5 Models for Monetizing Customer Success

January 25, 2022

Marley Wagner

Category: Customer Experience, Customer Retention, Customer Success as a Service, Customer Success Maturity, Customer Success Strategy, Monetizing Customer Success

For some, monetizing Customer Success may feel like a long way off. Others are but a hop, skip, and a jump away. If your organization is eyeing this lofty goal, there are some significant factors to take into account before you can start charging your customers for CS services. Because there is so much to consider, we count CS monetization and funding as one of the last capabilities to develop on the Customer Success Maturity Model. If you haven’t had a chance, I’d definitely recommend taking a look at our deep dive on Customer Success monetization for an in-depth examination of what it takes to be ready before launching a paid program.

Once you’ve developed a strong foundation on which to add a monetization strategy on top of, defining your model for structuring your fee-based program will be a critical next step. You have a variety of options to choose from, some tried and true and some that are more experimental. I’m going to take a look at each one to give you a better sense of what’s out there. Hopefully, this will help you decide what’s best for your Customer Success organization – once you’re caught up on all the dos and don’ts of monetizing Customer Success and ready to take the plunge.

A tiered pay structure that encompasses the entire customer lifecycle

Perhaps the most comprehensive way to monetize Customer Success is to develop a tiered structure that covers everything from free to fee. A two-tiered approach is simplest, splitting your customer base between those who aren’t paying for Customer Success services and those who are. A multi-tiered system like the one PTC utilizes has four payment tiers beginning with a free tier bundled with the product’s subscription. Two middle tiers are hybrid options for PTC’s customers who want a bit more hands-on guidance from CSMs. Their final tier is a strategic partnership between the customer and PTC.

PTC was one of the first companies to really nail their CS monetization strategy, and there is a lot to be said for the approach they take. Customers understand tiered pricing because the concept has been around forever and, in the modern age of digital subscriptions, good-better-best is rapidly becoming ubiquitous. It’s a holistic model that might take time to build correctly, but it’s a well-established and proven system that customers are used to.

Customer’s choice: à la carte modules and add-on packages

If you need to start your monetization journey on a smaller scale, à la carte may be a viable option. By creating offerings that customers can add to their regular subscription, you can try out different things and gauge interest before making a more considerable change. According to a recent survey, this is the most popular strategy for Customer Success monetization, with 39% of organizations taking this route.

This model can also be combined with other monetization methods, which may add to the appeal. For example, in addition to their “Success Plan” tiered services, PTC’s customers can choose from an extensive catalog of add-on microservices.

A honed services approach – typically focused on adoption

From the beginning, Customer Success has been closely tied to the adoption motion. So, charging extra for special guidance in the early stages of the customer journey makes a lot of sense for some businesses. Educational services that add value for customers and help them accelerate time to value make happier customers too, even when they pay for them separately. Bundling training into Customer Success offerings leads to a 16-point increase in corporate Net Promoter Scores.

The best example of this honed approach to monetizing Customer Success is from Salesforce, who blends support and adoption services to create a tiered model geared specifically toward adoption activity. You can also get creative with this model, building out concise, specific CS offerings tied to different customer lifecycle segments.

The cut-off: applying Customer Success services to a select group of higher-paying customers

Another option is to apply high-touch Customer Success services to a select group of customers and charge them accordingly. With the availability of so many great tools these days, you could keep other customers on a more automated track, but we don’t necessarily recommend it. If you go this route, it will make it more difficult if you want to transition into a dynamic engagement model in the future. The study I mentioned earlier puts this model at relatively low popularity. Only 13% of CS organizations monetize like this on a case-by-case basis, providing strategic customers premium Customer Success engagement as part of their subscription.

Free Customer Success for everybody!

Although this isn’t technically a structure for a paid program, I’d be remiss to leave this one off the list. If you aren’t doing any of the above, you’re technically operating a freemium model.

One thing we can all agree on, no matter what structure you choose, monetization is tricky. The great thing about Customer Success is how the industry is constantly changing and thinking up new, creative ways to get customers the support and value they need. Soon, CS organizations could monetize with totally different models than these. The important thing is to choose a system that works best for your unique business, your CS team, and your customers.