What Does “Customer Success” Mean For SaaS Startups?

Customer Success, if you haven’t heard, is a pretty big deal for SaaS companies. It’s a recently adopted term to encompass a new function within recurring revenue businesses. Unlike Growth Hacking however, everyone is taking Customer Success very, very seriously!

Because customer success, or the failure to implement it, is already costing SaaS startups millions of dollars in revenue.

Customer Success is the recurring revenue business’ answer to churn. A newly discovered weapon against a problem that had previously being accepted as a fact of SaaS life. Just as the sun rises and sets every day, so must 2.5% of all customers churn every month. That’s just the reality of subscription business models, right?

Well not anymore. Customer Success is here to kick churn’s ass!

In this post, I’ll discuss:

  • An introduction to Customer Success as a basic concept
  • What functions does Customer Success cover?
  • An introduction to the important metrics of Customer Success

What Is Customer Success

Humans are biologically programmed to prevent loss before increasing gains.

Once we’ve worked hard for something, we don’t want to give it up. And that’s a good thing, because acquiring a new customer is 7 times harder than retaining an existing one.

Customer Success is all about preventing that loss, and retaining existing customers. Luckily, software business have discovered that the correct way to do this is not to tie people into long contracts. Instead, the industry has realised that the customers who stick around are the ones who are successful.

If a customer can clearly see an additional $15,000 revenue per month as a direct result of using your software, and your software costs $1,500 per month, guess what? They stick around. Because business folk are all great mathematicians, and $15,000 – $1,500 = $13,500 profit for them.

Not all SaaS products are designed to increase cash profits for their users of course. Some are designed to directly impact a different business function. Save time. Save energy.

Perhaps your product is a project management tool for software teams. You might argue that the value benefit for your users is to increase the overall team productivity (although I’d argue that most value benefits of B2B SaaS can eventually be traced back to a profit/revenue increase). The value you sell all over your website is “Be more productive”.

But how confident are you that every single customer is achieving a higher level of productivity since paying for your software?

In my opinion, the mission statement of a Customer Success team should be:

“To maximise the actual value benefit of our customers as a direct result of using our product”

Now right now you might be shouting “Well Obviously!” and your marketing team already have tons of fantastic marketing materials that promise to achieve this exact result.

But honestly, if you look really hard, once that customer has completed their free trial and entered a credit card, do you actually take a proactive approach to discovering how much value they’re actually getting from your product?

And notice I said “…actual value…” because sometimes a customer can initially perceive to be receiving value, so they stick around for a few months and keep paying. But 3-4 months later, when the effects have rippled through their business and they notice zero increase in their revenue, they might start to ask just how much value your product is really providing. It looks pretty and displays fancy charts, but how does that translate into business value?

Customer Success is about ensuring your customers realise greater success in their business. If you can guarantee that, you’ll reduce churn.

Which Business Functions Does Customer Success Own?

Typically speaking, customer success will primarily exist in 3 core areas:

  • Onboarding
  • Support
  • Up-Sales and Renewals

Onboarding Users and Free Trials

Customer Success teams should own the onboarding experience. Educating the customer about the product, slowly easing into more complex features, hand-holding through the setup process, webinars, screencasts.

The onboarding flow is designed to demonstrate to the customer the value they can receive from this product within a 14-30 day window.

In some circumstances (large enterprise) where perhaps the “customer” is a VP who will probably never use the product, the sales rep will own that relationship, but the onboarding team will be working with the actual users of the product within the company. In this case, they aren’t working within a finite free trial window, but the process is the same.

If you can get the team successfully using the product, then when their VP asks for a review after 3 months, it’ll be a positive one and she will continue the subscription (or renew the contract etc.).

Customer Support

Whenever a customer opens a support ticket, it usually means your product’s engineering, user interface or help documentation have failed. Most people will try to help themselves, and when they can’t anymore, then they’ll open a support ticket.

While a support ticket is open, a customer is no longer being as successful. They might even have to logout and leave the product entirely until the ticket is resolved.

Customer Success teams own support because it allows them to:

  • Be Proactive: Resolve issues before they’re even issues by monitoring in-app usage
  • Success-focussed: Don’t just fix the issue, but take the opportunity to go above and beyond the issue so that the problem because and increased benefit
  • Loop in feedback: Instead of thinking about issues as bugs or problems, the customer success team will see blockers preventing their customers from being successful. This change in mindset is powerful for helping to inform design and engineering about which priorities matter the most
  • Repurpose: Once a support question has been answered, the customer success team can get straight to work on creating a screencast or setting up a webinar to answer that question for all customers affected.

