customer experience
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4 proven approaches to CX strategy that make customers feel loved
Customers have been “experiencing” business since the ancient Romans browsed the Forum for produce, pottery and leather goods. But digitization has radically recalibrated the buyer-seller dynamic, fueling the rise of one of the most talked-about industry acronyms: CX (customer experience).
Part paradigm, part category and part multibillion-dollar market, CX is a broad term used across a myriad of contexts. But great CX boils down to delighting every customer on an emotional level, anytime and anywhere a business interaction takes place.
Great CX boils down to delighting every customer on an emotional level, anytime and anywhere a business interaction takes place.
Optimizing CX requires a sophisticated tool stack. Customer behavior should be tracked, their needs must be understood, and opportunities to engage proactively must be identified. Wall Street, for one, is taking note: Qualtrics, the creator of “XM” (experience management) as a category, was spun-out from SAP and IPO’d in January, and Sprinklr, a social media listening solution that has expanded into a “Digital CXM” platform, recently filed to go public.
Thinking critically about customer experience is hardly a new concept, but a few factors are spurring an inflection point in investment by enterprises and VCs.
Firstly, brands are now expected to create a consistent, cohesive experience across multiple channels, both online and offline, with an ever-increasing focus on the former. Customer experience and the digital customer experience are rapidly becoming synonymous.
The sheer volume of customer data has also reached new heights. As a McKinsey report put it, “Today, companies can regularly, lawfully, and seamlessly collect smartphone and interaction data from across their customer, financial, and operations systems, yielding deep insights about their customers … These companies can better understand their interactions with customers and even preempt problems in customer journeys. Their customers are reaping benefits: Think quick compensation for a flight delay, or outreach from an insurance company when a patient is having trouble resolving a problem.”
Moreover, the app economy continues to raise the bar on user experience, and end users have less patience than ever before. Each time Netflix displays just the right movie, Instagram recommends just the right shoes, or TikTok plays just the right dog video, people are being trained to demand just a bit more magic.
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Breinify announces $11M seed to bring data science to the marketing team
Breinify is a startup working to apply data science to personalization, and do it in a way that makes it accessible to nontechnical marketing employees to build more meaningful customer experiences. Today the company announced a funding round totaling $11 million.
The investment was led by Gutbrain Ventures and PBJ Capital with participation from Streamlined Ventures, CXO Fund, Amino Capital, Startup Capital Ventures and Sterling Road.
Breinify co-founder and CEO Diane Keng says that she and co-founder and CTO Philipp Meisen started the company to bring predictive personalization based on data science to marketers with the goal of helping them improve a customer’s experience by personalizing messages tailored to individual tastes.
“We’re big believers that the world, especially consumer brands, really need strong predictive personalization. But when you think about consumer big brands or the retailers that you buy from, most of them aren’t data scientists, nor do they really know how to activate [machine learning] at scale,” Keng told TechCrunch.
She says that she wanted to make this type of technology more accessible by hiding the complexity behind the algorithms powering the platform. “Instead of telling you how powerful the algorithms are, we show you [what that means for the] consumer experience, and in the end what that means for both the consumer and you as a marketer individually,” she said.
That involves the kind of customizations you might expect around website messaging, emails, texts or whatever channel a marketer might be using to communicate with the buyer. “So the AI decides you should be shown these products, this offer, this specific promotion at this time, [whether it’s] the web, email or SMS. So you’re not getting the same content across different channels, and we do all that automatically for you, and that’s [driven by the algorithms],” she said.
Breinify launched in 2016 and participated in the TechCrunch Disrupt Startup Battlefield competition in San Francisco that year. She said it was early days for the company, but it helped them focus their approach. “I think it gave us a huge stage presence. It gave us a chance to test out the idea just to see where the market was in regards to needing a solution like this. We definitely learned a lot. I think it showed us that people were interested in personalization,” she said. And although the company didn’t win the competition, it ended up walking away with a funding deal.
Today the startup is growing fast and has 24 employees, up from 10 last year. Keng, who is an Asian woman, places a high premium on diversity.
