Biz Tips: Top 10 Questions I’m Asked About Customer Success

Biz Tips: Top 10 Questions I’m Asked About Customer Success

Biz Tip:

Top 10 Questions I’m Asked About Customer Success

I’ve been talking about Customer Success and its importance for SaaS businesses for a while now, but I know it’s still a new subject for most, which is why I receive a lot of questions. So I decided to compile this article to answer some of the most common Customer Success questions I get so anyone can refer to it whenever they need it.

Here we go.

1. Why do I need a Customer Success Department?

Your business’ success depends on the success of your customer. When a customer succeeds by using your product, they’ll continue using it, which enables your business to thrive. In a nutshell, Customer Success is about ensuring customers achieve their desired outcome by using your product.

However, to achieve that, you need people, processes, and, most importantly, data. A Customer Success Department is in charge of finding out when, why, and how your customers are using your product and leverages that information to ensure customers continue to receive value from your product over the course of their lifetime as a customer.

2. How is Customer Success different from Support? Isn’t a Customer Success Manager just a glorified Support Specialist?

There’s a clear difference between Customer Success and Customer Support that lies in their nature: the first is proactive, while the latter is reactive. Therefore, the tasks associated with each role also differ.

The main goal of Customer Success is to reduce churn, to ensure your service meets customers’ expectations, so they stick around and renew their subscriptions. You do that by:

  • building relationships with your customers
  • understanding them and their organizational KPIs, bottlenecks, etc.
  • helping them meet (and surpass!) their goals
  • facilitating the successful implementation of your services into their organization.

On the other hand, Customer Support is about helping a customer resolve an issue they encountered while interacting with your service. Often, this involves helping them better utilize the services you offer.

3. How do I get started with Customer Success?

Onboarding is one of CSMs’ main tasks. Therefore, you need to know your product and its use cases inside out, as well as your customers and their goals and struggles, if you want to help them.

Segmentation is also important – you should always segment your customers based on their needs. Here’s a quote that perfectly explains why:

Not every customer is the same, and as a result, everyone should be treated differently. For example, what you provide for your biggest clients could prove too much for smaller clients; and if you provide the same type of service to your bigger clients as you would to smaller ones, then you would risk not meeting their needs.
Tal Shalef, Realtor and Co-Founder of Condo Wizard

And last but not least, make sure you prioritize your customers’ goals over your gains. You can easily get carried away with excitement over new features, but before you push them to customers as upgrades, you need to take a step back and think: “is this really going to benefit this customer?” You want to avoid disappointing them by creating false expectations.

4. Do CSMs track different metrics than Support or Sales?

As I’ve previously mentioned, these are three different departments, so, naturally, the metrics each representative should track also differ. For Customer Success Managers, their main priority should be tracking the Churn Rate, Customer Retention Cost (CRC), Customer Lifetime Value (CLV), Net Promoter Score (NPS), and Customer Satisfaction Score (CSAT).

On the other hand, Customer Support should focus on tracking the number of support tickets, first response time, overall resolution rate, and average ticket handling time.

Last but not least, the Sales department should analyze total revenue, market share percentage, cost of sales, average time for conversion, average contract value, etc.

Although there can be metrics all three departments could track (like those related to customer satisfaction), generally speaking, each department has its own set of specific metrics to consider.

5. Can you measure Customer Success value or performance? Do you actually have an ROI?

Despite the numerous customer success stories out there that have proved the importance of Customer Success departments for SaaS businesses, many still want to make decisions based on cold, hard numbers. I get that.

There’s good news regarding CS ROI and not-so-good news. The good news is that yes, Customer Success value can absolutely be measured. The not-so-good news is that it’s by no means an easy process because the impact CSMs produce is largely intangible.

Different Customer Success industry leaders each have their own tactics for approaching the challenge of measuring the performance of their CS departments. Some look at word-of-mouth marketing results, some correlate NPS to business metrics such as LTV, while others conduct customer satisfaction surveys.

In my 20+ years of experience in the software industry, however, I have come up with my own method of measuring Customer Success ROI that involves calculating:

  • the cost of your CS rep (fully loaded)
  • the baseline before you hired them
  • the impact they have on their leads and Customer Success KPIs.

