Have you ever had to fire a customer?

ashley_martin
ashley_martin Member, Success Network Members Posts: 30
10 Comments 5 Insightfuls First Anniversary 5 Likes

Let's be honest CS isn't always rainbows and butterflies. Sometimes we are left to handle very difficult customers.

My question is have you ever had to fire a customer? If so, how did you go about it?

Comments

  • mattj
    mattj Member Posts: 1
    Photogenic First Comment

    I have. It was a delicate situation, as we wanted to maintain our relationship and brand as a company. The bottom line was that the customer had a use case that wasn't aligned with what we could really deliver, despite what they had understood as part of the sales process.

    Once this became clear, following months of trying to make it work, and realizing that we would continue to waste resources trying to do something we couldn't really do, we diid a few things:

    1. We got everyone internally on the same page, starting with the front-line account team, then up through their leaders, and eventually the CCO and CRO and CPO.
    2. We had a series of calls with the customer at different levels within each of our organizations to help them understand the situation and the prognosis.
    3. We ultimately parted on good terms that allows for future business if/when our capabilities change or their use case changes.

    Everyone is so much happier now and we can focus on the customers and work where we can actually make a difference.

  • afettere
    afettere Member Posts: 6
    5 Comments 5 Insightfuls Name Dropper

    Breaking up with customers is hard.

    It's better not to get married in the first place.

    Bad fit customers are a real challenge for startups struggling for revenue.

    Trying to service them can be a drag on the team. They suck up time and attention better served elsewhere. Losing them (as you ultimately will) is demoralizing.

    You know they aren't a good fit. But they are a customer, so you need to double down on them.

    Work hard on avoiding this.

    It's important for the sales, product, and success teams to align on what use cases are red/yellow/green for customers.

    Not all products need this. But for products that do a lot of different things, it's critical to have this in place.

    Put a system in place to review deals and confirm that the customer's use case can be addressed with your product.

    Green use case? Sure, go ahead and sell to them.

    Yellow use case? Hmm. Figure out what it would really cost to make them successful and have all internal stakeholders agree that supporting them through engineering or post-sales work makes sense.

    Red use case? If the customer only has red use cases, have sales lead a difficult conversation on how your product isn't a fit for them at this time.

    But also do this.

    Make sure that you take this as a data point for your product plans. If you find there are a lot of customers with this use case, it may be worth exploring and prioritizing it.

    Good luck!

  • Brian O'Keeffe
    Brian O'Keeffe Member Posts: 151
    100 Comments 25 Insightfuls 25 Likes Photogenic
    edited March 9

    I have had one customer in the last ten years that I knew was not a good fit from day one and marked them as unlikely to renew, no matter what. We threatened to fire them, but it never happened.

    1) The internal owner was hands off. It was purchased and then the owner had nothing to do with it and was unresponsive.

    2) A VP was given the role of day to day manager, but no resources to manage it. He expected the vendor to manage it. I told him, politely, we cannot and that ownership for day to day tasks and mangement was not our responsibility. It included managing users access, problems, corrections and other routine tasks. We do not touch customer data. He refused to hand it off, did the bare minimum and they lurched from crisis to crisis.

    3) The VP became threatening and abusive. This was the beginning of the end. We had to tell the owner that we would no longer do business with them if the VP remained in charge. This came from an executive level to the customer owner. The VP was removed from direct communication and had a direct report, who had an equally bad attitude, take over.

    4) User adoption was minimal. How could it be successful when there was no internal stakeholder willing to lead?

    5) Renewal time came and they were gone. As I predicted after my first meeting with them.

  • Javed Maqsood
    Javed Maqsood Member, Success Network Members Posts: 31
    Third Anniversary 10 Comments 5 Insightfuls 5 Likes

    Yes. This usually happens when you don't have a good product - use case fit. You could arrive there in different ways.

    • Customer has perhaps outgrown the initial use cases. Their expanded use putting a strain to support them overall. They are not willing to adjust the contract accordingly.
    • Increased the SaaS processing load on your system as they have grown and you are losing money
    • They have not delivered on their initial commitment changes on their side to make it possible for you to support them in a business effective manner
    • Last one is a tough one - really bad fit for a customer

    The first three cases - you can reason with the customer and explain to them why you need to part the relationship. You can leave on good terms.

    The last case - you have to fall on your sword and apologize. It's hard to leave these relationships in good terms.

    Javed Maqsood
    Advisor, Mentor
  • Sean L'Italien
    Sean L'Italien Member Posts: 3
    Second Anniversary First Comment

    Has happened a bunch of times in my career. I'm a little different as I'm in an outsourced company and we handle support and success for a lot of our SaaS clients, so we're doing this for a variety of customers (it probably won't happen as often as someone only focusing on their own customer base)

    The common themes for customers we've had to fire (always with the approval from our clients):

    • Unwilling to do any work themselves for highly self-managed products with fantastic onboarding/documentation/setup wizards
    • Skipping onboarding and insisting they can do it themselves
    • Having the wrong people in place to manage the product
    • General as*holes/abusive people that no one would want to be associated with, regardless of revenue.

    We don't allow our support agents to be treated like crap, its a promise from us on the day of hiring. If someone contacts support and threatens anyone or is abusive, they are not a good fit (rare). We frequently get people who curse as just part of their day to day vocabulary.... that's different than abuse and you can tell when listening to the call.

    Other scenarios are not immediate 'firing.' We have conversations, reminders of agreements that were made/expectations that were set, needs from both sides, etc and if there isn't an improvement, its usually a done deal.

    One trend I've noticed over the years is that its usually people paying the least that demand the most. I'd say 8 out of 10 customers we've had to part ways with were paying for the lowest plan our clients offered.

    To do it, its a simple conversation and we're transparent about the reasoning. The customer may not like it, but a successful deal needs to make sense for both sides. Its never a personal thing, unless you're a jerk and abusive.... you might get the ban hammer for that.

Leave a Comment

Rich Text Editor. To edit a paragraph's style, hit tab to get to the paragraph menu. From there you will be able to pick one style. Nothing defaults to paragraph. An inline formatting menu will show up when you select text. Hit tab to get into that menu. Some elements, such as rich link embeds, images, loading indicators, and error messages may get inserted into the editor. You may navigate to these using the arrow keys inside of the editor and delete them with the delete or backspace key.