Driving profitable growth in the current environment: strategies learned at LinkedIn

Even with heightened interest rates and global growth slowing, business leaders are charged with finding profitable growth. As the cost of capital goes up and economic demand shifts, we need a new growth playbook that is both capital efficient and resilient.?

At LinkedIn, we adjusted our growth playbook in 2019 to put a strategic focus on customer value, which led to accelerated revenue growth, expanded margins, and more successful customers. These lessons may help your company drive more profitable growth by...

• Embracing customers who already love you
• Prioritizing resources toward acquiring customers "likely to succeed"
• Helping existing customers go from good to great
• Reducing internal complexity by making your organization easy to do business with

Find upside in customers who already love your product

The easiest way to grow your business profitably is to start with the customers who already love your product and brand. You probably have more growth potential in your best customers than you think. There are more users to be supported, more product to be deployed, and more service to be offered than you probably think. Start by helping these successful customers get more value from what already works, and then show them how to bring that value to more parts of their organization – "more of what works" is an incredibly powerful proposition during at a time when customers are looking to simplify their worlds, consolidate vendor spend, and minimize the risks often associated with deploying unproven solutions.???

Take action: make a list of your best customers. Identify where growth opportunities exist within those accounts (perhaps across different buying groups). Where can you do more of what already works to deliver a quick return to your customer? Build new pricing strategies that entice customers to increase their investment. How can you offer 2x the value for a 50% higher price?

Growing your best customers is incredibly profitable and capital efficient. Selling time is efficient. Churn is low. Additional support resources are efficiently deployed. And your customer typically sees return on investment very quickly, so everyone wins.

Acquire customers "Likely to Succeed"

One of the most costly and under-appreciated expenses in most businesses is acquiring and then churning customers that were a bad fit for your products from day one. These customers don’t retain, and they usually require substantial support which drains profitability and distracts your team from focusing on growing healthy relationships.?

At LinkedIn, we figured out a way to predict which prospects were most likely to succeed based on attributes like industry, size, location, and other dimensions. With that information, we’re able to focus our sales and marketing teams not just on companies exhibiting a likelihood to buy (which is how most go-to-market propensity models are built), but more importantly on whether customers are likely to succeed. ?

Take action: identify which of the prospects in your funnel are most likely to succeed. Look at how much service and support resourcing is going to your “good fit” customers versus those with continued challenges getting value from your product. In many cases, the root cause of ongoing customer challenges is a bad fit between the customer and the product.?

Help customers go from good to great

At LinkedIn, we learned that one of the most powerful things we can do to grow our business was helping customers getting good value to graduate to getting exceptional value, because customers getting exceptional value grew much faster. As it turns out, helping a customer go from good to great is much easier and has a bigger impact on future growth than trying to breathe life into challenged situation. In most organizations, underperforming customers get outsized attention from success and support teams charged with "saving" them, even though their lack of success is often caused by a bad match with the product offering... many products with excellent product-market fit can still have poor product-customer fit. Focus your teams on helping customers go from good to great and you'll find further growth in those relationships.

Don’t make it hard for your customers

Trimming costs is a common strategy companies use to improve profitability, but it’s important to carefully consider its impact on experiences. Customer experience can be a competitive differentiator. Modernized companies focus on making it easy to do business with them, not just because it improves customer satisfaction and retention, but because friction for your customer becomes a major distraction to your sales, service, and support teams.

Take action: think about your customer’s experience from beginning to end, and where you can make things easier. The customer onboarding experience is one place to avoid making shortcuts even when budgets are tight. Customers decide to embrace your product or service within the first 30 days. Even if you’re providing annual subscriptions and the renewal date is 12 months away, providing a great onboarding experience will pay dividends for years to come.

When you focus on customer value, everyone wins

At LinkedIn we have a mantra: when the customer wins, we win. Underlying that approach is the foundational belief that customer value is what drives growth. Figure out how to grow with your best customers and help them use your products to drive success; because when they win, you’ll win too.