Around 2015 the title Chief Revenue Officer (CRO) started gaining popularity within the SaaS space. Since then, we’ve seen it become more and more popular among tech companies. In this post we’ll talk about why we’ve seen the CRO become a more common position and how its rise is connected to the Revenue Stack.
Why your SaaS Company needs a Chief Revenue Officer:
Companies in the B2B SaaS space face extremely high customer acquisition costs; making renewals, upselling and decreasing churn essential. In order to make better decisions and decrease churn, someone needs to have a bird’s eye view of all revenue generating activities within the company.
Marketing, Sales, and Customer Success are responsible for revenue generating activities within most SaaS organizations. Unfortunately, these departments often have three different leaders independently making decisions. The idea behind the CRO is to have someone with c-suite clout responsible for maintaining a high-level view of the sales funnel from start to finish (from lead generation to renewal).
What is a Chief Revenue Officer (CRO)?
As mentioned earlier, the CRO is responsible for overseeing all revenue generating processes. They are also accountable for driving better integration and alignment between all revenue-related functions, including lead generation, marketing, sales, customer success, pricing, etc. Ideally, members from Marketing, Sales, and Customer Success team role up to the CRO.
Venture beat describes the CRO’s purpose as “to align and optimize the entire customer experience with the aim of increasing revenue.” Problematically, each department (along with having their own VP) also has their own platform to track, measure, and report success. For example, often Sales relies on a CRM, Marketing on an analytics platform, and Customer Success on a support platform. Meaning, there is no single source of truth for an organization to use when looking to optimize revenue from end to end of the customer lifecycle.
What is a Revenue Stack?
A Revenue Stack is the set of SaaS systems that facilitates and tracks revenue’s progression from lead, to sale, to upsell and renewal. For many of our clients a simplified view of this might look like: Adwords to WordPress to Marketo or Pardot to Salesforce to Desk.com, with a tool like Zuora or Chargify at the end of the trail and Google Analytics tracking in place.
In short, the Revenue Stack is the integrated set of tools that gets a prospect to your site, converts them to a lead, preps them for the sale and ensures they renew. Many of you reading this might be thinking that description sounds very similar to your definition of a technology stack. So, what’s the difference between a technology stack and Revenue Stack?
The key differentiators between a normal technology sales and marketing stack and a Revenue Stack are:
- It’s built from the ground up with integration in mind
- It’s optimized to provide end-to-end reporting on how specific efforts (like an AdWords campaign) influenced pipeline and sales. ROI, not just clicks or leads or visits
- It extends beyond the first sale and continues to track value and help optimize renewal and upselling efforts
How to Optimize your Revenue Stack
A true Revenue Stack for a B2B SaaS company is heavily integrated, not just within external systems, but also your own. We love Salesforce at CloudKettle and one reason why is their AppExchange has made it so easy to integrate with other systems. Over and above that though, Salesforce’s APIs provide even more ways to move data. In particular, we encourage clients to use the APIs to pass data back and forth between Salesforce and their own products (sometimes in conjunction with a subscription management tool like Zuora or Chargify).
Let’s look at two examples of how a Revenue Stack can be used to automate Customer Success to decrease churn. Once your Salesforce instance has been integrated with your own product, Sales, Support and Customer Success have the ability to query and use data based on customer’s actions. This means Customer Success has the ability to trigger a workflow based on how often a client is logging in. Passing data on last login to Salesforce via the API is straightforward – so you can have a workflow built in a tool like Marketo that sends an email offering a free tutorial if a client hasn’t logged into a certain feature within a designated timeframe. Another use case would be, Salesforce sending a notification to Customer Success if a client has a low number of logins and is at risk to churn.
Conversely, if a user is logging in frequently, that might trigger a notification to Sales to begin planning for an upsell or cross sell opportunity because the user is clearly seeing value in the product.
Ongoing we’ll be talking to industry experts on how to optimize your Marketing, Sales, and Customer Success departments to support the Revenue Stack and set your CRO up for success. This month, we sat down with data insights and analytics expert Joel Burke to talk about how to manage advertising for SaaS companies from end to end of the customer lifecycle.
Look for that article at the beginning of February, and as always, if you have any questions about Revenue Stack Management or how to hire your first CRO, get in touch.