What you should consider when selling to established customers

What you should consider when selling to established customers

"Depending on which study you believe, and what industry you’re in, acquiring a new customer is anywhere from five to 25 times more expensive than retaining an existing one". I am sure many of you have heard or read something like that before in discussions of customer acquisition vs. customer retention. Well, I took the above quote from a blog post written by Amy Gallo at Harvard Business Review back in October 29, 2014 - that is 7 years ago as of me starting this post.

Today, if you were to google "retention vs. acquisition" you would get dozens, heck, even hundreds of recently (written within 2 years) articles debating which one is better for optimizing business growth and minimizing costs, all sharing that 5x metric used above by Ms. Gallo (5x seems to be the agreed upon relative metric to use). After looking through many of them, I quickly noticed that there was some congruence in the following ideas:

  • Inbound sales are becoming a lot more effective & scalable
  • A customers (projected) lifetime value (CLV) should guide business decisions
  • If you do customer experience right and provide the value the customer was expecting (and more), retention can resolve itself
If you want to read more on CLV, estimating company value, and predicting customer behaviour, I have had a lot of fun endlessly scrolling through ThetaCLV's Twitter page and reading some of their blog posts.

Here is my immediate thought when reading through those ideas: Although every company's vision is different, CLVs are different, growth is different etc. I don't think you can go wrong by focusing largely on the value & experience that your organization provides its current customers, the rest should come*. How do you get your organization to focus on value & experience? Well, that's where Client Success comes in.

By "the rest should come" I am referring to business success/growth factors like referrals, better reviews, increased revenue etc. This idea deserves it's own entire blog post, so I will leave it at that for now 🙂

Enter Client Success (CS)!

Hopefully you now have a shallow bit of knowledge on what decisions are happening at a higher level in organizations, before customers actually land in the lap of the client success team, you can understand the importance of customer experience & retention. Now, if you don't know what client success teams do, please jump over to google for a quick summary, or visit my good friend Edgar's blog for some deeper insights on the work that CS teams do.

If you're too lazy to do either of those, just click on the toggle to see Edgar's quick paragraph on CS

In the past, I have been exposed to a couple different internal sales structures. For instance, one structure was where I regularly had inbound SDRs hopping onto my calls and trying to pitch certain functionalities of our product. I can't say that the interactions I generally saw were the most successful, as it felt strange seeing a sales rep interact with an established client as if they were a net new customer. On the other hand, I was also part of a structure where the inbound SDR team was removed entirely and all the selling of our immediate add-on products fell on the CS team. Throughout this transition I came to realize that there are so many situational variables at play that differentiate the process of selling to existing customers vs. selling to new/prospective customers.

The comparison I am making is not to be confused with inbound vs. outbound sales in the sense of marketing & capturing potential customers. The comparison I am making is, once they are already established customers, how do the sales interactions go, what happens after the pitch, and how is this different from the first outbound SDR conversation with that same customer? It is difficult to generalize my ideas below to apply to all product structures & organizations, so to simplify this, the ideas below are specific to SASS (software as a service) organizations that have post-implementation add-on functionalities that can be sold at an additional cost.

Some ideas to keep in mind when selling to existing customers

Leverage reciprocity

The old give and take... This is one tactic that sales reps selling to outbound prospects do not get anything close to the same opportunity that CS teams have to leverage reciprocity. I don't think that this concept requires much explanation, but if you're interested in reading a little more on how deep reciprocity actually runs and how it can be used, I thoroughly enjoyed reading the book Influence: The Psychology of Persuasion by Robert B. Cialdini. In my recent role as a client success associate, I always kept the quotes below in mind when actively trying to leverage reciprocity:

"One of the reasons reciprocation can be used so effectively as a device for gaining another’s compliance is its power. The rule possesses awesome strength, often producing a “yes” response to a request that, except for an existing feeling of indebtedness, would have surely been refused."
"Although the idea/rule was developed to promote equal exchanges between partners, it can be used to bring about decidedly unequal results."

The beauty of this, is that it is literally the job of the CS team to say yes as much as possible when customers have any sort of request, which creates a deep foundation of reciprocity waiting to be unleashed. You might find the wording "foundation of reciprocity" a bit strange, but hear me out and think about it this way: Every time you say 'yes', fulfill a customer request, or even answer an email, you have this meter that keeps growing. After a certain accumulation of completed tasks, your bar gets full, and you can then use that feeling of indebtedness that the customer has to time and make your pitch. As long as you are consistently providing value and supporting your customer in any sort of way, your reciprocity meter keeps growing, and you will always have this tool that outbound sales teams unfortunately do not.

