Recording & Takeaways - Retention is the New Growth
When economies boom, customer retention is largely taken for granted. The customer success team will handle it, many revenue leaders think. Surely we’ll oversell from time to time and, yes, we’ll lose some customers along the way, but that’s the nature of B2B. It just works.
Until it doesn’t.
If we’ve learned anything from this past year, it’s that you can’t rely on new business alone to fuel your revenue organization. When budgeting delays and inefficient procurement processes effectively evaporate otherwise promising deals, the only thing that you can do is turn to existing business.
There is no doubt that customer retention is more important than ever before, but many businesses are in the dark on how to ensure healthy, long lasting customer relationships.
To help you out, MetaCX teamed up with Terminus to host a webinar dedicated to retention best practices and customer strategies. In the recording below, listen to Waqas Hussain and Justin Keller explain the two major components of customer retention and how to implement them within your organization.
NRR > ARR
Net revenue retention is the simple calculation of expansion revenue minus churn. Ideally, your NRR is (way) over 100%, meaning that you add more install base revenue than you lose. Even if two companies are bringing in the same amount of new revenue every year, the company that has a lower churn rate will come out ahead.
The 2 major components of retention are customer experience and proof of value delivery.
It’s simple; in order to retain customers, you have to provide a good experience and prove that you’ve delivered on the outcomes promised in the sales cycle. And these two components don't work in isolation—better experiences often produce better outcomes. For example, by using ABM to enrich the customer experience, you can keep your business top of mind and ensure commitment from all parties to shared goals and objectives. Experience is the method, outcomes are the goal.
Customer retention is ABM at its purest.
Think about it:
- Your customers most likely already fit your ideal customer profile (ICP) so there’s no need to build targeted account lists.
- The account is already mapped. You should already know who the stakeholders are within a particular customer account and have rich profiles on them in your CRM.
- You have already established the desired business outcomes (DBO) of your customer, so you know what they’re trying to accomplish and how you can help.
- Cross-functional alignment is easier. While sales people chase whatever opportunity is hottest at the moment, your CS team is completely devoted to their customers already. Any support their marketing team can give them will be deeply appreciated.
Proof of value requires a holistic change to the revenue cycle.
How you retain customers depends on how well you can prove the value your product delivers. This requires a holistic change to the revenue cycle, where the outcomes the sales team promises are the ones that the implementation team delivers and the ones that the customer success team measures, reports and holds everyone accountable to. When you build a customer lifecycle oriented around outcomes, everything gets easier: selling and renewing isn’t based on vague promises, but a systematic approach to customer value creation.
ABM is the best strategy to elevate proof of performance.
Once you can prove value delivery, ABM is the best strategy to make sure key customer stakeholders are aware that you’ve delivered on promises made, effectively ensuring renewal and unlocking the expansion movement. If you can show your customers how you’ve helped them achieve their goals, they are much more likely to further invest in the partnership.
Provide your contact information and MetaCX will send you an official invite with webinar details.