It's an incorrect strategy to segment your customer according to ARR/MRR and then leave it that way. CSMs should invest their time in a customer based on the highest return on their investment according to where their customer is at any given stage.
Often we assign a segment to a customer and it stays that way until they increase their worth. However this not a cost effective approach for the CSMs time. The proper approach should be segmenting within High and Low touch tiers. Then segment further by ARR and goal ( risk mitigation, adoption, retention, key customer turnover, etc') within those two main tiers. Done properly, the customer may move from one tier to another depending on the goals set for the customer at any given time.
Take these two companies as an example:
Company A -
- Enterprise customer - high ARR
- Maxed out in Growth and Expansion
- Fully adopted
- Champions of your organization
- Strong relationships with several teams
On paper, due to their ARR, some would say they should have the highest touch and most attention from the CSM. However do they really need high touch activities such as:
- 4 QBRs a year?
- Bi Weekly meetings?
- Frequent high touch adoption check ins ( however you do this)?
Company A should be segmented into a Lower Touch Enterprise tier. This can change throughout the customer life cycle as mentioned above.
Company B-
- Commercial Customer - Low ARR/MRR
- Expansion into global market potential
- Never fully adopted (for whatever reason)
- Champions of your organization
Company B should be given High Touch treatment. Why? They have an expansion opp into the global market and they are champions. This should be nurtured and given the high touch treatment. That means you should be engagement in the following high touch activities like:
- 4 QBRs a year
- Bi Weekly meetings
- High touch adoption flow
The potential return on this high touch activity for this low ARR customer is high. Therefore a company should invest a high touch method with the CSM.
Thougts?
@Jay Nathan - Would be happy if you'd share your engagement pyramid that I've seen you post. It's a great visual.