No means 'maybe later'

This is my favourite, yet most simple idea: Even if they say no to your pitch, it's not a no forever! Even in my relatively short time period being part of a sales focused CS team, it happened many times that I pitched a certain functionality and got a hard no (for very valid reasons), only to get an email a couple months later asking for more information on it. You can ALWAYS take a 'no' and schedule follow ups based on the customer's response/sentiment at the time. This is another tool that outbound sales reps do not get to utilize nearly as much, as the work involved with keeping those communication channels open & consistent is much more difficult. As a CSM, your relationships with your customers are (hopefully) MUCH deeper than they were with the SDRs and those same customers, so by nature they should feel much more comfortable coming back to you with questions/follow ups.

Understand that your priorities ≠ their priorities

When working with existing/established customers, understanding their current priorities are probably one of the most important things you can do when trying to make any upsells. Based on what they currently have going on, you can circle back and try and place it in their customer lifecycle appropriately. It should not matter if it is a personal initiative or a company wide initiative, the customers priorities always trump your priorities. As Edgar puts it: "... time with each customer is the most valuable resource you have", so don't waste it by pushing something that is not currently important for them!

Hypothetically, let's say that after pitching a certain add-on, even to the perfect contacts, they are not extremely engaged and it is clear that there is not sense of urgency from their side, you can assume that they are just not looking for that solution at this time. As I stated earlier, your job here is to document everything you possibly can, and come back to it when the time is right - again, SDRs do NOT have it this way. As a CSM, if you always ask your customers to spend more, or market to them constantly, you are risking tainting the relationship you have worked so hard to build, so don't be that person.

Customer facing product managers

You must understand that in a customer facing role in a SASS organization, every day you have the opportunity to do product discovery work that would otherwise fall on your product manager and their team! This is extremely valuable work that essentially guides the development of your organizations product suite, so don't take it lightly.

Whenever you get a 'no' or any sort of feedback, make sure you document with as much detail as possible what happened, why they said no, and when to re-approach if possible. If they said no because of certain product limitations, you have found yourself in a great product feedback loop, because in general, as long as the customers are already happy with the rest of the service they are being provided with, it is a very low risk/low effort way to get feedback on your products. With new customers however, if you can't promise to build certain things to meet their needs, you could expect to lose that prospect to a competitor very quickly!

Lastly, it is important for you to understand in detail, what the Job-To-Be-Done (JTBD) is for each feature you are trying to sell to your customers. Even if your organization has built a seemingly 'perfect' product, you have to understand that not EVERY customer needs that exact solution - and it is your job (no pun intended) as the CSM to know when this is the case.

If you have not heard of the JTBD framework, click on the toggle to the left to see a funny figure I found in the "What is Jobs to be Done (JTBD)?" article sourced at the end of this post

To visualize my point above, when you try to sell something to a customer that is not looking for that solution you get something like this:


Not very useful, huh?

Use promotional periods

I know I'm not the only one who does this, but I don't think I could even count the amount of times I have gotten a free trial for something and cancelled my subscription before I had to start paying. Fortunately for organizations with CS teams, part of their role is to get customers 'sticky' on these new features before the agreed upon date, so I would imagine that the success rate here vs. tools that I have finessed in my days would be much higher!

Regardless of the product, the implementation time, resources required, etc. Promotional periods greatly reduce friction when selling new features to customers - so make sure to use them!

Here's a snippet of a great infographic from Invesp Consulting that summarizes the difference between selling to existing and prospective customers. I feel confident arguing that free trials are much more successful for existing clients based on the data shown.
Screenshot of an infographic complied & designed by Invesp Consulting
Screenshot of an infographic complied & designed by Invesp Consulting

Use your 'people map'

After having a few conversations with some SDRs, I came to realize how much harder it is for them to weave their way through and find the right contacts for certain items. Fortunately for CSM's, once you have build a rapport/relationship with your point of contact, it is much easier to request for some support on directing you to the appropriate contacts. The ability to grow your 'people map' over time is an invaluable resource that should not be taken lightly when it comes to selling.

'White space' is finite!

White space is the gap between what products or services your customer has invested in, and the other products or services that your company or business has to offer. As you could imagine, SDRs have an infinite pool of white space, since every single prospect they are reaching out to has not adopted any part of the product.

Established customers on the other hand, there is only so much that you could try and sell, as eventually they will be using close to 100% of what your organization has to offer. This brings me back to my earlier points about the product feedback loop & customer priorities - you have to understand that white space is finite and can be re-visited, it is not as go go go as external sales are. Take your time, position things strategically, and white space will diminish.

Wrapping Up

My above ideas are really just scratching the surface on the different variables at play when it comes to selling to existing customers vs. outbound prospects, and I am not attempting to take away from the breadth of work out there on sales and how complex it can actually be. I just wanted to shed some light on how different those two responsibilities are, and how they should each be treated as their own function of a business - you can't expectations to be consistent across both departments.

Thank you if you made it this far, and please don't hesitate to reach out - feedback is always appreciated!


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