Will your new customer stay?
One of the critical reasons customers churn is a lack of business alignment.
When customers churn, most organizations start with concerns about Product quality, pricing or the level of support/service and the business impact. This is not true. It is not about Product quality, or the Support or the Price. All these are solvable in the long run with enough sponsorship. What can never be solved is a lack of business alignment between the companies. When two companies with very poor business alignment get into an engagement, then, over time, sponsorship ceases to exist. And continued executive sponsorship is critical for long term success.
Why does business alignment go wrong?
A combination of proper sales qualification process and lack of level setting with the rest of the organization - such as Customer Success, is the primary cause.
The entire company, starting from Sales to CS, Marketing and Product need to have one unified vision of why the customer does business with them. It is naive to build a culture where the Product does not understand business and business does not understand Product.
Here is where the erstwhile Value Proposition framework can be of big help.
A value proposition framework looks like this:
The way to look at this template is from left to right.
What are the customer jobs, what are their pain points and what could they gain from?
A customer job is the primary set of activities that they are focussed on.
For example, a Technology Director responsible for accelerating a product launch to the market is looking for augmenting their tools/process/people to bring in automation efficiencies.
Similarly, a marketing director is looking for innovation in marketing by changing the content strategy from a formal channel to more social media driven promotions. The Marketing director is looking at fitting in business evangelization in pure B2C medium such as TikTok/YouTube.
This is their current Jobs.
What is their pain point?
The Technology director has a very short duration to launch and building a team or tool from scratch in a complex product area will further delay than expedite their plans. Their pain point is not budget but Time. Who can augment this?
The Marketing director is looking at some industry data on where most of his customer base are present in social media, who the influencers in that area are and what customers are reacting the most to. They want authentic research data so that they can invest their creative budget there.
Their current Gains: (what would make them accomplished)
For the Technology Director: A partner with ready to deploy tools and team that have built complimentary products with minimal integration and deployment time. A partner that can promise a time to deploy at the fastest path possible, with a proven track record.
For the marketing director: A consulting firm that specialises in helping B2B businesses with the right strategy, search keywords, customer purchases based on analytics and historical data which is currently not with them.
The first step of the Value Proposition is now complete. A clear understanding of the customer’s pain points and what they could gain from.
Unless an organisation collectively believes they have the product, strategy and solution to compliment or alleviate these pains and offer the gains, they should not get into a partnership with them.
Now, how can the partner company (YOU) help?
Products & Services:
Do you have products and/or services that can augment the customer?
For the technology director, has your company built automation tools that eliminate the need for a manual effort and integrate with customer’s products? Do we have enough solution architects and test engineers that can work on this integration and roll it out to customers? Does the company have the tenets to scale ?
Out of the chosen products and/or services, what are the pain alleviators?
The automation tool combined with a customer integration lab that we have can help customer to completely offload the integration and deployment efforts to us while they focussing on building core product features
The marketing insights we have gained from an analysis of B2B customers and their target customers in this space, and the consulting framework we have created will enable the customer to completely pivot their marketing strategy very seamlessly while also transforming their skillsets towards a more informal, dark social approach.
These are sample pain relievers which the products bring to the table.
And how will the customer Gain or what are the Gain creators/indicators?
The tool will help the customer to launch ahead of competition and with some great complimentary features and help win a huge market share
Increases their new revenue potential by up to 35%
Acquire customers in the new Geography
Increase social media presence and brand awareness
Increase brand likeability
Increase chatter about the brand thereby increasing brand credibility
Increase brand loyalty
These are some sample Pain relievers and Gain Indicators.
When such a common canvas exists for each Project, and where there is a clear alignment between customer needs and partner products/services, the company shares a common vision.
Misalignments if any must be caught before Sales signs a contract with the customer. Companies can work with 70% alignment and 30% gap where there is a need for more work. However the reverse is bad. Having 30% alignment and 70% gap is an absolute flaw.
For CSMs out there, make sure that the customer pre-onboarding tasks involves creating a unified customer canvas and the entire organization understands why they are doing business for the customer in the first place.