[Perspective Series] Secrets to Retention and Revenue Boosting With Joseph Loria
- Quik! News Team
- Jun 28
- 28 min read
Joseph Loria is the Founder and CEO of RetentionCX, a company dedicated to helping businesses boost revenue retention through structured customer experience strategies. With over 20 years of senior leadership experience, he has led customer-facing teams across high-growth companies backed by venture capital, private equity, and bootstrapped models. Known for designing a proprietary framework that ensures customer value realization, Joseph has played a pivotal role in driving 10x exits and long-term client success. His background as a chemical engineer and project manager in the medical device industry brings a disciplined, results-driven approach to the world of SaaS and CX.
Here’s a glimpse of what you’ll learn:
[2:21] Joseph Loria discusses RetentionCX’s framework to ensure customers receive measurable value
[4:31] The misconception that onboarding alone guarantees customer success
[8:14] Nine factors that drive successful customer relationships
[11:01] Using Likert scale assessments for proactive customer experience management
[14:34] Proving value to new decision-makers to avoid unexpected churn
[19:48] Joseph shares the challenges with value realization as companies scale beyond early adopters
[26:27] How missing strategic relationships leads to revenue risk and churn
[29:32] Applying customer retention strategies to any business model, not just SaaS
In this episode…
Customer retention is critical to business growth, yet many companies struggle to demonstrate value to their clients post-sale. Often, organizations assume customer success will follow once a product is implemented — overlooking the clients' complex, layered needs. How can businesses ensure that their solutions get adopted and lead to long-term customer loyalty and measurable business impact?
Seasoned customer experience strategist Joseph Loria shares a proven framework for ensuring customer value attainment. He emphasizes the importance of understanding the multi-dimensional environment in which customers operate, including each organization's varying goals and roles. Outlining nine essential factors contributing to successful customer relationships, he offers actionable tactics, such as using Likert scale assessments for proactive health scoring and mapping strategic relationships with stakeholders. Joseph argues that businesses can build trust, predict risk, and organically grow customer accounts over time by focusing on measurable outcomes and not overselling early on.
In this episode of The Customer Wins, Rich Walker interviews Joseph Loria, Founder and CEO of RetentionCX, about building value-driven customer relationships. Joseph explains how to prevent churn by mapping stakeholder goals, the significance of a post-sale strategy, and the importance of aligning pricing with perceived value. He also discusses measuring subjective client outcomes, managing growth beyond early adopters, and selling through customer experience rather than pressure.
Resources Mentioned in this episode
"Redefining Client Discovery in Finance With Marla Sofer" on The Customer Wins
"Empowering Advisors With the Gift of Time With Rich Whalen" on The Customer Wins
"The Six F Strategy for Success With Brett Gilliland" on The Customer Wins
"How To Simplify the Accounts Receivable Process With Mark Firmin" on The Customer Wins
Guerilla Marketing: Easy and Inexpensive Strategies for Making Big Profits from Your Small Business by Jay Conrad Levinson
Quotable Moments:
“We're going to find a way to make sure that customers see value every time.”
“I think customer experience becomes a lot about predictability and prioritization.”
“You have to find a way to objectively measure that sort of relationship with the client.”
“What impact is this having on the organization? That’s the question leadership really wants answered.”
“If you align your packaging and offerings that way, the upsell just happens naturally.”
Action Steps:
Map strategic relationships within customer accounts: Identifying key stakeholders ensures your solution aligns with business priorities and prevents revenue risk.
Use Likert scale assessments for client feedback: Structured feedback tools transform subjective experiences into actionable data for proactive client management.
Right-size your initial value proposition: Aligning early expectations with achievable outcomes builds trust and enables long-term account growth.
Track customer impact beyond adoption metrics: Measuring how clients leverage your product to drive results deepens relationships and reduces churn risk.
Adopt a prescriptive approach to customer engagement: Guiding clients post-sale accelerates success and makes renewals and upsells feel earned and natural.
Sponsor for this episode...
This is brought to you by Quik!
At Quik!, we provide forms automation and management solutions for companies seeking to maximize their potential productivity.