“We partner with about four different kinds of diversity groups right now to source candidates, but at the end of the day, I think if you are someone that’s eager to learn, and you might not have all the skills yet, and you’re [part of an under-represented] group we encourage everyone to apply as much as possible. We put a lot of work into trying to create a really well-rounded group,” she said.
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Develop a buyer’s guide to educate your startup’s sales team and customers
Every company wants to be innovative, but innovation comes with its share of difficulties. One key challenge for early-stage companies that are disrupting a particular space or creating a new category is figuring out how to sell a unique product to customers who have never bought such a solution.
This is especially the case when a solution doesn’t have many reference points and its significance may not be obvious.
My view is simple — some buyers could use a walkthrough of the buying process. If you are building a singular product in a nascent market that necessitates forward-looking customers and want to drastically shorten sales cycles, I have a proposal: Create a buyer’s guide.
A buyer’s guide is essentially a prescriptive summary that provides an understandable overview of how a customer may buy your solution.
A buyer’s guide is essentially a prescriptive summary that provides an understandable overview of how a customer may buy your solution. What does your product actually do? Is it secure? How would you implement the technology? What does it replace, if anything? It should be short, simple and speak the customer’s language. It also acts as a sales-enabling tool. Sales teams, especially at smaller startups, can review the guide quarterly and analyze what is and isn’t working as the company goes to market.
Here is how to put together a buyer’s guide, including what to sort out before you type a single word.
Know your audience
From the start, it’s important to think about who the stakeholders are for your product’s buying cycle. One typical issue with early-stage startups is they meet with an enthusiastic buyer — a CIO, CTO or VP of product — but neglect to include the other stakeholders who should be part of the conversation. More importantly, a lot of companies don’t realize the impact of their product on a group or team that they would not typically sell to.
For example, target the security team as an early stakeholder, because they’re probably going to review your product. If the solution is focused toward, say, integration, then hone in on who would be owning the integration process on the buyer’s team.
If you’re selling a martech solution, on a business level, you have to consider a finance business partner for marketing. Think about the problems your customers face and also how others in their company relate to them.
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Even startups on tight budgets can maximize their marketing impact
Search engine optimization, PR, paid marketing, emails, social — marketing and communications is crowded with techniques, channels, solutions and acronyms. It’s little wonder that many startups strapped for time and money find defining and executing a sustainable marketing campaign a daunting prospect.
The sheer number of options makes it difficult to determine an effective approach, and my view is that this complexity often obscures the obvious answer: A startup’s best marketing asset is its story. The knowledge and expertise of its team, together with the why and the how of its offering provides the most compelling content.
Leveraging this material with best practice techniques enables any startup, no matter how limited its budget, to run an effective marketing campaign.
Many startups make the mistake of choosing systems and employing procedures to solve the immediate needs of the department that requires them.
I know this approach works, because this is exactly what I did with my co-founder Alex Feiglstorfer when we set up Storyblok. To be clear, we are developers not marketers. However, our previous experience building CMS systems taught us that the main driver of organic engagement for most businesses was customer conversations around content.
Specifically, sharing experiences, expertise and what we learned. We had committed nearly all of our available cash to developing our product, so we knew that the only way to market Storyblok was to do it all ourselves.
As a result, we focused solely on problem-solving content. This took the form of tutorials on web development and opinion pieces on headless CMS and other topics within our areas of expertise. The trick was that what we published wasn’t made just for marketing, it was based on our own internal documentation of problems we encountered as we developed our product. In essence, we were “learning in public.” Through this approach we were able to acquire thousands of customers in our first year.
Retelling this story isn’t to blow my own trumpet, it’s to make clear that you don’t have to be a marketer by training or commit a huge amount of time and resources to successfully market your startup. So, how do you get started?
Getting your structure and technology right
Although there’s no one-size-fits-all approach to how you organize your startup’s marketing function, there are some basic principles that apply in nearly every situation. A recent survey of 400+ executives from CMS Wire helpfully identified the following factors as the “top digital customer experience challenges” for businesses:
- Limited budget/resources.
