How Blackbaud turbo-charged referral revenue by upping their customer advocate game
- Summary:
- Community matters but isn't easy to justify to bean counters. That changes when you can tie customer advocates directly to referral revenue. Here's how Michael Beahm's team at Blackbaud pulled it off - with seven transformation lessons to act on.
It's not easy to get budget for customer communities. So when companies tie communities to real world results, I pay attention. At the Influitive Advocamp pre-conference day, I sat down with Michael Beahm, Customer Advocate Marketing Manager for Blackbaud, and picked up nifty lessons on transforming a narrow reference program into a customer advocate community.
Numbers never tell the whole story, but it sure doesn't hurt to have them on your side. Beahm cites a boost in revenue from customer referrals, to the tune of $250,000 in 2014 to $500,000 in 2015. This year's goal: $750,000. After going live with Influitive's Advocate Hub in 2014, Blackbaud began tracking - and growing - this number.
But - and this is a huge but - they didn't do it by pinging their customers for referrals until they served up names. Beahm:
You can't just go and ask for a referral. The reason we're able to grow by these percentages year over year is because we've spent eighteen months building relationships with a lot of these same people.
Subscription models require a better customer experience
Blackbaud bills itself as the "leading provider of nonprofit software and services." But Blackbaud has undergone a big business model shift, from pay-once software sales to subscription-based selling. Beahm didn't think their referral and "superfan" programs were enough:
We had a new CEO start about two years ago, Mike Gianoni who came from the financial industry. He was brought on to help in the transition over SaaS and cloud-based offerings. With that change, I felt like we can't just assume a customer isn't going to leave you - they can leave at any time now. It was going to be really important for marketing, to start having relationships with our customers. I saw it as an opportunity - I saw it as a need within our own company.
Customer advocacy needs executive sponsorship and buy-in
Beahm wasn't going to get this done on his own. He had the support of an executive sponsor, Amy Bills, Director of Customer Marketing. Bills spent a year selling executives on the changes. Bills made the case that Blackbaud needed an advocacy program, led by someone who could operationalize it, and bring in the right technology. Beahm: "Customer advocacy is a new term. We had an existing product with a similar name, so there was quite a bit of education."
Ultimately, Bills secured the funding and headcount. In May of 2014, Beahm formally took on the role of building Blackbaud's customer advocate program. There was an existing customer reference program, and also a "superfan" program called Blackbaud Fans. Beahm thought the superfan program was "too self-elevating" for Blackbaud, and not enough of a two-way street.
Choose a vendor that earns your trust through expertise
In the summer of 2014, Beahm's team evaluated customer advocate software. They kicked tires on Zuberance, SocialChorus, and Influtive. But Influitive's useful content earned his trust:
Thought leadership is really important to me. Influitive were the ones that were speaking the language of customer advocacy and building out this category. They had come out with something called the Advocate Marketing Playbook. I sat down at a coffee shop and read it cover to cover. In a sense, it told me how to do my job as I was getting started. I felt like if they could talk the talk, then their product was going to be able to walk the walk as well.
Blackbaud went live with in September of 2014. They timed the go-live before their annual user conference in October, allowing for a soft launch to their customers in October. Since then, says Beahm, "It's been a whirlwind."
Your customer advocate program should be more rewarding for customers than it is for you
Blackbaud launched their re-minted "Blackbaud Champions" program, which recognizes their dedicated customers. They use Influtive to recognize/manage/empower those advocates. Beahm modeled the program after Influitive's hierarchy of advocate needs. This means relating to advocates on multiple levels - not just asking them for referrals:
Graphic from Influtive.com
Lately, Beahm is focused on professional development rewards like funding product certifications. He also offers speaking and blogging opportunities:
It's a win-win, because they're building their professional brand, and they're also fueling our content. That's where it's at for me: when they love what they're getting, and then we totally get value from what they're giving us.
Once they engaged their advocates in a regular way, Beahm heard good feedback:
Previously, our customers were engaging with us once a year at the conference or at a user group. But now, we're interacting with them all the time. The feedback and the testimonials being given through the program are fueling marketing campaigns... The customer sentiment has been just very positive.
Happy advocates are great, but get the numbers to prove it
Prior to Influitive, Blackbaud wasn't tracking all the metrics you'd want around customer advocates. But now they have a baseline to show executives that this isn't just a feel-good exercise. The big number is the boost in customer referral revenues from 250K (the first year they started tracking it), to 500K, with 750K as the goal for 2016:
We've had really strong growth every year, and it's just continuing to build. Referrals are a strong point we've been able to take to our VP of marketing.
Now, Beahm and his team are tracking a bunch of new metrics, such as revenue influenced by references. They can trace the impact of reference on closed deals within Influitive: "That's been really important."
Maintain a dialogue with your vendor - push for enhancements
Beahm maintains a feedback loop with Influitive on enhancements he is looking for, such as expanding referral functionality. For example, he wants to extend referral capabilities to customers that aren't part of their Blackbaud Champions program. He also wants to make it dead easy for salespeople to initiate a referral process with customers. He believes Influitive is going to act on this feedback in upcoming releases. Given that referral revenue has a potent effect on ROI-conscious managers, that's an area I'll be digging into - and asking Influitive about.
The wrap - don't rest on your laurels
Beahm isn't taking the initial success for granted. Next up? Customer retention, and improving support by providing community resources (and, hopefully, reducing inbound support calls as advocates provide their own tips). In turn, this could free up time for community managers to build out more opportunities for advocates:
People just really enjoy participating and feeling wanted, and feeling like they are a part of your company. It's much more than paying money to go to a conference... the sky's really the limit in terms of what we can measure in terms of impact.
Updated, Tue 3/8 5:00 pm with an addition in the "push your vendor" section.