Using our FormXtract API, you can submit your completed forms and get clean, context-rich data that is 99.9% accurate.
Our vision is to become the leading forms automation company by making paperwork the easiest part of every transaction.
Meanwhile, our mission is to help the top firms in the financial industry raise their bottom line by streamlining the customer experience with automated, convenient solutions.
Go to www.quickforms.com to learn more, or contact us with questions at support@quikforms.com.
Episode Transcript:
Intro: 00:02
Welcome to The Customer Wins podcast, where business leaders discuss their secrets and techniques for helping their customers succeed and, in turn, grow their business.
Richard Walker: 00:16
Hi, I'm Rich Walker, the host of The Customer Wins, where I talk to business leaders about how they help their customers win and how their focus on customer experience leads to growth. Some of our past guests have included Marla Sofer of Knomee, Rich Whalen of Equity Services Inc., and Brett Gilliland of Visionary Wealth Advisors. Today, I'm speaking with Joseph Loria, founder and CEO of RetentionCX. Today's episode is brought to you by Quik!, the leader in enterprise forms processing. When your business relies upon processing forms, don't waste your team's valuable time manually reviewing the forms.
Instead, get Quik! using our Form Xtract API. Simply submit your completed forms and get back clean, context-rich data that reduces manual reviews to only one out of a thousand submissions. Visit Quick Forms to get started. Now, before I introduce today's guest, I want to give a big thank you to Mark Firmin, who was also a guest on my show and recently retired after a successful sale of his business. All right.
Joseph Loria, founder and CEO of RetentionCX, has over 20 years of senior leadership experience with full revenue retention ownership in five high-growth companies. He's led large global customer-facing teams and his experiences crosses venture capital, private equity, and bootstrapping like me. He notably built a customer experience from scratch that led to a 10X exit. His gift is boosting revenue retention, and his passion is guiding founders and CEOs toward predictable revenue. Joseph, welcome to The Customer Wins.
Joseph Loria: 01:58
Thanks for having me, Rich. Super happy to be here.
Richard Walker: 02:01
Oh, glad to see you today. So, for those who haven't heard this podcast before, I talk with business leaders about what they're doing to help their customers win, how they built and deliver a great customer experience, and the challenges to growing their own company. Joseph, I want to understand your business a little bit better, and all about this retention thing. So how does your company help people?
Joseph Loria: 02:21
Great question. Customer wins is a great name for a podcast, by the way. As soon as I heard like this, this is a place I have to be. Yeah, I think I think the thing that is most interesting for companies to learn from what I do is there is a very specific framework for how to be really successful with customers, and has to do with sort of the in explicit delivery of value and the sort of assurance of value attainment with customers. And that's not necessarily an easy thing to do.
So because I did this five times, I'll be totally transparent in saying I learned this the hard way. I'm a frustrated. I'm a chemical engineer by degree, and so a former medical device-like project manager before I got into tech. And so I came from a super-regulated industry that was sort of bent on delivering quality and value at all costs. And then you come to the SaaS world and it's not quite as structured as medical devices.
And so this frustrated engineer was like, we're going to make this work, and we're going to find a way to make sure that customers see value every time. And a lot of that was trial and error. And eventually over the years, I figured out a sort of simple framework for exactly how you can assure that a customer will see value from what it is that you do. So now I have this business that ensures that clients can embed that framework in the business, ensure value attainment or value realization in the client, which is sort of the thing that makes sure customers stay, stay longer, buy more, refer more, which is, I think, what every business wants at the end of the day.
Richard Walker: 04:04
Okay. You are talking about something I've been debating lately with other entrepreneurs, you know, in terms of, you know, you build this great product. Did you build it because it's cool? I mean, think of how many things are cool or did you build it because the customer wants it, and regardless of which way you approached it, what the customer values is, what they pay for. So when you say how you're helping ensure the customer gets value, what does that really mean?
How do you do something like that?
Joseph Loria: 04:31
I think there's a bit of a misconception. I've seen a lot in SaaS businesses where there's this assumption that the customer is, and I don't mean this in a negative way, but the customer is entirely functional, like you're placing this product that you've created into this perfectly calm, structured, ordered environment and therefore it's just as simply a matter of, I don't know, getting it configured and getting them set up and trained and functional and then things are great.
