Customer Success Glossary

360° Customer View means centralizing all customer data in one place:

• Customer and contract data from CRM
• Product usage from the back office or Product Analytics
• Customer support information in a ticketing tool

A common problem that Customer Success teams face is that this data is not consolidated. This is where Customer Success Platforms come in. They enable you to centralize all your customer data and set up a Health Score to have a more complete understanding of their accounts’ health.

An ambassador is a highly satisfied customer who recommends your product to other companies. They promote your brand, reinforce your credibility and help you acquire new customers. You can implement a referral strategy to turn your customers into ambassadors, offering them rewards for leads or sales that they generate.

In SaaS companies, ARR means the Annual Recurring Revenue generated by subscriptions taken out by customers. It also includes upsells and recurring user fees. However, it doesn’t take into account one-off revenues or non-recurring services.

For example, if you sign a 6-month contract for €1,000 with a customer, it generates an ARR of €2,000. Another example: a customer who signs a 2-year contract for a total of €3,000 has an ARR of €1,500.

You can also use MRR (Monthly Recurring Revenue), i.e. monthly recurring revenue (ARR = MRR x 12).

The Average Revenue Per Account (ARPA) is one of the most important KPIs in Customer Success.

It’s calculated as follows: Total MRR / Number of customers

For example, if your total monthly recurring revenue (MRR) is €500,000 and you have 1,000 customers, your ARPA is €500.

The calculation to track its evolution is: (ARPA year 2 - ARPA year 1 / ARPA year 1) x 100.

Track ARPA to assess the impact of your retention and expansion efforts.

A Business Review, also known as a Quarterly Business Review (QBR) when it takes place every quarter, is a meeting with one of your customers.

The aim is to evaluate the results achieved and ensure mutual success. It's a tool for analyzing the business gains (productivity, profitability, adoption) offered by your product to your customer. The information you gather from the customer can be disseminated internally to other departments, such as Product, to improve your offering.

A champion is a key user within his company who advocates the adoption of your product internally, to colleagues and/or management. Sometimes, this person is the main point of contact for the Customer Success Manager. A champion can intervene before the sale, but also afterwards, to support an upsell or cross-sell for example.

Bear in mind that a customer champion is different from an ambassador, who promotes your solution externally.

The Chief Customer Officer (CCO) is an executive position that manages both the Customer Success and Customer Support teams, and sometimes even the Account Management team. He usually reports to the CEO, and one of his missions is to promote a customer-centric culture within the company.

This position is relatively new to SaaS companies. It tends to be found in well-structured companies, while it’s still rare in start-ups in their acceleration phase.

Churn refers to the loss of a customer. One of the main objectives of Customer Success Managers is to prevent churn, even though there are always customers who churn.

This is measured by calculating a churn rate, usually on a monthly basis. There are 3 possible churn rate indicators:

• Customer Churn Rate: indicates the proportion, by volume, of customers present at the start of the analysis period who are still active at the end of the analysis period.

• Gross MRR Churn Rate: measures revenue lost over the analysis period, whether through churn or downsells.

• Net MRR Churn Rate: this indicator takes into account both revenues lost over the period (churn and contraction) and revenues gained (expansion and reactivation).

Early-stage start-ups generally have a relatively high churn rate. This rate decreases as the company gets more structured.

Among the main churn factors are failure to achieve results, short onboarding time and lack of upsells.

In SaaS, Customer Lifetime Value (CLV), also known as LTV or CLTV, is an indicator that tells you how much the average customer spends on your product over the entire duration of their collaboration with your company, from signing to churn. It helps you identify the customers who bring the most value.

For example, if your customer has a MRR of €500 and remains a customer for 24 months, his CLV is €12,000.

Since you don't know in advance how long a customer will last, the CLV calculation is based on an estimate. Here's the formula generally used:

CLV = ARPA / Monthly Churn Rate

For example, if your ARPA (Average Revenue Per Account) is €200 and your monthly churn rate is 2%, you have an average CLV of 200 / 0.02 = €10,000.

Another calculation method takes gross margin into account, for a more precise calculation:

CLV = (ARPA x gross margin rate) / Monthly Churn Rate

Gross margin corresponds to total revenues - costs (infrastructure, direct purchases, etc.)

Cross-Selling is a type of customer expansion. It involves selling complementary products or services to an existing customer, based on their needs or current use of the product, to bring them even more value. This increases the total MRR generated by the customer.

