The most obvious question I'm not asking
And why I'm so bullish about this play for our company
I posed the below question to a couple of members on our Customer Success leadership team a few months ago + I haven’t been able to shake the idea since.
There are enough generalized (and often over-promising) ROI calculators out there.
There are enough “100x” your performance claims out there.
But when the time comes, we rarely have or provide the ACTUAL return someone has gotten from our product/service.
Sponsor: Default
We’ve come a long way since the days of “A member of our team will be in touch within the next 72 hours” upon a prospect submitting a demo request on a website. Automating the back + forth scheduling so the prospect could pick the date + time for their call upon form completion was a huge step forward.
And now we’re seeing the next one.
Default is levelling this up for organizations by going not just one, but multiple steps beyond this by looking at the overall job to be done and solving for that. So instead of stopping at helping the prospect pick a date + time for the call, here are just a few additional things Default is automating for teams:
Automatic enrichment of the lead + company with information relevant to you
Automatic qualification/disqualification based on pre-determined criteria
Automatically create leads, contacts, activities, and even opportunities within your CRM with the correct info appended
They gave me a sneak peek at what’s coming over the next few months as well, and I’ve got to say, I’m impressed.
Talk is cheap
“I’ll help you build a business case, don’t worry.”
- Every AE, working to sell you their product/service
Enter the market to buy a product/service and you will quickly get sales reps volunteering to help you build an internal business case and provide you with an absurd amount of “estimated ROI” data.
Claims made using data from their top 1% of their customers form the benchmark numbers they’ll say you’ll achieve. “In time” reporting figures saying you’ll see pipeline or revenue quickly - but don’t account for sales cycle lengths, let alone the implementation or onboarding period of 4-8 weeks.
So we plug our numbers into an overpowered ROI calculator. We’re provided a business case talking about all of the work the provider will do, the “white glove” service where we don’t have to lift a finger. Hell, we even get a starchy Gildan t-shirt with their logo slapped on the chest because the AE likes us.
And then we sign the bottom line of the contract.
Post-signature
Remember that AE who was always happy to see you? Always quick to respond and help answer your question? Laughing at your bad jokes? Yeah, they’ve disappeared.
They got you across the finish line. You’re someone else’s problem in their company now. And reality starts to set in.
You’re now passed on to an implementation specialist or solutions engineer who doesn’t have enough hours in the day to get through what they need to. And they aren’t paid for outcomes either, so you’re just another account number to them that needs to be set up as quickly as they can so they can get on to the next one.
So that ROI number you promised the leadership team? Yeah, that’s on you now.
Fast forward 11 months and, to no one’s surprise, the ROI isn’t what was promised. Leadership sees this as an expensive line item with an average/sub-average ROI and pulls the plug on it.
So you re-enter the market, find another vendor, and rinse + repeat this same process over and over.
What if there was a better way?
Everything leading up to this point is short-sighted. The goal is to get the initial signature so a company can hit their monthly/quarterly/annual revenue target. X more customers have signed on. $Y more in MRR/ARR has been added to the bottom line. The company has grown by Z% MoM/QoQ.
And despite all of those great growth numbers, we see the highest count of churned customers ever in a period. More MRR/ARR lost. A dipping retention rate. Gross revenue retention (GRR) on a continuous decline.
Essentially, a revolving door into + out of your organization is being seen.
At the risk of oversimplifying this, I do believe there’s an easy solution here that will both:
Help customers achieve the ROI they were promised and
Keep (renew) customers and see real company growth as a result
So what is this ✨magical✨ solution?
Intake benchmarking x ownership
Two variables.
One is a binary variable in the sense that it’s either done or it is not done. The other is a continuous variable that requires a consistent application of resources toward.
Intake benchmarking
This one is simple. Painfully simple. Yet so many of us don’t do it (🙋♂️, yes that’s me, also not currently doing this as of this being written). Whether it’s because we get caught up in onboarding and implementation so we forget to, or because it’s a cross-functional item that no one wants to own because “we have enough on our plate,” I see this opportunity and want to slap myself for not being more proactive here.
We all love data. So we think if we take this project on, we need to cover an extensive amount of data in this type of report for the customer. But here’s the truth: this shouldn’t contain more than 2-3 metrics being tracked.
