lot also by starting a ‘free trial’ for the Totango trial conversion product. So here’s the link for that as well.

If you enjoy this content, please be kind and share it with your friend. The links are above and below.

At Totango, I have initiated a project to collect and share more best practices around low-touch selling, free-to-paid conversion, up-selling and customer retention. On this blog we will share what we learn from speaking to sales and customer success professionals in the field of open source and SaaS software.

Today, I had an opportunity to speak to Rudy Reyes, the newly appointed VP of Customer Success at Alcove9. Alcove9 is a young company with an open source search tool that looks into a company’s intranet and indexes all of its data and information for rapid retrieval. It is a subscription-based service, but not a cloud-based solution.

The basic indexing and search tool is a free, open source download called the a9 Hub. Then, Alcove9 offers support subscriptions and upgrades to premium features such as CAD visualization and markup (a9 CADViz) or application connectors (a9 AppConnect) to systems like PLM (Product Lifecycle Management), ECM (Enterprise Content Management), ERP (Enterprise Resource Management), and more.

I asked Rudy about his priorities and customer success metrics for the company.

What are the priorities for the company today?

Alcove9 just went live on Monday, October 31; however, the foundation is based on a proven solution that has matured for over 7 years.
Our primary focus is on people who are looking for instant access to all of their corporate data that often resides in disparate systems. The core, open source download, a9 Hub, is the cornerstone of the entire suite of products and support services. Another important aspect of our sales and marketing activities is to work with partners such as AutoDesk and Aras to identify new product solutions in order to make organizations more efficient while eliminating the frustrations of trying to find vital, lost or legacy data.

What is the priority for the Customer Success team?

I work with the early adopters, translating customer requirements into product features. Then we help customers with successful on-boarding and implementation. It is really important to have someone who is focused on the total customer experience.

What are the key metrics you measure?

We are interested in adoption rates: who is downloading our application, who is installing it and then adoption metrics of different modules, such as which features they are using and finally retention rates (churn).

What are sales or up-selling signals?

Our sales are based on high-touch qualifying questions. For example, do they use CAD; do they have a PLM, ECM or ERP system. If they answer “yes,” then we will introduce them to the appropriate connector solutions. (AppConnect).

Thanks Rudy for the insights! I am keen to watch the progress of Alcove9 in the future!