CSAT (Customer Satisfaction) is an indicator set up to track account health. It measures customer satisfaction, for example, by asking the question: “On a scale of 0 to 10, how would you rate your satisfaction with our solution?”

Consider contacting users who give CSAT a low score, to get back to them and obtain more information. This can help to reduce churn and raise interesting requests to the Product team.

The Customer Health Score is an indicator of a customer's level of health and future loyalty. The lower the score, the greater the risk of churn; the higher the score, the healthier the account, the more likely it is to renew and upsell/cross-sell.

Customer Success Platforms automatically calculate a Health Score based on specific indicators. For example, the Skalin solution uses the following data:

• Criteria linked to the use of your product
• Customer interactions with your team
• CSM Pulse (the CSM's assessment of the account)
• Contract data.

The Customer Journey refers to all the stages a customer goes through, from the moment they become aware of your product, through to adoption, use and even loyalty or churn. It's a detailed and specific view of the customer experience, taking into account every interaction with the company at different touchpoints. The customer journey often evolves and varies from one customer to another.

You can create a Customer Journey Map to provide a visual representation of interactions with your company, from the customer's point of view.

The Customer Lifecycle describes the major phases through which a customer passes during his or her entire relationship with the company:

• Acquisition
• Onboarding
• Adoption
• Run
• Retention
• Churn

In SaaS, Customer Lifetime Value (CLTV), also known as LTV or CLV, is an indicator that tells you how much the average customer spends on your product over the entire duration of their collaboration with your company, from signing to churn. It helps you identify the customers who bring the most value.

For example, if your customer has a MRR of €500 and remains a customer for 24 months, his CLTV is €12,000.

Since you don't know in advance how long a customer will last, the CLTV calculation is based on an estimate. Here's the formula generally used:

CLTV = ARPA / Monthly Churn Rate

For example, if your ARPA (Average Revenue Per Account) is €200 and your monthly churn rate is 2%, you have an average CLV of 200 / 0.02 = €10,000.

Another calculation method takes gross margin into account, for a more precise calculation:

CLTV = (ARPA x gross margin rate) / Monthly Churn Rate

Gross margin corresponds to total revenues - costs (infrastructure, direct purchases, etc.)

A CRM tool (Customer Relationship Management) is used in almost all SaaS companies. Originally designed for Sales and Marketing functions, they are now tending to be used by other departments, such as Customer Success. They allow you to centralize all customer information, including contacts, contract information and exchanges with your company.

HubSpot, Salesforce and Pipedrive are examples of popular CRMs.

Customer retention refers to a company's ability to keep its customers as subscribers over a given period. It is the opposite of churn.

The customer retention rate (CRR) is calculated using this formula:

(Final customers - New customers) / Initial customers x 100

For example, if you have 200 customers at the beginning of the month, 5 customers join you during the month and you have 202 customers at the end of the month, your CRR is: (202-5) / 200 = 98.5%.

Customer retention can also be measured using NRR (Net Revenue Retention), which takes into account expansions, downsells and churn.

Customer Satisfaction with your product can be measured with these indicators:

• CSAT
• NPS (Net Promoter Score)
• Sentiment analysis

Customer segmentation involves dividing your customers into groups based on common characteristics. For example, you can segment by revenue, vertical, product, geography or potential.

Segmentation makes it easier to keep track of your customers, and increases efficiency. What's more, it's an essential step in creating effective Playbooks.

Customer Success Automation involves using automated tools and workflows to support customers at every stage of their relationship with the company. This improves the customer experience, enables proactive customer management and saves time for CS teams.

Customer Success Platforms offer a key tool for automating customer journeys: Playbooks. Playbooks are automated workflows that depend on a trigger condition to define a sequence of actions. For example, when a customer no longer uses your product, an e-mail is automatically sent.

In B2B SaaS, a Customer Success Manager is a professional dedicated to customer satisfaction throughout the customer lifecycle. He aims to help customers achieve their objectives, in order to build loyalty. They generally have a portfolio of accounts at their disposal.

The CSM's current missions include

• Customer onboarding
• Platform training
• Operational support for customers
• Feedback to the product team
• Contract renewal
• Upsell and cross-sell

In addition, we can distinguish 3 main CSM profiles according to their main missions:

• Operational CSMs: they accompany customers and also perform support tasks.
• Full-Stack CSMs: in addition to supporting customers, they identify and sometimes manage upsell opportunities for their portfolio.
• Support + CSMs: their role is essentially to respond to incoming customer requests.

