The Power of Sales Renewals, Upsells, and a 360 Degree View Featuring Stuart Balcombe

All right, well, hub heroes, here we are for a sidekick strategy. I'm super excited. I hope you're excited. If you are excited and you can hear what we're saying, put in the chat pane. Let's go. Because it is time to go. Today we are talking about the power. Of course we want all of you hub heroes to have the power. Power of sales, renewals, up sales and a 360 degree view. Now, Stuart, you're going to explain more of what all of those words mean as we kind of move forward. But ladies and gentlemen, just so you know, I'm not al. That would be boring. We have Stuart here today who is the head of growth at Arrows, the collaborative customer onboarding tool built for HubSpot, as well as the creator of the popular. If you haven't seen it, you should steal this workflow series for the HubSpot community on LinkedIn. And he spent the past eight years helping early stage software companies grow by focusing on their customers. And today he's one of the hub heroes and he's on Sidekick strategies. So, Stuart, how the heck are you today?

I am doing great. Thank you so much for having me. Super excited to dive into this.

Yeah, I think it'll be a ton of fun, for sure. So today again, we are talking about the power of sales, renewals, up sales and a 360 degree view. So let's get in to the good stuff. I'm going to ask the first question, Stuart, to kind of kick us off here. And that is I like the level set a little bit. So can you explain the importance of sales, renewals, up sales and customer retention for businesses, particularly regarding revenue growth and long term success? Because I see so many folks out there that are trying to just get new people in the front door. I want to have this conversation first. So what do you have for us?

We see that a ton all the time too, right? Everybody's focused on new customer acquisition, everybody's focused on closing that deal, celebrating that big initial sale, and then there's this big question mark about what comes next. So often onboarding is an afterthought. The renewal process itself, when you're coming up to that renewal date, is an afterthought. And it's just sort of a wing and a prayer that customers actually renew. And if you're in a recurring revenue business, you need renewals and expansion because you are probably spending a ton of money to acquire customers because the model sort of expects that they'll stick around for two, three, four, five years. Right? So if you're not actually building a process, if you're not actually investing in making that customer successful, I think this is something that's really come into focus, you know, this year, maybe last year a little bit, as well as sort of the economic situation. But, like, you have to be focused on retention. Customers have more options than ever. They're more conscious of their budget and where they're spending their resources than ever. And if you're not only building a strategy, but building a proactive strategy that isn't just, oh, we saw you didn't renew. Do you want to come back? If you're not getting ahead of that, then you're sort of already behind and you're ultimately impacting your own growth. Right. Not only are you losing customers, you'd never have the opportunity to expand those customers either. So that's sort of the. In a nutshell. See, so many companies or so many folks who aren't making it a priority focused on a new customer acquisition. And it's not just the lost revenue, it's the, the opportunity cost of the customers that you lose, not expanding as well.

Yeah, such a good foundational piece there. And hub heroes, by the way, you heard it here first. A wing and a prayer is not a valid sales and marketing strategy. So you can't do that now. Stuart, that being understood that we have to kind of move in this direction if we haven't thus far. What are some mindsets that, you know, marketers and businesses have when approaching renewals up sales and customer attention? Like, how does this mindset differ from acquiring new customers? Because it really is kind of these two different pillars or two different conversations. So talk to us about the mindset of making this shift and what you need to be thinking about.

Yeah, for sure. One thing that we always say is the retention starts on day one. Retention isn't, you know, doesn't start to come into play when you have that renewal date coming up in the next 30 days. Right. Retention starts really from a customer's very first interaction with a brand. And I think that that is maybe a little counterintuitive for folks who are traditionally in sales and marketing that are thinking about that initial sale first. And, you know, how do we win this customer? The things that you do to win the customer are really going to ultimately impact your ability to retain and expand that customer. Right. If you're setting expectations that you're not able to meet, you're just setting yourself up for failure when it comes to retention. So I think everything that you're doing.

Businesses should track to meas the success of their renewal and upsell efforts because I think that's half the battle when it comes to reporting is you just don't know what you don't know. And if you can learn that, then you can implement it in a report or a dashboard and actually be able to measure that success. So where does your brain go with that?

