The Upsell That Cost More Than Money: A Customer Success Cautionary Tale
In the world of business, Customer Success Representatives play a crucial role. They’re tasked with helping clients navigate company policies and services while also aiming to increase sales and customer retention. But what happens when these goals conflict? Let’s dive into a real-world example pulled from a similar situation on my team that highlights the importance of understanding client needs before pushing for bigger sales.
The Scenario
Imagine a customer who regularly orders 500 units of a product priced at $5 per unit. They’ve been placing this exact order monthly for over half a year. A Customer Success (CS) Associate notices this pattern and sees an opportunity to upsell.
The CS Associate reaches out to the customer with an enticing offer: orders of 1000+ units qualify for a 10% bulk discount. It seems like a win-win situation, right? The customer agrees, cancels their current order, and places a new order for 1000 units.
When Good Intentions Go Awry
Two weeks later, the customer finds themselves in a tight spot. They urgently need the 500 units they originally ordered, but their new 1000-unit order isn’t scheduled to arrive for another two weeks. Worse yet, they’ve run out of inventory.
What went wrong? The CS Associate failed to communicate a crucial piece of information: the change in lead time for bulk orders. While smaller orders (under 1000 units) are pulled from existing inventory with a lead time of 3 weeks or less, bulk orders of 1000+ units require individual manufacturing, which can take up to 8 weeks.
The Hidden Complexities
Further discussion with the now-unhappy client revealed that the original 500-unit order wasn’t arbitrary. It had been carefully calculated by the initial salesperson to balance the client’s space constraints, time needs, and costs.
Despite the $250 savings on a 1000-unit order, this “deal” actually created more problems than it solved. The client lacked storage space for the larger order and lost the flexibility of rapid shipping from stock.
Key Takeaways
- Understand Before Upselling: CS Agents should fully grasp a client’s needs and business operations before attempting to upsell.
- Clear Communication is Crucial: Clients should have a clear understanding of company policies. Both Sales and CS teams are responsible for educating clients about these policies.
- Leverage CRM Systems: Structured use of Customer Relationship Management (CRM) systems is vital. Detailed information about client management choices should be logged, reportable, and consistently input.
- Balance Flexibility and Policy: While empowering CS Agents to discuss flexible ordering options can be beneficial, established company policies for effective forecasting and usage of recurring purchase orders often work better than creating multiple customer exceptions.
In Conclusion
This case serves as a reminder that in customer success, the goal isn’t just to sell more—it’s to ensure that what we’re selling truly meets the customer’s needs. By taking the time to understand our clients’ situations and communicating clearly about all aspects of a sale, we can avoid costly mistakes and build stronger, more trusting relationships with our customers. As well, sticking to our SoP’s and SLA’s is the best practice, both for the company and the customer. See: Special treatment causes special problems.
~ Brianne Tengwall