- Siloed systems and fragmented customer data.
- Limited cross-department alignment/collaboration.
- Outdated/limited technology, operations or processes.
- Lack of in-house expertise/skills.
Challenges two to four are the pitfalls that we can focus on avoiding. They are directly related to how a startup produces, organizes and distributes its content.
With regard to the siloing of systems and fragmentation of customer data, the overriding goal is to ensure all your systems are integrated and speak to one another. In practice, this means that the data gathered in different departments — whether its feedback from sales, engagement on your website, customer service responses or product development information — is collected in a uniform and methodical manner and is readily accessible across the business.
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Kenya’s Ajua acquires WayaWaya to consolidate consumer experience play in African SMEs
Kenyan consumer experience platform for businesses in Africa, Ajua today announced that it has acquired WayaWaya, a Kenya-based AI and ML messaging and payments company.
WayaWaya’s customers and partners include the likes of I&M Bank, Interswitch and MTN. The company offers a range of services, from digital banking and payment services to financial services APIs and payment bots.
According to Ajua, the acquisition is primarily focused on WayaWaya’s payments bots system known as Janja. The platform, which has customers like Airtel, Ezee Money, Housing Finance Company of Kenya (HF Group), enables borderless banking and payments across apps and social media platforms. Teddy Ogallo, the entrepreneur who founded WayaWaya, joins Ajua as VP of Product APIs and Integrations.
Per Crunchbase, WayaWaya has just raised $75,000. Although the two companies did not disclose the financial details of the acquisition, Ajua is expected to have paid 10 times more than WayaWaya’s total raise.
Ajua, formerly mSurvey, was founded in 2012 by Kenfield Griffith. The company is solving a consumer data problem for African businesses to understand their business better and drive growth.
“There’s a lot of commerce happening on the continent and Ajua wants companies to move from transaction numbers to the customers behind such transaction,” Griffith told TechCrunch. “Imagine if we knew what drove consumer habits for businesses. I mean, that’s a huge exponential curve for African businesses.”
Teddy Ogallo (Founder, WayaWaya) & Kenfield Griffith (CEO, Ajua)
Nigeria’s SME market alone is valued at $220 billion annually. And while businesses, mostly big enterprises, can afford customer communication tools, a large segment of small businesses are being left out. Ajua’s play is to use data and analytics to connect companies with their customers in real time. “We’ve taken what makes enterprise customers successful, and we’re capturing it in a simple format so SMEs can have the same tools,” Griffith added.
Since most consumer behavior for these SMEs happens offline, Ajua gives businesses unique USSD codes to receive payments, get feedback and offer discounts to their customers. It is one of the products Ajua has launched over the years for customer feedback at the point of service to businesses that cumulatively have over 45 million customers.
The company’s partners and clients also include Coca-Cola, FBNQuest, GoodLife Pharmacy, Java House, Safaricom, Standard Chartered and Total.
As an intelligent messaging bot, Janja is used by individuals and businesses across WhatsApp, Facebook Messenger and Telegram to automate customer support and make cross-border payments. So, Janja’s integration into Ajua’s product stack will close much of the acquirer’s customer experience loop by automating responses and giving customers what they want, when they want it.
This acquisition comes a month after Ajua announced that it partnered with telecom operator MTN Nigeria to launch a customer management product for Nigerian businesses. The product called MTN EnGauge carries the same features present in Ajua but, in this case, is tailored solely for businesses using the MTN network. The roll-out is expected to generate more data for Ajua’s thousands of users. It will also be upgraded to incorporate Janja and other services.
In hindsight, it appears Ajua could have created a product like Janja in-house due to its vast experience in the consumer experience space. However, the company chose an acquisition and Griffith gave two reasons why — building a similar product would have taken a long time and Ogallo seemed to know Janja’s business and operations so well, it just made sense to get him on board.
“Teddy was going the same direction we’re going. We just thought to acquire WayaWaya instead and make a really good company out of both products attempting to solve the same problem. To me, it’s all about solving the problem together rather than going alone,” said the CEO.
