The Ultimate Guide to Customer Success in SaaS

SaaS products success are totally dependent on customers who are happy and loyal to gain maximum product value. Hence, customer success becomes a crucial factor in sustained business growth.

Clock15 min read



When operating a SaaS company, customer retention is just as important – if not more important – as customer acquisition. It costs up to seven times more to acquire a new customer than to retain an old one.

What’s more, businesses have a responsibility to look after their customers post-sale. Since SaaS companies are built on the subscription model, there is always the possibility that customers could be lured away by your competitors if they don’t realize the value they expected from your product.

Are your customers happy using your products, and are they likely to renew their subscription? These are big questions for a SaaS business, and they are the domain of your customer success team.

While some churn is inevitable, customer success teams are deeply engaged with retaining your customers and maintaining the recurring revenue that your business gets from your existing customers.

What is SaaS Customer Success?

SaaS customer success is making sure customers find value with your SaaS product from day one. SaaS Customer Success Managers (CSMs) are at the forefront of proactively helping customers to understand the product and using it to solve their problems. Instead of simply passively relying on dissatisfied customers to reach out to support, CSMs are involved in creating a better customer experience to make sure customers are successful.

The point of customer success is to retain more customers, increase customer lifetime value, and reduce churn. These vital metrics are a measure of whether your customer success strategy has been successful and directly drives revenue for the business.

Your customer success process is the strategies and methods you can use to help customers find value in the product. CSMs must clearly understand the customer success process to be effective in supporting customers and increasing product adoption.

What is the relationship between customer success and SaaS?

Any type of company may implement a customer success program but it is most closely associated with the SaaS world.

This is because SaaS companies need to keep customers on an ongoing basis in order to make a profit. Their products are priced on a monthly subscription rather than a one-time fee of thousands of dollars. Customers need to be realizing consistent value month-over-month and be satisfied with their product in order to keep paying the subscription fee. If they don’t, it’s easy enough for them to cancel and seek an alternative solution.

It’s all about Customer Lifetime Value. The longer you keep a customer in your business, the easier it is to offset the initial acquisition cost and make a profit. When you keep your customers happy, that makes it possible to upsell and cross-sell to your customers and generate even more profit.

Customer success challenge

Customer success just makes sense for SaaS companies. That’s because SaaS businesses are equipped with the data to execute proactive customer success. They know how customers are using their products with usage statistics and when they are running into problems, so they are able to act on this information and prevent customer churn.

Read more: Unlocking SaaS success using Customer success playbook

What will happen if you don’t implement SaaS Customer Success?

Customers are not successful with your product

Without customer success initiatives, customers may not be successful with your product. They may sign up, sign in to your platform and play around with a few features, but they may not find first value with your software. Customers don’t accomplish their goals and this is made possible by the fact that your team is not helping them.

No matter how well-designed your product is, and how intuitive your onboarding process, there will always be those customers who need a helping hand. Your SaaS company is missing a trick if they don’t track opportunities where they could intervene and accelerate growth through creating more successful customers.

Customers churn at a high rate

When customers don’t see success with your product they are much more likely to churn. This represents a huge chunk of lost revenue for your business as customers fail to renew their subscriptions and seek alternative products. While some churn is inevitable, as customers’ needs change and people move companies, limiting churn is necessary for those SaaS companies who want to drive growth.

In fact, according to Aaron Ross, customer success is not simply glorified support but is a growth driver for SaaS businesses. Head of Customer Success is just as important as Head of Sales and Head of Marketing in terms of increasing revenue by driving renewals and securing upsells. They own the “90 day adoption” which is the customer’s journey to finding value with your product, without which they will simply churn and never look back. Customer Success Managers work closely with customers so they are able to provide vital feedback to product teams that will help them create a solution that customers actually want.

 Customer Success

Your product lacks a people element

When you sign up for our SaaS product, you may not expect us to leave you all on your own. They may appreciate a helping hand that can reach out and help them understand certain features or gain insight into how products benefit them. Especially if customers are paying a lot of money for your SaaS, they may anticipate a high-touch customer success approach which involves a dedicated CSM to look out for their needs.

It’s human interaction that helps customers develop loyalty to your SaaS brand, especially when you go above and beyond their expectations with your customer success efforts. Customers will remember you as the business that cares about them and wants them to be successful with your product.

You fail to gather feedback on product usage

Customer success teams are on the ground working with customers to find out exactly how they’re using your product. They are the collectors of vital information that lets you know what customers want from your software, and what will make them stick around. You can answer important questions like:

  • Which are your most popular features and why?
  • Is your onboarding flow successful?
  • What direction would your customers like to see your product moving in?
  • Are your self-service resources helpful for customers?
  • Are customers using your product correctly, or are they a bad fit?

When you can answer these crucial questions through customer feedback then your other teams are better equipped. They can now know how to improve your product and the way they approach customers.

How Customer Success Manager can drive SaaS growth?

1. Understand what helps your customers find value

Every customer is different and what they need from you as a Customer Success Manager will vary. You need to collect data from new customers immediately to help you identify what customers will consider valuable from your product.

Signup forms can assist you in finding out who customers are and how they intend to use your product, which you can then use to personalize the onboarding and adoption experience. When customers find your product valuable, they are less likely to churn and this enables your SaaS business to grow.

