• Companies can be B2B or B2C, with different product lines of diverse contract values per seat or per data storage size.
• Metrics: informed or driven decision, confidence, credibility to deliver value

Key pillar AREAs

• Adoption: implementation, user onboarding (using product, aha moment), training (instruction manual)
  • product adoption succeed under implementation, track frequency, check in on possible issues, make the most of the product
• Retention: avoid churn
  • Product does what users need to do
  • Produce remain good value
  • Ongoing relationship with customer, regular business reviews to reassess customer needs
  • Timely support
  • Promptly listened and responded to
• Expansion - primed to increase spend with you
  • Net promotor score (NPS), customer satisfaction
  • Extra licenses, increase order value, additional hours or duties, average spend increase, upgrade the level of product
• Advocacy - customer experience
  • Referral program, Ask for referral
  • Social proof

Customer Stages

• Account provisioning and training
• New customers:
  • trigger -> initial brand consideration, active evaluation, purchase (out of market) ->
  • existing customer - decision, experience, loyalty (out of market)
• Boarding strategies
• Up sell, cross sell
• Content curation
• Prevent churn: the % of customers that stopped using your company's product or service during a certain time frame

Annual Recurring Revenue (ARR)

• value of the recurring value from all customers
• annual contract or monthly subscription
• Monthly recurring revenue (MRR): no. of monthly active customers * average revenue per user
• 1M for 10 schools at Western annually

Upsell Revenue, Expansion Revenue

• Upsell purchase additional revenue from existing customers
• Expansion increased usage of product or increased price
• original monthly contract value + upsell and or expansion contract value = the new value

Retention and Churn - Logo Retention

• retention - glass half full perspective
• logo retention - the ending number of active customers (each treated equally) divided by starting number, at its best can reach 100%

Gross Revenue Retention (GRR)

• percentage of revenue from a pool of customers that is still present at the end of a specific period, excluding expansion and upsell, or downgrade
• deduct the ARR of customers churned, reverse calculation

Net Revenue Retention (NRR)

• percentage of revenue from a pool of customers that are active at the end of the period, including the expansion and upsell, churned and downgraded
• could exceed 100%
• what your company looks like if no new customers acquired

Gross revenue retention

• allow to talk about or summarize customer success at leadership/aggregate level, rather than individually in a customer's context

Annual contract value (ACV)

• of the subscriptions agreement, excluding implementation or training costs, excluding the system configuration fees

Total contract value (TCV)

• including multiple-year deals
• 3 years + 1-time system configuration fee

Average Revenue Per Unit or Account (ARPU)

• considering all existing customers, e.g. 10K per user
• in B2C, per user
• SaaS metrics

Customer acquisition cost (CAC) and Customer lifetime value (CLTV)

• CAC - total cost of sales and marketing efforts needed to acquire a customer (divided by the number of new customers)
  • keep it low as it scales for a viable SaaS
  • optimally lower than CLTV
  • e.g. 18 months on average (18 months of customers to recoup the cost)
  • could be a seesaw esp. during the early stage of a company
• Customer lifetime value (CLTV, or LTV) - prediction of the net profit attributed to the entire future relationship with a customer (shift to long-term account health)
  • ARPU divided by the revenue churn rate
  • usually the number of months the customers would continue with the software solutions
  • (annual revenue per customer * customer relationship in years) - customer acquisition costs
  • Hubspot - average purchase value * average purchase frequency rate * average customer lifespan
• CLTV: (to) CAC ratio ideally higher than 3

Customer success overview and recap

• Customer Success intro - 2021
• evidence-based and enduring strategy maximizing customer and company sustainable proven value and achievement goals - CX (customer experience)
• long-term health account relationship with customers
• Customer Success Strategies -> metrics -> targets, content & KPI
• objective: user requisition or retention (boarding); reduce churn, increase product usage, increase renewals, upsell and cords-sell, increase average revenue; deliver and demonstrate value

Net promotor score (NPS)

North Star Metric on customer loyalty - how would you recommend

• 0-6 detractors
• 7-8 passive
• 9-10 promoters
• NPS = % of promotors - % of detractors
  • Better 30-50

Make NPS work

• Ask detractors for feedbacks with follow-up questions
• Act on feedbacks separately on the 3 groups
• Make the NPS results
• Walk by implementing improvements
  • Customer satisfaction - Analyzing comments, sentiments, trends and topics
• Analyze growth trends for business - measure and predict future growth projections
  • NPS accounts for 20-60% of overall growth rate

SaaS metrics

• Product usage rate (frequency, usage of specific tools/features, usage duration)
• Average time on platform / application
  • Average session duration = total seconds of all sessions / total number of sessions
• Active user - daily, weekly, monthly
  • MAU, DAU (visiting certain pages, sharing/liking contents, completing a task, creating content, scrolling to the bottom of a page etc)
• Free trial conversion rate
  • Conversions/total number of visitors or leads

Other metrics

• Metrics (e.g. Usability sessions: note-taker notes, background questionnaire, prep survey, post-test questionnaire, product reaction cards)
• Customer health score - to formulate & index - finance, customers amount, growth etc (impact on their business, how often using, how successful after using, pain point eliminate, value seen?)
• CSAT rate (customer satisfaction score) measures individual satisfaction with a purchase, traction or experience = no. of positive scores / total scores
• VOC (Voice of Customer) measure expectations, needs and overall feedback on products and services - speak out-loud - qualitative
• (Customer) Churn Rate = no. of customer churned in a given time / customers at the beginning of the time period
• CES (customer effort score) measures effort a customer has to exert to get an issue resolves, a request fulfilled, product purchased/returned or a question answered - qualitative survey
  • Frequency, breadth, depth etc
• Customer Retention Cost (CRC) = total annual cost of customer success & retention initiatives / no. of active customers
• Customer Retention Rate (CRR) = (customers at the end of period - new customers during period) / total customers at stat of period
• Repeat purchase rate (RPR) = no. of customers who made a repeat purchase over 1 Y / total no. of customer over 1 Y
• Renewal rate: no. of renewals / no. of customer eligible to renew
• Net dollar retention (revenue change generated by existing customers): (starting MRR + expansion - downgrades - churn) / starting MRR * 100
• First contact resolution rate (FCR)