By Kristen Hayer
As I mentioned in my last blog post, I think it is the responsibility of a CSM to identify areas where a customer needs a new or expanded solution. Uncovering opportunities is a core part of the customer success manager’s role, regardless of whether or not they are the “closer”. Here are some ideas on how to make that happen.
Where to Look
New Customers
Salespeople are generally great. They work really hard to identify customer needs, match them to products and services, negotiate pricing, and bring the deal home. That said, the other side of sales is that they have an enormous amount of pressure to close things quickly or on a specific timeline. What this means for a CS team is that a “land and expand” model is becoming increasingly popular because it allows the sales team to close deals fast, while leaving room for customers to grow. Who handles that growth is often up in the air.
With new customers, CSMs should be on the lookout for expansion opportunities. This could be more licenses than were initially scoped, more services that are needed, or additional teams that weren’t a part of the original plan. It is important for the CSM to identify that there is a gap between what was sold and what the customer actually needs – after all, this is a big part of getting the customer off on the right foot. If this happens often, CS leaders should consider a variable comp plan that rewards CSMs for identifying and closing these early expansion opportunities.
Existing Customers
We’d like to think that every customer reads all about the latest release when marketing sends out a new feature announcement or product shares release notes. The reality is that this doesn’t actually happen. When was the last time you read the release notes on an app update on your phone? It falls to CSMs to identify new features and functionality that are relevant to a particular customer, and to proactively bring that up on a call or business review. This can be an excellent source of new opportunities.
In addition, CSMs should always be on the lookout for customers whose businesses are going through some sort of transition. This could be as simple as a new contact, or as complex as an acquisition. Things like layoffs, hiring rounds, funding rounds, and mergers all have an impact the business a customer is doing with you. By identifying a shift in the organization, a CSM is in the perfect position to ask a few questions and identify potential opportunities for cross-sell or up-sell.
Renewing Customers
Renewal is a great word. It means a reset, a resumption of activity, or a re-commitment. What better time to look for new ways to work together? Often renewals come with a standard price increase, but they can also be a time for a license increase, a package upgrade, or new services. Be sure to hit the reset button as you’re thinking about a renewal and consider all of the options for your customer. After all, they are already going to have to go through a budget approval process on their end, so this is an easier time to add new features or services that fit with their strategy.
Documentation
Just as if you worked in the sales department, the minute you uncover a potential opportunity, you should document it. For those of you with a CRM system (this should be most of you), set up an opportunity. The two pieces of pushback I hear about this are: “My AE doesn’t want me to set up an opportunity for them.” and “I’m nervous about setting up an opportunity that I’m not sure will close.” Let me take these one at a time:
“My AE doesn’t want me to set up an opportunity for them.”
This could be happening for a few reasons. If the AE thinks that their job is to identify and close all opportunities across the board, that’s a team alignment issue and should involve a conversation between your manager and theirs to pin down a process. More often it is because the AE feels nervous about dealing with opportunities that they haven’t qualified themselves. To overcome this issue, set up a meeting between CS and Sales, and nail down qualification requirements and timing. Generally, this resolves the conflict.
“I’m nervous about setting up an opportunity that I’m not sure will close.”
Any time you have to put a stake in the ground, you’re taking a risk. I’ve managed a lot of sales teams over the years, and one thing I’ve noticed is that there is always someone on the team who is worried about adding an opportunity to the CRM system because they aren’t 100% certain it will close. Guess what? Not all deals close. Any manager with experience knows this and will work with you to align on what is realistic, what is likely to close, and what is a stretch. What they can’t do is read your mind. If it isn’t in the system, they can’t help you.
Involving Sales
Many, if not most, CS teams are working with Sales in some way to close opportunities. Either CS handles the relationship and Sales handles anything commercial, or CS is handling simple up-sells and renewals and Sales is handling more complex cross-sell opportunities. Whatever your setup, most CS teams will need to closely coordinate with Sales to optimize expansion opportunities. Here are some best practices:
1. Nail down roles – do not leave the “who does what” up to chance. Clearly define roles and responsibilities, down to the qualification questions that need to be asked. Make it a no-brainer when an opportunity needs to be transitioned from one team to another.
2. Consider customer preferences – often CS professionals are in the best position to close expansion opportunities because they are the trusted advisor. Don’t let your internal systems like commission plans or CRM workflows get in the way of a better customer experience.
3. Over-communicate – you cannot communicate too much when you have two teams working with the same customer. Be sure that everyone is logging everything in the CRM, but also make sure that the CS and Sales teams are meeting regularly to coordinate on an approach that works for everyone.
Having a CS team that is actively looking for selling opportunities is critical for success in a subscription environment. Whether or not they are doing the selling activities, they should be identifying opportunities. Set your team up for success by teaching them where to look, enabling effective documentation, and building strong teamwork with your sales organization.
Looking to build you CS team’s consultative skill set? The Success League is a Customer Success consulting and training firm. Our CSM certification program includes courses on Uncovering Opportunities, Asking Great Questions, Managing the Selling Cycle. Visit TheSuccessLeague.io for our full offerings.
Kristen Hayer - Kristen believes that customer success is the key to driving renewal and expansion revenue, and delivering exceptional customer experiences that produce referrals. Over the past 20 years Kristen has been a success, sales, and marketing executive, primarily working with growth-stage tech companies, and leading several award-winning customer success teams. She has written over 100 articles on customer success, and is the host of 2 podcasts about the field: Strikedeck Radio and Reading for Success. Kristen serves on the board of the Customer Success Leadership Network and the board of the Customer Success program at the University of San Francisco. She received her MBA from the University of Washington in Seattle, and now lives in San Francisco.