Yeah, there's a couple of things. The very first one, and I think the thing that is actually pretty easy to measure this is a similar to the retention stats on day one. We're going to talk a lot about renewals and expansions and not really talk about the renewal moment or the, you know, the expansion moment. Everything is earlier in the journey. The first thing to look at is how quickly after somebody says I want to become a customer or I've become a customer, like you've signed the agreement, you've paid, whatever, how quickly do you get them to that next thing? How quickly can they engage? Can they start making progress towards that goal? For some folks that's going to be scheduling a kickoff call. For some folks it's going to be if you're a self serve software program, it might be like and you're a project management tool, let's say like you're creating your first project in the tool. Like how quickly after they say yes, I'm going to become a customer, do they do that first thing? That's sort of the leading indicator if you're looking for anything to look at. There's some great data from ChurnRx on the impact of sort of speed to engagement, post sale and retention. They have hundreds of thousands of companies in their data set. The graph is staggering. To sort of paraphrase, customers that engage in the first 10 days versus don't are 70% more likely to be around at year four than those who don't engage early. So that's the sort of, the first thing to look at is how quickly after you close a deal are people engaging with the next thing they need to go do. And then after that when it comes to measuring, it's sort of on the, I guess onboarding sort of activation side. But when it comes to the marketing side, I think this is always a question that you get right. It's like, well if we're not doing direct response, how do we know it's working? How do we know that we're having the impact that we want to have? And I think ultimately the closer you can tie the work that you're doing to the, the Big outcome that you want, how do you get it as close to revenue as possible. And maybe that isn't actually dollars because there's some steps in between. But how much qualified pipeline are you generating, for example, from marketing efforts versus we're just generating email addresses that we don't actually know where they go. Are you generating qualified pipeline? And then importantly but separate is making sure that you're keeping track of the alignment between who you're closing on day one and who renews. The easiest way to have a really hard time in retention is to close deals all over the map and actually not have that many deals that are a great fit for your product. It's a trap. Especially working with early stage startups I see all the time is early on, you want customers so you sort of say yes to everybody and you end up building a more bloated product. You have less control or less clarity on which problems you should be solving, how you should be speaking to those customers. So keeping track of what are the customers you're closing on day one trying to do. And of that group, are there patterns in who is renewing versus who isn't? One thing that I will say is that not all churn is bad. You should probably be churning some customers and that's totally okay as long as you know those are customers who just weren't a great fit. We weren't able to help them in the way that we would have wanted to and instead we're going to focus on the ones that are really a great fit. A little rambly, but those are sort of the three things that I would focus on, I guess to put them in order. One, measure marketing by something that is as close to revenue as possible. Make sure that you're not just doing things in silos. Two, track sort of time from close to first engagement and then three, make sure that you're sort of mapping the deals you're closing on day one or who are the customers that are continuing to renew and expand versus those that aren't. And this will build that feedback loop.

Very good. And hub heroes, I need you to get your pen, your paper, whatever you use to take notes. I feel like that needs to be a moment where you write something down is all. Churn is not bad. Knowing who you're a good fit for, who you're not a good fit for, and, and using that data, understanding those patterns, because Stuart, you mentioned that word too in that segment is patterns. And then being able to make smart decisions based off of seeing those patterns and having that Knowledge is super key as you move forward. So, Stuart, here's the thing. People are watching or listening to this episode. By the way. If you're listening to it, it's because you're listening to it on your favorite podcast app. If you're watching it, it's because you've headed over to community hub heroes.com and you've actually created an account and you're watching it along with all the other interviews that we've done on the sidekick strategies. But here's the thing, Stuart. They're gonna be watching this. They're gonna be, yes, we need to plug in everything that Stuart's talking about. We need to focus on renewals, we need to focus on upsells, we need to focus on the beginning customer, you know, onboarding and journey and the measuring. But unfortunately, Stuart, there's going to be challenges and roadblocks that are going to come up along the way. So let's address some of those. What are some of the common challenges or roadblocks businesses may face regarding building a renewal, upsell and customer retention process? And, and can these challenges be overcome? Like, are there a way that today we can give them some words that are like, and if you know, you can do this and miss that big bump in the road, for sure.