2. Reach out personally to train and support your customers

It’s essential for customers to be educated on the best way to use your product. One of the most important methods for education is personally reaching out to train customers. One of the surest routes to customer success is to ensure customers have access to the proper training.

You can offer an email sequence or give access to a live webinar to train customers on the use of particular features. You can create video tutorials and distribute these to customers thus benefiting from further training.

3. Provide in-app help to enable them to get the most out of your product

Customers who are learning how to use your product can easily get distracted when you offer them too many different forms of help. SaaS companies that take the step of serving in-app help to customers experience an uplift in customer success. This may take the form of a self-service knowledge base that is embedded in your application.

Customers can find the help they need without switching contexts and quickly get back to obtaining value from your software. Customers can contextualize your documentation to locate the right information depending on what they are doing in your software at the time. This kind of targeted support experience reduces churn as customers are able to help themselves.

4. Monitor customer satisfaction and loyalty

Don’t just rely on customers complaining before you find out whether there has been a problem with their experience. Regularly sending out surveys to monitor customer satisfaction and loyalty is an important way to check that customers are engaged. This helps to know whether they are happy with the service you have provided.

If customers give you a negative rating you can quickly reach out to get them back on course, which as the customer success team should be your number one priority. Customers may be heavy users of your software but if they can’t achieve their goals then they are at high risk of churn.

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5. Upsell to customers when they are ready to expand

The role of a Customer Success Manager involves tracking when particular customers might be ready for an upsell. Of course you don’t want to pester happy customers to buy more products. But if the customers are reaching the limits of their plan then they might be ripe for an upgrade. Successful customers are likely to be growing over time. They will appreciate the guidance from your CSMs that enables them to get more out of your product.

Upsells and cross-sells to customers are a vital way that SaaS companies can grow. This increases the Lifetime Value of their most important customers. Without selling to existing customers, you run the risk that they outgrow your product and start considering your competitors.

How to Implement Customer Success in Your SaaS?

Customer success is an essential part of SaaS startups. It involves implementing and measuring processes at every step of the customer journey to ensure customer satisfaction. The customer success pipeline in SaaS startups can be divided into four stages, explained in this section. To implement customer success in a SaaS startup, it is important to understand that the customer success pipeline should be practiced along every step of the customer journey, with processes designed to facilitate it. Each process must be measured, monitored, and optimized constantly to ensure the best customer experience.

1. Marketing and Pre-sales:

Customer success, marketing, and sales form a triangle that needs to be in alignment. Your marketing team needs to identify the people who would best suit your product and market it to them. It is crucial that your marketing team sets up the correct expectations and does not promise something that you cannot deliver. False expectations lead to customer dissatisfaction, resulting in churn, even if your product or service is good. Therefore, it is important to vet prospects to ensure they fit your customer persona well.

To do this as a process, you can define certain customer success criteria and parameters related to prospects that make a customer successful (or not) for your organization.Once the sales team has converted them, it is important to monitor the handoff process to ensure that it passes complete information about the customer to other teams. This helps prevent the need to ask customers the same questions over and over again.

KPIs/Measurements to monitor:

  • Total Prospects/Good Fit Ratio
  • Churn at end of the first cycle/Successful Prospect Conversions

2. Immediately After Sign Up (Onboarding, Delivering Value):

Onboarding is the first time the user will engage with your product, and providing the promised value to the customer in the shortest time possible is important. Your activation funnel should be self-explanatory and intuitive for the user. If the funnel is too complex or the process too long, users will abandon the ship, and even successful signups will return no value. Therefore, it is important to analyze and optimize your onboarding experience.

3. Expansion: Upgrades and Upsells

KPIs and Parameters to track:

a) Core Tasks Completion Rate: Analyze and monitor the core tasks in your activation funnel to see how many users are completing all and where users may be dropping off. In case of drop-offs, aim to make the tasks and experience more intuitive. You can also use activation emails to get users back on track in their activation funnels.

b) Session Lengths: Monitor the session lengths for your new users to receive crucial feedback about your onboarding process. For example, if the average session length for completion is 15 minutes, and most of your users drop out at 3 minutes. You need to optimize your funnel.

c) Returning Sessions: Track how many users return to become active users after successful onboarding. If users are completing the onboarding but not returning, there might be something wrong with your messaging. You can use activation emails here to get them back.

4. Customer Support and Satisfaction

If the customer achieves the promised result, which holds value for them, they will experience high satisfaction and willingly make the payment.

Therefore, it is important to measure trial-to-paid version conversions to see how many free trial users actually end up signing up for the paid version.

If the number does not look good, there could be various problems, such as the customer not seeing value in the problem you’re solving. 

The result promised was not delivered, the onboarding experience being poor, the product being priced too high, or the payment process is turning users off.

Once customers are paying users of your product, determine engagement parameters based on the product. And their interactions to define whether they would be interested in using more functionality. When users properly engage with your product regularly and understand

Wrapping up

Customer success in SaaS is critical in ensuring your company’s growth and that your existing customers decide to renew their subscription. Every month, the customer will be evaluating whether the product is living up to expectations or if they might be better served by another tool. SaaS customers are fickle, but you can earn their loyalty by proactively leading them to success and ensuring the company is living up to its promise.

Your customer success team should identify and anticipate problems with the product before the customer has the chance to realize anything is wrong. Customer success has the power to create instances of customer delight and ensure that your product becomes indispensable to the customer’s routine.

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