Highlights From the Customer Success Index 2023: We’re at an Inflection Point Image

Highlights From the Customer Success Index 2023: We’re at an Inflection Point

If this past year has shown us anything, it’s that companies with the most agility and a strong focus on the customer are the ones that are poised to thrive in a constantly shifting and uncertain economy.

But what does this evolution actually look like in the real world?

We partnered with Benchmarkit, a B2B SaaS research firm, to find out. We surveyed nearly 400 companies throughout North America to create the Customer Success Index 2023 North America (or CS Index for short). 

So what did we learn? Ultimately, we’re at an inflection point. Digital strategies are paving the way forward. And Customer Success has evolved beyond firefighting to become a mission-critical revenue driver during the down economy. 

To fully unpack our findings, read the CS Index 2023 North America. To start, here’s the TL;DR. 

Customer Success Has Matured—And Is Growing

A whopping 98% of companies are maintaining or increasing their investment in CS, and we’re seeing that the important role of CS Operations is becoming more common in companies with more than 20 Customer Success Managers (CSMs).

Companies are also recognizing the value of CS Operations to drive efficiency and further ROI from the CS organization. The number of companies with a dedicated CS Operations organization has more than doubled, from 20% in 2022 to 41% this year.

The Responsibilities of CS Hold Steady

As in previous reports, CS continues to have the same primary responsibilities: customer retention, customer outcomes, product adoption, and expansion.

One interesting point: These responsibilities don’t always align with what a company measures. Dig into the report to learn more.

CS Measurements Are Evolving

While traditionally, companies have only measured CS performance based on customer retention, we’re starting to see expansion and other measurements come into play.

We’re seeing that 64% of companies primarily measure their CS organizations on customer retention, with Net Dollar Retention (NDR) coming in a close second at 63%. Only 41% of companies measure CS on expansion revenue.

Keep Your Eye on Digital Customer Success

Almost half of the participants (48%) currently have some level of formal Digital CS programs and teams, a number we’ve seen grow steadily. Digital CS is gaining the most ground in companies at the lower end of revenue ($1M-$10M) and at the higher end ($100M+).

We only expect Digital Customer Success to grow as companies continue to strive to do more with less, without losing the human touch.

KPIs Still in Their Infancy With Digital CS

While only 27% of companies with a Digital CS program have well-established KPIs, 60% report their KPIs are currently “under construction.” An interesting finding: Companies that do have Digital CS KPIs are using the same metrics as they do for human-led CS (renewal rates, Net Revenue Retention, and logo churn).

At first glance, this makes sense. The ultimate goals of Digital CS programs should be the same—driving adoption, retention, and expansion. However, the leading indicators of Digital CS programs are much different—there’s often little to no human assessment of risk or opportunity. Teams need to increase their focus on collecting and acting on signals from user engagement with your products, one-to-many campaigns, and self-serve assets.

Customer Health Scores and NPS for the Win

It should come as no surprise that Customer Health Scores were the number-one non-revenue measure of CS organizations in North America, with 60%.

Organizations are looking for that holistic view into customer health that product adoption alone just doesn’t always provide. Close behind was Net Promoter Score (NPS) at 59%. NPS can be a polarizing topic. And it’s not a panacea. Mature CS organizations use NPS as an early signal of risk or opportunity. Are you immediately driving advocacy off promoter NPS? Why not? Further, they confirm the validity of NPS on lagging outcomes to ensure NPS scores are not mischaracterizing the customer situation.

Expansion Revenue Responsibilities Still Up for Grabs

Of our participants, 42% report that CS is responsible for renewals, while 33% report Account Management, and 15% say that Sales owns renewals. It’s important to note that these findings are closely correlated to company size and ACV, so make sure you factor those things in when you’re looking at your own company.

In our conversations, we hear a lot more discussion and planning around CSMs “owning their number” for expansion. Next year, look for CSMs with expansion responsibility to dramatically increase.

Learn More

Want the full scoop? Download the Customer Success Index 2023 North America.