Why Customer Success and Account Management Should Ensure Customers Get Both ROV and ROI

Prioritizing ROV and ROI: A Holistic Approach to Growth

In today's dynamic business landscape, driving customer success goes beyond just delivering products or services. It's about ensuring our customers are getting a high financial return and we are creating lasting value that resonates with them, fostering loyalty, and ensuring sustainable growth.

Two critical metrics can guide us in this mission: Return on Value (ROV) and Return on Investment (ROI). Both need to be at the forefront of a customer success strategy, i.e., our customers should get a high measurable financial return and long-term value from our products and service.

What is ROI (Return on Investment)

ROI is a financial metric representing the profitability of an investment relative to its cost. It provides a snapshot of financial profitability from a particular initiative, product, or service.

ROI = (Net Profit / Cost of Investment) × 100.

When ROI is significantly larger than 100%, it expressed as a multiple. So 30x ROI is 3000% ROI.

Read how Pure Storage achieves a 30x ROI with cast.app Digital CSMs

ROI's Transactional Lens: ROI offers a transactional view, pinpointing the immediate financial returns from investments. It answers the question: Are our customers gaining financially with our product or service?

What is ROV (Return on Value)

ROV is a holistic measure that considers an investment's financial and non-financial impacts. It encapsulates a range of factors, from customer experience and brand loyalty to innovation, overall customer satisfaction, and long-term sustainability.

ROV's Comprehensive View: Unlike ROI, ROV gives businesses a panoramic perspective. It delves into intangible assets, stakeholder relationships, and long-term implications, asking the question: Are we adding value for our customers?

ROI and ROV in Customer Success

Customer success fosters growth, loyalty, and long-term customer relationships. By leveraging ROI and ROV, customer success can create a comprehensive strategy that touches every facet of the customer journey.

ROV helps us quantify the 'soft' outcomes—those benefits that don't always translate directly into dollars but are vital for sustained business success.

Soft outcomes, often referred to as intangible benefits, are crucial aspects of business growth and stability that might not directly correlate with immediate monetary gains but play an integral role in the long-term success and health of a company. They include your brand perception to customers, customer satisfaction, retention, loyalty, strategic alignment, innovation and adaptability, stakeholder relationships, and risk management and preparedness.

Let's explore how these two metrics can enhance critical aspects of customer success:

ROI versus ROV
Driving Usage and Engagement
Using high-ROI products and evaluating their profitability based on increased user engagement and activity. Emphasizing the broader value users get from these tools, such as enhanced efficiency, better collaboration, or more streamlined workflows, ensuring customers recognize and utilize the full suite of features.
Promoting Adoption
Measuring the financial success of account and user onboarding and training programs by assessing upticks in product usage post-introduction. Focusing on the qualitative benefits of these programs, like increased customer confidence, smoother integration into their daily processes, fostering a sense of belonging to a community, and confidence in renewals, up-sells, and cross-sells.
Guaranteeing Renewals
Analyzing the direct financial benefits from customers renewing their contracts or subscriptions, ensuring that investment in renewal campaigns yields a positive return. Capturing the intangible benefits of long-term relationships, such as trust, brand loyalty, and the mutual value created over prolonged engagement.
Elevating Retention
Assessing the cost savings of reduced account and revenue churn and the profitability of retention campaigns. Understanding the broader reasons customers stay, like consistent value delivery, exceptional support, or alignment with a brand's values.
Revenue Expansion
Quantifying the financial gains from upsells, cross-sells, add-ons, or expanded contracts. Recognizing the added value these expanded engagements bring to customers, such as more comprehensive solutions, enhanced capabilities, or better alignment with evolving needs.
Championing Advocacy
Measuring the direct financial impact of customer advocacy initiatives, such as reduced marketing spend due to word-of-mouth or increased sales from customer testimonials. Appreciating the power of organic advocacy, the brand reputation boost, and the trust built when existing customers vouch for you.
Fostering Referrals
Calculating the profitability of referral programs by comparing the acquisition cost of referred customers to traditional methods. Valuing the strength of peer recommendations, the deeper trust instilled by personal endorsements, and the potential for creating a community of brand champions.

When explaining ROV to customer executives, it's essential to highlight that while the tangible, immediate benefits (ROI) of an investment are crucial, the softer, long-term outcomes (ROV) ensure the sustainability, growth, and resilience of the business.

Cast.app ensures your customers are get a measurable return on investment and value. If you are interested in replicating Pure Storage’s 30x ROI, please set up a demo at https://cast.app/demo

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