Richard Walker: 05:02
Yeah. Just turn it on. Right.
Joseph Loria: 05:03
Yeah. The truth is that's not the case, right? The truth is there are things that go well in this business and things that don't. There are employees that are fantastic employees who are struggling. And so you're sort of trying to fit your product into this complex ecosystem.
And that requires some, some sort of specialized focus in terms of like, how do I assure, despite all of the things working against me and all of the change management that goes with new stuff, because at the end of the day, whatever it is that we're doing is new business process for this organization, right? We're trying to interact with there is complexity there that sometimes I think gets it's not that it gets ignored, but I don't think the I don't think the, the complexity of that is realized all the time. And so we tend to assume that we can just kind of get them configured and running, and the rest will happen. And it does require a little more effort and management of that, because there are, you know, what the organization is trying to accomplish is often multi-layered. Sometimes there's some, you know, top-level corporate KPI they're trying to shift.
Sometimes there's some mid-level operational efficiency, sometimes it's lower-order stuff. In the business, there are multiple stakeholders involved. Someone who's expecting that corporate outcome, somebody who's running a process that just expects efficiency and clarity. And there are people doing actual work who need certain things to just work. Right?
Richard Walker: 06:39
Right. And they don't want disruption in their day. Yeah, exactly.
Joseph Loria: 06:43
There's a multi-layered approach that I think doesn't sometimes get the attention it requires right to get that in. So the framework I've created acknowledges that sort of complexity. And the fact that there is this multi-layered arrangement with the client and makes that more explicit, if that makes sense.
Richard Walker: 07:01
It does. I, I'm going to I'm going to reveal a secret, but it's also my cheat code, because I love to design business models that work best for me. And the problem I have is I'm not a retail guy. Never asked me to open a retail store. I don't like dealing with the end consumer per se, yet we started our business with the end user in mind, and I've quickly realized I'm not good at selling to the end user.
I'm better at selling to an enterprise where they push it to the end user. And that's just kind of like a de facto standard. You get it or you don't. And there's still, of course, onboarding, and there's still adoption. But when we changed our model from end user to enterprise, we had a bet inside our company, our first customer, MassMutual.
We were betting they would have 25 to 35% adoption in 12 months. They hit 35% adoption in 90 days and 100% adoption within six months. Wow. Change the world for how I said how I'm going to deliver software. So I mean, going back to what you're saying then then how do you measure all these different components and how do you help a, a company?
Maybe you work with companies like mine. How do you help them then figure out how to work with the customer to get that kind of adoption and then roll it out more successfully?
Joseph Loria: 08:14
Yeah. The secret sauce is that there are actually nine factors that really matter in a customer relationship. Call it. Right. In the broader relationship, like part of the relationship is definitely based on the mechanics of this thing we're doing for the client, the product, the offering, the service, whatever it is.
Right. That's true. There are aspects of the relationship where that is important for sure, but that's foundational, right? They need to They need to adopt and use this thing, and they need to actually run that in the business. And theoretically they're using this and they take action on it as a result.
So I'm just extrapolating based on what Quik! does. Right. But the idea is if you guys get into a business and this is entirely extrapolation, like Rich and I have not talked about this before, but if they get in and use these forms to be more effective, that that's actually it's not just about automating the form, but that actually creates opportunity for the business to do other things better, right? Absolutely. This base level execution thing and there's this sort of this participation and execution level, and then there's this higher order like, well, gosh, now that this thing is so much better, we can actually do better work as a result of that.
So they're actually taking action on what you're doing as a business to get better. So you can measure those factors like some of that's obvious like product utilization metrics and like active user percentages and those kinds of things are normal. But then how do you measure like are they taking action on this in the business? Are they using this as a springboard to better work? You have to measure that.
And some of that can be subjective, but you can turn that into objective measurement. But can we. Do. Oh go ahead. Question.
