How To Accelerate Upselling With CAC On The RiseJune 23rd, 2020
We had Josh Allen, SVP of Inside Sales at Drift, and Jim Nystrom, Chief Sales Officer at Cogito Corp, provide tactical strategies for upselling current customers with new customer acquisition costs climbing higher than ever.
Caring for your Existing Customer Base
- Startups across the board are leaning on their current customer base and focusing on upselling versus tracking down new leads. It's more important than ever that your customers are delighted with their experience.
- Check-ins with existing customers are necessary right now. Have their expectations been met? Are they receiving the value they initially expected? If you don't have the answer to these questions, prioritize finding out.
- The better you know your customer, the better you can identify their problems. Stay nimble and stay in contact.
- Ask yourself, how can you make yourself a token employee of your customer? Getting to the level of trusted advisor is always key - not just in pandemic times.
Guiding the Renewal Conversation
- Before starting a renewal conversation, you should have already identified other appropriate lines of business. This is a constant process and your customer support teams should be well-versed in each customers needs and potentially upselling trajectory.
- If an upsell isn't in the cards, have an earnest conversation about whether they're willing to partner up and help you win new business. Can they commit to being a reference on a regular cadence? Are they willing to participate in your press releases and webinars?
- Remember, you and your customers have the same goal to grow your business. Sometimes you have to remind customers of this.
- If upselling is a focus for your startup, founders should implement an incentive structure that reflects that. For instance, if the account manager successfully upsells, they should receive a kickback.
- Going back to the negotiation table every 12 months is tough and time consuming. Because of this, suggest longer contracts that span 2-3 years instead of every 12 months.
- Renewals shouldn't just be a date on the calendar but a process that's constantly monitored and always being delivered on. Remember, renewals are evergreen!
- Is it possible to relieve a little pressure by adding in an auto-renew after the initial contract term? But remember, this doesn't relieve you of the day to day work on maintaining and connecting with your customer.
- Implement a strategic selling approach. Listen to their earning calls, check out their 10ks, review their job postings. The more you know!
Training Employees to Recognize Upselling Opportunities
- It's all about the inbound contacts. If you customer is contacting you, seize the opportunity.
- Have your customer success teams regularly update and assign their customers in your CRM. This helps track how and when upselling takes place. Additionally, it gives the startup an opportunity to financially compensate support reps for their role.
- Consider creating a user services team where support teams have light selling responsibilities with variable compensation tied to leads.
- It's important to identify whether the economic buyer has changed when upselling a new product. If so, have you identified who you should be contacting?
- Upselling team members should have close relationship with the product team. This goes both ways - know what product lines are coming soon as well as share the customer's pain points.
- Does it make sense to separate upselling team members from new business team members? It all comes down to the powers of specialization.
Thank you Josh & Jim for taking time out of your day to share your expertise with the greater Venture Lane community!
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