And this is why I think it's great that we're talking to, you know, the Hub Heroes community, the folks who are familiar with HubSpot, using HubSpot all the time. Because HubSpot is a great place to be doing this, and here's why. The number one thing that will kill retention that will hurt your ability to help customers post sale is siloing teams, teams not talking to each other. There's always going to be handoffs that have to happen, right? Marketing to sales, sales to onboarding, onboarding to success. Whatever it is, there are always going to be handoffs. If those teams are not talking, the customer is going to feel it. Maybe they just feel it as like, oh, that was a little weird. Like there wasn't. I had to wait a little bit to get the next thing that I need to go do. Or maybe they had to repeat themselves after they'd already told somebody their challenges what they're trying to do and then they have to go repeat it. Or maybe it was something more catastrophic than that and they were told by one team something that just isn't possible when they talk to another team. Right? So first thing is you have to have interdepartment. Even if you small company, even if you don't have big formal departments, everybody involved in the customer journey has to talk and has to build a feedback loop across those handoffs. And this is where HubSpot's so great is unlike a lot of other tools and HubSpot to a certain extent has focused in a very specific area. Started as a marketing and sales tool for sure. But we know that HubSpot's narrative to be the connected platform. We know that having everything in one place, having your data connected, having all your teams connected across the customer journey is a really great way to start breaking down some of those silos, start to introduce more collaboration between teams. So tactically that's going to be the biggest bottleneck is teams not talking, not building feedback loops between them. So tactically, how can you bring more of your process, more of the lifecycle into HubSpot, give everybody context on what's happen. Clearest way that we think about doing that is building Separate pipelines in HubSpot are a great place to go build a process and define what needs to happen. Define a journey, having discrete pipelines for each stage in the customer journey. So you probably already have one for sales if you have a hands on onboarding or implementation pipeline, whether it's in deals or tickets, but having pipelines for each stage so that you can take a record from one place with all the data, you can require the data that is needed for that next step in the journey and validate that it's there. And if it's not, if something happens, you have everything in one place. Having data makes it much easier to start a conversation rather than it being like, well, sales did this and this customer churned and onboarding, your success is mad and they're mad at sales, that's not very helpful. But if you are able to say these are the specific reasons this is what we knew, this is what was said in sales and this is what happened. That becomes a much easier conversation to have. And ultimately it's sort of not about trying to point fingers and assign blame to teams, but how do you come together and solve for the customer? Because ultimately that's the thing that's going to have the long term impact on retention.

I love this so much. First of all, we're kind of bouncing into like this rev ops mindset of like across the board with HubSpot. But also to hear you say data helps you start a conversation. I might even add in there an educated and productive conversation, as you were kind of alluding there. And data is so key, it's so important and many Times we look at it from an external perspective of what can we gather versus like what can we gleam as an internal team. So one of the things we talked about kind of the potholes, you know, the hurdles, the challenges that get in the way. And so let's shine a light on what success looks like. So Stuart, can you share any success stories or examples of businesses implementing effective strategies for renewals, upsells and customer retention that you've seen or worked with the.

Biggest one, because it's usually the biggest friction point and the one that Arrows as a product has the sort of biggest direct impact on really is that time from sales handoff or sales close to sort of engagement and customer progress during onboarding. And we've really seen. So we have some case studies on the Arrows website about companies that have by defining that process, more in that data in HubSpot, by sort of just building a defined process and sort of being prescriptive, but being prescriptive about this is how these teams are going to work together. This is going to be the experience for the customer and then using arrows to sort of enable the customer. We've seen teams cut onboarding times from sort of 30 to 45 days to three days. The bar for improving onboarding is frankly not very high. Usually the reasons why you're onboarding or implementation, which ultimately is a great indicator of what your retention and expansion is going to look like, the reason that those times that that engagement is so low is because you're getting in the way of customers, because you don't have a defined process, because you don't have the data flowing in the way that you need it for everybody to know what's next, to know what to go do. So we've certainly seen some pretty wild improvements. The best documented example is actually another HubSpot partner, RBP Ribbon Business Partners went from a pretty manual process that was really difficult to scale. It was really overwhelming and sort of burning out the team to something that better defined, uses the data enabling customers with arrows cut it from 30 to 45 days to 2 to 3 in some cases. So it's pretty amazing what you can do. And ultimately, like I say, doesn't usually mean ripping it up and starting over. It usually just means being more intentional, better defining what you're trying to do and keeping everything organized. And, and HubSpot and arrows, if you want to enable the customer as well, love it.

Rbp Adam and team, we see you love hearing your name on the show for sure. So Stuart, if you're in the marketing circles, I mean, you can only stand there for all of about 35 seconds, and somebody's gonna spit out the word personalization or somebody's gonna say something about target marketing. I mean, it just happens. So I'm curious with what we're talking about now, today's subject. What role does personalization and, and. And target marketing play in driving more renewals, upsells, and customer retention, if any?

