Customer-Led Growth Principle Nine: Prioritizing Customer Revenue in the Marketing Funnel
In a ‘do more with less’ world, marketing needs to get even more creative around driving business growth. Here’s how to take your strategy to the next level in this new revenue era.
Is your Marketing team strongly aligned to Sales and net new business? Ideally, Marketing should also be working in lockstep with your Customer Success leader.
Think about it… how do you win new customers with less budget? Customer case studies, word-of-mouth referrals, free community events, customer reference calls, and the list goes on.
The gist of this CLG Principle is: you’re missing out on a fundamental revenue-generating loop if Marketing isn’t prioritizing customer advocacy and growth—especially in today’s bear market.
We all need to grow more efficiently this year—without the massive budgets and funding of the last decade. CLG provides a faster, cheaper, & less risky way to grow your revenue.
- Edward Chiu, Co-Founder & CEO, Catalyst
Changing the marketing growth mindset
As discussed in CLG Principle 1, throwing out the old ‘growth at all costs’ mindset is not easy, nor do we expect it to happen overnight.
However, if history has taught us anything in the last 12 months, we know we must change old habits to survive this next revenue era.
That’s where customer-led growth comes in—and it’s surely going to be the biggest change for teams who’ve been traditionally tasked with prioritizing ‘new business over existing customer growth.’
And let this remain clear: it’s not a one versus the other scenario. What we’re talking about is a reordering of growth priorities to help you strike the most optimal balance for sustainable, long-term recurring revenue.
Forrester’s research shows that surveyed customer-obsessed firms (subscription required) grew 2.5 times faster than non-obsessed ones and retained 2.2 times more customers per year.
Source: Forrester Research
How to take action
Unless you’ve landed yourself in the niche of the Marketing team (Customer Marketing), you’ve likely been hyper-focused on one thing: new business targeting. However, in a ‘do more with less’ world, we can no longer throw dollars away in hopes of growing more demand in the market.
Plus, we know that the probability of selling to an existing customer is 60-70 percent, in comparison to 5 to 20 percent for closing new business. So, let’s start thinking about ways to drive our revenue engine from within the existing base.
Step 1: Proactively Use Customer Insights to Drive the Marketing Funnel
Customer-led growth begins with deeply understanding your ideal customer profile—this insight will in turn shape your outbound marketing strategy.
Marketing needs to be actively involved in full-cycle customer engagement and collecting customer insights that inform their strategy for driving both new business and expansion. These types of programs can include:
Customer Advisory Boards: Collect insights on your customer base and build advocates for case studies, quotes, blogs, webinars, tactical use cases, and other customer-created content.
Win/Loss Deal Interviews: Meet with buyers to understand what they care about and why they did or didn’t buy your solution to share to the organization for improvement across all teams. Ensure you capture win/loss on both net-new and expansion deals.
Case Studies and Stories: Actively monitor accounts for high adoption and partner with CS to provide case study candidates in real-time. Use case studies as both an external campaign story and an internal education tool that demonstrates what customers truly care about.
Step 2: Target Expansion Revenue as a Key Part of the Marketing Funnel
Marketing needs to ensure there’s an optimal mix of activities that support customer adoption and advocacy in addition to programs that drive net-new revenue.
From driving adoption through product launch communications, events, and campaigns to customer community building initiatives; Marketing will not only drive increased expansion revenue but also generate new business more efficiently through the following:
Adoption Events: Partner with Product and Product Marketing on events that drive adoption through the release of new features, educate customers on use cases, present inspiring customer stories, organize best practice roundtables.
Adoption Campaigns: Ensure your campaigns are not just focused on net-new business. What customers are ready for cross-sell? How do you help customers overcome a timely challenge in the market with a new feature? What resources can you share with customers for their ongoing path to advocacy? Marketing campaigns targeted towards customer-generated MQLs can often be your low-hanging fruit for filling up the funnel and hitting your revenue goals.
Product Launches: Ensure product launch communications are targeting your external ICP and also being communicated to drive internal adoption across your customers. Track MQLs on both net-new business and expansion leads, as well as tracking post-launch adoption and churn metrics as additional measures of success.
Step 3: View Customer Advocacy as a Critical Growth Investment
Advocacy initiatives are often an intangible, yet powerful source for driving internal demand and capturing new interest among your ICP.
Community Building: Create events, programs, forums—whatever is feasible—that build brand advocates from within your customer base and your industry. The goodwill generated from community programs will often drive more loyalty amongst your customers, accelerate word-of-mouth marketing, and build lasting impressions that can result in new business.
At Catalyst, we continuously strive towards supporting our beloved Customer Success community as much as we can—and the community has certainly given back to us in return! Numerous leads come to us after attending a Catalyst event or our Annual CS Summit, following our team and company page on LinkedIn, or participating in our ongoing career program, Coaching Corner. We are big believers in the power of community and it should certainly be a top priority in your Customer-Led Growth strategy.
Directly Partner with Customer Success: This truly applies to all Marketing initiatives. Customer Success can be a fantastic partner in helping you gather direct customer insights that shape your pipeline strategy, drive event registrants, identify case study candidates, and build community programs that deliver tangible results.
Develop strong relations with your Customer Success leader and ensure you have dedicated meeting cadence to keep initiatives aligned to customer value and growth.
Empower Customers to Tell Your Story: After all of the great work you’ve put into driving growth from within, be sure to proactively market your biggest customer advocates! Develop customer referral programs, encourage online reviews, partner with customers on webinars, and use social media to amplify their story on your platform.
The New Funnel: Customer Revenue
The power of Customer-Led Growth is undeniable. Leaders, investors and top analysts are advocating for the shift to grow revenue through cheaper, more reliable customer-led initiatives. If you’re reading this as a marketer, we hope you feel inspired and ready to take this important next step in your strategy!
Stories, best practices and thought leadership from the customer success community.