The important thing to remember is that in many SaaS businesses, one support call can wipe out the entire profit margin of that customer for that month, maybe even longer. Customer success teams know that they need to reduce support tickets, but while achieving an overall net-positive effect on their customers experience.

Up-sells and Renewals

Because customer success teams have access to so much data and information about each customer, such as how they use the app, how that’s translating to business value for them, who the product champions are within the company etc. they are the most informed to know when is the right time to get an up-sell from that customer.

Because even if we have reduced our churn to 1%, we can counteract that further with negative churn. Which means our revenue increases from our existing customer base is greater than the amount we lose from lost customers each month.

If your customer is only paying a 5 seat license, but you know that over the last year their marketing department has grown to 13 people, then you know that they will be more successful if they upgrade to a 15 seat license (leave room for growth). This is not pushy sales. You’re genuinely trying to help their business out.

Customer Success Metrics

“If you cannot measure it, you cannot improve it” – Lord Kelvin

We need to understand the basic metrics around customer success so that we can improve it. The problem is, the most obvious metric is actually one of the least useful:

Churn % (Revenue and no. Customers)

Churn is a trailing metric. Which means by the time it has happened, the customer has already left and there isn’t much you can do about it. At the end of the month when we know our churn rate got worse, from 1% to 2.4%, there’s not much we can do about those extra 1.4% of customers. All we can do is look backwards at the month, see where we went wrong, and put changes in place to not repeat those mistakes

It’s important to track Churn as a % of number of customer accounts lost, and Churn as a % of recurring revenue lost.

If we’re churning a high number of customers, but hardly churning any revenue, then that paints a picture that we’re losing a huge number of our very small users (maybe hobby or developer accounts) but we’re keeping around our bigger business and enterprise customers. From there, we can look at whether we can make our smaller customers more successful and perhaps learn from what we’re doing with the bigger customers.

Product Utilisation %

If a customer account is only using a handful of the features of your product, then generally speaking, they aren’t being as successful as they could be. When tracking this, it’s useful to add context and weighting to each feature, as it may also be a product development issue.

Consider this: 90% of your user base engage with your Messaging feature, every single day. However, only 8% of your user base engage with your file upload feature on a daily basis. The correct action in this case is not to repeatedly spam the other 92% of users about your file upload feature. Instead, you should speak to your customers and find out why they enjoy the messaging component so much more than the file upload. Maybe they think it sucks, maybe they never noticed that tiny file upload button.

From those conversations, customer success can either inform product development, or they can implement a product feature awareness campaign.

Account Health Score

Product utilisation contributes to an overall Account Health score, which is a leading metric. If an account is beginning to look unhealthy, you usually have a few days minimum but potential a few weeks to recover the account before it churns.

It can be difficult to quantify account health, and therefore have metrics like % monthly change in average account health, however various apps and tools can do this for you. Other factors that contribute to a health score include support tickets, bugs encountered, frequency of logins to the product, open and click rate on emails and social media mentions of the product.

NPS (Net Promoter Score)

An NPS is really a very complicated way of asking how many of your customers say they would refer your product to a friend. The important thing to remember about these scores is that what a customer says they will do, and what they actually do, are very different.

You can measure NPS pretty simply using apps like

Referrals (no. Leads and Revenue)

Much more meaningful than an NPS score is actually measuring the amount of referrals an account has given. If they have yet to refer a single lead, then there’s a good chance they aren’t experiencing maximum success from your product. You don’t want them to just like your product, they need to love it!

Measure # of referrals on an account (give them a promo code to give to friends) and measure the referred $ revenue on an account.


Customer Success is a huge area, and something I’ll be blogging about in a lot more detail over the next few months. While this post hasn’t dived into any particular aspect in great deal, it’s the introduction to the topic that I wish had existed a few years ago when I started exploring the topic myself.

If you have any specific questions, tips or opinions on Customer Success for SaaS startups, please join in the discussion in the comments below. It would also be great to know a bit more about which parts in particular to cover in future posts.

And of course, I’d be crazy if I didn’t add…

Can We Help You With Customer Success at allows you to track your customers on a granular level, recording every in-app activity your customers perform. We track individual people, as well as grouping these together under customer accounts. Having this 360 degree view of your customers makes it a lot easier to deliver proactive customer success.

Head over to now to start your free trial and start implementing a Customer Success strategy today!

Published by

Liam Gooding

Liam is the cofounder and CEO of Trakio. Previously an engineer, he writes about growing subscription companies using data-driven techniques and inside glimpses to Trakio's own growth journey. He wrote a book, "Growth Pirate!" which discusses data-driven growth strategies for startups.

  • Liam, as always, spectacular content!

  • hambo

    I really enjoyed this article! Thanks and keep em coming 🙂

  • olivierpailhes

    very interesting indeed… just realizing we’re at 10% of all the actions you mention… Thanks for outlining this topic so clearly!

