There are many metrics that businesses and Customer Success professionals use to measure the success of their projects. Understanding these metrics, and the ones you choose to work towards will entirely depend on your business goals. Focusing on client retention, growth, and customer satisfaction are typically the main goals for CS professionals.
Read more below to see what metrics are available and how you can measure success.
What are success metrics?
Success metrics are the figures and tools you use to understand how successful a product, service, or business is. There are many metrics you can use, such as; profit margins, return on investment, recurring revenue, client reviews, etc.
Depending on the area of the business, each department may use a combination of the above or other metrics to analyse the individual performance of their own activities within the business.
How do you measure success?
How you measure success is entirely dependent on your business goals. What you hope to achieve as a business will differ from other businesses, understanding what metrics are available to you and how you can use these to measure each goal would be the best place to start.
For example, a business can measure success by;
- Gross Profit margin – this is measured by taking the cost of goods or services from the net sales.
- Return on investment – sometimes seen as ROI, this is a metric that is used to calculate whether or not someone should invest time or money into a certain project. In some cases, this metric is used after a project to assess the success of the project itself.
However, customer success metrics will include;
- Customer retention rate – this will measure how many customers remain loyal to your business over a set period of time. It will be up to your CS team to decide how long that time frame will be set.
- Customer churn rate – the opposite of customer retention, this figure will inform you how often your customers leave. As with the retention rate, it will be up to your team to set the time frame in which they believe will be most beneficial to obtain accurate data.
- Customer feedback – this is a harder metric to quantify, however no less important. Having a good base of customer feedback can help you improve your business and services. It could even help guide new projects when implementing new products or services. Access to this information to help you make better decisions will ultimately lead to happier clients overall.
- Customer lifetime value (CLV/LTV) – this metric will help you understand the lifetime value of each customer. You work this out by looking at the average lifetime of a customer and calculating their spending over that time period. You can then use this information to predict the average customer spend for new clients.
How do you pick metrics for Customer Success professionals?
The metrics you decide to use to help you measure success will depend on your business goals. If you are looking to improve customer retention then setting a goal for that metric, while looking at ways to improve customer satisfaction will be the best option for you. When you work with a highly skilled Customer Success team, allow them to help guide your business. Their experience with both the customer and your company will ultimately assist you when picking the right metrics to measure your success.
Why should you measure success?
As a business owner, it is important to see growth and improvement. Success will look different to each individual, and keeping track of that can help you see where you can improve and also help motivate your team to continue working in the same manner.
No matter how you assess your business success, having the right people in the right places will ultimately drive success to your business. Finding the star talent to get you there is no easy task, however, with ABR talent we are experts in matching the right people to the right roles. Speak to us now to see how we can help you build a successful SaaS team.
