“They couldn’t find the budget.”

You’ve heard that at renewal. Everyone has. It’s the most comfortable explanation there is, because it puts the decision where nobody can be held responsible for it.

It’s also an easy out for the customer. It’s easier than saying, “We have budget, we’re just choosing to use it elsewhere.” Especially when you’ve built a decent relationship.

Budget isn’t found, it’s defended. Put yourself in your customer’s shoes – you’re going to defend whatever’s already attached to a priority for the board, or a line in the P&L.”

Assessing root cause

Sixty days ago, I workshopped with a senior leadership team whose growth target was getting harder every year. In another 30 days I’ll be reviewing the results of a test we’ve agreed across the team.

I was called in because of a number of important factors slowing down growth. New business was still working, but churn and downgrades kept eating into the gains, so each year started further back than the one before. The reason coming back from lost accounts was budget.

When a target keeps slipping like that, the ideal customer profile is the first thing you interrogate. We did, and it held up to scrutiny. They’re selling to the right people – but working through the discussion, we established how the right people can be segmented – looking at an existing fact, with fresh eyes.

So then we went at the knowledge, because if you’re losing customers who fit, the next thing to think about is if you understand them well enough. Ask the people closest to the subject matter what their customers are trying to get right and you usually get a good answer. Editors, analysts, product specialists, the people who spend their days in the customer’s world. That’s what happened here.

We ruled out two obvious causes – which feels like progress, like people are passing a test – but where do you go next if everything seems ok?

Without an external facilitator, that’s normally where a team reaches for something new – maybe price, or negotiations, or process – hoping whatever gets agreed doesn’t mean more work for them.

What the workshop surfaced

Their customers wanted different things depending on which segment they sat in, and not slightly different either. Different enough that trying to create one approach didn’t serve anyone.

I wanted to know what the customer got out of the solution – the measurable result – the ‘SubsNoun.’ The first reaction was the one I’d expect, and I’ve heard some version of it in most of these sessions…

You can’t connect to a customer’s results. Too many variables, too much going on inside their business you can’t see, and you’d be claiming credit for things that aren’t yours.

What was missing…

Helping the customer connect what they were buying to something they’d have to deliver, in a form they could take into their own budget round and defend.

The SubsNoun is the thing your customer is trying to get right, the number their own performance turns on. It’s their job, not your product. Once that landed, someone said the sentence that made the rest of the session easy.

“We used to do this.”

When scaling leads to failing

They’d invested properly in customer success, which was the right call. More customers, more consistency, less depending on whichever individual happened to pick up the phone.

Before the workshop I could see they had copy and pasted a diagnostic approach from another membership. In doing so, along the way they had distanced their subject matter experts from the customer, and unintentionally blocked the route to connect with meaningful results.

I imagine that’s because the diagnostic looked plausible but didn’t replicate what the SME had been doing to refine what the customer needed and why. In the end, the diagnostic was becoming seen as admin – at best, holding a mirror up to what they were today, not how to progress tomorrow.

So the delivery scaled and the progress didn’t. Onboarding, training, usage reviews, quarterly check-ins, all of it competent and consistent and yet not tied to what any particular segment had to achieve.

Customer success without customer results is a reactive support function.

It answers questions, fixes problems and turns up on time. What it can’t do is hand the customer something to defend. So their customers were reacting to it like it was admin, and admin doesn’t get defended in a budget round.

The diagnostic approach told a customer where they stand, and these customers didn’t argue with what it showed them, they mostly already knew. What it didn’t do was show them a better way to execute.

There’s an order to diagnosing the root cause, and it runs in sequence. Fix then move on to the next.

What the market needs. What you make. What the customer gets from it. What you can charge. How you’re set up to deliver.

Because each element rests on the one before it, a break shows up as damage further down. Looking at the visible damage which is pricing and people related, you’re left to ponder how much you charge, or if your team is the right one to deliver what you need. When you should be starting with what’s going on in your customer’s market and pulling that thread.