  • Great stuff Liam. You mentioned how support tickets are a bad thing, but Alex over at Groove did a study that showed when someone contacted support during their trial they were 59% more likely to become a paying customer. We plan on hitting customers over the head with support (in-app live chat support and regular reminders or even agent initiated chat) to see what kind of results we see.

    Just downloaded your book though and began diving in. Great stuff so far 🙂

    • Hi Justin,

      Very good point.

      I think the equivalent study would be to show the difference between customers who have to wait on support tickets, and customers who have their issues pro-actively solved. Also, I think it’s more about the processes used in dealing with tickets, i.e. going above and beyond.

      While it makes a ton of sense that a customer hitting support with “How does this feature work?” will be more likely to engage once they’ve been told about that feature, you need to factor in how unsuccessful and disappointed they will have been with your product during the time they spent waiting on a reply, and the time they spent trying to solve it themselves before contacting you.

      I hope you enjoy the book, be sure to shoot me over any feedback to

  • Great post Liam (and thanks for the mention of with regards to NPS)!

    I should highlight a common misconception about Net Promoter however. It’s not about simply identifying whether someone would refer/recommend your brand. You correctly called out the fact that user behavior is (such as referrals) is what drives results and ultimately growth.

    The purpose of NPS is to identify who your brand Promoters are using a proven, valid, and simple metric. These loyal customers are the most profitable (spend more, stay longer, less price sensitive, etc) but more importantly, they have the propensity to recommend/refer your brand to others. That does NOT mean that they are actually doing this. A small subset of your loyal customers/advocates/fanboys will always do this when they get the opportunity, but depending on whose data you’re looking at, it’s generally only 30-40% of this group, or less.

    What you gain by reliably identifying your loyal Promoters is two-fold:

    1) You get to learn what it is about your product or service (the most important reasons) that are influcencing someone to feel so stronly about your brand. What are you really excelling at that you could highlight for others? Can you use this subset of features or aspects of your business to attract others who value that most from the get go? You can see where this is going…

    2) This is the big one…identifying who is WILLING to recommend so you know who to engage to drive new referrals/recommendations you otherwise may not get. Even some passionate customers who love your brand don’t wake up in the morning and strategize how they can net you some new revenue that day. Just like sales, you need to have an ask for your Promoters. Give them an incredibly simple way to refer you. Landing page you can point them so with all sorts of pre-populated social share options, an email capture form for friends/colleagues they think would like the service/product, an incentive or referral program, etc.

    It’s not enough to just look at who is referring. There is a large segment of customers in most companies who are willing to but are dormant. Huge untapped growth. And don’t forget that referral/word-of-mouth growth results in the the most profitable customers/accounts as well. Little to no CAC, someone referred by a trusted friend/advisor is less price sensitive from the beginning, they in turn tend to spend more/stay longer. Once you master this practice you can start driving some measurable compounding growth.

    The last thing I’ll mention about the value of NPS is on the other side of the spectrum…churn. This can be a business/product killer when not considered carefully, no matter your customer growth. The biggest problem is there are few reliable ways to _accurately_ predict churn. A lot of the data driven solutions that are starting to become available, like are a great first step. Overlay this with a proactive relationship based NPS survey and you’ll cut churn drastically. Some of our early customers have cut their revenue churn nearly in half (probably more over time). Letting customers self-select and signal that they are having a bad experience (at the relationship level) gives you a clear picture of what’s coming. Because NPS for subscription based companies (SaaS, hosting, etc) is measured quarterly in most cases, you end up with a 90-day forward looking indicator for most customers. Simply put, you’re getting more time to engage with that customer before they make that decision to cancel and switch to another provider/option. Once they’ve migrated data or paid another vendor, it’s already too late…yet this is where most companies try to optimize the retention experience.

    Sorry for the book! Meant to write a few sentences but the fingers kept going. Now I just need to do this for our own blog 🙂

    We’ll also be spinning up on soon ourselves. Keep up the good work and thanks for the post. Also a late comment…post got lost in a sea of Chrome tabs =

    Chad Keck
    CEO & Co-Founder,

  • Joshua Michael

    Great article but I was just curious as to where you are getting your statistics from.

  • Deploying new technology to enhance the customer experience and reduce complaints is indeed one of the best options to choose from and doing so has become necessary. If the business has a mobile application, it can integrate a customer support platform within the application to aid app users and resolve any complaints that they might have. Among others, devContact ( is a support desk that is built specifically for mobile apps and can be easily integrated for free. It offers a wide range of features including live chats, FAQs, analytics and push notifications. This will help deliver a better overall user experience with the mobile application.