Richard Walker: 10:04
Can we make an example out of this. Then. You know from my standpoint with quick. So we automate forms. If I can get a user to generate a form pre-filled with data, get it assigned faster, do their business faster, instead of 45 minutes of handwriting or 20 minutes of typing, they can do three minutes of choose a form, fill it out and get it signed.
If I can get a user to do that, they see the value and they're hooked at that point. That's the core value that we're delivering. But what you're saying is beyond that, like we made a promise to the enterprise. They also made a promise internally that they're going to have certain level of efficiency. Sometimes it's quiet down the noise of frustration.
But more lately it's if we improve customer experience, we know we can drive revenue. But how? So are you saying that you're building up to that higher-level metric to help both the customer and the provider see that?
Joseph Loria: 11:01
Totally agree, by the way, that some of that's subjective, but I think you need to put an objective measurement on it. And I found that simple Likert scale assessments are actually incredibly valuable. I mean, people have been doing things like CSat and Net Promoter Score for years. Those are after the fact measurements like the experience happened and now I'm ranking it. It's not super actionable.
So how do you put objective measurements on things that feel more subjective, but allow you to then act on it? I think customer experience becomes a lot about predictability and Prioritization like, but I need to give people the heat map that sort of tells them where the mouldering is before there's a dumpster fire. So back to like I think part of that is the product part of it. But the other two pieces are like, what are the it's the thing you mentioned. What are they trying to accomplish as an organization.
And that's sometimes multi-layered. And then, therefore who has to be involved at those different levels for this to be effective. To your point, like yeah, they're buying forms to maybe quiet down a disgruntled audience with pitchforks and torches, like, okay, now they're quiet, but they're just so what to that, right? Like, okay, now they're quiet. So what?
Eventually the question is, what impact is this having on the organization? And I think certainly automating a form is great. But what are those resources doing with the freed-up time. That's higher-order strategic stuff, you know, and the customer experience world. It's how do I maybe heat map clients across goals and roles and sort of process adoption.
Call it those three factors. How do I heat map the client base to do that? To know I need to strategically focus over here. The rest. It's not that I'm ignoring customers, but they're good.
Like they're great. I'll check in. We'll we can automate some messaging to them, make sure they're okay. How do I prioritize work so that I ensure that that outcome happens for the business like and not just the yeah, we got the forms automated, but now that the forms are automated, they're getting to higher order work. That's actually having an impact that can be measured on the business.
What I'm saying is that whole piece needs to be managed effectively, and that's really what post-sale and customer success and those kinds of functions should be doing. mean the strategic management of that result? Because that's what guarantees longevity of the relationship. Because you provide real value, measurable value.
Richard Walker: 13:43
It's a challenging thing. Customers are often doing multiple things at once as well. In fact, I used to say I'm not competing with a competitor. I'm competing with the customer and their prioritization of money and time. Right.
When I started, everybody was saying, oh, we got to get email compliance into place because that didn't exist until mid-2000. And then it became social media compliance on top of that. And there was always something else they had to choose between. We're at a point, thankfully, where the industry runs on forms. So they recognize that.
But if I'm if they're measuring the success of giving people back time from forms, but simultaneously giving them AI tools that free up time on meetings and note taking and scheduling and analysis. How do we know the true impact any one of us are having on that customer.
Joseph Loria: 14:34
Yeah, I think it's about think of it. Here's a way to think about it. Like in the early days of me figuring out how this worked, I remember measuring like one of the factors I thought was a churn predictor was leadership change on the client side because it it just correlated, right. When there was a leadership change at a decision-maker level, on the client side, there was a risk of churn. What I later realized is the problem had already happened before then.
And the thing we were missing was because what happens is leader is exits the business. The new one comes in and says is looking at the PNL right and going at a detailed level, going, well, what's this thing going? Oh, that that product is great. It's a great product and we love the people. They're fantastic.
And the leader goes, What? What's it driving force like? And they're going to ask the obvious questions like, is this driving revenue? Is this a top-line play? Is it a cost-of-sales play?
Is it a gross margin? Net margin. Like what? What are we doing? What is this doing for us as a business?
And the people that the leader is asking don't know the answer to that question. They go, we're not sure we think it might be driving pipeline. Well, do you have the attribution to show that? No. Like I don't really.
