Sep 22, 2017

Read Time 4 min

Stop Acquiring Bad Fit Customers, Customer Health Webinar, and Building a Playbook


When I was younger I booked a hotel room down in the Outer Banks of North Carolina for a long weekend. I envisioned looking out into the ocean while sipping my coffee and disconnecting for a bit. I booked a room with an ocean view and was super excited about it.

Unfortunately, I didn’t know “ocean view” meant I would need to lean over the railing to even get a glimpse of the ocean itself. What a letdown.

When you bring on a bad fit customer, you’re essentially setting them up with an ocean view experience. They may have glimpses of how they can be successful but ultimately, they won’t achieve their goals and will be rightfully disappointed.

What are the exact impacts of selling that wrong-fit customer? Let’s discuss them below and we’ll give you some ideas for making sure you avoid this moving forward.

You’re Driving up Costs

According to a study conducted by SurveyAnyplace, the average Cost per Lead for a technology company was around $45. The actual cost per customer acquisition is much higher – hitting $5,000+ per customer. (Source)

By focusing on these bad fit customers you’re only wasting precious time and human capital that could be spent on customers that are going to contribute a better overall Lifetime Value (LTV) and will hopefully evolve into advocates for your company.

Instead, make it OK to pass on a $45 lead and disqualify them instead of heading down a long and dark road that will ultimately lead to disappointment for both you and your customer.

You’re Losing Trust

Your customer trusted that you were acting in their best interest when you walked them through the purchasing journey. They had specific goals and even likely had to sell the solution internally – putting their recommendation and word behind the resources that you’ve supplied to them.

If this customer comes onboard and they don’t achieve those goals then they may immediately feel as though they’ve been duped. Their reputation may even be on the line. While it is up to use to make sure that we’ve set the proper expectations with our customer, it’s possible that the sale was simply misaligned. Of course we can head this off by making sure we have a proper transition from Sales to Customer Success. 

Take the opportunity here to make it right. If you offer something comparable that will help them meet their goals – you should feel empowered to make the shift to the solution that may be a better fit without the customer having to sacrifice extra dollars or invest a drastic amount of time into the switch. Then and only then can we begin rebuilding the relationship with our customer.

Your Reputation is on the Line

Gone are the days that we see sales people providing all the resources that a customer needs to make an informed decision. In fact, only 3% of people say they trust sales and marketing professionals. Now what they are doing is conducting their research via sites like G2Crowd, asking friends and colleagues for referrals, and are heavily influenced by word of mouth.

If your customer has a bad experience, according to research conducted by Dimensional Research and sponsored by ZenDesk,  95% of respondents that had a bad experience told someone about it. So now not only is this customer gone – they’ve influenced potentially hundreds of other potential good-fit customers in their buying decision.

This presents a massive problem when customers go to search for reviews on your solution, talked to their trusted colleagues at an industry event, or simply ask for references. Make sure that the impact of this bad-fit customer is understood by Sales, Marketing, and the rest of the organization.

So as we charge forward, let’s be honest about our ability to deliver with your customers and don’t offer confusing language like “ocean view” – it will just turn them away. The best advice I heard from my father at a young age was to, “Do the Right Thing” always and I feel this is applicable both to acquiring a new customer and servicing them as a paying customer. By acquiring the right-fit customer instead of a bad-fit customer – you’re able to keep costs low, manage your reputation, and make sure you maintain the trust of your customers – leading your organization to much faster and sustainable growth.

Want to get alerted when a customer is not meeting the goals you’ve set together? Customer Success software and the team at ChurnZero can help!

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Customer Health Scoring: The Why and How

Want to learn about Customer Health Scores, what they are, their goals, and how to create them?
Join Mikael Blaisdell from the Customer Success Association and Abby Hammer from ChurnZero for an infomrtive webinar that goes into the nitty gritty of the Why and How of customer health scores.

This is for both new and veteran Customer Success professionals.

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