7 Proven SaaS Customer Success Best Practices

Emily Byford | January 14, 2021

Customer success is often overlooked as a growth driver for SaaS businesses. Most companies focus on acquiring new customers and forget that retaining their existing customers is just as important.

But in SaaS, everything compounds. If you’re losing 10% of your customers each month, that becomes a massive 71.8% over the year. Put another way: If you started the year with 100 customers, you’d only have 28 of them left by the end of the year, meaning you’d have to acquire 72 new customers in the year just to break even.

That’s where customer success comes in. If sales and marketing drive customer acquisition, then customer success drives retention and reduces churn.

What is SaaS customer success?

Lincoln Murphy describes customer success as “when your customers achieve their Desired Outcome through their interactions with your company.” Customer success is a defined strategy for helping your customers be successful when using your product.

SaaS is built on the recurring revenue model: To grow a SaaS business quickly and sustainably, you need to acquire customers and retain them.

This means customer success plays a role across the customer lifecycle:

  • Onboarding and activation: Successful onboarding gets your customers into your product, set up, and getting value from using it.
  • Renewal and retention: Customer success works in partnership with your customers, helping them get value from your SaaS throughout their contract. This should improve customer retention and lower customer churn rates.
  • Customer advocacy and referral: Customer success focuses on meeting your customers’ individual needs and making them successful with your product. A successful customer is a happy customer, and only happy, successful customers will recommend your product to other people.

Why is customer success important for SaaS companies?

Recurring revenue is the lifeblood of any SaaS business. If you’re struggling to retain customers, your SaaS company will struggle to grow.

Customer success is important for SaaS companies for three main reasons:

  1. It reduces churn: The higher your customer churn rate, the more difficult it will be for your SaaS business to achieve growth through new customer acquisition alone.
  2. It maximizes customer lifetime value: If your customers are successful using your product, they’re less likely to churn. A one year contract becomes two, three — even longer — and can grow with your customer if there are good fit opportunities to upsell and cross-sell.
  3. It unlocks second-order revenue: Second-order revenue is revenue that comes from customer referrals as well as customers changing jobs and bringing your product to their new company. Making your existing customers successful makes it more likely that they’ll want to recommend your product to their network or continue using it when they move on to new roles.

7 SaaS customer success best practices

Below, we break down seven customer success best practices for growing SaaS companies. These are actionable ideas you can put into practice to improve customer retention and satisfaction, turning one-time customers into long-term advocates.

1. Make customer success an early priority for your SaaS business

The earlier you start focusing on customer success, the easier it’s going to be. Jason Lemkin believes customer success should be a “single-digit hire” — one of the first 10 employees in your business.

Hiring a dedicated customer success manager early will help you build a customer-centric company. Hiring early makes it clear that your customers are your priority: You’re investing valuable time, energy, and money in helping them be successful with your product and your company.

But if you’re looking to build a customer-centric SaaS company, it can’t just be the responsibility of your customer success team. Customer centricity needs to be a mindset that’s shared across the company.

2. Know what success looks like for your customers

If customer success is, as Lincoln Murphy says, “when your customers achieve their Desired Outcome through their interactions with your company,” then you need to know what their Desired Outcome is.

How can you find out what success looks like for your customers?

Well … you could ask.

Run a survey as part of your onboarding process. Run regular customer feedback surveys. Get your sales team to ask leads about their goals. Run customer dinners. Talk to customers at conferences.

It’s important to remember that each customer will have their own specific goals and their own definition of success — their own Desired Outcome. As you speak to more people, you’ll build up a solid understanding of common themes in what your customers look for from your product, and you’ll be able to tailor your onboarding process and messaging with that in mind.

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3. Create an onboarding process to set your customers up for success

The first goal for your customer success team is to get each new customer signed in, set-up, and using your product. But more than that, a successful onboarding process helps your customer get value from your product in that very first session.

Some SaaS companies provide a dedicated onboarding manager to provide a concierge service to walk new customers through their onboarding step-by-step. This is highly tailored and mostly reserved for enterprise companies or high-value customers.

Much more commonly, SaaS companies automate their onboarding process with a combination of a product walkthrough and a few automated emails with handy tips to get started.