6. What’s the industry standard for the number of customers per CSM?

There’s no such thing as a standard number of accounts a CSM should be in charge of. I know there’s this ratio on the internet, 1 CSM per $2M/ARR, but that’s just not accurate. That would mean that the CSM coverage ratio is specific to SaaS businesses (as it’s calculated on recurring revenue), but that is just not true – Customer Success is not limited to SaaS!

Here’s how you should approach this subject instead:

First, stop looking for a formula to calculate how many CSMs per customer you should have – it doesn’t exist because the number is 100% based on your unique situation. A formula doesn’t take into account the different types of Customer Success Managers and different customer segments.


  1. Logically segment your customer base according to their Appropriate Experience
  2. For each logical customer segment, determine the coverage level and type of coverage required (for example, one segment might need a high-touch, consultative experience, while another can do with low-touch).

Learn more about the details of the required coverage model and the characteristics Customer Success Managers should have, and from there, you can work out how many accounts in each segment a CSM can handle. For example, if a CSM can handle 3 high-touch customers and you have 30 in total, you’ll need 10 CSMs (for this level, you’ll need to re-calculate the number for each of the other levels and see how many CS reps you need in total).

In time, with experience and by using a Customer Success tool that automates a large portion of CSMs’ work, you’ll be able to assign more accounts to each CSM and streamline your resources. This way, you can accommodate a larger client portfolio with a relatively small Customer Success team.

7. How should the Customer Success department interact with other teams (Sales and Product)?

All departments can benefit from interacting with the Customer Success team. For Marketing, CSMs can help identify happy customers that can become advocates; for Sales, CSMs can help identify upsell and cross-sell opportunities; as customer satisfaction is the main focus for CSMs, they can also convey feature requests to the Product team.

The key to getting everyone to work together is clear communication from the top down. It’s not enough to say you’re a customer-centric company, you actually have to set procedures in place and create cross-functional teams. When everyone understands they’re a piece of a bigger puzzle and it’s their collective effort that makes the customer successful, the magic happens.

8. Where should the Head of Customer Success report? Where do CSMs report to?

Depending on how large the Customer Success department is, the hierarchy is similar to any other department’s: each CS rep reports to their manager, and each CSM reports to the Head of Customer Success (or Director of Customer Success, or whatever title the person responsible for the entire department has). From there, the Head of Customer Success reports directly to the CEO.

9. Should upsells, cross-sells, and renewals be done by the Customer Success department or by Sales?

First, you have to realize that, without Customer Success, you have no upsells and renewals; you need to focus on making your customers successful before you think about ways to increase your revenue.

Now, with that out of the way, I think a better question would be ‘who should own the upsell, cross-sell, or renewal transactions’? The answer depends on how you set up your Customer Success department, its maturity, and how it interacts with the rest of your organization.

For example, in early-stage companies (or companies that have an undeveloped Customer Success department), CSMs handle everything from identifying opportunities to closing the deals.

For more mature companies and/or CS departments, there are 2 options:

  1. You have a dedicated CS task force that only handles upsells, cross-sells, and renewals
  2. You hand over the closing the deal part to Account Managers / Sales Reps so CSMs can stay focused on making customers successful.

In Custify, we have dedicated features and an automated process that helps CSMs discover upselling and cross-selling opportunities and also detects ahead of time customers that might upgrade.

10. Can you share with us best practices from other customers? What are they doing to be successful?

Of course. I’ve already mentioned that CSMs’ main focus is reducing churn and, to do that, they need to make the onboarding process as frictionless as possible. Because of that, many neglect the offboarding process, thinking that once a customer has decided to leave, there’s nothing you can do to stop them.

But as Referrizer has proven, designing a great offboarding process can actually help you save customers. They have used Custify’s features to analyze each canceled account and come up with a personalized counteroffer. Sometimes, customers cancel simply because they don’t understand your product and they need a bit of hand-holding.

There are many cases and situations unique to each SaaS business, which is why every CS tool should give hands-on support to each client to adapt to their specific needs. Otherwise, they won’t see results. So, having a personalized approach, I’d say it’s another best practice. In fact, personalization, in general, is always great, in all areas, not just Customer Success.

Got Questions? Shoot Me a Message

Do you have a customer success question I haven’t answered yet? Leave it in the comments section below, and I’ll add it to this list.

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