Customer success isn’t just about preventing churn; high-performing customer success teams play a crucial role in generating revenue and growth for their organizations.
Consider Net Dollar Retention (NDR). NDR measures how much your existing customers spend over a certain period, excluding any new customer revenue. It’s a vital metric for company valuation, and you won’t improve it by simply “making customers happy.” Positively impacting NDR requires customer success professionals to take a different approach to their conversations.
Over the years, DecisionLabs and Corporate Visions have conducted many behavioral studies on how to best approach customer retention and expansion conversations. And across the board, whether you’re trying to retain a customer, expand the relationship, or mitigate the risk of a price increase, the science says you should always do one thing first: document results.
Why Should You Document Results First?
Showing the results you’ve helped your customer achieve is the best way to kick off key conversations. It reinforces your credibility as a vendor and sets the tone for the rest of the conversation.
Yet, customer success professionals tend to slip in other things before this critical first step. Too many quarterly business review decks or cadence calls start with throat-clearing moments—reviewing the relationship history or jumping right into day-to-day program needs. In doing so, you hinder your chances of securing a renewal or expanding business.
Participants in our renewal messaging studies felt greater trust in the provider when the conversation led with results. And when conversations don’t lead with documented results, customers are at least seven percent less likely to renew.
Okay. You know what you need to do. But how do you effectively document results?
Identify Your Customer’s Goals
First and foremost, you need to know your customer’s goals and how they measure their progress against them. You need to show how your solution helps your customers get closer to (or achieve) those goals. It sounds obvious, but it’s easier said than done.
Sometimes customers don’t track their progress consistently. Sometimes they won’t share it with you. And too often, they simply don’t know which metrics to track or where to go in their organizations to find them.
People buy millions of dollars’ worth of products without ever knowing if they make a positive business impact. You don’t want your solution to fall into that trap.
So, if your customers genuinely don’t know what to measure or how to track it, it’s your role as a customer success professional to tell them. Collaborate with your customers to identify their desired outcomes. Then, agree on meaningful yet achievable measurement criteria.
At Corporate Visions, this vital conversation is known as the Triple Metric.
The Triple Metric Framework
When you use the Triple Metric framework, you ensure you’re measuring results that are meaningful to the person you’re meeting with as well as your senior-most customer stakeholders.
The key is to define goals and metrics on three levels:
Corporate – How will your solution support your customer’s highest-level performance measurements—the goals you might find in your customer’s management presentation or shareholder letter? Think of metrics like increases in revenue or improved cash flow.
Business Unit or Department – How will your solution help your customer create a business or operational change at the department level? How do those changes ladder up to corporate metrics? Metrics such as productivity, employee engagement, or win rates will be critical here.
Project or Program – How will your solution help your customer achieve the tactical changes necessary to support the department goals? These are the metrics most sales and customer success teams know and love—completing projects on time and budget and meeting service-level agreements.
Your job in documenting results is to link project progress metrics to department outcomes and, ultimately, corporate goals. If that connection doesn’t exist or is unclear to your customers, your results lose power. It’s better to have a mediocre progress update than report on a great-looking metric that doesn’t relate to your customer’s higher-level goals.
It’s Not Just About Numbers
Communicating business impact doesn’t mean always showing hard ROI. In the beginning, you might not have metrics to report. But you can start small with user stories or quotes from management that demonstrate your solution is making an impact.
These stories not only show qualitative evidence of your value. When you start your conversation with stories, you create a “hot opening”—a significant improvement over standard small talk. You create a human connection right off the bat, setting the right tone for the rest of the conversation.
Show Them What You’re Worth
Your customer stakeholders invested in your solution because they believed you would make a meaningful contribution toward their strategic business goals. Their decision to continue or increase that investment hinges on your ability to document and measure results toward those goals.
Improving your company’s most important health metrics (like NDR) always starts with a conversation between you and your customer. If you’re starting those conversations with small talk, you’re squandering your chances to win more revenue. Instead, start by documenting results and make sure you’re measuring metrics that decision-makers care about.