And therefore the leader says, well, let's put that on pause or cancel that until we do know and we'll figure it out later. So this happens a lot. And what I want to happen in a business is when that new leader shows up, the resources there slide the laminated business case in front of them on day one. What's this? This is this great system that actually drives pipeline for us.
Let me show you the attribution chart we got from them. Like they here's the here's the reporting that they give us that prove the case. And sure, to your point, maybe it's not like direct attribution. And you can't exactly show contribution, but you can show changes, inflection points. Like we got involved here.
This thing went up after. And here are all the things we do that support that that probably drive this result that did happen. But you can't ignore it, right? Sometimes it's a little messy, but the point is like to get into the messiness of it. I had a client who was complaining to me about this conversation they were having with senior leadership in a client of theirs, where they were like, yeah, they're looking at some system updates.
And so you guys might get consolidated out. We're not sure yet. We're looking through it and we understand what your system does. So we'll keep you apprised and blah, blah, blah. And he's like, well, this is ridiculous.
We're going to get business decision out because of this change. And I said, you actually need to be happy about this. There's nothing you can do if you get businesses out. But the truth is, like, they know what value you provide and you are involved in the conversation. This is what you want.
At least you're involved in the conversation, and you will not be surprised if and when they do churn. But nine times out of ten, what happens is you're not involved in that conversation because you're not having the elevated conversation around what business value this is driving. So those decisions are made in your absence.
Richard Walker: 18:03
Yeah.
Joseph Loria: 18:04
At least you're involved in the decision-making. So yeah, I think there's a you got to find a way to, to objectively measure that sort of relationship with the client, because then at least you can predict what's going to happen.
Richard Walker: 18:16
So two things about this. One is my company, I think we've been fairly successful and unique in this regard. I have only lost customers for three reasons. They've gone out of business. They get acquired.
The acquirer has a system of their own. They're not using us. And the third was they graduated. They no longer use forms, which happened once in 18 months. Later they came back and said we were wrong.
Joseph Loria: 18:41
We now have more forms.
Richard Walker: 18:43
We have more. They did. They acquired a firm that was equal in size to them. That's all forms based. And they said, we're back.
We got to do forms still and they're still our customers. So we only lost them for 18 months. But I was thinking about this because when they told me, hey, we're going to discontinue because of this reason, I honestly said, well, congratulations, you have literally graduated away from forms. And that's been my goal. I don't want anybody to ever fill out a form again because nobody likes it.
The truth is, we can't get away from it. So I have a business to run. But the other thing is that when you were talking about this attribution of value. So the thing that pops in my head is as a, as a company. You're saying to your customer, look, we can either save you money and time.
We can help you recapture revenue that you're losing. We can help you grow revenue. I mean, those are like the three drivers I can think of. Yeah. And if you're saying, hey, I'm going to save you this much time, is that what we're going to have to document to show them?
Is that the attribution laminated sheet that you're talking about? If we're saying we're going to grow revenue, is it a prediction? So what is it we're giving them in that regard?
Joseph Loria: 19:48
Yeah, I think I think what, what we what we should acknowledge here is sometimes in the early days of a company that is less of an issue, it is more about this basic product capability and it is more tactical. In the early days. I have a client going through this. They do what we can sort of classify as reputation management, like Google reviews essentially.
Richard Walker: 20:11
Yeah.
Joseph Loria: 20:12
And what they can prove is that they can maximize the volume and quality of those reviews. Views, and they have a process by which they can do that. What you get early in your time as a company, right. Early in your maturity is you get a lot of early adopters who can do the rest of the translation for you. Like you, if you come in and do this, I know I will get business.
For example, I will get referral business. I will get more inbound business because I'm more visible in the internet or whatever it is. People are doing the extrapolation because they're sort of aware, right, of how this can actually fill a need in the business. As you mature as a business, that becomes less evident. And so people then you get past the early adopters where the attribution or connection, whatever is not as clear, and then you start to get some of this friction in the relationship where, well, I bought you.
