The SaaS Debate: Who Owns the Renewal and Upsell? Customer Success vs. Sales
Whether Customer Success or Sales should own the renewal, expansion, and upsell is a hot-button issue in today’s SaaS sphere. As such, we decided to tap industry experts for a verbal duel on the subject where the winners take home the esteemed (and priceless) prize of bragging rights and SaaS street cred.
This Customer Success showdown, which took the form of an Oxford-style debate, was held at BIG RYG, ChurnZero’s annual Customer Success conference. (You can watch all the recorded sessions from the conference for free and with no form-fill required – after you finish reading this article, of course).
As an Oxford-style debate, the audience was polled on their resolution stance both before and after the debate. The side that convinces the most participants to change their initial vote wins.
The pre-debate audience poll revealed a strong majority with 63% of participants voting for the motion (affirming that Customer Success should own the renewal). That was followed by the undecided (24%) leaving only 13% of participants who voted against the motion (believing that Sales should own the renewal).
Now before we jump into the debate, stop to take note of your own vote (absent of these poll results). Are you steadfast in your renewal convictions or do you believe you can be swayed with a new perspective? Maybe you’ve always been unsure of who should take ownership and seek a deeper understanding of each side’s case.
Whatever your mindset, it’s time you read on to find out where you truly stand.
The Debate Synopsis
To give you the cliffs notes version of what lies ahead, here’s a snapshot of how it all went down.
ChurnZero CEO You Mon Tsang moderated the debate which featured two teams arguing for and against the most discussed topic in Customer Success today.
In one corner, arguing for the resolution (Customer Success should own the business relationship) was Grubhub Director of Client Success Kassie Anderson and TaskRay VP of Customer Success and Sales Mike Davis. Their main arguments include:
- Humans are wired for reciprocity and Customer Success is best suited to make deposits and withdrawals from the “relationship account”
- Customer relationships offer the clearest view into the value created by the product
- Removing Customer Success from business conversations leads to a poor customer experience
- Coordinating account and customer hand offs become problematic
On the other side of the virtual ring, arguing against the resolution (Sales should own the business relationship) was 15Five Director of Customer Success Amanda Ingraham and iContact VP of Client Services Shawna Vandenheuvel. Their main arguments include:
- The job skills needed to work with a customer across the lifecycle (including adoption, relationship building, and renewal/expansion) significantly differ
- Customer Success Managers (CSMs) who possess the full spectrum of skills required to own the business relationship in its entirety are “unicorns” and there aren’t many roaming around
- Scaling organizations need to have Customer Success focused on their core competencies to create the best customer experience and optimal business path
- Partnering Customer Success and Sales builds a family of people focused on your customers’ success – not a single point of contact (or failure)
If you don’t fully understand these cases yet, that’s OK. We’ll dive into each in the next section where we get into the juicy arguments from each side.
The Customer Success Showdown: An Oxford-Style Debate
For the resolution (Customer Success should own the renewal)
Argument #1: Respect the rule of reciprocity
In Mike’s opening remarks, he explains how the rule of reciprocity guides us as humans in every interaction. Put simply, reciprocity is the social norm of responding to a positive action with another positive action – or as prominent sales trainer John Barrows frames it: “gives and gets.”
But Mike prefers to think of this social psychology concept as a balanced checkbook. He explains that all deposits and withdrawals (or “gives and gets”) are not created equal. (This we know all too well from the friend who rewards our back-breaking labor of helping them move an entire house with a pizza and/or six-pack.)
When applied to Customer Success, Mike says removing a price increase and getting a 5-star G2 review strike the right balance of a give and a get. He adds that every customer is a separate account that we’re hard-wired to balance.
Mike says that customer goodwill is built over time and Customer Success, by nature, makes regular deposits in the customer relationship. Their ongoing customer investment uniquely positions them to make withdrawal requests while still driving meaningful and profitable performance.
Following the rule of reciprocity allows you to use societal norms to your advantage and balance your checkbook with every customer. Mike concludes: “As the token sales guy in the debate, it’s not about ABC (always be closing) – it’s about ABB (always be balancing).”
To operationalize the “gives and gets” framework, Mike recommends brainstorming a list of the desired actions you want from customers and a list of desired actions your customers want from you. Then, force-rank the lists from the easiest to hardest and least valuable to most valuable. This creates a loose framework to help you balance your checkbook.
Argument #2: Don’t reinvent the car buying experience
Those in favor of Sales owning the business relationship often believe that money and strategy conversations should kept separate – and that asking for the renewal or negotiating discounts taints the relationship.
