Why RevOps Must Prioritize Customer Success: The Untapped Goldmine of Expansion Revenue
Why RevOps Must Prioritize Customer Success: The Untapped Goldmine of Expansion Revenue
Introduction
Revenue Operations (RevOps) has traditionally been viewed as a linchpin for aligning sales, marketing, and operations. However, there is a glaring oversight in its integration: Customer Success (CS) teams. With organizations running leaner and economic pressure to show the ROI from PE and VC investors, the importance of retaining and expanding revenue from existing customers has never been greater. The cheap money/easy capital raises of the mid-2010's up until recently are over, and investors want to see returns- especially if there are alluring alternatives appearing in the market. Yet, CS teams often find themselves sidelined by RevOps, missing a critical opportunity to drive sustainable growth.
Current Challenges in RevOps and CS Alignment
Most RevOps frameworks are heavily geared towards sales and customer acquisition, leaving CS teams under-supported in a high-pressure environment. Sales, with its fast-paced, target-driven culture, often takes center stage in RevOps strategies, pulling critical resources, data insights, tech stack priorities away from Customer Success. We as RevOps leaders all know there is a dashboard request coming any minute now or migration to a sales tool that will 'solve all our pipeline management problems.' This creates an imbalance that can foster friction between sales and CS teams. However, this tension, if approached strategically, can and SHOULD evolve into a productive partnership. By leveraging the inherent customer knowledge of CS teams and the operational expertise of RevOps, organizations can unlock the full potential of expansion revenue while reducing churn.
The Importance of Expansion Revenue in a High-Interest Rate Economy
As businesses navigate rising costs of capital, expansion revenue emerges as a lifeline. Expansion revenue—derived from upselling, cross-selling, and account growth—can significantly improve financial stability. According to Gartner, companies that prioritize expansion revenue achieve higher net revenue retention (NRR) rates, often surpassing 120%, a metric critical for long-term profitability.
Like I mentioned ealier, investors want returns and they want them yesterday. You already have a base of customers who (hopefully!) love you - and 2025 is the year to capitalize on it. Let's look at how RevOps and CS can join forces to make it rain.
The Missed Opportunity: How RevOps Leaves CS Behind
The Historical Sales-Centric Bias in RevOps
RevOps has traditionally focused on optimizing processes for sales and marketing teams. While this approach delivers results in lead generation and pipeline efficiency, it often leaves CS teams with insufficient resources to capitalize on post-sale opportunities. This bias limits the potential of RevOps to support a comprehensive revenue strategy.
Consequences of Neglecting CS in RevOps Strategy
The exclusion of CS teams from RevOps planning has tangible consequences. Customer churn increases as businesses fail to proactively address pain points or identify upsell opportunities. Additionally, organizations miss out on expansion revenue that could strengthen their financial position during economic downturns.
Expansion Revenue: A Lifeline for Growth in Tough Times
The Strategic Importance of Expansion Revenue
Expansion revenue not only bolsters profitability but also reduces dependency on volatile new customer pipelines. In a recent study by McKinsey, SaaS companies that focused on customer success-driven expansion achieved 30% higher annual growth rates compared to their peers.
Key Drivers of Expansion Revenue
CS teams are uniquely positioned to identify and drive expansion revenue through deep customer relationships. By leveraging RevOps support, they can unlock opportunities such as:
- Upselling: Offering premium features or higher-tier plans based on customer needs.
- Cross-selling: Introducing complementary products or services.
- Account Growth: Expanding existing contracts with scalable solutions.
Now you might be in a position where Rules of Engagement (ROE) cause conflict between sales and CS as far as expansion revenue ownership. This is another area where RevOps can help. That is a topic for another article, but an important one with lots of nuance and solutions. A good RevOps team will help advocate for Customer Success and ensure fairness across acquisition and expansion deal credit.
Aligning RevOps with CS: A Win-Win Strategy
RevOps as the Backbone of Cross-Functional Collaboration
For organizations to fully harness the power of expansion revenue, RevOps must serve as the backbone of cross-functional collaboration. By unifying data sources, streamlining processes, and breaking down silos, RevOps can bridge the gap between Sales and CS. This alignment ensures that CS teams have access to real-time customer insights, allowing them to proactively identify opportunities for upselling and cross-selling.
How RevOps Can Directly Support CS Efforts
RevOps can revolutionize CS effectiveness through targeted support strategies. Examples include:
- Customer Health Dashboards: Real-time visibility into customer satisfaction and usage metrics to identify potential churn risks and expansion opportunities.
- Automated Workflows: Streamlining customer touchpoints, such as renewal reminders and follow-up tasks, to reduce the administrative burden on CS teams.
- Data-Driven Insights: Leveraging analytics to pinpoint trends and tailor solutions that resonate with specific customer needs.
Case Study: Salesforce Unlocks 25% Expansion Revenue Growth
A leading SaaS company implemented a RevOps-CS alignment strategy that resulted in a 25% increase in expansion revenue. By unifying their CRM and creating detailed customer segmentation, the CS team could effectively target accounts with upselling potential. The streamlined approach reduced churn and maximized lifetime customer value, demonstrating the tangible benefits of RevOps integration. For other interesting case studies into successful SaaS business models, check out this article by Datadab.
Case Study: SemRush grows to $100MM by expanding 'horizontally'
Another compelling example of growing from within is Semrush. Instead of focusing primarily on new user acquisition, they were able to provide ever-increasing value to the base, growing MRR 6-7x through 2016 and doubling a few times after.
Practical Steps to RevOps-CS Integration
Step 1: Establish Shared KPIs Between RevOps and CS
The foundation of any successful collaboration lies in establishing shared KPIs. By aligning metrics such as Net Revenue Retention (NRR), Customer Lifetime Value (CLV), and churn rates, both teams can work towards common objectives. If RevOps has targets that are specific to CS this provides the shared-ownership that may not be present. I'll do an article on how this works with OKR's at some point soon, but shared goals create a lot more incentive across teams and build stronger companies. I've seen it time and time again. Accountability brings results!
Step 2: Create a Unified Data Ecosystem
A unified data ecosystem is critical for seamless collaboration. RevOps can take the lead by integrating tools like CRMs, analytics platforms, and customer success software to ensure all teams have access to the same insights. This transparency allows CS teams to make data-driven decisions that align with overall revenue goals. This should not be limited to what you can do in Salesforce or Hubspot - make friends with BI, you will not regret it!
Step 3: Cross-Functional Training and Communication
RevOps and CS teams should invest in cross-functional training to understand each other’s processes and pain points. Regular syncs and joint workshops can foster open communication, build trust, and identify areas for improvement. Just sharing what is happening with backlogs and active sprints is something a lot of CS leaders and partners find incredibly useful- and as a backstop to holding RevOps accountable to work on projects that support the shared goals I mentioned earler. This cultural shift towards collaboration ensures long-term success and alignment.
Conclusion and Looking Ahead: A Collaborative Future for RevOps and CS
In today’s pressure cooker startup environment, the synergy between RevOps and Customer Success is no longer optional—it is essential. By breaking down silos, aligning objectives, and leveraging data-driven strategies, organizations can unlock the full potential of expansion revenue. This partnership not only drives growth but strengthens customer relationships, meaning long-term success and revenue stability. The time to act is now: organizations must prioritize integrating Customer Success into their RevOps framework to stay ahead in a rapidly evolving market.
Look out soon for an article unveiling my framework (tentatively called ALIGN) that provides a blueprint for how RevOps teams can start to break down silos and transform from a glorified Sales Ops team into a cross-functional powerhouse. Want to chat more on this or other CS and RevOps topics? Contact me below.
