“How do your customers measure customer reference program impact?”
We get that question all the time. The good news is that it isn’t hard or complicated. It can be time consuming if you don’t have the right technology, but not impossible. Before going further it’s important to separate measurement of activities vs. measurement of outcomes.
Activities that most customer reference programs measure—both snapshots as well as trends—include;
- Customers added
- Segment coverage (industry, geo, product, etc.)
- Service levels/Efficiency (e.g., how quickly are requests fulfilled)
- Nominations submitted/qualified
- Customer content added
- Rewards earned/issued
- Reference activity feedback
Any well-run operation will track metrics like these with a goal of continuous improvement: curtailing negative trends, and adapting to changing stakeholder and buyer needs.
These are important program metrics, but leadership isn’t measured on them. Leadership is measured on growth, profitability and cost efficiency.
The savvy customer reference program manager gets this and makes a point of understanding the company’s overarching goals, and aligns the program’s goals to those of the company’s. For example:
- If the company is trying to enter new markets then the marketing and sales teams will need customer reference accounts in those markets
- If a new product launch is part of the growth plan then references will be needed at launch
- Perhaps an acquisition occurred and the company needs synergistic stories for the go-to-market strategy. Customers are needed to tell that story.
By connecting the dots between the program and strategic initiatives, the impact of customer reference program will be viewed in a very different light—indispensable rather than nice-to-have.
So you’ve done a good job of aligning your goals to those the CxO cares about. Now what? You measure the outcomes, the result of a well-run program:
- Revenue influenced
This is the revenue generated from closed/won opportunities that used the customer reference program: the buyer may have been connected with a reference customer, or received customer videos, case studies, etc., during the sales process. Program assets helped pull the deal over the goal line.
- Win Rate
This metric is most effective when there is a fair amount of opportunity volume. It’s a comparison between all opportunities that made use of a customer or customer content, and those that did not and the respective win rates. Companies that track this data see win rates between 20% and 50% higher when customer reference “assets” were used effectively. That’s big!
- Sales cycle compression
When the sales team spends minutes versus hours, days or weeks to identify relevant reference accounts and secure their use, it cuts a chunk of time out of the sales cycle. It also allows salespeople to use that time in better ways, including moving other deals forward. Then there is the buyer’s perception. When a company takes days, weeks or months to round up relevant, happy customers is that a yellow or red flag—especially if the competitor(s) don’t can present references faster?
- Win reports: customer references influence rating
This one is perhaps more subjective, but nonetheless valuable. If your company does a post-purchase survey of buyers there should be a question that helps answer the question: How important were our customer references or customer content to your decision? Some companies may ask the buyer to rank, from a laundry list of choices, the top 3 factors influencing the purchase decision. Others may simply ask, on a range of 1-10, how important customer references were to their decision. Either way, it’s the ultimate measurement, similar to the NPS question in simplicity and directness.
The key to outcome measurement is being able to report against opportunities. If every request for a reference and every buyer’s engagement with customer content is associated to opportunities to begin with then this exercise is trivial. The alternative is to manually make a match between outcomes and opportunities.
Our technology, ReferenceEdge, makes quick work of this since all the program’s data resides in Salesforce, there are many activity and outcome reports included, and any additional reporting or dashboard charts are created using Salesforce’s extensive native capabilities.
However you produce and track your program’s key metrics, you can’t keep them a secret. Don’t assume that leadership knows the good work you’re doing, the contributions made by your program’s ability to leverage your best story tellers: your customer advocates. If Salesforce is your CRM system then share the most compelling dashboard charts on CxO dashboards. Being proactive and transparent will pay off and position the program as it should be: strategically essential.