Customer Success Recommendations for Your 2020 Planning

November 7, 2019

Megan Macaluso

Category: Customer Success as a Service, Customer Success Resources, Customer Success Strategy

Fall is in the air! The days are getting shorter, the air is getting cooler, and that can mean only one thing: it’s time to start planning your Customer Success strategy for 2020.

To help you get started, we pulled together advice from the best of the best — our very own Sheik Ayube, Director of Business Development; Marley Wagner, Marketing and Communications Manager; and Michael Harnum, our CEO.

The Most Important Metrics to Focus On

First, from a CS perspective, what are the most important metrics that organizations should look at as they work through their 2020 planning? There are hundreds of metrics that SaaS companies can track, so which ones are the most beneficial to your business? And why are those metrics so important?

Sheik Ayube, Director of Business Development

Everything you do should be tied to retention and growth. Everything. Mature organizations will focus on the leading indicators (input) rather than the lagging counterparts (output). i.e. x% adoption (input) = y% retention (output).

Why does that matter? Say your business or industry takes an unexpected downturn. A new competitor comes around and disrupts your market. What happens next? Executives may look to make quick fixes — and if you’re not a profit center for the business, your organization (and your team) is at a larger risk. But if you know the specific actions that are leading to the results the company wants to see, you’ll be better prepared to prove the ROI of CS, regardless of the external circumstances.

Marley Wagner, Marketing and Communications Manager

Churn rate within the first year of purchase. This number will vary by industry, but if it’s high (or higher than you’d like), this could indicate one of two things:

  1. There’s room for improvement in your onboarding process.
  2. There’s room for improvement in your relationship with sales and marketing.

Onboarding is easier said than done, so take some time to analyze your current processes and adjust as needed. If onboarding doesn’t appear to be the culprit, some customers who churn early may not have been the right fit to begin with, which leads me to the next possibility.

If you suspect this, get time with your counterparts in sales and marketing ASAP! Assume that there is no malintent here, and go into the conversation with specific customer examples to share. Chances are, they’ll thank you for bringing the mis-alignment to their attention, and you’ll all go into 2020 with additional insight, leading to more accurate planning.

Michael Harnum, CEO

So many companies are at the very early stages of Customer Success maturity, so I recommend starting at the very early stages of your customer’s experience — specifically time to onboard and adoption index.

Your customers are forming opinions about your company and its product and services very early, so focusing on onboarding and adoption sets you on the path to success right out of the gate. If you initially stumble with a new customer, it is extremely difficult to rebuild trust.

Metrics Not to Follow

On the other end of the spectrum, there are plenty of metrics that people focus too closely on. “Vanity metrics” are metrics that are easy to boost, producing attractive graphs that you can show to your customers, but don’t actually indicate a healthy account. And some metrics simply don’t apply to everyone equally. So which metrics should we back down on? The short answer is one we all agree on: NPS.

Marley Wagner

Net Promoter Score (NPS). You may have a high NPS (and I can tell you from experience, your marketing team will certainly be excited to spread that news), but do you know the participation rate of your NPS surveys? If participation is low, that score is not painting an accurate picture. And while you’re busy celebrating, what about the customers who didn’t participate? They’re the ones who should keep you up at night.

Take some time to look at their usage data and reach out with a relevant message, not just a note to “check in.” (Lean on your friends in marketing here for ideas and support!) Potential churn may be lurking in those un-engaged customers, so by focusing less on NPS and more on the participation rate of that survey, you can act before it’s too late.

Sheik Ayube

NPS is a great metric to track. It’s also a great “feel good” score. But without deeply understanding the science behind NPS, your NPS score could likely be a false positive — you have a high NPS score, but what is your participation rate? Each customer has multiple buying personas (the user, finance, etc.), so who are you surveying?

Michael Harnum

Net Promoter Score (NPS) is over valued in many CS organizations for one reason only: it is a metric that is understood by C-Suite executives. It’s incumbent upon CS leaders to re-educate their respective exec teams on more relevant metrics.

Convincing the C-Suite

Customer Success is a relatively new concept, driven by the rise of social media and the increasing reliance on word-of-mouth in customers’ buying process. Understandably, C-Suite executives are hesitant to pour time and money into unproven concepts.

So where can organizations see the biggest impact? How can they persuade their executives to offer up more resources to their Customer Success departments?

Michael Harnum

Typically there is no immediate, short term ROI measured in terms of revenue. Building a strong CS foundation through tools, playbooks, understanding and learning make the company much more flexible and adaptable in a competitive marketplace.

Marley Wagner

Measure EVERYTHING!! Even data you don’t think you’ll ever use, if you can collect it, do so! You never know when it may come handy.

Setting Realistic CS Goals

Setting goals is tricky: if they’re too easily attainable, they won’t push you to improve. If they stretch too far, you’ll demoralize your team when they fail to meet them. Add to that the complicating factor that the ROI from Customer Success is hard to measure, and it becomes very difficult to set goals for your CS team.

So how do organizations set realistic goals for meeting Customer Success initiatives?

Sheik Ayube

Start small, trust yourself, and execute flawlessly. As a CS leader, you understand your customer, industry, and product. Pick a controlled set of customers, form a hypothesis with a few high impact metrics that are important to the entire company, and get to work.

Data is your best friend here. If you miss, that’s okay … it was a hypothesis. But what you cannot do is fail to understand why, and how not to miss next time. An iterative approach is key here, but you’ll need plenty of data to do so effectively.

Marley Wagner

Start by making a hypothesis and testing it. You won’t reach the goal every single time, but you’ll always make progress towards it, and the lessons learned along the way will enable more accurate goal setting down the road.

Michael Harnum

Short term goals should be centered around understanding your current position on a relevant CS Maturity Index (like ESG’s) and improving that maturing through specifically built programs delivered in phases.

Looking Forward

As you look ahead to next year, you’ll also need to look back — back on what you’ve accomplished this year, on what you wish you had done better, and on what you excelled at. Let what you’ve done and where you’ve been inform your future plans, and knock 2020 out of the park!