6 Tips and 5 Predictions for the Customer Success Industry

For our Customer Success meetup in Toronto, we had the privilege of hearing from James Scott, General Partner at SuccessHacker, who helps other companies achieve growth and success through their Customer Success (CS) teams.

James shared his knowledge and experiences about this young and booming industry from working in the US and the UK. Whether you’re new to Customer Success or always keen to learn more, this blog will give you tips, teach you about CS trends, and prepare you for the future of the Customer Success industry!

1. Self-Teaching in a New Industry

Customer Success hasn’t been around for nearly as long as we tend to think. James reminds us that “you won’t find a CEO who did Customer Success for 20 years and to whom you can turn to for institutional knowledge.” In that sense, you and your Customer Success team are a part of the creation process. You’re building the knowledge and best practices for Customer Success as you try new things and make mistakes. Experimentation is a great thing, but it hinders the industry as a whole when the results are kept internal.

As a growing industry, we have to help each other. Share the results of your Customer Success experiments and practices with colleagues, in a blog, and at local meetup groups. These are not only great ways to share the wealth, but they also allow us to learn from one another and share tips with fellow CSMs. There has already been so much progress in this up-and-coming industry over the past years, so by working together we can grow at a more accelerated rate.

If you’re new to the industry, James says, “Enjoy the ride because it’s certainly been a fun one so far and I think it will get even more interesting.” He recommends you join OUTCOMES, a free resource for CS professionals. If you’re in the Toronto area, you should check out our Customer Success meetup group which meets every month and has renowned guest speakers like James Scott!


2. Teaching Your Company About Customer Success

Since Customer Success is still new to the SaaS world, people within your company, even your CEO, don’t know much about it besides what they hear in passing. Your senior management may invest in Customer Success, but they don’t have clear and realistic expectations or goals for the CS team.

“They don’t put enough money behind it,” says James. “They don’t set up the Customer Success team for success, and they expect results. They expect churn to go down within three months, but it doesn’t happen like that.”

Thus, when they don’t see the quick results they expect, they start seeing Customer Success as a cost rather than a revenue center. “You need to invest in the right places, put the right resources behind the project, the right support, and then you need to stick at it,” advises James. “There’s this joke that there’s a revolving door for VPs of Customer Success because you go in, you have to reduce churn, but nine months later the impact hasn’t been good enough and you’re out the door.”

This is when you have to take what you’ve been teaching yourself, and share it with your company. Customer Success isn’t just to prevent churn or a last ditch effort to save some accounts. In reality, Customer Success is a long-term investment, closer to 12-24 months. If you help educate people within your company, you can get more people on board with this long-term investment and create meaningful change in your company through CS.

James says, “If Customer Success is done right as a company-wide philosophy, then the company will align around business outcomes, customer outcomes, and it will align every department around driving value.” This, in turn, will help you retain customers for longer, decrease churn, increase revenue, and make advocates out of your customers!

3. Becoming Proactive Instead of Reactive

Are you a part of a CS team but still feel like most your time is spent putting out fires? Don’t worry, you’re not alone, and James has some tips to help you and your team become more proactive instead of reactive. He says, “We need to be change agents within our customers’ companies. We’re helping them change the way they do business, the way they operate using our product or service to be more successful.”

But a CS team’s job doesn’t stop there. You also have to work with your colleagues, or “internal customers” as James calls them, and incite change internally to help your external customers prosper further. “Only by doing that, will we be able to address the root causes of why we spend so much time being reactive on things like product bugs and missing features.”

Part of the problem is how management sorts the priorities of your Customer Success team. Often, a large amount of time and money is allocated for risk detection, preventing churn, putting out fires, and not success planning—“this is an industry-wide problem and a negative way to approach what we do,” says James.

Instead, James recommends that you get your company to invest in sureness, which you can do from the beginning of the process at onboarding: “Make sure that handoff from Sales to CS is super tight and you’re getting all the information you need about the customer to set them up for success.”

Onboarding is the stage where the seed of churn will be planted. To be proactive about churn instead of reactive, provide a fun, educational, and memorable onboarding process for your customers. This will, ultimately, help you prevent your customers from churning close to the end of their contracts, when it may be too late to change their minds to renew.

4. Defining and Measuring Customer Outcomes

In Customer Success it can be difficult to define and articulate what success is, so it’s common for people in your company to describe success using general customer statistics. James asks CEOs and founders early on, “Which of your customers are being successful?” to which they usually respond with portfolio-level metrics about churn and retention. When he asks more specifically, “Which of your customers are being successful and which ones are not?”, they usually give him a blank stare and say, “How would I know that?” Well, worry no more because we have the answer!

