6 Biggest Mistakes of SaaS Customer Success

saas customer success mistakes

When you run a SaaS company that relies on a subscription model, it’s very clear when a customer is no longer unhappy: they’ll jump ship and move to your competitor.

That’s why the SaaS industry is arguably where customer success is the most crucial. So if you want to keep your customers coming back, you need to master a customer success methodology—and that means limiting your mistakes.

In this post, we’ll cover six top SaaS customer success mistakes to avoid and walk you through some ways to ensure your customers’ experience is as fulfilling as possible.

Jump to section:

Not Fostering a Customer Success Culture
Failing to Define Success for Users
Making the Customer Support Team Handle Customer Success
Neglecting to Segment Users
Customer Success Reps Handling Too Many Accounts
Mistaking the Users’ Silence for Success
Final Thoughts on Avoiding SaaS Customer Success Mistakes

Not Fostering a Customer Success Culture 

Customer success sounds like one of those vague, corporate-speak buzzwords that could mean anything. And in one way, that’s true; customer success is a buzzword, and it does look different based on your company, your customers, and the goals of everyone involved.

However, that doesn’t mean it’s one of those vague and unhelpful corporate buzzwords (looking at you, “synergy”) that carry no practical meaning. Instead, it’s a real and essential element of a SaaS business in 2021.

One of the most helpful ways to define customer success comes from Nick Mehta of Gainsight:

Nick Mehta quote

Source: Regpack

This methodology goes beyond individual roles and even departments—in order to work properly, you need to foster a culture of customer success. It needs to be built into the very fabric of your organization.

What does this look like?

First of all, don’t relegate customer retention worries to the customer success team. Every department—customer service, sales, marketing, development, and beyond—needs to prioritize customer satisfaction.

Source: Signalvoc

Everyone in the company needs to have a deep understanding of what the customer aims to achieve and how the product serves them.

The product team, for instance, keeps the customers’ needs in mind when developing new features and tools, while the sales staff takes customer pain points into account when developing outreach strategies.

It is crucial to develop a customer persona and make sure everyone in the company is on the same page about what the ideal customer is like. What are their preferences, needs, and habits?

How do they feel about the product, and why would they choose it?

Having a consistent image of the customer base helps each department understand its role in reducing friction and increasing customer satisfaction and loyalty.

Another important strategy for building a customer success culture is to ensure that your customer success managers (CSMs) have easy access to other departments. Natalie Williams, Director of Customer Success at SmashFly Technologies, said it best:

“True customer success takes a village. Period. CSMs can’t do it alone!”

Because customer success managers build relationships with and gather feedback from real customers, they have insights into what’s working and what isn’t.

If they can communicate with your product, marketing, and sales teams, they can translate those insights into bug fixes and improved messaging that keeps the customers coming back.

Failing to Define Success for Users

By definition, customer success happens when a customer achieves their desired outcome through their use of your product or service.

Unfortunately, one of the biggest mistakes SaaS brands make is failing to discover what that success would look like in the first place.

It’s much too easy to put yourself in an imaginary customer’s place and shoehorn their desires and goals into your vision of how your product would work for them.

But failing to define customer success based on real, live customers can only lead to heartbreak (in the form of customer churn and lost revenue).

You need to identify what real customers want. What are their goals? Using that as a starting point, determine how, specifically, your product would help your customers meet those objectives.

Don’t trust that your perceived benefits align with real-world customer experience.

Use this knowledge of your customers’ desired outcomes and how your product helps them meet them in everything you do going forward. Let it shape your marketing campaigns, sales strategies, product development, and customer outreach.

Leading customer success expert Lincoln Murphy splits the concept of the desired outcome into two parts: customer goals and appropriate experience.

desired outcome

Source: Regpack

Customer goals are fairly obvious; they’re the minimum required outcome. On the other hand, the appropriate experience refers to the quality of the experience the customer has while they’re traveling toward that goal.

A useful example is if a customer—we’ll call her Sally—wants a hamburger.

