6 Customer Success Metrics That Every SaaS Company Should Be Measuring

By Carl Avery Jun18,2022

Customer success is a key component of a subscription business. As such, you might be wondering if your company has the right metrics in place to track its progress.

The good news is that there are a lot of customer success metrics that can help you measure whether or not your product is doing what it’s supposed to do. The bad news is that most SaaS companies don’t have these metrics set up yet—and they’re missing out on some big opportunities.

Customer success metrics give you the right data about the transparency of what is working with your customer success initatives. Without these metrics, it can be difficult to tell if you’re on a winning path, along with justifying all the work and money you have been putting into customer success.

Here are 6 customer success metrics every SaaS company should be measuring:

1. Customer recruitment rate

This is the number of customers who sign up for your product divided by the number of leads you generated in a given period. If you’re able to get new customers at a faster rate than you’re generating leads, then you know that all of your marketing efforts are working well.

2. Customer revenue growth rate

This is the percentage increase in annualized revenue over a given period compared to the prior year. If your revenue growth rate is increasing over time, it means that all of your efforts to grow your customer base are paying off.

3. Customer churn rate

This is the percentage decrease in annualized revenue over a given period compared to the prior year. If your churn rate is decreasing over time, it means that all of your efforts to retain existing customers are working.

4. Net promoter score (NPS)

NPS measures how likely an individual is to recommend your product or service to a friend or colleague. This is a great indicator of whether or not your customers are happy with your product and the value they receive from it.

5. Customer effort score (CES)

CES measures how much effort customers need to put into using your product to achieve their desired outcome. This will tell you whether or not your product is intuitive and easy to use, which can have a direct impact on retention rates and customer satisfaction.

6. Customer satisfaction index (CSI)

CSI measures how satisfied customers are with their experience with your company, including the quality of products and services offered as well as any interactions with customer support teams.

Going beyond customer satisfaction, customer success metrics are critical to helping businesses measure and analyze how their products, strategies, and tactics are meeting the needs of customers. These metrics help determine future product development, areas for improvement, and even growth potential for all SaaS companies.

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