Innovate for Customer Success
Our customers look to us as enablers of their success. We innovate with their needs in mind. Our end-to-end network expertise and commitment to our promises build the trust that drives deeper engagement and secures our ongoing success.
The customer service sector is no longer limited to telephone conversations and answering machines. Now, the customer service industry is focused on innovation. Modern ways and processes are being embraced. Even the term customer service has been replaced with customer success.
1) Everything Mobile
There is very good reason for the reduction in sales of computers around the world. That is because more and more people are using their mobile phones for shopping and to interact with businesses.
2) Customer success teams have to become more responsive and alert to the wants and needs and capabilities of consumers on their mobile phones who demand immediate access. Such on demand customer success capacities can be delivered via SMS, or DMs on social media platforms.
3) Chatbots Everywhere
Chatbots are the ultimate innovation in the field of customer success. When customers want more than just the “human touch”, they frequently look for options that might help them faster than humans can.
Chatbots are becoming a top kind of customer success technology that can greatly reduce the number of contacts human agents have to handle. This also ensures that more humans are freed up to deal with problems that are too complicated for simple chatbots.
According to research, more than 80% of the queries that customers have can be cleared up with the help of chatbots.
4) Social Media Everywhere
Social media has been used by businesses for marketing and sales for quite a long time. Now, we are fully in the next phase where companies are beginning to use channels for customer success purposes.
Customers have made social media the default way of interacting with their friends and family, along with work colleagues and others. It makes sense for businesses to join the social circle of customers to resolve their queries efficiently.
There are a number of agencies that provide customer success on social media. They can be employed to save capital and the hassle of looking for more reps.
5) Everything Better with Video
Video chats in the post-pandemic world are being used by everybody. Technologies like Skype, Zoom, and Duo have become a daily part of our lives.
Because customers have become more comfortable with interactions over video chat, businesses should endeavor to launch themselves into this space as well.
Video guidance for customers over video tends to have effects that cannot be attained over other mediums.
Video simulates the actual presence of humans for the convenience of the customers. As a result, video makes customers feel that they are cared for by the company and feel valued.
These innovations in customer success have become prevalent in recent times. More and more businesses are getting focused on improving their customer relations, often hiring dedicated personnel to handle that area for them.
Customer success is becoming so important that there are dedicated agencies popping up offering businesses a steady hand to deal with the queries and questions of customers.
This change is for the better. With the advent and rising popularity of online shopping and telephonic marketing, customers are becoming more aware about the kind of businesses they are interacting with. A few words of appreciation and prompt replies to their emails goes a long way in securing their loyalty.
Innovation in customer success takes on a more systematic approach to delighting customers. It breaks down internal barriers and encourages more transparency.
It is key for every organization to measure customer success. According to Hubspot, given below are key customer success metrics:
1. Customer Health Score
This might sound obvious, but hear me out: You’ve got to look at the big picture — beyond just individual tickets and emails. Are customers actually seeing value from your product or service?
How often is your customer using the product? How successful is your customer after they purchase your product? What type of impact does it have on their business? Has their pain point been eliminated?
Customer support is no longer about getting someone to sign on the dotted line, setting up their new service, and answering their emails and calls. Instead, reps need to ensure that their customers are not only surviving but thriving after their purchase. They must follow up with clients, offer assistance with problems, and help them proactively strategize for the future.
As Forrester's Kate Leggett points out in a blog post, customer success is the driving force behind increasing existing revenue and influencing new sales. One customer's success can prompt another person to try your product or service in hopes of attaining a similar, successful outcome ... but this virtuous cycle only happens when you actively foster and track customer success.
How to Calculate Customer Health Score
To measure customer success, formulate a customer "health" score. What do their finances look like? How many customers do they have? Get a handle on their business' health as it pertains to your product, then monitor the metric over time.
You can develop a customer health score by compiling all of these factors and using an index as the actual score metric to keep things consistent and easy to track.
You can also measure your customers' growth. After all, the best sign of business success is growth. Ask if the company is hiring, taking on more business, or improving customer retention rates for a qualitative idea of how successful a customer is becoming.