With experience, a CSM can progress to a lead CSM or team management position, such as Head of Customer Success.

A Customer Success Platform (CSP) is software dedicated to CS teams. It provides a global view of all contact points.

Here's how a CSP works:

• It centralizes interactions, NPS feedback, product usage and CSM opinions to create a 360° customer view.
• It uses this data to calculate a Customer Health Score to predict customer loyalty or churn.
• It informs CS teams in the form of reports, alerts and reminders.

The ultimate objectives of a Customer Success Platform: to improve CSM time management and generate more revenue by enabling them to move from a reactive to a proactive mode.

Daily Active User (DAU) is the number of unique users who interact with an application or platform every day. This indicator measures user engagement and enables product usage to be tracked.

In SaaS, downsell refers to a scenario in which a customer chooses a cheaper alternative to your product, without unsubscribing. This results in a reduction in the customer's MRR. Examples of downsell: reducing the number of users or moving from an intermediate plan to a Starter plan.

As a CSM, you can offer a downsell to a customer who is considering leaving or reducing their commitment to your product.

In Customer Success, expansion refers to the growth of revenues generated by an existing customer, beyond their initial contract. This includes two main strategies:

• Upselling: for example, upgrading the customer to a more expensive plan.
• Cross-selling: for example, selling another product in addition to the one currently in use.

Expansion is often more profitable than acquiring new customers, as selling costs are generally lower with existing customers.

Handover (Sales Handover) refers to the transfer of an account from the Sales team to the Customer Success team. It can take place just after the signing of a new customer, or a few weeks later.

Successful handover is important to reduce the risks associated with a change of contact person. A successful handover guarantees a consistent customer experience, improves onboarding and sets the stage for the rest of the customer relationship. To achieve this, you need to obtain precise information about the customer, including expectations, challenges and objectives.

The Head of Customer Success is in charge of the CS team. Duties include:

• Managing CSMs: he recruits them, onboards them, and monitors their development. He also sets their objectives in agreement with management.

• Training his team and helping them with complex issues.

• Being responsible for the company's Customer Success: reporting the Customer Success team’s performance.

• Interacting with the Product team: share “macro” customer feedback and help build the roadmap.

• Supporting pre-sales reps: he can reassure prospects about their future support.

In some companies, the Head of Customer Success is also a member of the management board. In this case, he participates in the company's strategy and represents the voice of the customer.

The Head of CS should not be confused with the Team Lead CS, who has a “Senior” or “Expert” profile but is not a manager.

High Touch is an approach where customer support is highly personalized and proactive. In this case, the Customer Success Manager generally follows up with the customer on a regular basis.

High Touch is preferred for the most important customers or those with the highest MRR.

Conversely, in Low Touch, customer support is automated or involves little human interaction. Most of the time, these customers do not have a dedicated CSM, but are in contact with the Support team. This approach relies on automated emails, knowledge bases or webinars.

Low Touch concerns customers who generate the least revenue.

In SaaS, Customer Lifetime Value (LTV), also known as CLTV or CLV, is an indicator that tells you how much the average customer spends on your product over the entire duration of their collaboration with your company, from signature to churn. It helps you identify the customers who bring the most value to your company.

For example, if your customer has a MRR of €500 and remains a customer for 24 months, his LTV is €12,000.

Since you don't know in advance how long a customer will last, the LTV calculation is based on an estimate. Here's the formula generally used:

LTV = ARPA / Monthly Churn Rate

For example, if your ARPA (Average Revenue Per Account) is €200 and your monthly churn rate is 2%, you have an average LTV of 200 / 0.02 = €10,000.

Another calculation method takes gross margin into account, for a more precise calculation:

LTV = (ARPA x gross margin rate) / Monthly Churn Rate

Gross margin being: total revenues - costs (infrastructure, direct purchases, etc.).

Monthly Active User (MAU) is the number of unique users who interact with an application or platform each month. This indicator measures user engagement and allows product usage to be tracked.

In SaaS, MRR (Monthly Recurring Revenue) measures the monthly recurring revenue generated by customer subscriptions. It also includes upsells and recurring user fees. However, it doesn’t take into account one-off revenues or non-recurring services.

For example, if you sign a 6-month contract with a customer for €600, it generates a MRR of €100. If another customer signs a 24-month contract for a total of €12,000, his MRR would be €500.