But Mike believes they’re intertwined.
He counters the belief that a company extracts more value when a trained salesperson owns the relationship: “This is very Art of War, and that’s coming from a Sales leader. It’s also ‘short-term greedy.’ If your values are aligned to Customer Success, be ‘long-term greedy’ and truly align to the customer.”
To help illustrate this point, Mike uses a familiar anecdote of the dreaded car buying experience: “Imagine you’re in a car dealership. The sales rep you work with finds the perfect car that meets your goals. It’s actually a different car than you originally came in wanting to purchase. But inevitably the price is higher than you want to pay. Enter the Sales Manager. They sit down and start scribbling down payments and interest rates in a two-by-two square. How does that make you feel? Why would we replicate that awful and uncomfortable experience we have in the B2C world with our B2B buyers? Bringing in the ‘closer’ that doesn’t have balanced goodwill built up muddies the relationship.”
Argument #3: Renewal separation dehumanizes the customer relationship
Customer Success is all about human behavior. Kassie explains that despite our discipline’s data and technology evolution, we still spend significant time trying to tap into the human element – citing examples such as:
- Seeking out what success feels like to the stakeholder and soliciting candid feedback
- Analyzing usage patterns that indicate risk or opportunity
- Fighting entropy to keep the customer focused on product value through human engagement
When we reflect on the idea of Customer Success passing off a renewal to Sales, Kassie challenges: “What exactly is being sold?”
She explains that renewal and expansion are directly linked to a customer’s realized value during your relationship: “Renewal is them telling you ‘I want to keep seeing this,’ and expansion is them saying ‘I want to see more of this.’”
Kassie says that concerns about a CSM’s objectivity and negotiation abilities are unfair: “Bringing in a ‘ringer’ from Sales makes the process awkward and undermines the CSM and how far we’ve come as a discipline. We aim to humanize the relationship, but don’t confuse us with the old-handshake, slap-on-the-back relationship management approach.”
At Grubhub, she says they seek out Customer Success talent with skills like business acumen, executive presence, book-of-business ownership, and negotiation.
Kassie concludes that renewal and expansion are not checklist items or stand-alone events that should be handed off: “They’re a part of the customer journey. Sales owning the functions in lieu of Customer Success does a disservice to your clients and your CSMs.”
To handle renewal and expansion more effectively, Kassie recommends acknowledging success and opportunities on both sides – customer and company – by making the conversations both back-looking and forward-facing. Together, plan what the next renewal cycle or addition will look like to continue strengthening the partnership.
Against the resolution (Sales should own the renewal)
Argument #1: Focus on the journey, not the destination
With renewals being a product of strong adoption, Amanda argues that Customer Success should focus their efforts on what leads to the renewal, instead of starting at the end and looking backwards.
“Customer Success handling renewals changes the focus to the renewal event, which puts the cart before the horse,” says Amanda. “Keep your CSM’s eye on the ball of adoption or risk playing the resell game over and over again. CSMs who don’t handle renewals focus on the here and now. It’s just natural that when you put someone’s comp and targets at the end, that’s where they’re going to focus.”
She acknowledges that Customer Success exists to retain the customer but says that retention happens in the space between signatures.
“When a customer engages with your platform, they have a vision and an expectation of what they’ll achieve,” says Amanda. “CSMs exist to understand that vision and make it a reality. They partner with customers to learn their business goals and obstacles, and strategically plan together for their success.”
She expands on the Customer Success role by explaining that “It requires not only relationship building, but also monitoring platform usage and customer health and managing interventions when things go sideways. There’s also the cross-functional work CSMs excel at such as engaging with Product for feedback and roadmap planning, Support for ticket escalation, and Marketing for customer stories. This is what CSMs generally love and embrace about their jobs.”
When a CSM fixates on the primary task of renewal, Amanda warns that they spend their time chasing contracts instead of focusing on impactful activities: “The more complex the business, the more the renewal management becomes like herding cats – Procurement, DPAs, MSAs, redlines – you know the drill. These things happen to be a natural part of the sales cycle, so guess who the pros are in this arena?”
If you think it feels like you have too many cooks in the kitchen by having Sales own the renewal, Amanda says that what you actually have is a lack of defined processes and swim lanes: “The customer experience can be solid, and the relationship between Sales and Customer Success really fruitful, if you define roles and communicate them properly. The best way to ensure you properly qualify and sell great-fit customers is to incentivize your salespeople on their renewal rate.”