Sally has many restaurant options to choose from, from McDonald’s and Wendy’s, to a local farm-to-table restaurant with a homemade gourmet burger. Any of these options could technically help her meet her goal of eating a hamburger. Presenting some restaurant images, menus and juicy food and beverages section can also be decisive.

But she may be willing to pay a premium for the high-quality experience of eating at the local farm-to-table burger restaurant.

Similarly, your product shouldn’t stop at simply solving a customer’s problem or meeting their baseline goals. Aim to provide a quality experience that enables them toenjoy the journey.

If your brand can help your customers achieve their desired outcomes, they’ll be successful. As such, they’ll remain subscribers. They’ll become loyal customers and even fierce advocates for your product.

Making the Customer Support Team Handle Customer Success

If you were under the impression that customer success was the same thing as customer service, think again.

Many brand executives want to experiment with customer success efforts before diving into the deep end, in which case it makes sense to them to ask the customer support team to handle customer success efforts on their own at first.

But you wouldn’t ask a salesperson to handle software development, right?

While their names sound similar, customer support and customer success are two different roles with two different mindsets.

Mark Pecoraro, Chief Customer Officer at Owl Health, puts it this way:

“Customer Support and Customer Success relate to each other in that the Customer Success role should be an overlay to essential services with the focus of helping your customers properly consume your solution. But the overlap should stop there.”

While customer success strives to be a proactive methodology, customer support is largely reactive.

In other words, customer support is about fixing immediate problems that have already arisen. The support team answers customer calls and walks the users through basic processes or replies to questions about the product. Omnichannel contact center would genuinely improve your customer support.

On the other hand, customer success is more proactive and deals with long-term customer health. It’s less about the day-to-day, quick fixes that customer support specializes in (although those elements are very much a part of the general customer experience).

Instead, customer success cares about theway the consumer adopts the product and incorporates it into his or her everyday experience.

To help make the difference even clearer, listed below are a few responsibilities of customer support and customer success teams:

Source: Gainsight

One area where both departments overlap is that last one, how-to.

Customer support agents will likely field many questions from customers about how to use the product, while customer success managers will also work to train customers on how to utilize the SaaS tool according to best practices in order to reach the highest ROI possible.

Customer success and customer support have their own KPIs and goals, which can sometimes clash.

While customer success measures success in terms of customer retention, customer support measures success in time to respond and the number of cases closed within a given time period.

Whereas one cares about speed and efficiency, the other is concerned with long-term customer satisfaction.

Trying to mix these goals can only lead to frustration, confusion, and lessened effectiveness on both sides.

Neglecting to Segment Users

The next mistake to avoid? Treating your customers as a monolith.

Your customer base consists of individuals, each as unique as the next. Lumping them all into the same group means you’ll likely miss out on the personalized touch that can mean the difference between loyalty and churn.

Instead, segment your customers into useful groups. The criteria will depend on your situation; you may divide them into geographic, demographic, psychographic, or behavioral segments.


Source: Regpack

Behavior-based segmentation is common among SaaS businesses. For example, perhaps your CRM wants to send a user reactivation email to a customer who’s at an increased risk of churning.

Wouldn’t it save time and be much more efficient if that CRM could use a template to message all customers at the risk of churn simultaneously?

Another common segmentation tactic is to split customers up by life stage.

If you’re selling a photo editing solution, for example, young professionals looking to build their careers in graphic design are searching for much different advice and communication styles than older hobbyists using your tool in their free time to make their family Christmas newsletter, so it makes sense to message them separately.

Philipp Wolf, CEO of Custify, advises:

“Segmenting your customers by age or company type is easy, and will help you save time and run your customer success program more efficiently. From there, you can build up to more complicated segments, like churn score and behavior… No matter where you start, though, you’ll quickly see the benefits of customer success segments. And you’ll be ready to start running a much more efficient operation.”

The main benefit of segmenting customers is that you’re able to cut through the noise and dial in on each group’s desired outcomes. Segmentation means taking a tailored approach to your customers’ needs and making them feel not only more heard—but more valuable. Circling back to the photo editing tool example, some customers might need simple features like image effects and filters while others might need more advanced tools such as background removal. Understanding this wiill help you market to each more effectively.

