Decipher Customer References

How to Easily Decipher Customer References

How exactly do you decipher customer references? You are looking at purchasing some MarTech cloud solution, or maybe something not related to MarTech at all but you want to know what others are doing. Thus the customer reference.

Why Customer References are the Backbone of B2B Marketing

Since I started in B2B Marketing in the late 90s, customer references have evolved in their importance to selling B2B products, namely technology products. Previously customers were often satisfied with a quote or a case study, but increasingly they are demanding more detail. Why is this? The big reason is that often technology and cloud providers make very bold claims, and customers buy into those claims only to see reality not match the claims. The common solution in the buying process is to ask for more customer references, and ask for them early and often. Not only that, but demand ROI / payback analysis as part of the reference. Marc Benioff, the founder of SalesForce, took this to a new level by using customers in every part of his marketing. Other providers have followed suit.

Providers have aligned with these demands, and now regularly feature customer success stories as part of their core marketing materials. Often these types of stories represent the whole of their marketing. Personally I like it, customers respond best to backed up claims on customer success vs. generic promises often employed by B2B Sales Reps.

Decipher Customer References – A Primer

This post will  give you the basics of figuring out exactly what to look for in a customer reference. This blog post will  also offer insight into how to decipher a customer reference. It will also highlight some potential red flags for you.

As a veteran B2B marketer, I know exactly how hard it is to both cultivate and market a reference. You need to not just sell your products, but make sure the customer is successful. Once successful, it’s time to  convince them to be an advocate for you. Over the years, I have learned the ins and outs of this process and hopefully it will be useful to you. If you are unfamiliar with what is involved, wikipedia has a good overview for you.

Understanding the Types of References

There are a variety of types of customer references, and it’s important to know the differences so that you can decipher them. First up, is the difference between a marketing and sales reference.

Marketing vs. Sales References

  • Marketing References – These are the references that a company will use in their marketing materials. These are the types of reference where you will see a logo on a website, and maybe a case study, success story or a testimonial. Getting a marketing reference is the hardest for a company to acquire. Usually it involves not just convincing the buyer but also the legal department. These are harder for companies to obtain, so they often have fewer of them.
  • Sales References – These are often the unseen references. The references that a sales rep or a marketing pro keeps in their back pocket to use in the sales cycle. They may also be a marketing reference, but typically you will have a lot more sales references than you do marketing references. Sales references typically don’t do the case studies, but they will often take a call from a prospect and discuss the results they got from a particular product or solution. Their use of the product is just as valid as the marketing references.

Case Study vs Success Story vs Testimonial vs Logo

Marketing references can be further subdivided into types of marketing references. Understanding the differences will help you decipher customer references.

  • Case Study – These are the holy grail for marketing, a detailed case study discussing why the company bought the product, and the results they received. They are often multi page documents, or maybe even a long form video. A case study should always contain some sort of ROI metric, or specific value they received from deploying the product. Generally if there is a case study, then there will also be a success story or testimonial.
  • Success Story – These are shorter than case studies, and typically involve a brief description of what the customer did, and the results they got. They might just be a page or two, or a short video. Often times a success story is created in a slide format and used in a presentation by a B2B sales reps. Ideally a company should have a success story attached to every major feature or value point of their product.  
  • Testimonial – Testimonials are often just quotes from a customer saying they used the product and are a believer. You will often see quotes embedded in presentations, or on a website. Generally a testimonial quote will be part of a larger success story or a case study, but not always.
  • Logos – Generally if a company does any of the above, they will also let you use their logo. Sometimes they will just let you use their logo. So if you see a logo on a website, or presentation but no story or quote – the company has approved the use of the logo in marketing materials but that is all. I personally loathe logo slides, as I think they are relatively useless as they don’t provide details on how the product was used or the results generated.


The Makings of a Good Reference

  • It tells a story – References always need a narrative, they just didn’t buy and implement a product, something happened. It’s a customer success story, not a customer success information dump. A good reference will tell you what problem they were trying to solve, why they picked the product they did and the benefits they received. Providers often employ outside agencies to help with these stories, so it should read like a story.
  • A real person – A reference without a person involved is usually pretty bland, a good reference will offer up a real person and use them as part of the narrative. It will also have multiple quotes attributed to that person, or ideally multiple people. Look at the titles too, ideally you want C-Level or VP level in the story. If they are talking about managers or developer or staff, maybe it’s not such a good story.
  • Benefit quantification – The benefits the company received should be clearly articulated and measured, either in raw terms or in percent values. This quantification should be shared up front and in large bold letters. This is the meat of the story, and should be treated as such.
  • Details of Company – There are so many companies out there, it’s imperative that a reference gives the details on company name, location, industry and any other relevant details like a website and twitter account.
  • Non-Technical – Any sort of customer reference should be non technical, it should be developed for the buyer, not some IT wonk.


