Today, Investors, Boards, Executives, and Associations in every industry are all looking for rapid, exponential, and efficient growth. And yes, you can have all three of those.
In fact, there’s no more efficient (and if done correctly), rapid, and exponential – growth than growth within and from your existing Member base.
And the key to unleashing the power of this growth engine is Member Success.
Let’s dig into what Member Success-driven Growth is…
Member Success as a Growth Engine
Member Success-driven Growth – seeing Member Success not as a way to make Members “happy,” but as a true Growth Engine – is all about expansion (upsells, add-ons, land and expand, viral expansion, etc.), but in a way that absolutely requires a baseline focus on the Member’s success.
Member Success is when your Members achieve their Desired Outcome through their Interactions with your organization.
The actual process of moving Members toward their ever-evolving Desired Outcome is called Member Success Management.
Member Success-driven Growth is growth – upsells, cross-sells, Member advocacy, viral expansion, etc. – that occurs as part of the Member’s evolution and success. As Members succeed and evolve, their relationship with you should evolve and grow as well.
Through Member Success-driven Growth, account expansion happens in a predictable, scalable way that is a part of the Member’s journey through Progress Milestones.
However, within Member Success it is said that Renewal and Expansion happen because a Member is successful; but that’s not quite accurate.
The truth is…
Expansion and Renewal are Part of a Member’s Success
For Members to achieve their ever-evolving Desired Outcome, they’ll need to stay past a renewal, and they’ll very likely need to consume more of your core product, adjacent products, services, etc., so we say Expansion and Renewal are part of the Member’s success.
Through a combination of effective orchestration (managing expectations and teeing-up expansion opportunities early in the lifecycle), operationalization, and proactive intervention (three of the 8 elements of Member Success Management), Members that achieve a Success Milestone with a logical expansion opportunity attached – and that are on a positive Success Vector – will take the upsell when it’s presented.
The key to making Member expansion work in a way that is Member-positive on a scale that meets your organization’s Appropriate Experience is knowing exactly what expansion offer to present to the Member and when to do it.
This means knowing – for each Member segment – exactly what Success Milestones have associated expansion opportunities and knowing when Members will hit those Success Milestones.
It also means understanding how to short-circuit the Member’s journey to that Success Milestone by offering training, consulting, add-ons, etc.
Done correctly,
Member Success Leads to Truly Predictable Revenue
It doesn’t get more predictable than being able to look at your existing Members, say these 100 Members will reach this Progress Milestone in the next month, that milestone has a logical expansion opportunity associated with it, the value of that upsell is $1000/ARR, and the percentage of Members that should take the upsell based on their Success Vector is 90%.
That means, for that cohort, you’ll add $90k/ARR next month. Then, by combining the expansion value of all the milestone cohorts, you can give an accurate prediction of the revenue you’ll generate from our existing Members.
Now that’s actual, real predictable revenue.
Something that needs to be addressed, however, is…
Management by Objectives vs. Expansion Quotas
When you can build a revenue forecast model based on actual Member Success Vectors, then you can manage against that rather trying to force the issue through expansion quotas.
You can say “according to Success Vectors, this cohort should deliver $90k/ARR in the next month.”
When you have Success Vector in place, internal expansion quotas are not needed, which means you won’t have Member Success Managers trying to upsell products to members when they aren’t ready for it, don’t need it, or are otherwise not in a place where that is the logical next step.
Vector is defined, according to a quick Google search, as “a quantity having direction as well as magnitude, especially as determining the position of one point in space relative to another” and to us, that’s exactly what we’re looking for.
Direction + Magnitude.
People are a huge part of Member Success Management. Systems are necessary. Processes and Technology tie all of those together for efficient scaling.
But if the implementation of those things isn’t predicated on a deep understanding of the Member – and knowledge that the Member will evolve over time so your understanding must, too – then the members are going to be set up for failure, the systems won’t do what you “designed” them do, and the technology will fail to deliver a real ROI.
If we want our Members to grow with us over 5, 10, 15, or even 20 years, ensuring the Member is engaged and continues to achieve their evolving Desired Outcome is critical. In fact, it’s why your organization exists in their world.
Before you can Orchestrate, Operationalize, Instrument, and Intervene – or develop a Success Vector – you need to be clear about the Desired Outcome for each of your Member segments.
You can create Objectives to manage against, essentially saying “this is the expected expansion from these cohorts in the next 30, 60, or 90 days and if we hit that, it means you simply did your job.”
However, if you miss that mark, it means the Member didn’t hit that Success Milestone, because if they had, according to Success Vector analysis, they would have taken the upsell. So that’s a failure of Member Success Management; not that they didn’t make the upsell, but since the Member who you thought would reach that milestone didn’t.
There’s no need to identify quotas on expansion; instead, use Success Vector-based projections to manage the success – or failure – of your Member Success Management (including Success Managers, Expansion Resources, etc.) team.
Member Success-driven Growth is the way to get rapid, exponential, and efficient growth in a Member-positive (and, ultimately, sustainable) way.
Memberships Matter! 