Hot Take: No One Renews Because Their Salesperson is Great

I know many of us work in orgs where Renewals and Upsell are part of our numbers OR we are on an AM team that only deals with renewals and upsells, leaving net new to another team.


My hot take after years of selling: CROs and VPs and Sales Managers who continually lambaste sales people that 1) lose renewals or 2) have rough churn numbers and constantly blame bad churn on "sales practices" are worse than stupid - they're complicit in a dirty little secret that the Anything as a Service (specially the MRR "solutions" market) has illuminated for all to see, if they only look.


SECRET: Customers don't renew or re-subscribe to subpar solutions that don't work or have bad service.


Now I'm not talking about renewal accounts where the rep never upsells anything - that's a different issue. I'm talking about losing renewal deals because the effin' widget doesn't widget and then getting blamed because you "didn't know that."


Now supposedly "Customer Success" is supposed to help fix that - but most of us know all CS does is add another set of hands to finger point when an account is lost.


Interested in whether my hot take resonates with anyone or if I'm offbase. I'm just tired of C levels talking about "churn" like it's a SALES PROBLEM. What do you think?

When a customer doesn't renew, it's usually becasue:
Attached poll
*Voting in this poll no longer yields commission.
โ˜๏ธ Software Tech
๐Ÿฆพ Hardware Tech
๐Ÿ“Š Metrics
26
Kosta_Konfucius
Politicker
8
Sales Rep
I agree that no one renews because their AM is great. But people might not renew because there AM is bad. The main example being the Bad Sales Advice a couple weeks ago. During the process the sales team said X feature is on the roadmap to be include 2022 in order to win the daal. Then it turns out, that feature isnโ€™t on the road map at all.

I donโ€™t think this is that common, but happens more often than I would think.
Lambda
Tycoon
7
Sales Consultant
I think its completely circumstantial

How long has the AM had the book of business?

How high is employee turnover

How long has CS had the account

Are they a new CS or a tenured CS

How were they sold the product origianlly?

Has the business changed and it not been recorded in the CRM correctly?

Are the devs actually working on a solution of just pushing off V3 until the eventual "Next quarter"

The truth is if you aren't helping the customer it doesnt matter what you do you cant renew and cant upsell
DataSlangah
Politicker
4
SAE
As a former Sales Director and now BU Owner, I will tell you why I don't renew products. HINT - I renew stuff that is working.
1. It doesn't work.
a. because the product really does suck and got sold a bill of goods.
- or -
b. Lack of training on the product, and it doesn't work because of poor implementation or follow-up by the AM to ensure I was using the product correctly. (this is the AM/CSM's fault)

2. I can get a perceived comparable product at a lower price, and the switching cost is lower than the savings.
TennisandSales
Politicker
3
Enterprise Account Executive
if you are ONLY talking about situations where the product doesnt work and the customer churns, thats 100% not the AMs fault.

idk if thats really a hot take.

Sales is MUCH easier to blame than product.

but if your asking when a customer doesnt renew, what is it MOSTLY caused by?.....i have a hard time believing that MOST of the time the product is broken.
Gyro25
Notorious Answer
3
Account Manager
Here's my take for my specific org. When the AE closes to the deal and 'x' price for 'y' features promised and they use the product till its time to renew, CS and AMs need to be on them to let them know of product enhancements and features.

Here's the issue, when it's time to renew and the price closed is lower than the upsell, it fucks me as an AM because the AE closed the deal at a heavily discounted price which adds to the lack of perceived value in addition to what you mentioned about the shit not even working. It's part of what makes up sells for our team so damn hard if you're trying to expand on an account and you've got lower tier accounts as well, but that's a separate issue altogether.
FinanceEngineer
Politicker
3
Sr Director, sales and partnerships
Customer success is where this falls. You need to have someone (or a team) there to fix problems and help get problems solved. Sales shouldnโ€™t be anywhere near the customer once they sign, it should be handed off.
butwhy
Politicker
3
Solutions Engineer
It's a cycle of fuckups, in my experience. The sales team sold something that wasn't quite real or overly customized, the implementation team implemented something clugey, the original champion who had vision left, the team using it gripes because they hate change in the first place, the Customer Success team drops the ball because they are being paid peanuts and have absolutely no technical knowledge and the customer refused to pay for premium support, the AE comes back in after completely disengaging 30 days before renewal and finds out it's a shit sandwich.