Most data is noise. What we need here is alignment with the customer on what really matters. And here is where it typically boils down into 3 buckets:
Make money
Save money
Save time
Land on 2-3 metrics with the customer, have them pull their current and historical results for those metrics from the past few years, and get that documented.
You now have the framework for your ROI analysis tailored for each customer.
You know what’s important to them.
You know where they’re coming from.
You know what needs to be improved upon.
Now you simply need to execute + own those.
Ownership
This is the hard part. This is doing the actual work. This is being accountable to each customer in driving the results they’re after.
Too often, companies put the ownership on the customer. “You have our tool, your savior, your god-sent blessing from above. Go forth, my child, and create B2B history.”
But you know who isn’t an expert in your product? The customer.
You know who has 5 other priorities on their plate? The customer.
You know who doesn’t care if they’re still using your software or a competitor’s next year? The customer.
But you know who is an expert in your product? Your team.
You know who has 1 core priority of retaining customers? Your team.
You know who does care if they’re still using your software and not a competitor’s next year? Your team.
So remind me, why exactly are we putting the ownership here on customers instead of ourselves? 😅
Fast forward
Once this is in place, there’s only upside.
Customer Success has hard data for each customer around the results they have achieved with your product relative to what they saw before your product.
Sales has hard data for what prospects can expect based on their unique variables (what country they’re in, what tool they’re migrating from, what result they seek, etc.)
Marketing has hard data to become an industry report, establishing the company as both a thought leader + a no-brainer for where to go if a prospect wants to achieve better results.
So what do you think? Still think it’s not worth the effort? I’m with you. I know what I’m going to be getting into over the next few weeks.
Book quote of the week
For this week, I immediately thought of not a short quote that perfectly suits what I shared above, but a parable shared within the book Chop Wood Carry Water by Joshua Medcalf. It’s a little lengthy, but I promise it’s well worth the read.
There once was a man named Kota who built some of the finest houses in all of Tokyo. His work became world famous due to his dedication to the process, his willingness to beat on his craft, and his relentless devotion to keep learning, even late into his career.
Eventually though, Kota grew tired of building homes for other people and he was ready to retire. He had been building homes for over thirty years, and he was ready to move on. He wante to travel and spend lots of time with his grandkids.
One day, Kota approached his boss, and turned in his two week notice. His boss said, “Kota, we are forever indebted to you for the magnificent work you have done fro our company, and we are so grateful you have worked for us for so long. We do have one favor to ask you though. Could you please build one more house? It is a very important house, for a very important client, and everyone in the company agreed it needs your special touch!”
Kota was frustrated. He would have to cancel two trips and postpone his new life, all for one house. He told his boss that he needed a day to think about it. After talking it over with his wife, he gave in and decided he would build one more house. But he told his boss, “This is the very last one!”
But whie Kota had agreed with his head to build this last house, his heart was no longer in it. He had always been very hands-on through the entire building process, always selecting the finest materials by hand and making sure every detail was diligently tended to.
But this house was different.
He viewed it more as an obligation than an opportunity. He delegated much of the work, and consequently a lot of things started slipping through the cracks. The house would be up to code, but as it started to come together, it was obvious that it lacked the “wow” factor that Kota’s other homes were known for.
Kota knew in his heart that this was far from his best work, but he was over it and ready to move on to the next phase of his life. The next phase was much more appealing and important to him than the present moment.
After four months had passed, Kota finally finished the house.
He went back to his boss, telling him, “I did what you asked. Now I am asking, one last time, for your blessing to retire.”
His boss said, “Thank you Kota! We just have one more thing!”
Now Kota was beginning to get really upset becuase he thought they were going to ask him to build another house.
His boss reached into his desk and pulled out a very small black box with a red ribbon tied around it. He handed the box to Kota, and said, “We are so grateful for you, Kota. This gift is a token of our appreciation.”
Kota pulled the ribbon, opening the box to discover a set of shiny new keys. His boss smiled, “The house is yours! You deserve it!”
Immediately, his heart sank. Unbeknownst to Kota, the whole time he had been building his own house. If he had only known the house was his own, he would have cared so much more. He would have only used the finest materials, and he would have overseen every detail and given it his all like he had always done. But now, it was too late.
In case you missed these this week
The 3 angles to attracting prospects:
Save time. Save money. Make money.
See you next Saturday,
Sam