2013 Customer Success Benchmark

7/28/2019 2013 Customer Success Benchmark

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2013 STATE OF

THE PROFESSION:CUSTOMER SUCCESS

PRESENTS
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WHO ARE YOU,

CUSTOMER SUCCESSPROFESSIONAL?3


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THE AVERAGE CUSTOMER SUCCESS

PROFESSIONAL PROFILETitle: Customer Success Manager

Experience: 6.5 years in Customer Success or

working directly with customers

Background in: Sales/Customer Support

Compensation Structure: Base salary + commission/bonus

Reports to: VP Customer Success

Team Size: 14 people

Weve had Customer Success for: 1-3 years

Biggest challenges:

1. Lack of direction2. Lack of tools/info to manage customer info

Vertical: Computer software

Education: Graduated with bachelors degree

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MEET OUR SURVEYPARTICIPANTS5


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Our survey base spanned across

multiple industry verticals such

as: SaaS, analytics, broadcast,

technology, email marketing

services, call centers, projectmanagement, building systems,

finance, automotive, and much

more.

We had a nice mix of participants

from all levels ranging from

Associate to Director to VPs of

Customer Success.

BREAKDOWN OF PARTICIPANT BY TITLES

19%1%

9%

71%

Director

Associate

VP

Manager

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True to its infiltrating nature, the Customer

Success function has touched every

department of an organization. This also

makes it difficult to pinpoint who would be

responsible for such a function.

Many companies (47.1%) have dedicated a new

organization to Customer Success, with 15.7%

reporting directly to the CEO.

Its important that Customer Success

professionals are able to represent the

customers at the executive level.For some companies, Customer Success is a

fairly new introduction to their business

processes; but there is a growing need for

benchmarks and best practices to help instill

this growth.

Customer Success47%

CEO16%

COO3%

Sales10%

Marketing3%

CTO1%

Chief Customer Officer6%

Client Services3%

Other11%

WHERE DOES THEIR CUSTOMER SUCCESSFUNCTION REPORT TO?

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HOW LONG HAS THEIR CUSTOMER SUCCESS

FUNCTION BEEN AROUND?

37%

36%

26%

1%

More than 3 years

Between 1-3 years

Under 1 year

Just started

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TOP 10 COMMON CUSTOMER

SUCCESS CHALLENGESMost of the Customer Success professionals share similar issues - here the most 10

frequent ones (in order of urgency):

1. Need direction/Lack of information/tools to manage customer info2. External communication (with customers)3. Adoption4. Onboarding5. Unclear definition or understanding of CSM role/customer culture6. Internal communication (sales and other departments)7. Product training8. Measuring and acting on engagement9. Lack of personnel in team10. Identifying at-risk customers

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Balancing time between selling/retention/relationships Retention/Renewals Customer employee turnover Accurate measurement/Analytics Technical Support issues Prioritize leads Budget Predict customer behavior Measurement usage/adoption Customer software usage

WHERE ELSE ARE CUSTOMER SUCCESS

PROFESSIONALS FACING CHALLENGES?

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37% of our survey population shared that Customer

Success has been in their organization for more than

3 years, but still, as seen in the top 10 challenges,

13% complain that there is unclear definition/

understanding of the CSM role. In general, the

Customer Success function is pretty new. Most of the

Customer Success professionals have only been in

this field between 0-2 years. (41%).

About a quarter (24%) of Customer Success

professionals come from a Sales background and

therefore may need direction or new tools on how to

approach the customer from a different point of

view, which is not pushing for a deal but

understanding customer needs and leveraging their

success.

Most frequently, these professionals ask:

When does my role between firefighter andcustomer advocate begin or end?

My team is overwhelmed. The customer to CSMratio is too high, how can I manage this effectively?

What can I do when I feel like I have no authorityor influence on product decision or priorities?

How can I convince our executives of the value ofour work and not just another extra department?

How can I improve communication with otherdepartments like sales or support to solidify our

customer understanding?