2. Net Promoter Score
Customer satisfaction is not only about the customer's feelings towards the support rep, but also about their feelings towards the brand and the product itself. When you measure customer satisfaction, you're determining how content your customers are when they're interacting with your business. It should be no surprise that customers who are happier with their experience will be more likely to make repeat purchases.
One of the more popular ways to measure customer satisfaction is through Net Promoter Score. A Net Promoter Score, or NPS®, simply asks whether someone is likely to recommend your company to someone else. The rep and their relationship with the customer play a major role in this rating because they’re probably the person the customer has interacted with most frequently.
The benefit of an NPS is that it provides both quantitative and qualitative data about your customers. Not only does it ask participants to rate their experience on a numeric scale, but it also asks them to provide an explanation for their score. That way, your business can analyze feedback based on the scores, then examine the customer experiences if you come across abnormal or outlying results.
How to Measure Net Promoter Score
Measuring NPS is relatively easy. You just need access to a form tool that can generate a rating scale response.
Your eNPS survey form should only ask one question, "On a scale of 1 to 10, how likely are you to recommend this product or service?" Then, add an open-ended section below it and ask participants to explain their score.
3. Qualitative Customer Feedback
Another important thing to measure is your customers' feedback. What are they saying about you and the service you provide? What do they like about their connection to the company, and what do they dislike?
Customers need to feel that they have a voice. Offering them a chance to give feedback and provide insights is a great way to build a long-lasting and meaningful relationship.
Customer success managers can determine from qualitative feedback — like a survey responses — how well their reps are working with clients. It might be unpleasant to hear where your onboarding or customer service process is failing, but getting the chance to right a wrong before a customer jumps ship is invaluable.
How to Calculate Qualitative Customer Feedback
The simplest way to collect customer feedback is to send out a survey. Pose a few questions to your customer base and determine how they feel about your customer support reps.
You could also hold a "customer day." Invite some folks to your office or headquarters for lunch or a meeting, and talk to them one-on-one. Note their facial expressions and body language when they reflect on the service they receive and how they would improve their experience.
Remember: Customer feedback shouldn't be solely about the product — it should also cover how clients feel about the brand and company, as a whole.
4. Customer Churn Rate
Customer churn is a great metric to measure, especially on a rep-to-rep basis. A customer support rep who maintains a healthy relationship with their clients is likely to have a lower churn or cancellation rate. After all, customer support is about relationships, and building rapport makes a huge difference.
How to Calculate Customer Churn Rate
To calculate churn rate, follow these steps:
Step 1: First, determine the timeframe that you'll consider when measuring your data. This can be a week, month, quarter, year, etc.
Step 2: Next, determine how many existing customers there were at the start of this time period as well as the number of customers that churned during the same timeframe.
Step 3: Finally, divide the number of churned customers by the total number of existing customers to find your churn rate.
For example, let's say we wanted to measure the monthly churn rate for my business. At the start of May, I had 1,000 customers, but by the end of the month, 64 customers churned. In this case, my churn rate for May would be 6.4% (64/1000=.064=6.4%).
When measuring churn rate, remember to exclude the new customers that you acquired during the month from your existing total. These customers will count towards your existing customer total during the next assessment that you perform.
Additionally, be sure to include any new customers who did churn during the time period with your overall churn total. Since the churn for these customers occurred during the assessment period, you should include them when measuring for churn rate.
5. Monthly Recurring Revenue
Monthly recurring revenue, or MRR, is a great metric to use to determine how much your customer base — or their spending — have grown since working with your business. This metric outlines the amount of money that your customers are spending on your products and services for each given month. You can compare this value over time to determine whether your customers are succeeding with your products or not. This is particularly helpful for SaaS businesses that operate on a subscription model.
One additional MRR metric that can be calculated is your expansion MRR. Expansion MRR shows you how much additional revenue you're generating from customers outside of their monthly subscriptions. This can give you a good idea of how effective your upgrades and customer loyalty programs are.
How to Calculate Monthly Recurring Revenue MRR
To calculate monthly recurring revenue, you just need to multiply your total number of monthly active customers by your average revenue per user. This should give you an idea of how much money you're generating each month.