I'm not seeing the impact I expected. Well, what do you mean impact you expected? We boosted your Google reviews or we automated all your forms or whatever the thing is. And yeah, but we're not seeing a result. And I think the, the thing we also forget about is the those customers have salespeople chirping in their ears all the time.
So and those sales pitches always sound great unless are the ones you get on LinkedIn. But other than those, they're usually great right there, especially if you're talking to someone that the sales pitch always sounds fantastic. We'll solve the world's problems and you can, you know, take a vacation, you know, in the, in the Caribbean, and it'll be fine.
Richard Walker: 21:51
Right.
Joseph Loria: 21:52
So I think sometimes in the early adopter, early maturity part of the company, we don't have to worry about this. But what eventually becomes true is you scale is you need to worry about how this actually manifests in the customer in terms of value realization, like what metrics, what part of the business, who cares about that? And so it's acknowledging that and doing that earlier rather than later. That stuff's really hard to backtrack. I had a bigger client for a year.
And we'll keep names out of it. But. But tens of millions in revenue. Hundreds of customers. And as we sort of health scored, you know, that's what this is, is health scoring the client base.
There was a big deficit in in two things and they're related. One is in two-thirds of the customers. They weren't really explicitly sure what business value this was driving in the client and what was expected as the result. You had larger enterprise organizations that were willing to spend some money to try something out. It was sort of flashy and new, but there wasn't a clear designed business case for this.
So it was a little murky. And they also didn't really know who sort of the exact sponsor buyer persona was. And those two are related right there, clearly not entirely independent. So usually if you know the person, you know what that person cares about as a result, or if you know what result they're driving, you can find who cares about that? In two-thirds of the cases, those were really weak and there was significant revenue at risk if we didn't figure that out.
And to sort of drive to the two outcomes, there were two really good examples in that particular client that happened. One was we forced the issue with the client to the point where there's some friction in the relationship because we had a person, a mid-level manager, sort of gatekeeping and wouldn't let us talk to executives and said we didn't need to do that. But the CSM running that client was a bulldog. She wouldn't take no for an answer made the client actually pretty upset. They escalated around the leadership, but it forced the conversation.
We were also backchanneling to the executive we thought was the person to try to get a conversation through leadership on our side. What happened was, even though it got a little friction, it brokered a conversation. That conversation turned out to be amazing because we found out what this person was hoping to accomplish. And we're like, we can do that. We can help with those things.
It changed the whole nature of the relationship and they ended up being a great customer. We had customers where, despite effort, we couldn't broker that kind of conversation. And then six months later, they turned significant revenue churn too.
Richard Walker: 24:42
Yeah.
Joseph Loria: 24:42
Because we couldn't map that strategic relationship on the client side. It meant like what this means is they're at risk. Right. And the risk may not be evident. It may not be imminent, but it will.
It will manifest at some point.
Richard Walker: 24:56
You know, this for me, all comes back to understanding value. And what's fascinating is when you develop a product, you might think it has a certain value, but your customer sees it in a totally different perspective of what value means to them. And I mean, I, I had this case in point with a customer. We went and met with them. We spent the day with them.
At the end of the day, they went around the table and said, are we are we go for this? And everybody's like, yes, we're a go for this. And I said, that is amazing. I'm super excited. I want to ask what's going to sound like a terrible question, why do you want our product?
And honestly, the first answer was we have incentive bonuses to give time back to our advisors, and you're going to help us do that. I'm like, mind blown. Never knew that. Yeah, yeah, yeah. I mean, and they articulated a bunch of other things that we knew about, you know, saving time, blah, blah, blah.
But we that was a hidden thing for us. And the reason I bring back the conversation to this core concept of value is I totally believe customers want to only pay for value. They don't like overpaying for things, you know, just to get other bells and whistles or dashboards or whatever they want, the result that is the value for them, and therefore, your pricing has to line up with that value. And personally, I, Joseph, I think the best ways to keep customers amazing customer experience and service with them, constant innovation and pure alignment with the value they get.
Joseph Loria: 26:27
Yeah. And to do that, and this is a hard thing for most organizations, you cannot oversell the client initially. And this is another thing I figured out over time. And it's harder because it, it it encroaches the sales part of the organization, which I was always a fan of like hyper collaborating with, but never like dictating sales work. It's not my part of the business.
