AMA: Vice President of Customer Success APJ, John Brunkard on Customer Success KPIs

OKRs (Objectives and Key Results) are a goal-setting methodology that drives focus, alignment, and transparency within an organization. DERIVING OKRS FOR FUNCTIONAL GROUPS: 1. Top-Down Alignment: * Leadership sets broad, strategic OKRs. * Departments derive their OKRs to align with these top-level goals. 2. Cascade to Teams: * Teams create specific OKRs that support departmental objectives. 3. Individual Contribution: * Employees set personal OKRs linked to their team’s objectives. OKRS VS. KPIS: * OKRs: Ambitious, time-bound goals with clear, measurable outcomes. * KPIs: Ongoing metrics that track performance and operational health. Connection: OKRs can include KPIs as key results to measure progress. Customer Success OKRs Objective 1: Enhance Customer Retention * KR 1.1: Decrease churn rate from 10% to 5% by year-end. * KR 1.2: Increase customer renewal rate from 80% to 95%. * KR 1.3: Implement an early warning system for at-risk accounts and achieve a 90% follow-up rate within 48 hours. Objective 2: Drive Customer Expansion * KR 2.1: Increase upsell revenue by 30% by Q4. * KR 2.2: Boost cross-sell volume by 25% within 6 months. * KR 2.3: Achieve a 20% increase in average customer lifetime value (CLTV). Objective 3: Bolster Customer Loyalty * KR 3.1: Launch a customer loyalty program and enroll 500 customers within the first quarter. * KR 3.2: Increase the number of customer advocates (NPS promoters) from 100 to 150. * KR 3.3: Achieve a 90% retention rate among loyalty program members. Objective 4: Optimize Onboarding Experience * KR 4.1: Increase onboarding completion rate from 65% to 85%. * KR 4.2: Reduce time-to-first-value (TTFV) for new customers from 30 days to 15 days. * KR 4.3: Achieve a 95% satisfaction rate in post-onboarding surveys. These OKRs focus on critical aspects of customer success including retention, expansion, loyalty, and onboarding, ensuring a comprehensive approach to customer management and growth.

it's important to distinguish between truly impactful customer success metrics and those that might be over-hyped or less relevant. Here are some specific customer success KPIs from my past experience that often fall into the latter category: 1. Number of Customer Meetings or Check-Ins * Why Over-Hyped: While staying in touch with customers is important, the number of meetings or check-ins doesn't necessarily equate to successful outcomes. * Better Focus: Quality of engagements and the tangible results from those interactions, such as path to achieving outcomes, value delivered or identified growth opportunities. 2. General Customer Satisfaction (Broad Surveys) * Why Over-Hyped: Broad satisfaction surveys can provide a general sense of customer feelings but often miss specific actionable insights. * Better Focus: Targeted feedback around key interactions or milestones (moments that matter), such as post-onboarding surveys or feedback after feature releases. 3. Activity-Based Metrics (e.g., Number of Health Checks Completed) * Why Over-Hyped: Simply tracking activities like health checks or business reviews doesn't measure their effectiveness or impact on the customer. * Better Focus: Outcomes from these activities, such as increased adoption rates, reduced churn, or identified cross-sell opportunities. 4. Number of Customer Success Plans Created * Why Over-Hyped: Creating a plan is only the first step; the real value is in execution and outcomes. * Better Focus: Progress and results from those plans, such as milestones achieved or goals met. 5. Product Feature Usage Metrics * Why Over-Hyped: Tracking the usage of specific product features without context can be misleading if those features aren't aligned with customer goals. * Better Focus: Alignment between product usage and customer success goals, measuring how particular features contribute to the customer’s business objectives and delivering value. Metrics are only as valuable as the insights they provide and the actions they enable. For Customer Success to truly be effective, the focus should be on KPIs that measure meaningful outcomes and deliver actionable insights, rather than those that simply track activity or general sentiment. By prioritizing quality over quantity and aligning metrics closely with strategic business goals, Customer Success teams can better drive long-term value and satisfaction for both customers and the company.

