At ESG, we’ve gone all-in on the future of Customer Success. Our Customer Success as a Service® model means that it’s our job to understand all the industry’s challenges, and then develop and perfect the strategies and philosophies that empower CS organizations to face those challenges head-on. Part of our work is collecting data that will enable CS leaders to succeed as the industry evolves. Last year, we, along with our CS friends at ChurnZero and Higher Logic, embarked on an ambitious project to check-in with the CS community as a whole and find out more about the industry’s current place in SaaS business and uncover the trends influencing its growth. What we discovered has been compiled and analyzed by CS experts and distilled into concrete, actionable data about the state of Customer Success today.
We are proud to present the Inaugural Customer Success Leadership Study!
A spotlight on Customer Success
Although Customer Success has steadily grown from a small entity in a select few SaaS companies to a must-have organization for any serious enterprise, the data on what works and what doesn’t can be hard to come by. Easily defined steps for getting from A to B, let alone all the way to Z, for a CS department, unfortunately, are a mere figment of our collective imagination. Every business is different. Many factors go into how a good CS organization is run, from where they best fit into the overall business structure to the best ways to scale and grow. This is why, more than ever, we all need concrete data to guide us. There is no one-size-fits-all CS strategy, but the insights we gain from others’ achievements will help inform industry-wide progress to CS maturity.
According to TSIA’s The State of the Technology Industry 2021, COVID-19 has accelerated technology business trends that were already uprooting traditional business models. No matter what type of technology company you are, the report warns, you must evolve your capabilities to match these trends or risk falling behind. There are two trends they specifically call out: pivoting to care more about your customer’s value realization and business outcomes and the growing preference for XaaS offerings in the technology space. One way to offset the disruption of historical revenue streams from these trends is to deliver on – and fully develop – your Customer Success strategy.
Benchmarking the blastoff
2020 was a lot of things, but we didn’t expect it to be such a good time to begin documenting the facts and figures surrounding CS growth. Of course, we know the more data, the better, but the upheaval caused by COVID-19 verified the link between the adaptability of SaaS organizations in tough times and Customer Success. In fact, CS is in a period of sustained, rapid growth as more and more businesses realize the potential of fostering current customer relationships in exciting new ways. At the start of 2020, TSIA found that close to 70% of companies have a dedicated CS organization. Now, our Customer Success Leadership Study has revealed that 74% of CS leaders have a seat at the executive table and the ability to create a budget. This is a giant step forward for the maturity and influence of CS overall.
Wherefore at thou, finance?
We’re thrilled to report that our study found strong collaboration between CS and their counterparts in sales, product, marketing, and operations. Unfortunately, finance lags, with only 51% of respondents reporting that they regularly work with their finance teams to meet their objectives.
Interdepartmental collaboration is a sign of a healthy, well-developed Customer Success organization. One of the most significant benefits of gaining ground on the CS maturity scale is leveraging what your CS team does for the benefit of the entire business. Companies that embrace CS on a larger scale increase customer revenue optimization and customer loyalty.
Indicators of a bright future
The debate about who should own the customer renewal and expansion rages on. 50% of survey participants said that CS owns the customer renewal, and 42% said CS owns expansion. As long as CS and sales work together for the best partnership possible, and you’re playing to the strength of your unique organization, everybody wins.
Technology tools dedicated to CS functionality have advanced right along with the industry, and CS leaders are enthusiastic about adoption. 81% have a CRM tool in place, and 64% have support technology. However, only 47% of respondents have a dedicated CS platform in place. There is room to grow here in terms of automation and efficiency, a good sign for teams that plan to successfully scale CS in 2021.
Key themes for Customer Success
We’ve broken down our findings into four easy-to-digest categories of Customer Success:
- Influence Within the Organization
- Organizational Alignment
- Customer Success Operations
- Goals and Aspirations
After surveying hundreds of leaders in this space, we’ve found that CS organizations are being given a seat at the table. They are being held to higher standards. We are entering an unprecedented phase of expansion and advancement for CS overall. It’s clear that our industry is leading the charge for the future of SaaS companies. For more information on these promising trends, download the Inaugural Customer Success Leadership Study. Ready to talk about what these trends mean for your 2021 Customer Success strategy? Contact us today.