Even though these professionals ultimately want to

help the customer be successful, it helps to empower

them with the right training and tools. Its important

to help these professionals achieve the goal of being

the customers advisor and advocate. A good place to

start is to create a company-wide understanding of

customer success: what does it mean? What isconsidered a successful customer? How can we bring

the customers voice into the boardroom? It would

be a good idea to introduce structured training for

their customer success teams.

ANALYSIS OF CUSTOMER SUCCESS CHALLENGES

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LOOKING INTO THE CUSTOMER

SUCCESS TOOLBOX

5.2%

5.5%

6.2%

7.7%

11.9%

21.1%

21.7%

26.3%

Office Suite

Customer Engagement Management

Helpdesk

Proprietary (homegrown)

Analytics Tools

Communications

Other (social media, soft skills, etc)

CRM

TOP TOOLS USED DAILY IN CUSTOMER SUCCESS

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Salesforce was the big winner among our participants as CRM of choice, followed by

social media and communications tools. Following close behind was the need forcustomer analytics.

In order to better manage the customer journey, key data for Customer Success

professionals comes from these customer intelligence tools to identify growth

opportunities and at-risk accounts.

One repeated comment from the surveyed participants who had to manually analyze

their customer data was the need to have amazing Excel kung fu. Our Customer

Success professionals made it a point to touch base with their accounts while also

providing added value via video conferencing, personal emails, and monitoring usage.

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ANATOMY OF CUSTOMER SUCCESS

COMPENSATIONFactor in experience and how established the customer success function is, and youll find

theres a great range of how Customer Success professionals are being compensated.

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CUSTOMER SUCCESS COMPENSATIONSTRUCTUREAn interesting find was that a majority of customer success professionals are

compensated first with a base salary then with added perks like commission and

bonuses from the success of their accounts.

76%

17%

7%

Base+Commission/Bonus

Base Only

Commission Only

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CUSTOMER SUCCESS COMPENSATION TRENDS

Altogether, 91% of our survey participants received a base salary. From that number, 64%also received a bonus in addition to the base salary, while 33% received commission for

upsells/renewals in addition to their base salary.

91%$

64%$

33%$

Base Salary Receive bonus in additionto base salary

Receive commission inaddition to base salary

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THINGS TO NEGOTIATE FOR COMPENSATION

Heres the breakdown on how Customer Success executives are being compensated for

commission and/or bonuses:

! % of sales! % of renewal revenue, quarterly! % of upsell revenue! % of project value! % of target met in relation to available bonus

! Reverse % of churn! Team performance! Personal performance! Company performance! Set percentage

In some cases, a certain threshold must be met before commissions/bonuses are activated.

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CONCLUSIONThe Customer Success function is starting to emerge at all organization levels, includingexecutive ones. Customer success professionals come from varying experience andbackgrounds, but their goals are the same: reduce churn and earn customer loyalty.

Here is the 2013 State of the Customer Success Profession:

1. Customer Success is still emerging (and growing).Businesses are in the process of trying to understand how to organize customer success andmanage compensation.

2. Businesses are missing the Customer Success Playbook.They are figuring out how to define the role of Customer Success. What are their goals? How istheir performance measured? How can this role be more integrated in other aspects of thebusiness? More importantly, they need internal buy-in by upper management for moresuccessful adoption.

3. There is a need for the right technologies and tools.Being able to narrow down the wide array of homegrown or scattered tools will help streamlinecustomer success processes. Customer Success professionals are looking for better ways toprioritize accounts, monitor and analyze, as well as improve communications both internallyand externally.

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ABOUT TOTANGO

Were a full-service Customer Engagement Management platform for online businesses.

Totangos Customer Engagement platform helps online services create an active and engaged

user base. Totango combines big data analytics with powerful segmentation and engagement tools

to allow online services to take the right actions with each customer, in real time. End-users

become happier and more successful driving usage and adoption, increasing conversions, sales

and lifetime value while reducing churn.

In the Customer Era, the whole dynamic and interaction model between vendors and users have

changed. Whether its for Customer Success or any function in your business, Totango was built

from the ground up to help businesses deliver more value and drive more active and engaged

users the foundation for business success.

Find out more or start your free trial at www.totango.com.20
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Documents

2013 Customer Success Benchmark