Sales teams are a sturdy bunch. But even the strongest can’t outmuscle a looming recession or economic downturn. The sales network Bravado recently saw 63% of its sellers missing quota. Meanwhile, another survey found that only 43% of sales organizations plan for a recession before it happens.
Sales teams have navigated some challenging times since the pandemic’s onset in 2020, and they’re always looking for ways to course correct. They can start by recognizing that tighter wallets require a tighter sales strategy — even after the close.
Nurturing customer satisfaction is a strong defense against a recession. By monitoring ongoing relationships, engaging with accounts to encourage adoption, and empowering customers to champion your product, sales leaders can protect their team from potential loss and increase customer satisfaction.
Here’s more insight into the crucial three steps sales leaders should follow to spurn the churn and retain customers.
A sales team’s responsibilities don’t end with a closed deal, especially in tech companies with a subscription model. Staying engaged beyond the sale is a best practice that reduces high churn rates and leads to better outcomes. Remember, it’s 5 to 25 times more expensive to acquire new customers than maintain existing ones. Make sure your sellers monitor ongoing relationships and collect customer feedback by paying attention to the following factors.
Customer relationships are a two-way street. They give you business. You give them value and support. Building a strong customer success team can guide that process, with insight into the right levels of long-term engagement and what aspects of the partnership to nurture.
While every customer counts, some likely give more to your organization than others. Make sure you’re placing the right amount of effort with the right customers. Strike a balance between investing in higher-value customers while still caring for lower-value ones. If you find that a low-value customer is taking up more time, look into ways to improve your approach with repeatable processes or resources that can be used for more of your customer base.
An organization is more than the sum of its parts. Fine-tune your in-house relationships to improve a customer’s experience. Can you partner with marketing to include key customers in webinars and other initiatives? Is your sales team aligned with your customer success and other support teams?
Solidifying these bonds can enable smoother closings and renewal agreements. It can also help turn customers into champions. (More on that later!)
Once a sales team gains its bearings in its customer service relationships, it can work on engagement. Because every interaction counts double during an economic downturn, opt for quality interactions over quantity. The exact approach will vary from organization to organization — even customer to customer — but here are some guidelines to make sure that every customer engagement counts.
Sellers should have a Ph.D. in your product’s value proposition. Because when you’re laser-focused and hyper-knowledgeable on what you offer, you won’t waste time explaining features that your customers don’t need — or to people who aren’t going to buy in, for that matter.
Double down on understanding your accounts. Look closely at their challenges, the success they’ve seen using your product, and long-term objectives. Conducting this due diligence allows you to stay agile and respond to any changes caused by an economic downturn. For instance, if leadership changes or a key contact leaves, you can immediately start building the right relationships.
But that’s not the only benefit. When you thoroughly understand your accounts, you’ll be able to identify better customer fit, lowering acquisition costs and reducing churn. You’ll also be able to continue refining your strategy as you engage key accounts.
Having customers buy your product isn’t enough: You need to make sure that they’re using it correctly and gaining all the benefits. When onboarding a new account, your customer success team should closely guide the process. The support shouldn’t stop there — customers should receive ongoing check-ins to encourage thorough adoption. This practice is essential if you’re launching a new feature or expanding your product.
Make sure your teams have access to customer adoption metrics. This data can alert you to important trends, including early signs of renewal or churn. These insights allow you to be proactive and offer customers the support they need for full adoption.
Speaking of being proactive, you can (and should) ask for feedback. Hearing what works for your customers can help you know how to help them use your product. You can also consider offering loyal customers a special rate for adopting any new features.
Loyal customers count for more during a recession. A Statista survey found that 50% of customers are willing to switch to a less expensive brand during a recession. Strong relationships with customers can counteract any hesitations about your business, preventing them from switching to another organization or discontinuing for other reasons.
But building customer loyalty is more than a recession defense tactic. It can also result in customers becoming champions of your product. Here are three different ways that can play out.
If your customers believe in your product as much as you do, they are likely to buy your expanded offerings. Cross-selling or upselling to existing customers has a 60-70% success rate. Instead of only chasing new leads, your sales team can assist with conversations that invite customers to take their business one step further.
Pro tip: Treat this “warm pitch” with the same careful consideration as a cold one. Sellers should thoroughly understand how this new business will benefit the customer.
Customers that spread your gospel are such an asset when business is tight. Referrals convert at about 50 percent. Having a customer advocate for you considerably increases your chances of closing a deal.
Referrals can also open doorways that might otherwise stay closed. If you contact a prospect and name-drop a mutual connection, you’re more likely to receive a reply. Read this article to learn more about the power of referrals in prospecting.
Successful people change jobs every three to five years, with some studies suggesting it’s even more frequent than that. Be sure to keep track of when a customer leaves their organization. Sellers can touch base with that person at their new workplace and ask if they’d like to re-adopt your product. If they loved working with you in the past, they’re likely to say “yes” to doing so again.
We’ll say it again: tighter wallets require a tighter sales strategy. Focusing on B2B customer retention can spurn higher churn rates and guide a SaaS company through the worst of a recession storm. Of course, quality prospecting still counts. LeadIQ offers a plethora of resources for helping sales teams thrive. Check out our website to learn more, or get in touch.