For example, if I have 1,000 monthly active customers and my average revenue per customer is $750, my monthly recurring revenue would be $750,000 ($1,000 x $750 = $750,000 MRR).
To calculate expansion MRR, you'll need to add up all revenue that was generated from non-recurring purchases. These would be things like upsells and cross-sells, loyalty programs, and add-on purchases that are made by customers on a one-off basis.
By adding these values together, you see how much your customers are actually spending on your premium offers. If you're doing well, then you know that customers are not only enjoying your product or service but are thriving because of it.
6. Customer Lifetime Value
Customer lifetime value (CLV) is one of the most fundamental customer success metrics that you can measure for your business. It shows you the total revenue that you can expect a single customer to generate over the course of their relationship with your company.
Businesses can use CLV to determine the value of their customers over time. If their value increases, then your company knows that your products and services are contributing to your customers' success. If it's decreasing, then your business may need to re-evaluate its offers and look for flaws in the customer experience.
How to Calculate Customer Lifetime Value (CLV)
CLV takes a customer's revenue value and compares that number to the customer's predicted lifespan. It can be calculated in two steps.
Step 1: Multiply your average purchase value by your average purchase frequency rate.
Step 2: Take that value and multiply it by your average customer lifespan. This should leave you with the estimated amount of revenue that one customer will spend on your business.
Let's say my customers spend an average of $50 every time they shop at my store. My customers also visit my store about 3 times every month. Additionally, my average customer lifespan is typically two years before they stop purchasing from my stores. From this we can determine that my CLV is $3,600 ($50 x 3 visits x 24 months=$3,600).
7. Customer Retention Cost
While it's great to know that your customers are succeeding with your brand, how can you prove that your customer success efforts are cost-effective? Customer retention cost, or CRC, outlines the total cost of your customer success program and compares it to your total number of customers. This shows you how much money you are spending on each customer to retain them.
CRC helps businesses invest in their customer success programs. While you may be excited to roll out new initiatives, you want to make sure that you're spending your money in a cost-effective way. By measuring CRC, your business can make smart investment calls by comparing the potential cost of retaining customers versus the potential revenue you'll generate from a new feature or service.
How to Calculate Customer Retention Cost CRC
To calculate CRC, you'll need to audit the expenses of all of your customer success efforts. This includes expenses spent on payroll for your customer success and service teams, engagement and adoption programs, professional services and training, and customer marketing.
Once you add all of these expenses up into one sum, you can divide that value by your total number of customers to get your average customer retention cost (sum of all expenses / total number of customers = average customer retention cost).
8. Customer Effort Score
How difficult is it for your customers to get help? As customers ourselves, we understand the frustrations that come with navigating through pre-recorded menu options, repeating ourselves as we’re transferred from agent to agent, and struggling to find a contact option in the first place. In fact, 96% of customers who are faced with these types of high-effort experiences report being disloyal in the future.
So how can you ensure your customer support team isn’t unintentionally creating these barriers that frustrate customers and ultimately make them disloyal to your business?
You can measure customer effort score (CES) to measure how easy it is for your customers to get the help they want and need. The metric also helps you predict customer loyalty — Gartner found that CES is 40% more effective at predicting customer loyalty than customer satisfaction.
CES is measured by surveying customers, often once their issue is resolved. Here’s an example:
By tracking CES, you can determine where you’re unintentionally making things difficult for your customers and adjust as needed to make it easier for them to get support. As a result, you’ll create delightful customer experiences that increase loyalty.
9. First Contact Resolution Rate
One of the most common customer needs is time. Customers want their problems resolved quickly, so they can get back to pursuing their goals. If they're constantly waiting for your support team, this adds a great deal of friction to the customer experience.
With this in mind, it's important to measure your first contact resolution rate. This is the percentage of customer service cases that are resolved within the first interaction. If this number is high, that means your team is not only responding to customers but addressing their needs promptly as well.
How to Measure First Contact Resolution Rate
To calculate first contact resolution rate, you'll need to divide the number of service tickets that are closed after the first interaction by the total number of service cases your team received.