On why he accepted the acquisition, Ogallo, who now has a new role, noted that Ajua’s ability to scale customer service and experience and also help businesses was one reason and earned admiration from him. “Seeing how WayaWaya’s technology can complement Ajua’s innovative products and services, and help scale and monetize businesses, is an exciting opportunity for us, and we are happy that our teams will be collaborating to build something unique for the continent,” he added.
This is a solid infrastructure play from Ajua coming from a founder who is a massive advocate of acquisition and consolidation. Griffith believes that the two are strategies for a speedier route to new markets and channels in Africa.
“I think there are lots of ways we can build the ecosystem. There are lots of young talent building stuff, and they don’t have access to capital to get to the next stage. The question is if they want to race to the finish line or take off time and get acquired. I think there’s a huge opportunity in Africa if you want to solve complex problems by acquisition.”
There has been an uptick in local acquisitions in Africa from startups within a single country and between two countries in the past three years. For the former, Nigerian recruitment platform Jobberman’s acquisition of NGCareers last year comes to mind. And there are pan-African instances like Lagos-based hub CcHub’s acquisition of iHub, its Nairobi counterpart; Ethiopian software provider Apposit sell-off to Nigerian fintech Paga; and Johannesburg-based fintech MFS Africa acquiring Uganda’s Beyonic.
The common theme among the acquisitions (and most African acquisitions) is their undisclosed sums. For Ajua, Griffith cited regulatory issues as one reason why the company is keeping the figure under wraps.
Since launching nine years ago, Ajua has raised a total of $3.5 million, according to Crunchbase. Given the nature of this acquisition and partnership with MTN, the company might set sights on another fundraise to scale aggressively into Nigeria (a market it entered in 2019) and other African countries.
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How our SaaS startup improved net revenue retention by more than 30 points in two quarters
There’s certainly no shortage of SaaS performance metrics leaders focus on. While all SaaS companies do, and must, home in on acquisition metrics, there’s also massive revenue potential within your current customer base.
I think NRR (net revenue retention) is without question the most underrated metric out there. NRR is simply total revenue minus any revenue churn plus any revenue expansion from upgrades, cross-sells or upsells. The greater the NRR, the quicker companies can scale. Simply put: the power of compound math!
One of the biggest and most impactful changes we made was to move new business, retention and account management all under our chief revenue officer.
Over the course of two quarters, Terminus grew its NRR by more than 30 points, opening up incredible new levels of growth opportunities.
To boost our NRR for the better, I focused on three core pillars within our organization.
People
We took a holistic look at the organization and our org structure. One of the biggest and most impactful changes we made was to move new business, retention and account management all under our chief revenue officer. At the end of the day, it just makes a ton of sense to have acquisition and retention living under the same roof — why bother acquiring new customers if you can’t retain them?
We also rolled out a surround-sound team (around three or four people per customer) who onboard and help customers with their account from day one. In total, we have about a quarter of our company dedicated to this 24/7 support and hands-on guidance to ensure we’re enabling customers immediately.
Process
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Customer experience startup Sprinklr files confidential S-1 with SEC
Sprinklr, a New York-based customer experience company, announced today it has filed a confidential S-1 ahead of a possible IPO.
“Sprinklr today announced that it has confidentially submitted a draft registration statement on Form S-1 with the Securities and Exchange Commission (the ‘SEC”) relating to the proposed initial public offering of its common stock,” the company said in a statement.
It also indicated that it will determine the exact number of shares and the price range at a later point after it receives approval from the SEC to go public.
The company most recently raised $200 million on a $2.7 billion valuation last year. It was its first fundraise in 4 years. At the time, founder and CEO Ragy Thomas said his company expected to end 2020 with $400 million in ARR, certainly a healthy number on which to embark as a public company.
He also said that Sprinklr’s next fundraise would be an IPO, making him true to his word. “I’ve been public about the pathway around this, and the path is that the next financial milestone will be an IPO,” he told me at the time of the $200 million round. He said that with COVID, it probably was a year or so away, but the timing appears to have sped up.