What Should Give You Pause?

  • Reference is not yet live – Often times companies will publish reference stories before the customer is successful. The proof of MarTech solutions are in the details, and if the customer is not live then the reference is for only why they bought the product. Sometimes when companies launch a product, they don’t have a live reference and use a purchase reference instead. This is ok, assuming they have other references. Of course, one ask to ask, why release a product without making sure it works through some sort of beta?
  • Reference is a partner – This should raise a big warning flag. If the customer that is a reference is also a partner of the company involved, you should almost immediately dismiss it – especially if they resell or implement the product they are referencing. This is surprisingly common in the cloud world. Google the reference and check their partner page to see if this is the case.
  • No metrics are given – At some point in time, someone had to build a business case to justify the purchase or investment. If there are not metrics, you need to ask why that is the case. Maybe they didn’t measure them, or didn’t know how to measure them. Or even, they measured them and they weren’t that compelling. Take the time to follow up on this if you don’t see metrics tossed throughout the marketing materials.

Industry Relevant References

So this deserves its own section, when deciphering a customer reference, you need to look at the industry. Is the company offering the reference in your same or maybe a related industry? What happens if they aren’t?

It comes down to a simple rule, if the provider or vendor sold you the product based on some sort of industry specific functionality, then you should expect or even demand an industry specific reference. If the provider doesn’t market industry specific functionality, then it’s probably not that big of a deal. Ultimately it’s up to you on whether you demand an industry reference, chances are they should have one unless they are penetrating new verticals or industries.

Customer References Without a Name Attached

Occasionally, you will run into references that do not mention a company name that is using it. How should you react to this? Well this isn’t that uncommon to see and isn’t immediately a red flag. Many large companies have strict policies associated with using their name in their marketing materials. As such, they won’t let you reference their name, instead they will say “large financial services firm.”

It shouldn’t be too much of a warning assuming other reference are provided. Remember, it is really hard to get legal departments to sign off on the use of references. Assuming the reference has the makings of a good reference, then it’s not that big of a deal. Of course, if there isn’t much detail or no quantification, then you should dismiss it. Also, ask the sales rep who the customer is, they might tell you unofficially. Or maybe they won’t, but it’s worth a try.

When should you ask to speak to a reference?

My rule of thumb when advising clients is that they should ask to speak to a reference after the provider is shortlisted. They know the provider meets their key requirements and are debating between 1-3 different solutions. This the appropriate time to ask to speak to a reference. You should expect to see at least 5 marketing references, and talk to 1 or 2 sales references.

What is your role in references?

So we covered how to decipher a reference but that does raise the question- what should your role as a buyer be with regards to references?

  • If you are happy, be a reference. This is first and foremost, if you buy a product and are happy with it – be a reference. You are getting value out of it, then why not offer to help out? You likely asked for that reference as part of your purchase process. In my mind it’s unfair for you to ask for references, but then not be one. If your company won’t let you be a marketing reference, offer yourself up to be used in the sales cycle. There is typically little to no oversight associated with it.
  • Use canned reference materials whenever possible. If you want to know about what a company is doing and how they make customers successful, look at their marketing materials as opposed to demanding to speak to someone. Successful companies will often offer structured outreach. Maybe a customer will have a chance to tell their story via  webinar or phone call. Try to attend those webinars or view their recordings vs talking to one. This applies early in the sales cycle. Be selective about asking for more. You have a right to talk to references, but do so later in the sales cycle when the provider is on the short list. And when you ask to speak to a reference, make good use of their times and have your questions ready. Get to the point, and offer to share your experiences at a later date.

Required Reading on Customer References

You are ready to decipher customer references from whatever solution you are looking at, it might be helpful to read up more on the topic. Here are a few good links to peruse.

Wikipedia Entry on Customer References. I always find wikipedia to be useful and this article is short and sweet and discusses the basics of a customer reference program.

Pragmatic Marketing Seven Ways to Acquire Customer References. I am a big fan of pragmatic marketing materials, and this gives a good run down on getting a customer reference. Yes, it is from 2007 but the basics are covered.

3 Tips for Building a More Robust Customer Reference. – A more recent blog entry that covers more advanced customer reference topics. More for the sell side than the buy side. But definitely worth a read as its pretty short and gives you insight into what a marketer is doing.

HBR Article on Customer References.

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