NOTE: Last week’s blog, Stop the Check-InSanity: How to Make Ongoing Customer Interactions a Win-Win, was so well received that I decided to elaborate this week. Stop the “Check-InSanity” and truly focus on retention – here’s what works best based on my 20+ years of doing this work…
For B2B companies, revenue from existing customers can be as much as 80% of growth. That is, retention and expansion is the name of the game. Is your company truly focusing on retention? Or, are you chasing renewals?
- A focus on retention means doing the things that make renewals a non-event.
- “Chasing renewals” means trying to catch-up with decision makers to address concerns and issues at the time of renewal…when there’s scarce time to actually do anything to improve.
- The subscription economy has changed Sales to “Land, Retain, Expand.”
- Happy and successful customers are far more likely to be retained. Make sure you are creating happy customers that perceive success.
- Recognize that there is no “customer” in B2B (and I’m not talking about B2b for selling to small business) – it’s a group of contacts in the account, that all have different perspectives, expectations, and requirements.
- The key: Since people change jobs all the time, your company ought to have relationships with multiple people in the account. Engaging with only with 1 person in the account puts you at significant risk (especially for large/strategic accounts): What do you do when they leave? Is there a sufficient set of relationships that enable a smooth transition? Are you absolutely sure that person is really representing *all* interests in the account?
Smart, successful companies know how they are meeting the different perspectives, expectations, and requirements of the different customer persona that are involved in your products and services. To that end, it’s critical to measure and improve the Percentage of Key Stakeholders (“Buying Committee” Members) That Are Happy and Perceiving Success.
You could ask your Sales and CS teams about customer sentiment, but by doing so you’re missing a huge opportunity to engage the key contacts in the account. Besides, we continuously find that the account team hasn’t properly engaged the key contacts in the account to know sentiment with confidence. As a result, they aren’t growing footprint (i.e. just relying on 1 “Champion” contact), have blind spots, will be taken aback when a key contact leaves their job, and are likely to be surprised when an account churns.
There is a better way. Customer Success teams must:
- Recognize that acquiring feedback from a customer is engagement. Be concerned if they aren’t providing feedback. In fact, our research finds that silent accounts can be up to 14x more likely to churn than accounts that do provide feedback, even when that feedback is negative!
- Embrace feedback: Recognize that the customer is in an ideal position to tell you what’s working and what isn’t. Set up listening posts, especially (1) following the implementation phase to ask if they feel that the onboarding effort teed them up for success, and (2) ~5 months before renewal so you have sufficient time to address issues and concerns well in advance of renewal (and repeat that cycle each year to refresh the plan with the latest members of your Buying Committee since teams change over time).
- Communicate directly with the key contacts in the account to convey your commitment to addressing their feedback. Chucking a survey invitation over the wall from an automated system IS NOT sufficient!
- Leverage a B2B-specific voice-of-customer platform such as TopBox to scale your process. These platforms not only allow your CSMs/Account Teams to more scalably request and act on customer feedback, but also enable the rest of the company to hear the voice-of-the-customer directly, with visualizations to address root causes. Don’t debate with Leadership and/or Product what you “believe” the right improvement investments should be — show them the data!
- Commit to being transparent: Especially for large/strategic accounts, leverage your Champion in the account to help you gather feedback from the people that matter most. Share the feedback from the account, and use it to drive updates to the account plan. BTW, if you think being transparent is equivalent to “exposing the warts” then realize that they are already talking to each other anyway… you might as well be a part of the conversation.
Next step: Download this whitepaper to get the details and gain templates for the process. The paper includes a case example, a “cookbook” step-by-step description of the process, and templates ready for you to use.
Bottomline: It’s the job of the CSM to ensure revenue retention and expansion. Ensuring customers are happy and perceiving success, value, and frictionless experiences makes renewals a non-event. And sampling 5-10% via a survey isn’t enough — companies that do this well achieve 60%+ participation (response) rates, making it easy to have a focus on Customer Success throughout the company.