In our last blog post, our favorite Customer Success Manager, Cindy Carson, laid out the three stages of customer success—exceptional onboarding, reaching customer-centric milestones, and customer growth—that help companies fight churn, grow revenue, and expand their customer base. With that in mind, we wanted to share the KPIs (Key Performance Indicators) our team uses to measure those stages and make sure our customers are reaching their full potential with our product.
KPI #1: Churn Rate
Churn is a defining factor of a SaaS company’s ability to retain customers—a pivotal component of the growth of a company. In an article on the importance of churn, David Skok explains that as a company grows, “that loss of revenue requires more and more bookings coming from new customers just to replace the churn. As a result growth slows substantially.”
This is where customer success can really shine. Not only can great customer success teams retain customers, but they can take the lead on account expansion and referrals, which can dramatically offset inevitable churn.
KPI #2: Customer Sentiment
Perhaps the most common and most standardized metric in customer success is sentiment. Customer sentiment is measured through a quick NPS (Net Promoter Score) survey asking customers how likely they are to recommend this product to others. This helps measure customer satisfaction and loyalty and also lets customer success teams know what they can do to improve and who is prime for referrals.
Most companies implement NPS surveys via email, but we choose to deliver them inside our web-app, using best practices and strategies, where customers are most receptive. Our customers have seen great success with this method (MedReps saw a 70% increase in survey completion rates in just 10 days using in-app messages over email).
KPI #3: Activity Level
Our customer success team keeps a close eye on user activity levels. This not only shows them who is inactive (and therefore at risk for churn), but also shows where a user might be stuck or confused inside the app. This information helps them chart a course for correction through relevant messaging campaigns like guided tours or feature callouts. Appropriate activity levels will inevitably vary between companies, but login frequency is a key variable for us.
KPI #4: Product Utilization
We also care a great deal, as most SaaS companies do, about ensuring the product we’re building is being used. For us, this is made up of three key factors:
Feature Usage measures what features customers are using in the application. You want to make sure your customers are using the stickiest features, including integrations. Feature adoption measures how well customers adopt new features as they roll out.
Depth of Usage measures the percentage of the product being used and can indicate whether a customer is getting the most out of it. The more features a customer is using, the more invested they are in the product.
Breadth of Usage measures how many users or licenses (or seats) a customer has logging in on a regular basis. For us, this isn’t perfectly weighted against the others because an account can have any number of users and still be perfectly healthy, but the more users in an account, the more buy-in your product has.
Customer Success is much more than a checklist; it has real impact on the success of the company itself. From company to company, it looks different and it’s constantly evolving, but having a few solid KPIs as guides can help your team stay ahead of churn and work toward growth.
Pro-tip: Schedule a demo to see how UserIQ’s Customer Health Dashboard gives you an at-a-glance look at all of these KPIs and more.