Instead of MRR, you can also track ARR (Annual Recurring Revenue) (MRR = ARR / 12).

The Net Promoter Score (NPS) is a measure of customer satisfaction. It is based on the question: “On a scale of 0 to 10, how likely is it that you would recommend our company/product/service to a friend or colleague?”.

The answers classify customers into 3 categories:

• Promoters: answers of 9 or 10
• Passives: answers of 7 or 8
• Detractors: answers from 0 to 6

The NPS calculation is: % Promoters - % Detractors

The score ranges from -100 to +100. A positive NPS indicates that a majority of customers are satisfied. A negative score indicates that users are not satisfied overall. 50 is considered a good NPS and 70 an excellent score.

More and more SaaS companies are moving away from NPS, one of the reason being that survey information is not always usable. Furthermore, according to a ChurnRX study, there is no correlation between NPS and churn. Alternatives for measuring customer satisfaction are CSAT and sentiment analysis.

NRR (Net Revenue Retention) is a KPI used in SaaS companies. It measures the recurring revenue a company is able to generate over a given period, with a constant number of customers.

NRR = (initial MRR + expansion - downsell - churn) / initial MRR

An NRR greater than 100 means that revenue growth from existing customers offsets losses due to churn and downsell. An NRR below 100 indicates a net loss of revenue despite expansions. The most successful SaaS companies can have an NRR above 110%.

Customer offboarding refers to the process of supporting a customer when they end their subscription or stop using a SaaS product. This stage is an opportunity to obtain valuable feedback on your product and the quality of your support.

To ensure successful offboarding, draw up an internal procedure identified in your knowledge base, and share it with all departments in your company. Identify a person responsible for offboarding each account, ideally the CSM who has had initial contact with the customer.

OKR (Objectives and Key Results) are an objective management method used in SaaS to define priorities, measure results and align the team with key objectives. It can be used in all departments of a company, not just in CS. OKRs are generally set for a quarter.

An OKR includes :

• a clear, ambitious and qualitative objective
• specific, measurable results that show whether the objective has been achieved.

An example of a quarterly OKR in CS is :

• Objective: Improve customer retention to reinforce growth.
• Results:
  • Increase NRR by 3 points
  • Reduce churn rate by 8 points
  • Launch a loyalty program for 15% of existing customers

Onboarding refers to the process customers go through when they start using a SaaS product. The aim is for them to be engaged and satisfied with the functionality. It's a crucial phase, as it lays the foundations of your relationship and confirms the customer's choice of your solution.

Here are some best practices for onboarding:

• A solid Sales > Customer Success handover: get as much information as possible from the Sales rep on the customer's level of knowledge.

• Understand the customer's objectives: you can prepare a Success Plan for the customer, which will be used over the long term to monitor whether objectives are being met.

• Timing and visibility: divide the onboarding phase into several stages, with precise dates. Explain the process to the customer.

• Control your availability: don't spend too much time on each customer. To avoid this, segment your customers and use automated Playbooks.

• Keep onboarding time short: onboarding generally lasts a few weeks but shouldn’t exceed 3 months.

A Customer Success Playbook is a series of actions executed according to a defined process. It's an automated workflow, consisting of a Trigger (launch condition) followed by several distinct tasks.

For example, during onboarding, the creation of a new customer is the trigger that initiates the sequence. This may include the automatic assignment of a segment to the customer based on his MRR, the automatic assignment of a CSM and the sending of a series of automatic e-mails to guide the customer.

Customer Success Playbook have 3 main advantages:

• Proactive customer management
• Homogenize processes within the team and facilitate the integration of new CSMs
• Save time to focus on the most important tasks and customers

Predictive Analysis is a method that uses Artificial Intelligence and historical data to anticipate future customer behavior. It takes into account past behavior, such as connections, use of features and frequency of exchanges with the Customer Success team.

Predictive Analysis is used to find out the health of each account in a few weeks or months' time, and to identify churn risks.

Product Adoption is the process by which customers integrate and effectively use your product in their daily lives. To boost product adoption, it's essential to ensure that your customers quickly perceive the full value of your solution.

The following pre-sales stages lead to product adoption: Discovery > Interest > Evaluation > Trial > Adoption.

In SaaS, Product Analytics is the process of analyzing user engagement with a product. It involves tracking, visualizing and analyzing behavioral data. Customer Success and Product teams use this data to optimize their approach and improve the software.

Mixpanel and Pendo are examples of Product Analytics solutions.