Argument #2: Scaling Customer Success and driving performance demand specialization
Specialization is key to scale and effectiveness, says Amanda who believes that focusing Customer Success on what they’re most passionate about and skilled at leads to happier, more productive teams, and thus happier customers. “We’d all love to have a team full of those unicorns who can do it all, but the reality is those people are few and far between, and you can’t scale an organization if you rely on building a team of them,” says Amanda.
These “unicorn” CSMs being those who are customer-focused and responsive yet have the executive acumen to maintain a strategic conversation and the business confidence to ask for an expansion or upsell. Since SaaS businesses survive on Net Revenue Retention (renewals, expansion, and upsells), you need to maximize all these areas which typically exceed the scope of one person’s talent. You need specialists.
So, if Customer Success doesn’t own the renewal, who does?
Amanda’s answer: Sales. She argues that while the skill set of a CSM and an Account Executive (AE) overlap, they’re inherently different with distinct motivations, comp plans, and intentions at play.
“Sales exists to bring on customers who will be successful. Customer Success exists to make sure it happens,” says Amanda. “By keeping the AE involved in the customer’s long-term success, they’re more motivated to close the right customers and stay engaged with them.”
She explains how the AE’s investment leads to more organic customer references and encourages Sales participation in business reviews which gives them insight into common customer challenges. That, in turn, allows them to speak more effectively with prospects and sell more of the right customers – making renewal a natural extension of the sales role.
“At the end of the day, a customer experiencing value is far more likely to stay for the long haul,” says Amanda. “Contraction and churn are a leaky bucket that will lead to the demise of a SaaS platform. Focus your CMS on adoption, value, and customer happiness, and the renewal and expansion will follow. Just not by the CSM.”
Argument #3: Customer Success and Sales are more effective together than apart
The ultimate KPI every SaaS business has is to retain and grow our customers. As such, Shawna says that when Sales and Customer Success partner, they unite the business to deliver an exceptional customer experience.
“The customer feels their collaboration and unified front – a reassuring reminder that they made the right choice to renew,” says Shawna. “The customer isn’t confused about who to go to; they’re supported in knowing they have a team that is focused on driving results for their business.”
Shawna says the “always be closing” mindset and Sales placement at the front and top of the business is being challenged, now more than ever. With SaaS businesses facing pressure to secure and lock in recurring revenue, Shawna believes it’s paramount that Customer Success focus on product and customer engagement. “By partnering Sales and Customer Success and leveraging their strengths, we’ve seen that focus delivers results,” says Shawna.
While the opposing team claims that sales-owned renewals confuse clients and put too many hands in the pot, Shawna counters this with confidence: “We’re capable of clear communication and expectation setting to demonstrate we have a the family of people – who are all experts in their respective areas – ready to assist the client and partner to deliver results.”
Shawna continues, “We can define the right KPIs and leverage our teams’ strengths to make the greatest impact. Every department has a role in delivering an exceptional customer experience. It is not just Sales or CSMs, we’re a team. We succeed because we’re in this together.
“We know the most successful SaaS companies are customer-centric. Having Sales, Product, Support, and Customer Success all rallied around the customer means the customer has a strong relationship with the company, not just a point of contact.”
But what did our audience of +1,000 Customer Success professionals have to say?
Luckily for you, we captured the varied ideas, opinions, and musings from our audience of +1,000 Customer Success professionals during the debate. So, to give you more food for thought, we wanted to share a few of the best excerpts from our audience’s lively chatter:
- “Renewal is a continued and confirming indication of trust. If your renewal process is straightforward, it’s just another part of the overall CSM conversation and relationship building.”
- “CSMs need to have Sales skills by nature! They need to sell ideas and value!”
- “Whoever owns the business relationship makes the money.”
- “I don’t think Customer Success owning the relationship should be conflated with Customer Success handling every piece of the relationship. Of course, there should be collaboration but ultimately Customer Success is in the best position to establish and continue to deliver value, as a foundation to the relationship with the customer.”
- “I am convinced that Customer Success is more about trust than anything else. Sales Executives, at least where I am, are not likely to be the ones who ensure that the trusted relationship is long-term. The Sales Executive hands off the relationship once the contract signatures are obtained. The long-term, trusted relationship is what drives renewal and that is owned by the CSM. So, the CSM is the primary driver and should also be the primary area of responsibility and reward for renewals.”
- “It undermines Customer Success to have sales ‘swoop in’ for the renewal.”
- “My organization ended up with a semi-hybrid approach. CSMs own upsells, cross sells, and renewals, but we have a Sales Engineer who we loop into more technical conversations, help with negotiations, etc. Both the CSM and SE are compensated on the sale, so it’s a team-based approach.”