I mean, I think it's huge, but I just think it's different than the way that most people look at it. And what I mean by that is, ultimately, customers are coming to you to achieve an outcome. The outcome that they want to get to is going to be, you know, rooted in their own context and their own business, their own goals. So making sure that your customers are actually achieving that outcome is critical. That has to happen to drive retention and expansion. The thing that often gets missed is that it can be a lot of the discussion around personalization. It's hard to be in the discussion around personalization without somebody bringing up Personas, how you're building customer segments. And I think the most common thing that I see that I would push back on is that often those are built around, you know, demographic information, like size of company or role, even where is this company located, like, number of employees, that kind of stuff. And the thing that that misses is that that has zero connection to outcome. Right? It might have some correlation those customers want to want to achieve. Like maybe you can look at patterns and say, well, typically companies of this size are trying to do this. It also might not. So I think that a better way to think about personalization is using jobs to be done and really try to understand what is the thing that this company or this customer is trying to achieve. And I think the thing that is so easy to miss and does require some thought, it certainly requires some resources to do well, is not everybody at the same company the same account is going to have the same job to be done. An example of this is arrows is a good example of this. Actually. We. I can't believe I'm going to do this, but I'm going to use Personas. We still speak to three different Personas who have very different jobs, right? We talk to onboarding reps and CSMs who are working directly with the customers who are responsible for getting that customer to success, for onboarding them. And they care a lot about what is my daily workflow, how efficient am I at getting my job done? How can I not be burnt out trying to serve the number of customers that I'm expected to serve. We speak to rev ops and ops folks who are not to be a derogatory. They don't really care about the day to day. They know that they want the day to day to be better for their CSMs, but they really care about the data and the system and the ability to automate and remove work and make sure they have data that is up to date and accurate in HubSpot. Right. And then finally we have the leader who doesn't care so much about either of those things but wants reporting, wants to know that the thing they're spending money on is doing what they expect it to do. Hopefully the examples are helpful to sort of frame. Yes, you're going to to a certain extent have to define demographics or characteristics but ultimately the thing to create content around the thing to make sure that you're enabling and onboarding that you're first off understanding as you're talking to customers is what is the job that they are hiring my product to go do?

Yeah. And if you're watching or listening this and you haven't researched the jobs to be done methodology, there's books put out there now it's, there's. But there's an original resource that you can look up and fine, we'll try to have that in the actual show notes for this episode as well. So Stuart, let's kind of turn the ship for a second because we as humans we even talked earlier what's in it for me? And we're super all about most of the times like and how do I make it happen right now? Well sometimes some of this stuff isn't right now stuff. So when we sit back and we put the different cap on what are the long term benefits of focusing on renewals, upsells and customer retention for businesses? Like how does it impact their overall growth and profitability? Not in an instant, but over time.

Yeah, for sure. And I think this is really the best, the best way to look at retention and renewals is is what is the long term impact to give? I guess to give the the sort of first thing that folks are maybe already measuring is you're going to better offset your cost of acquisition. Right. If you are spending X dollars to acquire a new customer today and they they renew, you're only offsetting the amount you spent with their first year spend. If they stay around for year two, you are offsetting it with year two as well. And so that's ultimately especially when it comes to profitability is how effectively are you offsetting the cost of acquiring a customer by having them renew and continue to spend money. Secondly, if customers aren't renewing they're and certainly if they're probably more likely to be doing this if they're expanding but they're also not referring you which is by far the cheapest way to acquire new customers. You didn't do anything to get this new customer. You made somebody who was an existing customer happy, successful, they got a great outcome and brought you a new customer. You're instantly winning in that scenario. Right? So I think that those are sort of the two obvious ones. You're not offsetting CAC if you're not retaining expanding customers and you're missing out on that sort of easy win growth engine of of referrals when you are because there's sort of this implicit connection in there that if you are renewing and expanding customers they are being successful more likely to refer than somebody who isn't. And I think that that's certainly something that at Arrows we look at a lot is sort of our I'm sure we can link to the resource in the show notes but the burn multiple how efficient are we being with our burn against what we're generating from that burn all very well to spend a ton of money upfront or grow quickly, but if you're not growing efficiently, you're ultimately not going to be sustainable for the long term. And you can't go and invest in the things that you need to invest in later if you are cash strapped because you are spending it all on acquisition. And why I love that you frame this question this way is that retention and expansion really is taking that long term approach. Maybe it does. It might even mean we're closing less customers or we're trying to close less customers today because we're saying no to the ones who aren't a great fit. Right. Or we're not doing things that might have short term impact. A little more questionable when it comes to will those customers stick around. But in the long term the biggest lever that you have, especially in a recurring revenue business is expansion and referral because it's much much cheaper than new customer acquisition.

Yeah, there's a pro tip right there. It's much cheaper. Notice there was too muches. The other thing that I'll throw in here that I love about this is you mentioned referrals and hub heroes. Trust me, as soon as I heard that I'm like we need an episode on referrals and how to manage a process around referrals and does that equal HubSpot, is there other tools? We'll talk about that in the future because today we're talking about all sorts of fun stuff as renewals and upsells and retention. And so Stuart, earlier you mentioned HubSpot. It might be that you dive deeper into HubSpot and actually how we might be able to build some type of system or there might be other tools. I'm just going to ask the question people, are there any specific tools or technologies that can aid businesses, the hub heroes that are watching this or listening to it in managing their renewals, upsells and customer retention efforts?