Sprinklr sees customer experience management as a natural extension of CRM, and as such a huge market potentially worth $100 billion, according to Thomas. But he also admitted that he was up against some big competitors like Salesforce and Adobe, helping explain why he fundraised last year.
Sprinklr was founded in 2009 with a focus on social media listening, but it announced a hard push into customer experience in 2017 when it added marketing, advertising, research, customer and e-commerce to its social efforts.
The company has raised $585 million to date, and has also been highly acquisitive, buying 11 companies along the way as it added functionality to the base platform, according to Crunchbase data.
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Following acquisition, Episerver rebrands as Optimizely
After acquiring Optimizely last fall, content management company Episerver is adopting the Optimizely name for the entire organization.
CEO Alex Atzberger told me that the company will be rolling out new branding in the next coming months, as well as renaming its entire product suite to reflect the Optimizely brand.
“We believe it’s no longer just about personalizing the experience or driving recommendations,” Atzberger said. “The brand and word Optimizely really signifies optimal performance. Companies today of any size, any scale [need to be] much more sophisticated in terms of how they digitally connect with their customers. It’s a never-ending story.”
At the same time, he emphasized that Episerver is making the change from “a position of strength,” with the combined company seeing double-digit revenue growth last year and going live with more than 250 new customers.
Asked whether adopting the Optimizely name was always part of the post-acquisition plan, Atzberger replied, “When we acquired Optimizely, we knew that we would be acquiring not just a great product, not just a great customer base, but also acquiring a very well-known brand. We had not yet decided on [rebranding], but it was certainly something that, for me, was part of the consideration.”
In addition to announcing the new company name, Episerver/Optimizely is also announcing a new platform that it’s calling Optimization-as-a-Service, which integrates aspects of Optimizely and Episerver products to offer web targeting, testing and recommendations. As Atzberger put it, this new platform allows customers to determine “who to show something to, what content to show and how to actually show this content.”
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Color raises $167 million funding at $1.5 billion valuation to expand ‘last mile’ of US health infrastructure
Healthcare startup Color has raised a sizable $167 million in Series D funding round, at a valuation of $1.5 billion post-money, the company announced today. This brings the total raised by Color to $278 million, with its latest large round intended to help it build on a record year of growth in 2020 with even more expansion to help put in place key health infrastructure systems across the U.S. — including those related to the “last mile” delivery of COVID-19 vaccines.
This latest investment into Color was led by General Catalyst, and by funds invested by T. Rowe Price, along with participation from Viking Global investors as well as others. Alongside the funding, the company is also bringing on a number of key senior executives, including Claire Vo (formerly of Optimizely) as chief product officer, Emily Reuter (formerly of Uber, where she played a key role in its IPO process) as VP of Strategy and Operations, and Ashley Chandler (formerly of Stripe) as VP of Marketing.
“I think with the [COVID-19] crisis, it’s really shone the light on that lack of infrastructure. We saw it multiple times, with lab testing, with antigen testing and now with vaccines,” Color CEO and co-founder Othman Laraki told me in an interview. “The model that we’ve been developing, that’s been working really well and we feel like this is the opportunity to really scale it in a very major way. I think literally what’s happening is the building of the public health infrastructure for the country that’s starting off from a technology-first model, as opposed to, what ends up happening in a lot of industries, which is you start off taking your existing logistics and assets, and add technology to them.”
Color’s 2020 was a record year for the company, thanks in part to partnerships like the one it formed with San Francisco to establish testing for healthcare workers and residents. Laraki told me they did about five-fold their prior year’s business, and while the company is already set up to grow on its own sustainably based on the revenue it pulls in from customers, its ambitions and plans for 2021 and beyond made this the right time to help it accelerate further with the addition of more capital.
Laraki described Color’s approach as one that is both cost-efficient for the company, and also significant cost-saving for the healthcare providers it works with. He likens their approach to the shift that happened in retail with the move to online sales — and the contribution of one industry heavyweight in particular.
