How to build a Customer Success Metric System that rocks

Hi, I’m Markus, and welcome to a 🔒 subscriber-only edition 🔒 of my newsletter. I help you to deliver, grow, and monetize customer value to improve your performance, accelerate your career, and build a profitable SaaS business.

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It is my belief, that Customer Success needs to start over. Customer Success from a company perspective and how CS teams operate.

Because it’s not focused on the customer anymore (let that sink in for a moment). Internal procedures and convenience have taken over.

Consequently, these companies and CS teams, in particular, have cultivated ineffective Frankstein metric systems.

They literally put every Metric and KPI together that’s easy to measure. You know what I’m talking about - NPS, CSAT, CES, etc.

None of these is an actual customer success metric. But everybody is full of surprise when customers “suddenly” churn.

In today’s edition, I’ll show you how to build a fully integrated Customer Success Metric system for growth:

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Level 1 - Revenue Metrics

Customer success is not an end in itself. You are helping customers achieve their desired outcomes to earn their renewals, expansions/upsells, and referrals. Your efforts need to deliver a measurable ROI.

The first level of your Customer Success Metric System consists of your revenue figures. The most effective KPI to measure its impact is the Earned Growth Rate. It consists of expansions and upsells plus revenue from all kinds of referrals.

Of course, the GRR is highly important too but renewals are the low-hanging fruit. After you’ve reached a consistently high level (95%) you are looking for growth.

Despite what many Sales leaders seem to believe, there’s no direct way of improving these revenue metrics. Because growth has to be earned. There’s no marketing technique or sales playbook that can replace the proof of value required.

The revenue impact is your lagging metrics.

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