Right. So. Yeah. And I'm not a salesperson. Right.
He says having his own business. But that's a conversation for a different podcast. But yeah, I always was like, how can I be helpful with sales and make sure this is successful? But I'm going to dictate what happens. But where I did a lot of intense collaboration with sales was like, don't oversell them, because when you do that, it sets them up for not realizing the value they thought they would see.
If you find a way to rightsize it, like what's the value they're expecting in that first 6 to 12 months? And if you sell them that and we do that, we've earned the right for the rest. And to your point about pricing, like then make like the rest of that relationship. And the reason I do some of this scoring I've talked about on factors is I want the relationship with the client to be prescriptive, like you hired us for a reason. We're the authority.
We're going to tell you how this is going to go. And if I do that prescriptive relationship and I haven't oversold them upfront and I still scrambling to get them the value of all this stuff that they bought. Then I earned my earn the right to the next conversation about more value and the next conversation about more value. And if you align your packaging and offerings that way, the upsell and expansion that comes with this longevity relationship just happens naturally. It doesn't feel like a sales process anymore.
I don't have to go back, sell them and cross-sell people because you have this strategic relationship with the client that is about value attainment and more value attainment. Didn't oversell you up front. I can deliver you more value just like this. Here's the next step. Yes, we want to do that.
More value. More value. More value. You benefit from that incremental value through revenue. It's a win-win right?
It's a customer win.
Richard Walker: 28:46
It is. And actually one of the patterns I've seen on this show from talking to people, and it was actually articulated best by a golf pro that I had on the show. He said, you have to be on your customer team. You have to be on their side of the table. And that's what you're articulating in my mind is that if you don't oversell and they see the value and you become their trusted advisor, and you work with them consistently to find solutions to problems, even if it's not your own solution sometimes, then they trust you to help bring more value to their organization.
I want to shift gears just slightly and we're going to run out of time, so hopefully we can. Don't take too long on this. We started by talking about software as a service SaaS companies, which is my flavor and it's my favorite. But how does this apply to any business?
Joseph Loria: 29:32
So I often start that conversation with talking about an apparel retailer. So, clothing you know clothing seller. One time revenue business that went public in 2019 they're called revolve. So you can look them up. Revolve clothing I think is the name.
And they went public in 2019. And in the S-1 filing for this business was a customer cohort analysis. And what it showed was like new customer cohorts came in the business obviously through like marketing and sales efforts. Right. New customers came into the business and then they bought at this level.
And then the next year they bought at a slightly reduced level, but still bought. And then they bought next year at that same level and next year at that same level. And as they added cohorts, this stacked up and lo and behold, what it looked like was a deferred revenue business. Like it was it was predictable. And I could tell when a cohort of customers came in, I knew the level they were going to buy at for years.
I could predict that.
Richard Walker: 30:37
Wow.
Joseph Loria: 30:38
So when they went public and the market settled, they were valued at nearly 5X revenue, which for a clothing retailer is typically A1X valuation. So I use that as the springboard to this is not a SAAS-like concept. Every business on Earth could benefit from thinking like a recurring revenue business. The thing in SaaS is it's do or die. Typically, you're priced in a way that if they don't stay for 2 or 3 years, I don't make money.
We don't survive as a business. Like you have to, you are required to guarantee they see value. So they stay in businesses that are more transactional. Where they buy something, they get something. I really have to do that.
But there are some stats that start to get people interested in this, which is it's a couple, a few that always stuck with me. It's five times cheaper to keep a client than to get a new one. It's also cheaper to sell to them. They are much more likely to buy from you than some net new prospect like net new close rates, I don't know, 5 to 15, 5 to 20% depending on how people talk about pipeline and what's an opportunity. So in other words, mostly unprofitable.
And then a customer Closed rates are in the 60 to 70% range on average. And then most of that customer sale because of the lower customer acquisition cost, because it is cheaper, drops more to profit, so it creates more profitability. So like forget SaaS mechanics for a second. Do you want like cheaper to acquire revenue that's more profitable and is more profitable? That's the question right?