There's plenty of customer success platforms, there's plenty of tools out there. I think that the more you can keep things in one place, the more that you can build the system in the place your teams are already using, the more effective or the easier time you're going to have of ensuring that sort of cross team collaboration. So certainly when it comes to managing renewals and if you go and check out arrows to vault, we have, and I'm sure I can provide the direct link as well, we have sort of a system for building renewals and expansion process in HubSpot. My view is keep everything together as much as possible because the thing that as soon as you introduce other tools and you likely are going to want to use some other tools in here and push data into HubSpot. I'm going to call out Zebra from happily here. If you are using Stripe for billing, it's a great way to get your recurring revenue data from stripe into into HubSpot. But the more you can consolidate things in one place, the easier time you're going to have. I would say you're probably going to want to use sales Hub for renewals and expansion because you're going to have revenue associated with those deals. But certainly post sale, whether it's onboarding, implementation, ongoing success, certainly service Hub in pipelines can support that pretty well. But yeah, keeping everything together in one place is just going to make it so much easier because I think the thing that folks miss when it comes to the trade offs, when it comes to integrations is it's not just about the data that's flowing. And obviously having it in one place means the data is flowing. You really lose the team visibility into what's happening into the context of the rest of the customer journey as soon as you split those things out. Let's say that you're implementing a customer success platform. Sure, maybe you're integrating that data back to HubSpot, but are you Integrating every conversation. Can a sales rep just go look at what's happened with a customer in previous conversations? Because they're almost certainly not getting seats in a CS platform. I would certainly look at the more you can do do in in HubSpot from a sort of process perspective and then pull in any data for, you know, billing and payments. Using tools like zebras is great as well.

Yeah, such a good piece. They're keeping it all together. And by the way, if you're listening to this on the podcast feed, I want to reference what just happened because you as a listener need to know we had a comment in the chat pane because, yes, we're doing these episodes live, which gives people the ability to make statements or ask questions. And so when Stuart Referen referenced the service hub and when you would use that versus the sales hub, it was directly to a real human being that was interacting with the show. And yes, that could be you again. If you head over to community.hubheroes.com you can sign up and you can actually watch these episodes live and ask your own questions as well. Now I'm gonna end Stuart this way as we kind of land the plane. If there was one thing that the viewers or listeners take away from today's session, what is that hashtag? One thing that you hope they take away.

It's tough to get it to one thing. I really think that I would come back to retention stats on day one. I think that that is the sort of the drumbeat of everything that you need to do to be proactive about retention. Right. Retention is not just a customer success and sort of churn avoidance problem. Retention is a sales problem when it comes to setting correct expectations, aligning on what is actually going to what a. What the product can actually do. But what is that experience going to be like after the sale? It's a marketing problem when it comes to being clear in marketing about how things work, how easy is it to get set up, handling objections that are going to come up later, helping to identify and attract folks who are actually going to be a good fit for the product or service. Right. And I think retention starts on day one is sort of a nice way to sort of encapsulate all of that and help make it clear that retention is a, is a full team, but full journey activity.

Full team and full journey. Which by the way, means you might have some additional questions. Stuart, if people have questions on renewals, upsells retention, where do you want to send them so they can start a conversation with you?

Yeah, for sure, LinkedIn is probably the best place to come find me. I posted on LinkedIn but feel free to DM me. ConnectionDM is always appreciated. Happy to answer any questions there and I called it out. I'm sure we'll put it in the show notes but arrows to if you're looking for a sort of onboarding activation tool built for HubSpot and then we have the Vault as Well, which has 50 plus at this point templates, resources, including a big walkthrough of setting up a system for renewals and expansion in HubSpot as well.

And Hub Heroes. Don't you worry. Any links that Stuart shares, we'll make sure they're in the show notes so that you have valuable resources and we can help you live a better life pertaining to renewals and upsells. Remember if you're listening to this hey, well, we'll see you when we release the next episode. But if you want to dive deeper in between now and the next episode, make sure you head over to the community, sign up for your account. We're here creating all sorts of content for you as a HubSpot user. Stuart, thank you for the time that you spent with us, the value that you added, and again, Hub Heroes, make sure you reach out and give Stuart some big applause. Thumbs up on LinkedIn until next time. Remember to be a happy, helpful, humble human and we'll see you in the next episode of the Hub Heroes Sidekick Strategy Show.

Thanks so much for having me.

You bet.