5 Essential KPIs for Customer Success Teams [with Digital Analytics Examples]

What happens when your sales team has done its job and brought in a new customer? For some companies, it’s party time and on to the next sales-qualified lead. For smart companies, it’s time for the customer success (CS) team to take over. This crucial step can make or break a company’s performance as it ensures the constant stream of new customers doesn’t turn into a constant stream of customers who churn. So, how can CS ensure they are on track to convert new customers into brand advocates? In this article, we will have a look at the most common challenges that CS teams face in their day-to-day workflows, the Key Performance Indicators (KPIs) they need to keep track of, and the required digital analytics tools (with examples!) to take full advantage of a data-driven approach to skyrocket customer engagement. 

First up on the menu: what exactly is the role of Customer Success teams?

Customer Success is a fluid term that encompasses a wide variety of activities within an organization. To sum it up, it is the constant and proactive focus on nurturing long-lasting relationships with customers to ensure they achieve their desired outcomes when using the product or service your company sells. CS teams make sure that customers not only realize the full value of the product/service as quickly as possible but also continue to derive value from it in the long run. But how does CS do that?

• Outstanding support when the customers need it

Being there for new customers who need help can improve their overall appreciation of the product or service immensely, even leading straight to a recommendation to friends, family, and colleagues. On the other hand, making a new customer wait for support can sour their experience beyond repair and earn you a negative review.

• Proactive communication to understand product/service usage and pinpoint areas for improvement based on feedback

Reaching out to customers is now standard practice for many industries. From surveys and questionnaires to direct requests for feedback, getting this information in a parsable format is crucial for product improvement. 

• Targeted education and training

Using onboarding email sequences, video series, or webinars – even digital marketing campaigns like social media retargeting with useful educational materials as part of the overall digital marketing strategies can further improve customer satisfaction as it shows genuine interest in providing value beyond sales.

What are the benefits of having a dedicated CS team?

As you can see above, many of the tasks that CS does may already belong to an existing department in the company – be it support, product owners, or content marketers. But the true value in creating a dedicated team to handle CS is that they will have the complete knowledge needed to support customers on their discovery journey. Instead of transferring them from one department to another, CS quickly and efficiently tackles cases so that the customers receive one seamless experience. And, as we mentioned experience, CS may be defined as part of a broader Customer Experience (CX) framework that defines what a great experience is from the first touchpoint well into the ‘In a relationship’ status.

What challenges do CS teams face daily?

To understand how customer success teams can improve their results, we need to understand what challenges they face in their day-to-day work. 

• Monitoring product usage

CS teams can’t hop on calls with customers every time they have a question. This is why it’s important for them to have various examples of digital data analytics tools that enable them to monitor usage. Tools like Google Analytics and Amplitude only give the core information (website traffic, click-through rate, the time a visitor spends on your site, etc.), but cannot answer the “how” or “why” something happened. Session replay tools like SessionStack can better answer these questions, as they allow CS teams to replay sessions with technical issues and view with precision the actions that led to the issue at hand.

• Not enough value reaching the users

Not every user will make the effort to go through the Help section of your product and learn how to use it. This is why it’s important to invest in proper onboarding – be it with an email sequence, an on-page onboarding sequence, or even personal onboarding when possible.

• Keeping communication channels open

It’s difficult to maintain a personal relationship with every customer, we get it. But you need to be there when they ask for your assistance. If you can afford it, you can increase the size of your support team when needed. If you’re on a tight budget, you can explore automated or semi-automated solutions that answer basic requests and forward only the more complex ones to your CS team. With the rise of AI and language models, our guess is that we will see this gain even more traction than before.

How can CS teams measure their results with digital analytics tools?

Nowadays, we have digital analytics tools for everything – some examples are SessionStack, Google Analytics, Pendo, Mixpanel, UserPilot, etc. Customers’ digital experiences can be measured in detail, providing valuable insights to stakeholders across the organization – product, marketing, sales, and, of course, CX and CS teams. Which is great but poses a grand problem… How do you choose what to measure and how to measure it? Different teams have different needs and today we’ll be focusing on customer success. 

Customer success analytics is the process of collecting, analyzing, and interpreting different types of digital analytics data to gain insights into the effectiveness of customer success initiatives and strategies. It involves tracking various metrics and key performance indicators (KPIs) to measure the overall health and satisfaction of customers, identify areas for improvement, and optimize customer success efforts.

Customer Success teams rely heavily on real-time data to define if their strategies are working, especially after a new feature or product launch. From the vast amount of data generated by the different examples of digital analytics tools the company use, they need to extract the chink that relates directly to their day-to-day tasks. What might these be?

5 Important KPIs for Customer Success Teams 

We’re sure you’re already familiar with what a KPI is – but let’s brush up on the knowledge. 

‘Key performance indicators (KPIs) refer to a set of quantifiable measurements used to gauge a company’s overall long-term performance. KPIs specifically help determine a company’s strategic, financial, and operational achievements, especially compared to those of other businesses within the same sector.’ – Investopedia

While a single article will not suffice to bring together all the possible KPIs a company might set for its CS team, we pinpointed 5 of the most essential Customer Support KPIs that have the greatest impact. Feel free to tell us if we’re missing something critical!

1. Customer Effort Score (CES)

Do your customers find it easy to get help from your business? You can find out if you set the Customer Effort Score as a KPI. It will give you an idea of how much effort a customer expends to purchase your product, get answers, or achieve a specific goal with your product or service.

How do you calculate CES?

CES can be calculated with a customer survey using a Likert scale. Ask your customers to rate how easy it was for them to do /insert specific action here/ on a scale of 1 (Very easy) to 7 (Very difficult). You can use 5, 7, or 9 for the numerical scale, depending on how granular the verbal responses are. To calculate the score, subtract the number of Easy answers from the number of Difficult answers. 