In SaaS, Product Stickiness refers to the tendency of users to return to your product because it's attractive and important to them. Stickiness contributes to your customers using your product more frequently and renewing their subscriptions.

It's measured by a rate, calculated using this formula:

Weekly Active Users (WAU) / Monthly Active Users (MAU) x 100

For example, if you have 2,500 WAUs and 5,000 MAUs, the stickiness rate is 50%. A higher rate means that users find your solution interesting enough to use it often.

A Product Tour is a guided presentation of a SaaS product to new users. It takes place before customer sign-up or during the onboarding phase. A Product Tour can take the form of a video or a live session. The goal is to highlight the key features and benefits of the solution, to help users quickly understand how to get the most out of the software.

A Quarterly Business Review (QBR) is a quarterly meeting with one of your customers.

The aim is to evaluate the results achieved and ensure mutual success. It's a tool for analyzing the business gains (productivity, profitability, adoption) offered by your product to your customer. The information you gather from the customer can be disseminated internally to other departments, such as Product, to improve your offering.

Referral is the act of obtaining introductions from prospects, customers or people in a company's ecosystem. Referral is based on these people's network, i.e. the people they already know.

It's a highly effective lead acquisition and sales channel: the conversion rate of referred leads is on average higher than others, and customers obtained via referrals generally have a higher average shopping basket.

A referral strategy is advisable for better long-term results. It can include rewards, when the recommendation leads to customer conversion or lead generation.

In SaaS, renewals are key moments in the customer relationship. They occur when the subscription to your product expires, most of the time on an annual basis. The CSM's goal is to get customers to renew, to ensure recurring revenues. It's also an opportunity to offer an upsell or cross-sell.

Renewal is prepared throughout the customer journey, starting during onboarding, and at every point of contact. To maximize the chances of renewal, anticipate the customer's questions, stay proactive with them and help them achieve their objectives and obtain value from your solution.

Sentiment Analysis is based on Machine Learning, via Natural Language Artificial Intelligence. This technology analyzes customers' written or verbal messages and indicates whether their feelings are positive, neutral or negative. The aim is to accurately measure your customers' level of satisfaction.

Customer Success Platform tools, such as Skalin, enable you to track the evolution of this level over time, to detect issues and, if necessary, send alerts.

A Success Plan is a customized strategic tool that defines the objectives, milestones and actions required to ensure a customer's success with a SaaS product.

For an effective Success Plan:

• Define success: clarify the customer's expectations and your own.

• List the steps: what concrete actions need to be taken to ensure that your customer achieves his objectives with your product?

• Choose success KPIs to monitor

• Share your Success Plan with the customer, by sending them a simplified version of the document.

• Identify anything that could prevent you from achieving your objectives

• Implement your plan: meet regularly with the customer to monitor results

In Customer Success, Tech Touch refers to an automated, low-human-interaction approach to customer support. It relies mainly on technological tools such as automated e-mails, chatbots, knowledge bases and webinars.

Tech Touch is often preferred for customers with the lowest MRR. This approach has the advantage of avoiding overloading the CSM when there is a large number of customers.

It’s the opposite of High Touch, which involves personalized follow-up.

Time To Value (TTV) measures how quickly your customers expect to benefit from the value provided by your product.

To measure it, you need to know what benefit the customer expects to receive from your product. In concrete terms, approach each customer and ask them what specific objectives they want to achieve with your solution.

To reduce TTV, it's essential to know what action indicates that customers first realize the value of your Product. Once this has been identified, suggest quick wins and demonstrate value proactively.

Upselling means selling an existing customer a higher version of a product or additional features. For example, a customer upsells when they upgrade from a Starter plan to an Enterprise plan, or when they add more users to their current plan. Upselling translates into an increase in the MRR generated by the customer.

The difference between upsell and cross-sell is that upsell involves selling the same product, whereas cross-sell involves selling a complementary product or service.

Weekly Active User (WAU) is the number of unique users who interact with an application or platform each week. This indicator measures user engagement and enables product usage to be tracked.

In Customer Success, a Workflow is a set of automated steps put in place to ensure that customers achieve the goal they have set themselves by using your product. This can include phone calls, e-mails, conference calls, reminders to the CSM, etc. The aim is for the CS team to benefit from a duplicable process for accompanying customers, identifying churn risks and detecting upsell/cross-sell opportunities.

Playbooks are an efficient tool to build powerful Workflows.