25 Sep 25
NRR is falling at 58% of B2B companies. Discover why retention drops, and 4 strategies top performers use to expand and grow from the base.
Net Revenue Retention (NRR) is under pressure across the board.
In SBI’s latest analysis of more than 150 B2B companies, we found that 58% have seen NRR decline over the past two years, with average performance dropping from 110.8% to 107.2%. That shift alone is alarming, but the downstream impact is even more significant: 71% of companies with declining NRR are also missing their overall growth targets.
In other words, falling NRR is more than a Customer Success (CS) problem. It’s a signal that your entire commercial model may be misaligned with how value is created and sustained inside your base. So, what’s driving the drop, and more importantly, how are market leaders solving it?
NRR Isn’t Broken. The Way It’s Owned and Executed Is.
Many companies have responded to NRR pressures by spinning up new CS programs, tweaking pricing, or launching retention campaigns. Those things help briefly. But they often miss the deeper issue.
NRR isn’t just a metric. It’s an output. And what drives it isn’t effort, it’s how clearly your GTM model is designed to retain and expand revenue after the initial sale.
In our work with executive teams, we see a consistent challenge: even the most sophisticated organizations are overly indexed on acquisition. They’re excellent at generating pipeline but inconsistent at protecting and growing the value of what’s already been won.
Too often:
- Sales owns the logo, but not the renewal.
- Customer Success supports adoption, but not expansion.
- Marketing runs lifecycle campaigns without knowing who’s close to churning, or ready to buy more.
And in this kind of system, NRR falls through the cracks.
NRR Leaders Do Four Things Differently
Through SBI’s research and advisory work, we’ve identified four deliberate practices that separate NRR leaders from the rest. These organizations aren’t working harder post-sale; they’re working smarter, with clearer roles, better orchestration, and tighter focus on where growth is actually possible.
1. They know which accounts are worth growing.
The best companies don’t pursue expansion broadly. They prioritize a narrow band of accounts where they have both a right to win and room to grow—typically based on intent data, usage signals, and firmographic fit.
By contrast, average performers are 4x more likely to spread GTM resources across too many accounts with low expansion potential, resulting in wasted cycles and missed growth targets. NRR leaders double down where the signal is strong.
That means:
- Rethinking account segmentation
- Aligning resources to high-propensity accounts
- Building joint plays between sales, CS, and marketing based on expansion readiness
2. They treat retention and expansion as distinct motions.
Renewing an existing product is not the same as selling new functionality or converting a small team into an enterprise account. High-performing companies separate these motions structurally.
They create:
- Dedicated renewal roles with clear accountability and efficiency targets
- Expansion roles, such as customer success managers (CSMs) or account managers, are equipped to uncover new value and grow accounts
- Two-stage commercial engines: one for frictionless land and renew, and another for high-value upsell and cross-sell
This model removes confusion, drives ownership, and ensures that expansion is managed with the same rigor as new logo acquisition.
3. They elevate Customer Success from support to a strategic growth partner.
In underperforming companies, CS often ends up in a reactive, execution-heavy role answering tickets, chasing NPS, and keeping customers “happy” with no real connection to revenue outcomes. NRR leaders take a different approach: they turn CS into a commercial function. That doesn’t mean every CSM carries a quota, but it does mean:
- Tighter alignment between CS, Sales, and Product
- Defined post-sale responsibilities with clear KPIs tied to growth
- Compensation models that reward impact, not activity
Critically, these organizations invest in enablement for CS, recognizing that many CSMs were hired for technical depth or relational skill, not commercial acumen. If you want CS to drive revenue, you must train and equip them to do it.
4. They orchestrate value across the customer lifecycle, not in silos.
Too many companies treat customer engagement like a baton pass where marketing generates leads, sales closes the deal, and CS takes over post-sale. The best-performing companies don’t hand customers off; they stay connected through a unified lifecycle model. They:
- Define a shared operating rhythm across teams
- Use account-level data and AI to prioritize and sequence outreach
- Deploy orchestrated plays with joint goals and measurement
These companies aren’t building departments. They’re building systems that drive value consistently because every part of the GTM engine is aligned around the same customer outcomes.
Why This Matters Now
Growth from the base is no longer a nice-to-have. It’s the fastest, most capital-efficient way to hit targets in a capital-constrained, high-scrutiny environment. Yet many executive teams still treat NRR like an operational issue instead of a strategic lever. That’s a mistake.
If you’re not growing inside your base, you’re already behind. Throwing more sellers at the acquisition won’t fix it. As boards and investors demand more profitable growth, the companies that outperform will be the ones that can design their operating models to expand predictably.
What to Ask Yourself
Whether you're leading revenue, strategy, or the entire organization, it’s worth pausing to ask:
- Are we clear on which accounts are expansion-ready, and which aren’t worth chasing?
- Do we have defined roles for retention and expansion, or is everything muddled post-sale?
- Have we empowered CS to drive commercial outcomes, or just customer sentiment?
- Is our customer lifecycle a true go-to-market system, or a collection of handoffs?
If you’re unsure, you’re not alone. But this is fixable. The companies that get this right aren’t just raising NRR. They’re reducing risk, increasing predictability, and creating a GTM model built for long-term value.
The Data CEOs Use To Design Winning Plans
SBI’s latest research report, How Market Leaders Reverse Declining NRR, walks through the data behind the NRR slide and how top performers are redesigning their teams, roles, and motions to grow from the base.
