Doing More with Less

Hi, Markus here. Welcome to a new episode of the Customer-Value-Led-Growth Newsletter.

I share strategies and guides for CSMs and CS leaders to improve their performance and get the recognition and compensation they deserve every week.

Want to excel in CSM? Check out these resources 👇️ 

• The Customer Retention Blueprint *NEW*

• Raising the Bar - Enterprise CSM Guide *NEW*

• Plugging the Hole - Churn Guide *RENEWED*

• Peeling the Onion - Customer Problem Discovery Guide *RENEWED*

• The CSM Operating System for Customer-Value Led Growth

Got too much free time on your hands? Didn’t think so. It’s the sad reality that Customer Success Management has become a numbers game at so many companies.

More meetings, more calls, more Emails, more of everything. You are buried in work with rarely room to breathe. But CSM is about impact. It’s about making every action count.   

In today’s post, I’ll show you how you can use the 80/20 principle to create better results with less effort.

1. Customer Prioritization

Common wisdom says that 80% of profits come from only 20% of customers. Logic dictates that you’d spend 80% of your time with those customers. Does it happen in reality? Almost nowhere. 

CSMs are fighting lost battles with customers that will never become successful. Because they either are a bad fit for the product or show poor behavior like

• not willing to put in enough effort

• not showing up to scheduled meetings without a word, repeatedly

• not following advice and recommendations (but keep complaining)

People pleasing is one of the biggest adversaries in CSM. The tricky part is that most professionals are wired this way. That’s why they choose this career. It requires a lot of willpower to go against your instincts. 

But if you put these customers on minimum support - until they inevitably leave - something truly magical happens. You regain not only time but also energy and motivation. You channel them into the work you do with your top customers and create massive momentum.

In the end, your already great customers become even more successful and profitable. The gains greatly surpass the losses from the customers you let go. 

2. Churn Reduction

It does not happen for mysterious reasons. It does not happen because customers suddenly think the product is too expensive (they knew the price in advance). It’s also not equally distributed.

There are only a handful of reasons (20%) that account for the majority (80%) of churn. This is what I call systematic churn that follows specific patterns. Patterns that can be traced and elimianted with scalable and pre-emptive solutions.

A typical example: Churn that is caused by unrealistic expectations. Customers consumed your content. They rushed to your website. Found the most delicious value proposition and could not help but give your product a shot. 

If they are running through human-led or -assisted sales motions, the misguided expectations could be fixed. But the only way to do it would be case-by-case.

A far more elegant and effective solution is to match the value proposition with the actual capabilities of your product - an infinitely scalable solution.

It’s not a perfect solution because such do not exist and there will still be people who get it wrong. But it makes a lot of difference whether 20% or 2% are falling through the cracks. 

3. Activities and Inputs

Ever heard the expression “a meeting that could have been an email”? It happens all the time in CSM. A lot of customer meetings happen for the sake of it. Because the playbook says that you have to do pulse checks after X days or something.

They have no agenda and goal. You end up discussing open support tickets, the product roadmap, or doing small talk. At the end of the meeting, the only insight is that an hour of time has passed.

These meetings are almost certainly the largest time-wasters in CSM. You need to focus on the 20% of activities that drive (support) 80% of customer outcomes.

How do you know what has the biggest impact? Measure the impact of all your significant activities and inputs by their results (quantitative) and the feedback you get from customers (qualitative).

The impact you create is not static but changes - from customer to customer and over time. A prime example would be QBRs. They are invaluable (if done right) when you are working with a new customer.

But for a customer who you’ve been working around for 5 years? What are the odds that they need 4 QBRs per year? It’s not easy to find out what matters most for which customer at which stage but the potential gains outweigh the effort.

4. Customer Conversations

This one is a bit less straightforward. Most CSMs keep talking in their customer meetings most of the time. They believe customers are impressed, but in reality, they are turned off and driven away. 

But that’s not the end of the story. Due to you talking all the time, you are not learning anything about your customers, their needs, results, etc. As a consequence, you are completely in the dark. Often caught by surprise with your pants down. 

Of course, avoidable churn is the ultimate negative outcome. But the point I want to make here is that you end up spending a lot of your time fixing issues you’ve caused yourself. Caused by your lack of listening to your customer.

As a new rule to guide all your customer conversations, spend 20% of the time talking and 80% listening. Yes, that includes your QBRs. They are not one-sided presentations but conversations. Conversations about previous results, weak spots, and how to improve results. 

To identify weak spots, you need to listen, not talk. Restrict yourself to asking open questions and signal to your customers that you care about them and their success. 

Ok, so here’s the deal. If you understand your customers the odds of providing the right inputs increase substantially. Up to a point where you are getting it right at the first attempt 80% of the time resulting in an 80% reduction of effort.

Turn CSM into a Growth Engine and unlock your full Potential.