The best and most predictable path to improving revenue retention and growth is by understanding the outcomes that you drive for your customers - and not just the ones that you think you drive. The only way to truly figure out the RIGHT outcomes your customers are getting, is to interview your most successful customers.
Outcomes? Why Outcomes?
There's a big misconception around the "value" we drive for our customers - often its kept at surface level (tasks, projects, etc). The outcomes that our business drives for our customers needs to be deeply rooted, business-level objectives.
Think, how did our product save time, increase money, decrease spend, improve growth, etc. etc.
Colin Dowling said it best:
“People buy 4 things and 4 things only. Ever. Those 4 things are time, money, sex, and approval/peace of mind. If you try selling something other than those 4 things you will fail."
You need to be able to peel back the layers of your business' proverbial-outcomes-onion to the center of what results you're actually driving for your customers, not the surface level tasks and low-level deliverables.
One of the best ways to improve revenue retention is to align on outcomes with your customers, and then continually measure those outcomes going forward (you can't improve what you're not measuring, right?).
Successful vs. Churned Customer Interviews
Understanding the outcomes your customers achieved (and continue to achieve) is key for the success of your business.
Simply put, you can't learn what success looks like from researching churned customers and/or doing "post-mortem" analyses.
Sure, there are valuable insights to learn, but not what outcomes you drive (which is the one of the best and fastest paths to revenue retention and growth).
So if you're looking for success in churned customers, you're wasting your time. And your ex-customer's time.
How to Identify Successful Customers
Pinpointing successful customers involves more than just observing high usage metrics. It requires a strategic approach to recognize those whose objectives align with your product's purpose
Choosing the right customer to interview shouldn't be hard, but often we get hung up on the wrong datapoints.
Here are a few tips on how how to narrow down your selection:
What we're NOT looking for:
New Customers:
Newly acquired customers are great, but we can't learn much if they haven't had to change how they work to see the outcomes your product delivers.
High NPS/CSAT:
we love getting high scores here, but this doesn't mean they're successful with your product.
I've seen promoters churn regularly and detractors stick around for years.
Product Usage:
Yes, using our product is great. But don't ONLY look at customers with high-product usage as your main filter
'Product stickiness' doesn't always mean customers are successful
What we ARE looking for:
Longevity + Size:
Which customers have been with you the longest?
Which customers are paying you the most?
Look for high ACV customers that have been through multiple renewals
Outcomes:
Know what outcomes you drive for your customers? Great! On which customers have you had the largest impact?
Remember, outcomes here are business-level impacts - Increasing sales, saving time, cutting costs, etc.
(Pro tip: Not tracking and measuring your customers' outcomes? Start today)
Upsell/Expansion:
Which customers have consistently paid you more over time?
Search for customers that have multiple mid-cycle upsells
(Pro tip: Not tracking upsell opportunities like a pipeline in your CRM? Start today)
Once you've narrowed down your list, the goal is to interview 3-5 customers overall. This might mean you'll need to identify 7-10 customers based on availability and response rates.
How to Interview Your Customers
Asking the right questions will get you the right answers. So prepping for your interview is key. Here are the main questions I ask when conducting a customer interview:
Top 7 Customer Interview Questions:
What was the original motivation for purchasing our product?
What was the process before using our product?
Why did our product work, and what was the thing you had to do to make it work?
What help and support was required for you to make our product work?
How did you know that our product was a success for you?
What is the value our product brings to you?
How would you measure that value on a monthly basis?
Each interview is unique and flows differently, so being able to ask certain questions and skip others in important. To help with that, you need to learn what answers you're looking for.
What Answers You're Really Looking For
Beyond the surface-level responses, you'll need to understand the deeper insights that your customers are giving you. Here are a few things that you're really looking for in their responses:
Key Behaviors & Actions:
How are they using the product, and why? Are they using it in a way that you intended or not?
What are the specific actions they had to take to become successful with your product
Dig beyond product adoption, what behaviors did they have to change, processes they needed to create, meetings they setup, etc
Support & Tools:
What support was required from your company? How long, and how much?
What tools could you use, build, or change to make it easier to get to the outcomes?
What would you change to offer more strategic support based on these outcomes?
Measurable Outcomes:
What is the true, measurable value they're getting from the product?
How are THEY measuring it?
Does it match what you're marketing and selling?
Are you currently measuring this with other customers?
Sometimes you'll need to read-between the lines a bit and help to educate the customer on the outcomes they're seeing. Using phrases like "it sounds like you're using our product to measure [xx], is that right?" will help to drive the conversation towards those outcomes.
In Summary:
Bottom line? These are your most successful customers. Replicate them.
Learn how to sell the outcomes that they're actually achieving, build onboarding strategies around customer-actions needed to see those outcomes, and find ways to measure and improve those outcomes going forward.
The most successful tech-companies both understand the TRUE outcomes they drive for their customers, and align all of their internal teams around them.
Aligning to, and measuring customer outcomes is your winning strategy.
Whenever you're ready, there are 3 ways I can help you:
The Renewal Operating System: This is the ultimate set of playbooks for tech-founders and revenue leaders. This system aligns your teams to the outcomes you produce, improves customer retention, and doubles your expansion opportunities.
One-on-one coaching: Get one-on-one support and proven expertise around revenue playbooks, professional skills, operating models, and much more. I offer 1x1 coaching to help you win.
The Operators Newsletter: Join 2500+ tech leaders every Saturday morning where you'll get one actionable tip to help you build GTM alignment and scale your teams.