By Jeremy Gillespie
Sales is incentivized to close deals and customer success is incentivized to keep those customers. It’s pretty straightforward. But what happens when sales is closing the wrong type of deals? Deals that make it hard for customer success to do their job properly? Tension between the teams can arise and finger-pointing ensues. You may have experienced this yourself.
Growing a sales team is no easy task and being a sales rep isn’t either, but to prevent the sales team from over-selling takes practice. In this post, I’m going to cover four ways you can prevent this from happening.
Why This Needs to Be Solved
This is not a new problem, and it’s certainly not easy to solve, but the reality is - this is bad for the company. To start, it’s generally unprofitable. Of course you capture the initial revenue from the customer, but once sales commission is paid, the client is on-boarded, and time is spent on management you break even at best. However, the biggest cost is the opportunity cost to the company. Precious time and energy is spent focusing on customers who are going to quickly churn, while your best customers could have been getting the white glove treatment.
In addition, allowing this to go on reinforces bad habits. Sales reps who get by on misrepresenting the product, or continually using massive discounts to get sales on the board will continue to do so as long as it goes unnoticed or unchecked.
Lastly, it’s the customer who loses the most. They have purchased a solution and invested time and resources in it, when it ultimately won’t be a good fit for them. You lose the customer’s trust, eliminating any chance to expand the relationship. This can have ripple effect on your reputation in the market. So let’s discuss some ways you can prevent this.
4 Ways To Prevent Sales From Selling Bad Deals
Below are the four ways to prevent this. While there are other tactics you can use, I would suggest starting here.
1. Sales training
This is the number one way to prevent bad deals. Sales training is vitally important not only to get reps to meet quota, but to make sure they’re representing the product correctly. In addition to training, I would suggest you create an internal FAQ for reps to reference during their calls to drive accuracy and consistency.
2. Record & Review
There are a number of tools on the market, which let you record sales calls. Use them. Make it a habit to review calls on a monthly basis, especially while new reps are getting ramped up. By recording calls you have a way to continually educate and coach reps so they can optimize their message and prevent mistakes.
3. Customer Success Approval
With larger sales opportunities, it’s a good idea to loop in customer success toward the end of the sales cycle. This allows sales and success can go over the requirements from the prospect to ensure your product can fulfill their needs. Some success teams even have veto power over deals (although they need to use it carefully!)
Institute a commission clawback for customers who churn quickly. Clawbacks can be a little tricky, so do your best to make it as fair as possible and only apply it to deals where the customers has been misguided. Doing so will keep retention in the minds of your sales reps. If you prefer the carrot to the stick, try offering the sales team a bonus based on year one retention.
Just as the marketing and sales teams will always have some level of tension, so will sales and customer success. These tactics will align the teams on a common goal, which will help improve the relationship between the teams, as well as churn.
Need to learn more about how sales and customer success can work together better in your organization? The Success League is a customer success consulting firm that offers a CSM Certification Program that includes selling-focused classes like Uncovering Opportunities and Managing a Selling Cycle. For more information on these classes and workshops, please visit TheSuccessLeague.io
Jeremy Gillespie - Jeremy is a growth marketing expert who loves using complex data to build creative retention solutions. He is a founding advisor to The Success League, and is also the founder of Built to Scale, a consulting firm focused developing customer acquisition and retention programs. He holds a BA from the University of Pittsburgh and MBA from Point Park University. He's a proud former Pittsburgher, currently living in San Francisco.