Customer Growth: The Difference between Sales and Expansion

If you missed it, I’m done talking about churn. If you have a churn problem, read this post and follow my directions. Churn won’t be an issue for you anymore. Now we can move onto GROWTH! And the first order of business is understanding the difference between Sales and Expansion and why knowing the difference is so important. I’ve said that Sales is part of Customer Success before, and by that I mean Sales – like every other part of the company – should be governed by Customer Success as a philosophy. But, when it comes to operationalizing account growth, where do you draw the line between sales and expansion? Good question, let’s dig in. In my experience, if you want to remain a small company, have your New Business Sales team also handle Expansion (Upsells, Cross-sells, etc.) sales. However, if you want to grow fast, sustainably, and
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Eliminate Churn Forever in 5 Simple Steps

Churn… ya boring. Yawn. Time to move on. I’m so over talking about churn and if you really understand what Customer Success is all about, you should be, too. Churn is so easy to get rid of… you just have to do five simple things. If churn is a problem for you, this post will change that (if you’ll let it) and then you can move onto bigger and better things. Once churn is a non-issue, you can focus on growth.

Customer Success-driven Growth

Customer Success is a growth driver. Revenue growth from your existing customers. Growth in the value of your company. Real Customer Success is the future of business. It’s the future of high-growth business. Customer Success isn’t there to just stop shrinkage or lead to incremental growth. No… done correctly, Customer Success leads to exponential growth!

Busting the Churn Busting Myth

I’m tried of talking about
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Introducing the BEAST Message Framework for Customer Engagement

Let’s talk about Customer Engagement, specifically one part of the Communication Model, which is my BEAST Message Framework for creating messages that actually engage customers. It’s really interesting that we communicate all day long – with our friends, with our peers, with our customers – but when was the last time you actually thought about what goes into communication? Most of the time, we simply never stop to consider what needs to go into communication… we just do it. If we do spend any time at all thinking about communication, we only focus on the message itself. But it’s truly important – imperative, actually – that we spend time thinking about all of the components of the Communication Model. Whenever we try to send an email, have a call with a customer, set up a meeting with a customer, etc., we need to be thinking about communication and what
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Introducing the Customer Engagement Communication Model

Let’s talk about Customer Engagement, specifically the Communication Model. We communicate every day, all day. We communicate with friends, family, co-workers, industry peers, customers, vendors, celebrities, trolls, politicians, restaurants, airlines, etc., every day. We communicate more today than we ever had in the history of the world, and tomorrow, we’ll do it even more. Yet despite all this communication going on, we really know very little about how to communicate effectively. We think, since we do it all the time, we must be good at it, but as with most things, frequency should not be confused with proficiency. So let’s dive into this whole Communication Model thing and figure out how to more effectively engage our customers by simply communicating better. Join me, shall you?

The History of the Communication Model

Going back a long time – I think in the 1950s – there was the Shannon-Weaver model, created
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Churn Classification for Customer Success Management

Customer Success is when your customers achieve their Desired Outcome through their interactions with your company. If you focus on Customer Success, churn will not be an issue. At least in theory. To take that from a simple theory to your Operating Model, you need to put systems in place, be able to monitor their effectiveness, and routinely perform root cause analysis when things go wrong (and also when things go well so you can replicate, right?). So while our goal is to live in a world where churn doesn’t happen, while you have it, you really need to understand it so you can avoid it in the future. To that end, I put together this Churn Classification system (or matrix or quadrant or whatever) to help you do that.

All Churn is Bad

All churn is bad, but some churn is worse than other churn. Customers
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Sales is Part of Customer Success

Sales is part of Customer Success. Like it or not. No, I don’t mean the Sales organization should report to the Customer Success Management org. I mean that Customer Success as an Operating Philosophy, as a way of doing business, includes sales. It includes marketing, product, support, etc, too. It’s critical to understand that Customer Success is not just about “post-sale.” Customer Success is when your customers achieve their Desired Outcome through their interactions with your company. Those interactions start early – from the first marketing touchpoint, at the start of the sales cycle, on the first cold outreach email by your SDR – and they continue throughout the entire lifecycle of the customer. Which means we need to be thinking about Customer Success when creating marketing campaigns, determining Ideal Customers, optimizing the sales cycle, etc. In fact, let’s talk about Sales. Sales is important. Sales is critical.
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Appropriate Experience is Required for Customer Success

Customer Success is when your customers achieve their Desired Outcome through their interactions with your company. As I’ve said before, Customer Success as a concept is very simple. Don’t overthink it. But I always have to unpack one piece of that definition and that’s Desired Outcome, or what your customers need to achieve (their Required Outcome) and the way they need to achieve it (their Appropriate Experience). Required Outcome + Appropriate Experience = Desired Outcome Desired Outcome is also a relatively simple concept. Unlike Customer Success, however, Desired Outcome isn’t something people tend to overthink… … it’s something they just tend to ignore. Well, if they don’t ignore the entire thing, they only focus on one part… the Required Outcome. Appropriate Experience either doesn’t matter to them or is just too hard to figure out (which makes them give up and say “it doesn’t matter”). I can’t help you if
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What Are The Best Customer Success KPIs?

As you can probably imagine, I’m asked all the time what the best Customer Success KPIs are. What metrics should you use to know if your Customer Success initiative is working. Here’s the deal. I’m not an analyst… I’m a consultant. Companies hire me to help them rapidly acquire good-fit customers, keep those customers longer, get them to buy more over that extended lifetime, and get those customers to advocate for them, too. That’s called Customer Success-driven Growth. The reality is, though, that every company is at a different stage as a company, with their Customer Success initiative, etc. so wha the “best” metric for one company at one point may not be the best metric for another company (or even the same company) at a different time. Let’s dig into this, but first I have to address something serious…

Customer Success is NOT a Metric

Recently I saw an
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You Can’t Solve Upstream Problems Down Stream

When it comes to Customer Success, I’ve seen a lot of things. I’ve seen what works (and what works REALLY works… it’s amazing). Unfortunately, I’ve also seen what doesn’t work. A lot. In 2017 I heard “Customer Success doesn’t work” way more than I ever expected. The main reason I saw for Customer Success “not working” wasn’t org structure, comp plans, operations, wrong CSMs, etc. No, the main problem wasn’t a CSM Org problem at all. It actually starts further upstream.

You Can’t Solve Upstream Problems Down Stream

The biggest contributor to churn is the acquisition of bad-fit customers. The biggest drag on growth I see is trying to make bad-fit customers successful. A huge drag on per unit margin is investing resources in bad-fit customers. Bad-fit customers are those customers that lack Success Potential. But this is…

Not a Customer Success Issue

This is a company issue. This is
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Customer Success is a Simple Concept (Don’t Overthink It)

Customer Success is a very simple concept that you’ll really want to overthink. Resist the urge. The beauty of this concept is in its simplicity. Implementation is another story, though. But the concept is simple. My definition of Customer Success has evolved as my understanding of Customer Success has evolved. The definition of Customer Success is very simple. And here it is…

Customer Success Defined

Customer Success is when your customer achieves their Desired Outcome through their interactions with your company. Two quick things to note:
  1. Desired Outcome is their Required Outcome – or what they need to achieve – plus their Appropriate Experience – or how they need to achieve it.
  2. I said “interactions” rather than “use of your product” because there’s more to your relationship with your customer than just their use of the product (even if it’s the primary interaction)
That’s it. That’s all there is to
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