The definition of success relies on each individual customer and how they want to define success for themselves. James suggests, “First, you need to understand what the customer’s definition of success is. Secondly, you need to know how you can measure how they’re doing versus that definition of success.”

To do these things, you need to make sure that your Customer Success team is making a success plan with your customers from that initial pass-off from Sales—as mentioned earlier, this is a pivotal stage. You also have to find reliable metrics that will allow you to track and measure your customer’s progress to see if they’re on the path to their definition of success, and have touch points where you can intervene if they’re not.

5. Increasing Alignment with Other Teams

To maximize the effectiveness of your Customer Success team, hiring CSMs is only part of the solution. The other part is communicating with other teams in your company, like Product Development and Marketing. You should already have good communication with Sales to ensure a smooth transition process for customers. The role of Customer Success teams is “to understand customers and their needs at scale,” says James. “That’s a core part of our job. The other core part is influencing our customers’ behavior.”

You can do these things with, for example, the help of your Marketing team. Since they are the driving force behind moving customers from the top of the funnel down to the sales pipeline, they have helpful insights about customers that you can use. They have the technology to track which marketing materials and tools resonated with your customers, and how your customers’ profiles have changed over time. This is especially helpful for your CS team because it’s scalable, compared to hirings new CSMs or having your team call/email customers to find these insights.

James believes that “our job in Customer Success is bringing the human aspect to the customer relationship, and filling the gap between customers and Marketing or Product.” By aligning your communications with these other teams, you can make CS processes more efficient. James notes, “As your Customer Success team gets better at understanding the information you need from a customer, then let’s look at using marketing technology and techniques to get those conversations automated at scale.”

You can even take it a step further by applying those insights to the product itself, so you can gain more information from how a customer is using the product, especially during onboarding, and how that can help their overall goals—which also helps you in the scalability of CS processes.

6. Growing the Customer Success Movement

Have you been hearing your colleagues in Customer Success talk about things like CS marketing, CS operations, CS analysts, CS associates, or anything else that isn’t simply ‘CSM’? James says, “We’re not just saying everybody’s a Customer Success Manager. We’re actually realizing that CS requires a whole different assortment of skills and that’s going to look different from company to company.”

The CS world is growing lighting fast and companies are seeing that they need more complexity and diversity in the responsibilities of their Customer Success team. This allows CS professionals to have more specialized roles under the umbrella of Customer Success as their team continues to grow.

Customer Success isn’t just another name for Support anymore. Its goals aren’t based around putting out fires and creating product documentation. “We have a clearer and clearer understanding every day of what it is that we’re trying to achieve, and what we need to do is take that message on the road,” says James. There are tools and technologies dedicated to this new branch of SaaS, showing the growth of Customer Success since its initial inception, and the room it still has to grow into.

Predictions for the Customer Success Industry

Based on the above trends in Customer Success, James has 5 predictions for the industry that he thinks will occur over the next 12 months.

  1. “New technology solutions will emerge to help vendors and customers align around business outcomes.” There can be some frustration in being able to clearly communicate and collaborate with customers about their success goals, especially with older systems like CRM. As such, we’ll likely see more and more new solutions to better accommodate for this communication and smooth out the data tracking process for Customer Success teams.
  2. “Customer Success will become a viable, alternative career path to Sales for recent graduates.” Traditionally, students who enjoyed consulting customers and working with them to reach success might have gone into Sales. But now, with this more niche, customer-centric field that allows professionals to make long-lasting and meaningful relationships with customers, these graduates can join the Customer Success world.
  3. “Every CS team of 10+ people will have a dedicated Customer Marketing and/or Customer Success Operations role.” As CS teams continue to grow, they also become more specialized. This will allow for more nuanced and specific roles that overlap with other teams, like Marketing and Operations.
  4. “Outcome management will become a core competency for success.” A lot of big decisions in Customer Success revolve around success and how to measure that, otherwise called “outcome management”. A hurdle to overcome in this area will be getting this information efficiently to scale as your company and customer-base grow bigger.
  5. “Regional centres of thought-leadership will develop fresh approaches to customer centricity.” All of this knowledge, tools, and best practices about being customer-centric cannot come out of one place, like Silicon Valley. Models that are working well for one region, like the UK, will not necessarily be the best model for customers in the US. So, Customer Success approaches needs to be a discussion everywhere, no matter the size of the group—we can all learn from each other.

Use these predictions and your own insights to nurture your Customer Success team and your customers, and prepare them for success