Top Findings from the Customer Success Practices and Metrics Study

by Dec 11, 2018

The State of Customer Success

Customer Success has become a widely used and universally accepted term to describe a variety of customer-focused activities. The term has many meanings: A department; a team; a role, a business strategy.

The fundamentals of Customer Success are not new, the general concept has been around for some time, but current practices suggest that something more profound is happening across the industry. There is broad recognition that helping customers adopt and apply products successfully will help retain and build customer relationship value.

Companies based entirely on “as-a-service” models have known for some time that landing new customers is just the beginning of the relationship. Companies that have evolved from the world of perpetual licensing have been slower to recognize that the imperative to retain and expand existing relationships applies to them too.

Customer success is not a one-sized-fits-all methodology and there is no right or wrong way to apply the principles of customer success provided that the outcome from success initiatives result in the ability to sustain and grow customer relationships.

Customer Success Structure

Top Findings

  • Customer Success is a series of interrelated activities performed throughout the customer relationship lifecycle.
  • Effective customer success initiatives include activities from onboarding to expansion with an emphasis on assuring customers successful use of products.
  • Nearly half of responding companies focus on just one or two customer success activities.
  • Customer Success reports to the CEO or Chief Customer Officer a quarter of the time (22.6%).
  • Typically, Customer Success is organized within an existing department, and most often within Service or Support (57.0%), sometimes Sales (16.1%) and least likely within Marketing (4.3%).
  • The primary customer success Key Performance Indicators (KPI) are strategic with an emphasis on the health and value of customer relationships.
  • The top customer success KPIs include customer sentiment as measured by customer satisfaction or NPS; recurring revenue, and retention (churn).
  • Companies report “positive” or “significant positive” results from their customer success initiatives with the greatest positive impact focused on recurring revenue rates and product adoption.
  • Customer success is reported to have the least impact on customer churn (retention) and margin.
  • 60 percent of the time the group responsible for establishing a new relationship is not responsible for the ongoing account relationship.
  • A formal hand-off from the sales channel to the team that “owns” the post-sales relationship occurs two-thirds of the time.
  • Less than half (41.5%) of companies provide formal onboarding services. Those that do are most likely to assure that customers can access and use the product or service they have purchased.
  • The initial customer welcome as part of the onboarding process, remains a personal activity using a combination of personal e-mails, phone calls and on-site visits.
  • Many (42.4%) companies use an automated welcome e-mail, but fewer than 5 percent rely on a fully automated welcome.
  • When account resources are included with product purchase they are often provided to fulfill vendor-focused objectives.
  • The responsibilities for customer retention and recurring revenue are seldom shared across multiple post-sales teams and are most often the burden of a single department.
  • Nearly half of companies surveyed indicate that they do not actively track formal Customer Success metrics.
  • The most common metric used to evaluate Customer Success team performance is customer sentiment expressed as satisfaction and/or NPS.
  • Less than half of companies have tools to enable core success activities. The majority of companies that indicate use of specific success systems built their own solution often based on their existing CRM infrastructure.

Download the full report for complete data and analysis.

Featured: Customer Success Practices and Metrics

Customer Success has become a widely used and universally accepted term to describe a variety of customer-focused activities. The term has many meanings: A department; a team; a role, a business strategy. Unfortunately, the broad use of the term has obscured the diverse and complex activities that underlie a potentially transformational initiative. This study examines the approach companies use to organize, deliver and measure their Customer Success initiatives.

[et_pb_df_wc_restrict_content_open_tag admin_label=”Not Logged In – Open” shortcode=”wcm_nonmember” start_after_trial=”off” _builder_version=”3.0.100″]

[/et_pb_df_wc_restrict_content_open_tag]

Please Login

Members, please login for access to this and other reports.

[et_pb_df_wc_restrict_content_close_tag admin_label=”Not Logged In – Closed” shortcode=”wcm_nonmember” _builder_version=”3.0.100″]

[/et_pb_df_wc_restrict_content_close_tag]

[et_pb_df_wc_restrict_content_open_tag admin_label=”Success Access – Open” shortcode=”wcm_restrict” plans=”success_plan” start_after_trial=”off” _builder_version=”3.0.100″]

[/et_pb_df_wc_restrict_content_close_tag][et_pb_df_wc_restrict_content_open_tag admin_label=”Success Trial – Open” shortcode=”wcm_restrict” plans=”success-trial” start_after_trial=”off” _builder_version=”3.26.3″]

[/et_pb_df_wc_restrict_content_close_tag][et_pb_df_wc_restrict_content_open_tag admin_label=”Success Enterprise / Team – Open” shortcode=”wcm_restrict” plans=”success-enterprise-plan, success-team-plan, success-trial” start_after_trial=”off” _builder_version=”3.0.100″]

[/et_pb_df_wc_restrict_content_close_tag]

[et_pb_df_wc_restrict_content_open_tag admin_label=”Not Logged In – Open” shortcode=”wcm_nonmember” start_after_trial=”off” _builder_version=”3.0.100″]

[/et_pb_df_wc_restrict_content_open_tag]

Login

*Membership level determines your access to ServiceXRG research and other member services. Paid memberships include access to research and playbooks. Free memberships include access to some reports and discounts to others. Please visit our membership page for a list of available membership programs.

[et_pb_df_wc_restrict_content_close_tag admin_label=”Not Logged In – Closed” shortcode=”wcm_nonmember” _builder_version=”3.0.100″]

[/wcm_nonmember]

[/et_pb_df_wc_restrict_content_close_tag]

**A copy of the current findings (as of 12-4-18) will be sent upon the completion of the study.

Related Articles

Is It Time to Modernize Your Service Portfolio?

Modern, well-defined post-sales service portfolios that combine elements of Customer Support and Customer Success can significantly increase your ability to help customers use and apply products; reduce churn; and expand revenue growth. This article will help you to determine the type of post sales service portfolio you need.

read more

How to Measure Net Recurring Revenue

Net Recurring Revenue is a comprehensive indicator that reveals the extent to which you are retaining, expanding and growing customer relationship value. Examining the specific underlying elements that contribute to the calculation of Net Recurring Revenue provides the necessary insights to identify the root causes of churn, attrition and contraction. In addition, examining the reasons for revenue growth presents opportunities to embrace and expand practices that encourage expansion of relationship value.

read more

The Journey from Support to Customer Success

The journey from Technical Support to Customer Success requires more than a name change or the addition of a team of Customer Success Managers. To fully embrace Customer Success, Support and Service teams must rethink their role and adopt new ways to engage, retain and grow customer relationships. This article introduces four key milestones to help you define essential Customer Success capabilities.

read more

Customer Success – Why Services Should Lead

The industry is buzzing with talk of customer success, what does it mean for Services? Service organizations are in a unique position to drive customer success initiatives. Who better than Services to understand the challenges customers face in using products and the gratitude that can be earned by helping them.  It is time for Services to take a leadership role in driving the principles of customer success across the company.

read more

Pin It on Pinterest

Share This