The Outcomes Disconnect

The Outcomes Disconnect

In this difficult economic environment, it is more important than ever that suppliers align their offering to the value (outcomes and success metrics) that their customers are looking to achieve. The challenge is customer outcomes vary based on stakeholder and evolve based on market dynamics.  

When outcomes and objectives are garnered from the customer, too often only a few voices (primary contact or supporter) weigh in and are heard by the sales team. The inherent assumption is that the information is complete. But everyone on the customer side may not necessarily be aligned on the outcomes, priorities, and success metrics. To further compound the problem, the customers context and market dynamics are constantly changing. Think about how much your customers context has changed just in the last few months in this market.

Therefore, gaining alignment is a task that must be shouldered by the sales and customer success team with the customer.

Implications of the Outcome Disconnect

The implications of an unhappy customer, particularly in the SaaS model are significant:

•  Over 50% of SaaS/cloud providers experience a 15% churn rate (Pacific Crest )
•  It costs $1.13 on average to acquire $1.00 of ACV from a new customer. Only $0.13 to retain $1.00 ACV renewal (Pacific Crest)
• The probability of selling to a new prospect is only 5-20%. Probability of selling to an existing customer is 60-70% (MarketingMetrics)
• 80% of future revenue will come from only 20% of current SaaS/cloud customers (Gartner/CMO )
•  Average SaaS/cloud provider leaves 15% of additional ACV on the table by not effectively up-selling and cross-selling existing accounts (Pacific Crest)

In short, it is imperative both parties (which includes all key players) mutually align on expectations of success. Experience has shown it is easier if this mismatch is addressed early in the sales process to give the supplier and customer common objectives and ultimately a scorecard for measuring the value delivered after the sale.

At Ecosystems we have built both a robust software platform and thought leadership community to focus on these critical customer value conversations.

I’m excited to share today how a member of our community has now become an app creator on the Ecosystems platform. 

For over two decades Steve Thompson has been a consultant to some of the world’s most progressive IT buyers and sales organizations, helping them establish compelling value together. Steve is one of the founding members of the Ecosystems Customer Value Community and has channeled all of his experience into the design of a new app called Value Alignment. See overview here. 

If you’re interested in leveraging this app with your customers please reach out. Also, if you yourself have developed an interesting framework or way to structure a critical customer value conversation and you’d like to be the next app creator in the Ecosystems platform please send me a note directly.