Yes, I think it is great to have share KPIs between Customer Success and Sales Teams. Alignment: Shared KPIs foster alignment between Sales and Customer Success, ensuring that both teams are working towards common objectives. 1. Collaboration: Encourages collaboration and communication between sales and post-sales teams, leading to a more cohesive customer experience. 2. Accountability: Shared ownership of KPIs promotes accountability and a sense of shared responsibility for customer outcomes. 3. Customer-Centric Focus: Allows both teams to focus on the entire customer journey rather than just their respective parts, leading to improved overall customer satisfaction and retention. By sharing KPIs, Sales and Customer Success teams can work hand-in-hand to acquire, retain, and grow customer relationships effectively, ultimately driving sustainable business growth and success. Best KPIs for Customer Success and Sales Team Shared Ownership 1. Customer Retention Rate (CRR) * Reason: Both teams share responsibility for ensuring that customers continue their relationship with the company. 2. Churn Rate * Reason: Helps identify how many customers discontinue services and understand the effectiveness of customer satisfaction efforts. 3. Customer Lifetime Value (CLV or CLTV) * Reason: Indicates the total revenue a business can reasonably expect from a single customer account, emphasizing collaborative efforts to maximize customer value. 4. Net Promoter Score (NPS) * Reason: Reflects customer satisfaction and loyalty, indicating the likelihood of customers referring the company to others. 5. Upsell and Cross-sell Revenue * Reason: Highlights how well both teams collaborate to drive additional sales and expand within existing customer accounts. 6. Time to First Value (TTFV) * Reason: Measures how quickly a new customer starts realizing value from the product or service, essential for setting the initial tone and expectations.

It is important to focus on KPIs that are actionable, aligned with strategic objectives, and within the scope of what the Customer Success team can influence and control. Here are some of examples of not good KPIs to commit to achieving: 1. Revenue Growth of the Company * Why It's Bad: Revenue growth is influenced by many factors outside the control of the Customer Success team, such as market conditions, sales effectiveness, and pricing strategies. * Better Focus: Customer retention rates or upsell/cross-sell success rates, which are more directly influenced by Customer Success efforts. 2. Unclear or Vague Metrics (e.g., Improve Customer Happiness) * Why It's Bad: Vague goals lack specificity and measurability, making it difficult to track progress or define success. * Better Focus: Specific, measurable outcomes like Net Promoter Score (NPS) or Customer Satisfaction Score (CSAT) with clear targets and timelines. 3. Feature Usage Metrics Without Context (e.g., Number of Logins) * Why It's Bad: High login numbers don't necessarily translate to success; they might indicate issues or difficulty with the product. * Better Focus: Metrics related to the outcomes of feature usage, such as increased productivity for the customer or specific feature adoption rates that tie back to customer goals. 4. Quantitative Activity-Based Metrics (e.g., Number of Touchpoints) * Why It's Bad: Quantity doesn't ensure quality; frequent touchpoints don’t necessarily translate to effective customer success. * Better Focus: Measure the impact of these touchpoints, such as resolution of critical issues or successful achievement of customer milestones.

Based on my experience as a Customer Success Executive Leader, the following are key areas I focus on to ensure our team drives meaningful impact for our customers. 1. CUSTOMER OUTCOMES AND VALUE REALIZATION * Ensure customers achieve their desired outcomes and realize value from your product. Establish clear milestones and regularly track progress. (Customer Success Plan) * =>Create a collaborative Customer Success Plan. Conduct regular business reviews, set and measure against success metrics, and provide actionable plans to address gaps. 2. CHURN RISK MANAGEMENT * Proactively manage churn risk by identifying at-risk customers and addressing their concerns promptly. * =>Implement early warning systems, conduct regular health checks, and prioritize engagement with at-risk accounts to mitigate potential issues. 3. PRODUCT ADOPTION AND USAGE * Drive product adoption to ensure customers are fully utilizing the features that align with their business objectives. We call these the golden features. * =>Provide tailored training, onboarding resources, and user education to facilitate deeper engagement and understanding of the product. 4. UPSELL AND CROSS-SELL OPPORTUNITIES * Identify additional pain points and provide solutions that deliver greater value to the customer, thereby driving upsell and cross-sell. * =>Regularly assess customer needs, present relevant product features or services, and work closely with the sales team to close the loop. 5. CUSTOMER ADVOCACY AND FEEDBACK * Foster strong relationships that turn satisfied customers into advocates who provide valuable feedback and referrals. * =>Actively solicit and act on customer feedback, recognize and reward advocates, and leverage success stories and references for broader company benefit.