To do this, you'll need customer service tools to help you keep track of your incoming cases. For example, a ticketing system can set up digital records of your cases that are easily categorized and stored. And, a help desk can provide the reporting tools you need to calculate first contact resolution rate without having to manually crunch the numbers.
10. Customer Satisfaction Score
Customer satisfaction score, or CSAT, is similar to NPS, but it has one major difference. Instead of asking participants to rate their likelihood of recommending the brand to others, CSAT asks them to simply rate their experience with the company. This gives businesses a snapshot idea of how customers feel after completing an interaction with the support or success team.
How to Measure Customer Satisfaction Score CSAT
Like NPS, customer satisfaction score requires a survey to measure it. But, you'll need to trigger this survey after a customer interaction, so you can get the most accurate response from your participant. Remember, this metric should analyze the customer's immediate reaction to an individual experience, not their overall perception of your brand.
Step 1: Once you have your form set up, you can calculate CSAT by dividing the number of positive scores (scores six to 10) by the total number of scores you captured.
Step 2: Then, if you multiply your result by 100, you'll have the percentage of customers who are happy with their brand experience.
For example, if we received 50 responses and 40 of them were positive, then our CSAT would be 80% (40/50 = .80 x 100 = 80%).
11. Renewal Rate
If you're a SaaS business, this may be one of your most important metrics. After all, most SaaS businesses operate on a subscription model, so it's no wonder that customer success would be determined by the number of people who keep signing up and using your product.
If your renewal rate is high, this means that your team or product is succeeding in driving customer success. So much so, that customers are willing to commit to your business for another year/contract so they can continue gaining benefits from your company.
If your renewal rate is low, this is an excellent indicator that customers aren't succeeding when using your product. This presents an opportunity for you to invest in customer success programs as well as product development, to create a more delightful, long-term experience for your users.
How to Measure Renewal Rate
Step 1: Divide the number of customers who renewed their subscription by the number of users who were up for renewal.
Step 2: Multiply your result by 100 to determine your renewal rate.
If you're not a SaaS company, you can look at product expiration dates. Use your CRM to see when a customer bought a product, then set a reminder to review the customer's account when their product should be replaced. If they purchased from you again, you know they "renewed" with your business.
Instead of making calls for the sake of making calls, customer support reps are instead turning their attention to relationships and what happens after they make a sale. The metrics that matter have shifted, and the customer success organization is adjusting accordingly. These metrics are worth watching as you help your customer success team ramp up.
SaaS Customer Success Metrics
SaaS customer success metrics are more specific and focus on data that is specific to the software industry. Several of the metrics listed above like renewal rate and MRR do apply to SaaS specifically, but we’ve added a few more that will provide a more holistic view of this business model.
12. Product Usage Rate
The more customers use your product, the more valuable it is to them. That is unless your product is similar to Hinge, where the customer’s goal is to delete the app as quickly as possible.
With just about every SaaS product, your customer service team will be able to track how often each user accesses it. Ideally, you want your overall product usage rate to progress over time until it reaches your ideal usage frequency.
To calculate this metric, decide which intervals you want to measure, i.e. daily, weekly, monthly, etc. Then identify what percentage of your customers are achieving each one.
13. Average Time on Platform/ Average Time in Application
Understanding how much time your customers spend using your software can tell a detailed story about how the product is integrating into their activity. This metric not only helps you understand the customer’s behavior, but it’ll also help you set a benchmark for how long a typical customer should spend using your product. That way, you can make improvements to your software over time.
14. Active Users
If your company is focused on growth, this SaaS customer success metric will be critical to your growth strategy. You can measure active users by adding the number of customers who use the product at a particular frequency — daily, weekly, and monthly are some of the most common.
15. Free Trial Conversion Rate
Freemium options are a staple in the SaaS industry as they drive user adoption quickly, but how can you measure their success? Free trial conversion rate is a must-have measurement for any SaaS company. This metric reveals how well customers are switching from the free version of your product to the version that generates revenue for the business.
You can measure free trial conversion rate by dividing the number of customers using the free trial by the number of customers who converted to a paid subscription. You can measure this data point on a monthly, quarterly, or annual basis.