That's the question that people need to answer. And I think most businesses would say, well, yeah, well you only get that through the customer experience, not from that new.
Richard Walker: 32:36
You just made me realize something. So thanks. So first of all, I've been a student of the guerrilla marketing book from back in the 80s, and one of the premises was put 90% of your advertising marketing budget back into your current clients, right? Because it's easier to keep them than it is to win a new one. And frankly, I've treated that in my company as we're going to do everything to keep the customer forever.
And frankly, we do. If you ask me my lifetime value, I can't calculate it yet because they don't leave. They just keep going. Yeah, yeah, yeah. But what you made me realize is that I haven't gone back to my customers to sell them the next product, the next product, the next product, because I didn't invent the next, the next, the next to add more value to what they're doing.
We just keep improving our product and keeping them forever, which is incredibly valuable, don't get me wrong, but it just made me realize we could be doing more potentially if we can, if we can build up more capabilities of our products or new capabilities that we hadn't thought of yet. I'm going to have to wrap this up because this is such a fun conversation. So before I get to my last question, what is the best way for people to find and connect with you? Joseph.
Joseph Loria: 33:48
You can go to my website at retentioncx.com or email me at joseph@retentioncx.com.
Richard Walker: 33:57
Okay. Awesome. So here's one of my favorite questions to ask my guest. Who has had the biggest impact on your leadership style and how you approach your role today?
Joseph Loria: 34:09
Wow. Biggest impact? There have been a lot of people. But the person that comes to mind was instrumental in also the timing around when I figured out a lot of this model that I'm talking about. And I really think, like figuring out the model was a result of the personal growth I went through at that time.
Because when you grow personally, it opens up so many doors, like you find that you've got fewer blinders on for things and you become more aware, you become a better employee. You work with people better. And the time that I grew the most as an executive was a couple of jobs back when I was still full-time and not doing my own business, and I had an executive coach. She's here locally in Indianapolis. Her name is Elisa Johnson, and she was phenomenal in terms of how she sort of coached me in a very collaborative way by asking really good questions.
Like, I used to joke, like she had like an elephant gun loaded with questions, like she would just shoot at me. And her questions were designed like. The other thing I realized at that time is how critical a growth mindset is to doing really well in anything business. Yes, but just life. Like if you see failure as the end in a, in sort of a personal failure, then you're done.
But a failure becomes learning. You get really good. And so what she helped me see was all of this sort of. not failure, but the constraints I had placed on myself. Yeah.
And her questioning and the way she viewed how I looked at the world opened up doors for me. And that's a time when I grew. So I grew great professionally at that time. It's also the time when I figured out this model. So there's a lot of good growth at that point.
So I give her a lot of credit for that. Nice. Lisa Johnson helped me grow dramatically at a at a really critical time for me.
Richard Walker: 36:14
I love that I love that you talk about personal growth, because a friend of mine who has also been on my show, Nikki Furlan, she's a coach. And she said the growth of your business is directly correlated to your personal growth as a leader. And I know this for a fact because I don't like to read books. I cannot focus long enough to read them. I found listening to them was successful to me.
So finally. And everybody's like rich read books, read books. I'd read one year in 2014 or 13, I finally got audible and started listening to books voraciously. Yeah, we started growing at 50% a year after that.
Joseph Loria: 36:51
Interesting.
Richard Walker: 36:52
Yeah, it just changed.
Joseph Loria: 36:54
Yeah.
Richard Walker: 36:55
Interesting. All right, Joseph, we'll wrap this up. I want to give a big thank you to Joseph Loria, founder and CEO of RetentionCX, for being on this episode of The Customer Wins. Go check out Joseph's website at Retentioncx.com. And don't forget to check out Quik! at quickforms.com, where we make processing forms easy.
I hope you enjoyed this discussion. We'll click the like button, share this with someone, and subscribe to our channels for future episodes of The Customer Wins. Joseph, thank you so much for joining me today.
Joseph Loria: 37:24
Thanks, Rich. Pleasure.
Outro: 37:27
Thanks for listening to The Customer Wins podcast. We'll see you again next time and be sure to click subscribe to get future episodes.
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