At most startups I have worked with, each of these steps has been inherently broken in some way.
SaaSguy
Tycoon
2
Account Executive
Recurring revenue is a result of RECURRING IMPACT. If you aren't delivering you get tossed into the scrap pile.
Justatitle
Politicker
2
Account Executive
Rarely does someone renew because of their AM but it does occasionally happen where the point of contact at the account feels well taken care of and even if there is some product issues they are loyal. Now to play devils advocate, if the AM, CSM, Support and product teams didnt listen to the clients issues and it's not a fit or didn't have the relationship to know ahead of renewal that they would churn for whatever reason the ball is dropped by everyone.
punishedlad
Politicker
2
Field Sales
It's really easy to point fingers, but the reality is that it could be any one/two/multiple of a litany of reasons. Competition stepped in and out sold you, they were priced out/budget fell through that year, product was broken (as you said), had a bad experience/relationship with CS/AM, etc. etc.
Sunbunny31
Politicker
2
Sr Sales Executive
At the very least, AM should be a channel for communication - hearing from the customer and having knowledge about the product or solution so that the customer didnโ€™t buy the wrong thing.

But in my experience, the rep never stays with the account for long, and itโ€™s somebody else who gets to come in and try to figure out whatโ€™s going on and who or what could fix it.
CuriousFox
WR Officer
1
๐ŸฆŠ
Especially in our world.
Space_Ghost20
Member
2
Account Executive
In a well-run organization, non-renewals happen because a product is truly no-longer a fit, never was a fit, or because there's been a change in leadership and they're going with someone/something they already know (AMs can sometimes head this off by being proactive, but not always).

AM and CSM teams are responsible for proactively understanding their customers, what their needs and use cases are, and try to make sure they can take advantage of any new features or products (cross-sell and upsell) that will hopefully make it harder for them to leave.

Problem is there are a lot of poorly run organizations, or poorly run AM/CSM teams (and individuals) so it absolutely can be a factor in non-renewals.
GingerBarbarian
Opinionated
2
Lead Sales
The ball drop can happen anywhere, but I do think we over-value relationships in sales. How many people work with compa is they hate because that company is simply the best at what it does. (WalMart, Comcast, AT&T, Amazon, etc).

Meanwhile, think about how often you decided not to work with someone you like because they sold a shitty product. Think about your cousin who just got their real estate license or you high school freind who started MLM selling. We love them, but athat does not mean we always want to work with them.

The difference is often competence, not relationships.
Pachacuti
Politicker
1
They call me Daddy, Sales Daddy
Itโ€™s definitely not an All The Above answer. I think there are variety of factors, some of which are not mentioned in that list.
TheDukeofNRR
Old School Bravo
1
Customer Success Exec
Retention is a company sport and a company is only as good as its weakest team.


Most good customers renew for value. Period. If they don't they're probably not a customer you should keep around long-term. Value must be quantifiable and everyone in a customer-facing role should be making the effort to communicate some expectations, reiterate them, and reinforce this value on a regular basis. Secondarily, if your stakeholders like working with their AE, CSM...that's great, but when dept budgets get tight, line items will get stack ranked for impact and the lowest performers will be reduced or cut.


Mitigating churn starts with speaking to your customers early and often. Uncover breakdowns in communication, missed expectations, suboptimal delivery...and most importantly make sure every single person accountable for driving adoption, satisfaction, and growth understands and can articulate how your product drives value using their KPI's, not yours.


If you're part of an organization that's able to have intellectually honest conversations about what you uncover speaking with your customers and can resist finger-pointing then things will get better.
RandyLahey
Good Citizen
0
Account Executive
I think product/service is the most important factor.
8

"What is it going to take to put you in one of these baby's today?" - Really bad coffin salesman / Or a really good one?

Question
4
13

Hot Take: Spiffs are a terrible idea

Discussion
47
15

What does it take to become a great SDR?

Advice
10