“At some point, you build Amazon — a technology-first stack that’s optimized around access and scale,” Laraki said. “I think that’s literally what we’re seeing now with healthcare. What’s kind of getting catalyzed right now is we’ve been realizing it applies to the COVID crisis, but also, we started actually working on that for prevention and I think actually it’s going to be applying to a huge surface area in healthcare; basically all the aspects of health that are not acute care where you don’t need to show up in hospital.”
Ultimately, Color’s approach is to rethink healthcare delivery in order to “make it accessible at the edge directly in people’s lives,” with “low transaction costs,” in a way that’s “scalable, [and] doesn’t use a lot of clinical resourcing,” Laraki says. He notes that this is actually very possible once you reasses the problem without relying on a lot of accepted knowledge about the way things are done today, which result in a “heavy stack” versus what you actually need to deliver the desired outcomes.
Laraki doesn’t think the problem is easy to solve — on the contrary, he acknowledges that 2021 is likely to be even more difficult and challenging than 2020 in many ways for the healthcare industry, and we’ve already begun to see evidence of that in the many challenges already faced by vaccine distribution and delivery in its initial rollout. But he’s optimistic about Color’s ability to help address those challenges, and to build out a “last mile” delivery system for crucial care that expands accessibility, while also making sure things are done right.
“When you take a step back, doing COVID testing or COVID vaccinations … those are not complex procedures at all — they’re extremely simple procedures,” he said. “What’s hard is doing them massive scale and with a very low transaction cost to the individual and to the system. And that’s a very different tooling.”
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StepZen snares $8M seed to build data integration API
StepZen, a new startup from the crew who gave you Apigee (which was sold to Google in 2016 for $625 million) had a different vision for their latest company. They are building a single API that pulls data from disparate sources to help developers deliver more complex customer experiences online.
Today, the startup emerged from stealth and announced an $8 million seed investment from Neotribe Ventures and Wing Venture Capital .
With years of experience working with APIs, the founders wanted to take that a step further, says CEO and co-founder Anant Jhingran. “StepZen is a product that lets front end developers easily create and consume one API for all the data they need from the back end,” he explained.
This is all in the service of providing a smoother, more consistent customer experience. That means whether you are on an e-commerce site accessing your order history or a banking app grabbing your current balance, these scenarios require pulling data from various back-end data resources. Connecting to those resources is a time-consuming task, and StepZen wants to simplify that for developers.
“Developers spend an enormous amount of time deploying and managing code that accesses the back end, and what StepZen wants to do is to give them that time back,” he said.
Instead of manually writing code to pull this data, StepZen enables developers to simply provide configuration information and credentials to connect to these back-end data sources, and then it builds a single API that handles all of the heavy lifting of pulling that data and presenting it when needed.
Jhingran uses the example of presenting a list of open orders for a customer. It sounds simple enough, but once you consider that the data could live in several places, including the CRM system, the order system or with your courier, that means accessing at least three separate and highly disparate systems. StepZen will help pull this all together via its API and present it smoothly to the user.
Today the company has 11 employees, including the three founders, with plans to add another eight or so in 2021. As they do that, CBO and co-founder Helen Whelan says they are working to build a diverse and inclusive company. While the founding team is itself diverse, they want to hire employees with diverse backgrounds and ways of thinking to build the most complete product and company.
“For the first 10 or so employees, we tapped into the networks of the people who we’ve worked with, people who you know can do a great job. Then I think it’s about deliberately expanding from there and deliberately taking the time that you need to explore and expand your pipeline of candidates,” she said.
The company is just nine months old and has been spending most of this year building the solution and working with pre-alpha users. Today the product is in alpha, with plans to release it as a software service early next year.
As the company emerges from stealth, it’s looking to continue building the product and looking for ways to remove as much complexity as possible. “We know how to do the hard things on the back end. We’ve got the database technologies and the API technologies down, and it’s now about finding how to make all of that simple on the outside and easy for developers to use, ” Whelan said.
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