Whichever approach you take, it’s important to have a process that delivers value to your customers as early as possible to encourage them to keep using your product.

4. Don’t forget that off-boarding matters, too

So many SaaS companies focus on acquiring and retaining customers that they ignore the unpleasant truth: Sometimes, customers will churn.

Your off-boarding process is just as important as your onboarding one. You want to leave on a good note; just because your customer is leaving now doesn’t mean they’re leaving forever. Today they’re still your customer even if they won’t be tomorrow.

There are several important parts of your off-boarding process:

  • Cancellation process: We all know the fury of trying to cancel a subscription online only to find out you need to call back during business hours, Monday to Friday. Make it as easy as possible for your customers to cancel their subscription: If they’ve made up their mind, hiding the link somewhere obscure on your website won’t change that; it’ll just make them angry and leave them with a negative impression of your company.
  • Integrations: Does your SaaS integrate with other products that your customer uses? How will cancelling this subscription affect those integrations? Make sure they are aware of this — again, it will leave them with a bad impression if their carefully-crafted integrations stop working without warning.
  • Access to data: One of the most important things to consider is ensuring customers are still able to access their data from your SaaS once they’ve cancelled. For example, after cancelling my subscription to Drip and moving to a different tool for email marketing, I was still able to access my account to download previous emails, customer data, and analytics data for several months.
  • Access to your product: Do you want churned customers to be able to access your product at all? Some companies, like Ahrefs, downgrade you onto a free, limited-features tier when you cancel your paid subscription, retaining you as a free user instead of losing you altogether.

5. Keep an eye on your customer data

Usage data is a customer success manager’s best friend. At its simplest, you need to know whether customers are actually using your product. A customer can’t be successful with your SaaS if they never use it.

Monitoring your customers’ activities will help you:

  • Understand how they’re using your product.
  • See how often they’re using your product.
  • Provide better help and support if needed.
  • Identify customers who are getting the most from your product who might be a good upsell opportunity.
  • Identify customers who are at risk of churning.

6. Create a process for collecting, sharing, and taking action on customer feedback

Getting feedback from your customers is essential for understanding their needs, priorities, and experiences with your product. Your customer success team is in the perfect position to regularly gather feedback from your customers by:

  • Using in-app surveys such as Customer Satisfaction Score or Net Promoter Score to measure customer sentiment.
  • Asking for online reviews on sites like Capterra, Trustpilot, or G2. While reviews can be good or bad, the positive reviews make fantastic social proof for your business.
  • Sharing key quotes from customer emails or phone calls, for example, in an internal Slack channel dedicated to collating customer feedback.

The most important thing: If your customer success team spends so much time collecting customer feedback, actually use that feedback. It shouldn’t just get dumped in a spreadsheet and forgotten about.

Collecting feedback is just the start. Once you have feedback from a number of different customers, you can analyze trends and use that feedback across the business. It could be to guide the messaging on your marketing site or to feed into your product roadmap.

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7. Make it easy to contact your customer success team

If a customer has a problem with your product, don’t make them dig around in their email to contact you. Offer different ways for customers to find information and support, such as:

  • A dedicated email address for your customer success team.
  • A phone number for their customer support manager.
  • Live chat on your website.
  • User forums.
  • A knowledge base with articles explaining product features, tips, and troubleshooting info.

Making it easy to contact your customer success team will make it more likely a panicked customer will contact them directly instead of venting their frustrations on social media. Your customer success team may then transfer them to your support team, but even if they don’t directly solve your customers’ problems, they’ll leave a positive impression of being supportive and available to help.

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Adopting customer success best practices in your SaaS business

The ultimate goal of customer success is to make your customers successful when using your product, improving customer retention, reducing churn, and increasing customer lifetime value.

If you’re a small, early-stage SaaS company, your existing customers should be your first priority. Understand what they need to be successful first to improve retention and reduce churn. Then, you can expand your focus across the customer lifecycle, from acquisition and onboarding to upselling or off-boarding.

Adopting these best practices will truly put your customers at the heart of your SaaS business, making it easier to grow quickly and sustainably in the long term.

Emily Byford

Emily is a B2B SaaS content marketer. When she's not writing, she loves cooking and is a keen (indoor!) rock climber. Find her on Twitter or at ek-byford.com.