Lose your knowledge of your customer and you can still ship a good product to the right people. You just can’t tell any of them what it’s for, enough that they can convince the other people in their business to sign off the budget.

When I say the damage lands further along the sequence and is visible, here’s how it manifest. It opens discussions about if the amount being charged is the problem, or if the customer success team is commercial enough, or if they need to invest in negotiation training, etc.

Discounting shows up on a dashboard, firefighting shows up in a pipeline review (or exit interviews), and churn gets logged with ‘no budget’ as the reason.

When a business is doing all the right things and none of them land, there’s nowhere obvious to look. So blame settles on whatever’s visible, which tends to be people first, then process, then product. That’s what I mean.

If you go at the pricing when the break’s in the sequence is happening earlier, then all you get is a discount conversation with better spreadsheets. And you light a fuse with a 2 year timer, this being annual subscriptions.

Testing with the team

I work with teams. We are testing how to discover what’s aligned to budget with an internal lead. Someone experienced, sitting between the customer’s subject matter expert, their own, and the team who have to make sure the customer gets somewhere.

The test is the opposite of a one size fits all approach (or, one size fits none). Their role is to see if the customer can point at what they are setting out to achieve AND tie it to something their board already cares about.

It might not work – but that’s the point of a focused test. And if it does work, segment-specific support costs more to run, and the reason they standardised in the first place hasn’t gone away. But nor has the targets for growth. So we’ll have to make the case for the long money – the compounding ARR it needs to represent.

What we’ll know by the end of the 90 day test is if customers can evidence something they couldn’t before – and commit to the journey.

How to tell if this is you

If your growth target gets harder every year while new business holds up, the problem isn’t at the front end.

Take your last ten lost or downgraded accounts. If budget is the recorded reason on most of them, that’s not a finding, it’s a gap in the record – I think it’s a cop out.

Ask three people what result your biggest customer got last year. One from product, one from sales, one from customer success. If the specialist gives you an outcome for the customer and the other two give product / internal focused points of view, this is happening to you.

Look at what your product people know about your segments that has never been written down anywhere. If the answer is that they’re just good with customers, that’s the thing you didn’t scale.

And if you’ve already tried to fix this, check what advantage it gave the customer. Be specific – is it linked to board initiatives, shareholder commitments, P&L?

One last thing

The businesses that ask me in aren’t the ones in trouble. They’re the ones performing well enough to want somebody independent getting close to their teams and their customers, to find where value is building, where it’s leaking, and what nobody inside can see any more.

Common questions

What is a SubsNoun?

SubsNoun is a Substribe term, considered to be a trademark. It’s the thing a customer is trying to get right, the number or outcome their own performance is judged on. It belongs to the customer’s job, not to your product.

Why is budget the most common reason recorded for churn?

Because it’s the easiest reason for both sides to accept. In a relationship business like b2b subscriptions and memberships, it puts the decision outside anyone’s control and closes the conversation. Budget is rarely found or lost, though. It’s defended, and what gets defended is whatever the customer can tie to something their board already cares about.

What’s the difference between customer success and customer results?

Customer success should be about your customer but it’s come to mean something your team does. It’s broken. Customer results are what the customer can point at afterwards and use. Without the second, the first becomes a reactive support function, competent and well run, and read by the customer as admin.

Why does pricing get blamed first?

Pricing moves fastest and shows up on a dashboard. Everyone has an opinion about it but quite often, nobody owns it, so it’s fair game to blame. Even if you have a pricing specialist, they’ll be wishing they got more context to inform their decisions. This is at odds with the fact that pricing is such a powerful lever to pull.

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How this was written

The diagnosis and the client work are mine. The words came out of several rounds with the Substribe brain, an AI project built on the method I’ve developed since 2018 across more than 50 B2B information and data brands and over 500 customer conversations. I write and voice my own experience into it, then keep going until it resonates. Then edit again.