- “What about keeping expansions with Sales, but renewals with Customer Success? IMO, this is based on where your business is in its lifecycle. If it’s more growing, you want your Sales to focus on hunting, and not on farming.”
- “It’s a good point to consider the customer and buying structure. In our business, the decision makers/drivers of use are the same buyers. So, I feel it’s very important for us to have Customer Success own the business relationship after sale.”
- “We encourage our CSMs to build relationships with [customer] leaders at a governance/business review level. They should be able to escalate accordingly while still working with those end users on a more week-to-week basis. If the signatory doesn’t know what’s happening, it’s much easier to have them cut [you] come budget creation time.”
- “Who does the customer want to own the business relationship? I’d have to imagine most would say whoever can help me maximize value, show results, and stay within budget. A closely aligned Sales and CSM partnership can deliver this together.”
- “At my last company, we had two sets of sales. A set of AEs that drove net new business, and a set of ‘Customer Success Account Directors’ that worked side by side with CSMs for the duration of the program with goals on retention, upsells, and expansion. Loved that as a CSM I could still be the strategic partner but had backup from experienced sellers.”
- There’s also a case that everyone is right. As long as you can segment customers by what they (and their renewal/expansion) need. Sales should only get involved when their unique skill achieves a different outcome – and they should be rewarded for that. But too often we see Sales rewarded for the same skill/outcome of the Customer Success team members.”
- “Turnover in Sales is a consistent customer pain point in my experience, something Customer Success often has to mitigate.”
- “When my team switched to owning upsells, there was a lot of initial hesitations (‘I don’t know how to sell,’ ‘I didn’t sign up for this,’ and ‘I don’t know how to approach this conversation’). We paired up with a Sales leader and had great training sessions in a supportive environment (objection handling, practicing SPIN, BANT). Now none of us have any problems handling difficult sales conservations.”
Now that you’ve heard from both sides as well as our passionate and deeply beloved audience, it’s time to share the post-debate poll results and announce the winner.
At first glance, we see that those for the motion (Customer Success should own the renewal) have majority vote (51%). But as reminder, majority doesn’t win here; the side that convinces the most attendees to change their initial vote does. With that in mind, those for the motion also lost 12% of their initial votes – making the winner…
Those against the motion (Sales should own the renewal) the victors.
And the debate goes on
Now if you’re anything like us, you were likely having your own heated internal dialogue while reading this recap – which hopefully triggered a few thoughts like “Yes, they read my mind” and “I hadn’t thought of it like that before.” Maybe those feelings even took on a physical manifestation if you geeked out as much as our team did during the live debate:
Or perhaps it brought up familiar pain points like the one shared by this attendee: “This conversation is why every CSM job I interview for has significantly different expectations.”
Whichever side you chose, it’s clear that the answer is more nuanced than we’d prefer, or as this attendee put it: “All arguments are valid…it really depends on domain, customer, product, and team dynamics.”
What we can say with absolute certainty is that there’s no room for an “us versus them” narrative here, which so often descends into passive-aggressive behavior and a toxic work environment.
As one attendee concluded at the debate’s end: “CSM and Sales [working in] lockstep is key to either model.”
United we retain, divided we churn.
If you’re still fired up about this topic and want to hear the Q&A portion of the debate where our panel answers pointed questions served by our moderator and rebuts the other side’s arguments, watch the recorded session now – or share it with your team, choose sides, and host your own debate to get in on the fun.
If you missed BIG RYG, ChurnZero’s annual Customer Success conference, you can now watch ALL the sessions for free and without filling out a pesky form. So, make sure to check out a few of our favorite talks including:
- When Customer Success is a Second-Class Citizen
- The View of Customer Success and Customer Churn from the Board Room and VC/Investor Meetings
- Why Humans Are Irrational: Applying Behavioral Economics to Customer Success
- Managing and Running a Customer Success Team in The Age of Remote Work
Customer Success Around the Web
- 5 Head-Turning Examples of SaaS Onboarding that Wowed Their Customers– View these examples of onboarding sequences that you can use as inspiration for your own program.
- BIG RYG: Key Takeaways – Check out these key conference takeaways from the CS pros over at ESG.
- Customer Success Managers Shift from Advocacy to Forensics – See how CSMs roles have evolved over time.
Fighting Churn is a newsletter of inspiration, ideas and news on customer success, churn, renewal and other stuff and is curated by ChurnZero.