Customer Success Reps Handling Too Many Accounts

Next, be careful of forcing your CSMs to overextend themselves. Customer success responsibilities range from keeping in constant contact and building relationships to sharing best practices, initiating customer training, and beyond.

Since a customer success rep’s main role is to develop relationships with existing customers and keep a finger on their proverbial pulse, it can be hard to fill this role successfully if each CSM is too overworked to pay proper attention to the customers’ needs.

But how do you know how much work a single CSM can take on?

Dave Blake, founder and CEO of ClientSuccess, suggests considering the following three criteria:

  • Annual Contract Value (ACV) target for each CSM
  • Product complexity
  • The volume of clients for each CSM

According to Blake, a good rule of thumb is that each CSM should manage about $2 million in annual contract value (or annual recurring revenue).

However, if that means managing more than 50 clients each, your customer success agents need to use automation tools to stay organized and communicate efficiently.

Source: ClientSuccess

While this rule of thumb is helpful, you’ll still need to find the method that works for your organization. Some CSM teams can handle up to $5 million each in ACV, while other CSMs max out at about 20 clients apiece.

In fact, author and consultant Lincoln Murphy claims that Blake’s revenue-based approach is an outdated holdover from the traditional account management model.

He suggests that customer success teams instead:

  • Segment customers based on their desired outcomes,
  • Determine what each customer segment will expect in terms of type and amount of CSM coverage, and then
  • Divide CSMs based on this segmentation, and determine how many CSMs are required to provide each group with the time and care they need.

You may need to do a little experimentation to find the right workload for each CSM.

The key is to be careful not to get your team into a situation where each customer success manager is juggling too many responsibilities at once, as this will have a negative effect on their results.

Mistaking the Users’ Silence for Success

When was the last time you called the customer service line of your favorite app to give your personal suggestions on how to make it better?

Probably never, right?

If you’re anything like most of the world, you avoid contacting businesses unless it’s an absolute necessity. Heck, you probably don’t even complain about getting the wrong food order at a restaurant unless it’s truly inedible.

So why should your customers be any different?

Well, it’s not as simple as that.

Don’t make the mistake of assuming if you’re not hearing complaints, you’re not doing anything wrong. In fact, 96% of unhappy clients don’t speak up—they just churn and tell 9-15 of their friends about their bad experience instead.

Source: AndyBeal

Users rarely voice their concerns, so silence shouldn’t be considered a success.Rather than becoming complacent, you should stay vigilant.

Be proactive by:

  • Monitoring customer usage, churn, and other relevant metrics
  • Reaching out to customers for feedback
  • Getting ahead of a problem by addressing any bugs or glitches that you uncover

As Deepali Jagota, Senior Customer Success Manager at IIHT, says:

“There is no such thing as a silent client. When the client seems to put up with everything, that is the warning sign.”

So, keep your finger on the pulse of public opinion with frequent surveys and data analysis and make sure you identify and address any issues in a timely manner.

Final Thoughts on Avoiding SaaS Customer Success Mistakes 

By definition, as a SaaS company, you’re vulnerable to customer dissatisfaction and churn at the end of every monthly billing cycle.

You need to invest in customer success in order to ensure your customers are reaching their desired outcomes with your product on both a short- and long-term basis.

Avoiding common customer success mistakes like the ones listed above really comes down to being willing to find out what your customers need, and then equipping your team to meet those needs with both efficiency and humanity.

Mastering customer success is crucial, not just for your customers’ satisfaction, but your own—because, as the saying goes, you’re not successful unless your customers are successful first.

About The Author
Asaf Darash
CEO and Founder of Regpack

Asaf, Founder and CEO of Regpack, has extensive experience as an entrepreneur and investor. Asaf has built 3 successful companies to date, all with an exit plan or that have stayed in profitability and are still functional. Asaf specializes in product development for the web, team building and in bringing a company from concept to an actualized unit that is profitable.

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