Why is it important?

Calculating CES is an invaluable KPI for CS teams in particular, as it provides a key insight into opportunities to improve support processes. This can help increase brand loyalty and decrease frustration caused by inadequate support practices.

2. Customer Satisfaction Score (CSAT)

This nifty KPI is where customer success and customer support come together. How happy are your customers with their onboarding? Look no further for the answer than CSAT. 

How do you calculate CSAT?

CSAT is once again calculated using a Likert scale, but this time you are asking about the level of satisfaction for a particular feature/product. After you get your responses, divide the total number of Satisfied responses by the total number of responses in the survey. Finally, multiply by 100. 

Why is it important?

How can you improve if you don’t know that some aspects of your product are simply not delivering the expected results? CSAT puts a numerical value on how much your customers enjoy your product. From there, you can continue the conversation to pinpoint any problem areas so that your product development team can work on them.

3. Free Trial Conversion Rate (CR)

Mainly used in the SaaS world, this KPI helps CS teams measure how many of the free trial customers convert to paying customers. Some businesses use a freemium (having a free product whose upgrades are paid) rather than a free trial (the full product is free for a limited amount of time), but this KPI can be applied to both. 

How do you calculate the Free Trial conversion rate?

Divide the number of conversions by the total number of trial users, then multiply by 100 to get a percentage.

Why is it important? 

If your free users don’t convert to paying customers – you know something’s wrong with the value of your offering. By constantly monitoring the Free trial CR and making sure it’s improving, you can decrease costs associated with customer acquisition (as you won’t need as many new users to achieve your revenue goals). 

4. Churn Rate

One of the scariest words in a SaaS company business owner’s dictionary is churn. Each customer who churns puts a bullet hole in our hearts, right? Let’s not get overly dramatic, though – this is a normal part of the business process and sometimes even healthy (just like competition), as it helps us constantly improve the products and services on the market. 

How do you measure Churn Rate?

Depending on the offering, you can consider a customer as ‘churned’ when they have unsubscribed from your service or haven’t purchased your products for a specific amount of time. To calculate the churn rate, subtract the number of clients at the beginning of each month from the number of clients at the end of the month, then divide that number by the number of customers at the beginning of the month.

Why is it important?

When you lose customers you lose revenue. And that hurts your bottom line and stands in the way of growth. Acquiring new customers is more expensive than retaining existing ones, so focusing on churn prevention is key. Hence, churn rate is a KPI that helps you pinpoint strategic stages of the user journey you need to work on.

5. Net Promoter Score (NPS)

Ah, this has to be our favorite KPI! With NPS, you can measure your customers’ loyalty to the brand. Who are the ones you can rely on to spread the word about how great your product or service is? Which ones will most likely drive potential customers away from your brand? 

How to calculate NPS?

Start with a survey that focuses on what is the likelihood that the customer will recommend your product/service on a scale from 1 to 10. Customers who answer from 1 to 6 are most likely detractors and will discourage their peers from choosing your brand. People who answer with 7 and 8 are passives – satisfied but not enough to recommend your brand. 9 and 10 is the golden range for promoters – these are the people who will promote and recommend your product!

To calculate the NPS, subtract the percentage of detractors from the percentage of promoters. You will get a number in a range between -100 and +100; the higher your score, the better.

Why is it important?

This is yet another customer success KPI that helps you understand how satisfied your customers are. Followed up by more specific questions, it can help you improve CS and CX procedures, and product features – and ultimately, keep your customers happy over time. 

What are some examples of digital analytics tools that you need to gather and analyze data for these KPIs?

Some of these KPIs rely on basic calculations taken from your sales spreadsheets or Google Analytics (average time on page, bounce rate, etc.), and some will require your CS team to acquire specific digital analytics tools – more specifically, platforms that provide customer surveys. If you choose to rely on a third-party tool rather than ask directly (which is better but very resource-consuming), some of the most used platforms are SurveyMonkey, Typeform, SurveyLab, HelloNext, and even the ubiquitous Hubspot. 

When choosing which platform to choose, you need to consider the volume of surveys that you will need to conduct each month. Some vendors offer free options that may be enough for smaller businesses, but larger companies will most probably want to scale things up in order to get the bigger picture and statistically relevant results.

And while we’re on the topic of digital analytics examples…. How about we tell you a secret? 

You can now have a look inside your customers’ journey like never before – by combining Session Replay and Co-browsing. If you’re not familiar with these terms – don’t worry, we’ll give you a quick overview of both!

What is Session Replay?

Session Replay is an example of a digital analytics tool that captures and reproduces user behavior on a website or mobile app. It gives you the opportunity to replay user sessions to understand how your customers interact with your website or app. SessionStack’s pixel-perfect session replay can help you identify usability issues, improve user experience, and optimize your product’s performance more quickly than any customer satisfaction survey!

What is Co-browsing?

Co-browsing is a technology that allows your Customer Success team to assist your customers in real time. During a co-browsing session, you can join a user and guide them to quickly answer a question that would otherwise require a lengthy chat or phone call. With co-browsing, you can even onboard users in the most intuitive way possible, taking over their session and letting them take the backseat while you show them around your product (session takeover always happens upon the user’s approval). SessionStack’s low-latency co-browsing may just be the tool that your CS team needs to supercharge their performance.

To wrap it up…

KPIs allow businesses to track progress toward their goals and identify areas that need improvement. The effective use of the digital analytics examples and the KPIs discussed can lead to improved decision-making and better outcomes for your Customer Success team. In the grand scheme of things, it will help your bottom line and increase the loyalty of your existing customers who will promote your brand with word of mouth – the best marketing you can get (and free!).