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The new way to measure success

Published: Dec 27, 2022

10 customer success metrics you need to learn about

The health of a business is often judged by how productive its customer support organization is. But in the ever-changing environment we are immersed in' what if that also would be changing'?

The old way of doing things isn't enough to keep customers happy, and keep them as clients. A new way of thinking is coming out, more focused on developing long lasting relationships with customers rather than just trying to close as many sales as possible.

The whole concept of success is changing, which means the way we measure has to change, too.

Customer success metrics typically include key performance indicators (KPIs) such as customer lifetime value (CLV), customer satisfaction scores, churn rate, net promoter score (NPS), customer retention rate, and more.

By tracking these metrics over time, companies can better understand how they are performing in terms of customer satisfaction and loyalty. This allows them to make adjustments to their product or service offerings as needed in order to ensure that customers continue to be satisfied with their experience. Tracking customer success metrics also helps companies identify areas where they may need to do some improvements.

Here are some customer success metrics that will become more important in the coming times and that we should learn to measure:

1. Customer Retention Cost (CRC)

This metric tracks the percentage of customers who continue to use a product or service over time. Customer retention cost, outlines the total cost of your success program in relation to your total number of customers. This shows you how much you are spending on each customer to keep them as clients. CRC helps businesses invest in their customer success plans. While you roll out new initiatives, you want to make sure that you're spending your money in a cost-effective way. By measuring CRC, your marketing team can make smart calculations by comparing the potential cost of retaining customers versus the potential revenue you'll generate from a new product/service. To calculate CRC, you'll need to check the expenses of all of your customer success strategies. Once you add the expenses up into one sum, you can divide that value by your total number of customers to get your average customer retention cost (sum of all expenses / total number of customers = average customer retention cost).

2. Net Promoter Score (NPS)

This metric measures customer loyalty based on an individual's likelihood to recommend a product or service to others. Customer satisfaction is about their feelings towards the brand and the product itself. When you measure customer satisfaction, you're determining how happy customers are when they're interacting with your product. Obviously, customers who are happier with their experience will be more likely to become repeaters (remember to do something to reward their loyalty). One of the more popular ways to measure customer satisfaction is through Net Promoter Score. A Net Promoter Score, or NPS', simply asks whether someone is likely to recommend your company to someone else. The benefit of an NPS is that it provides both quantitative and qualitative data about your customers. Not only does it ask participants to rate their experience on a numeric scale, but it also asks them to provide an explanation. That way, your business can analyze feedback based on the scores, then examine the customer experiences to see how you come across. Measuring NPS is relatively easy. You just need access to a form builder (you can find free versions online) that can generate a rating scale response. Your eNPS survey form should only include a single question, "On a scale of 1 to 10, how likely are you to recommend this product or service?"

3. Customer Satisfaction Score (CSAT)

This metric measures customer satisfaction with a product or service based on surveys or feedback forms. It looks a lot like NPS, but instead of asking participants to rate their chances of recommending the brand to others, CSAT asks them to simply rate their experience with the company. This gives companies an idea of how customers feel after having an interaction with the support or success team.

How to measure it? Once you have your form set up, you can calculate CSAT by dividing the number of positive scores (scores six to 10) by the total number of scores you captured. Then, if you multiply your result by 100, you'll have the percentage of customers who are happy with their brand experience.

4. Customer Lifetime Value (CLV)

This metric tracks the total amount of revenue a customer generates over their lifetime as a customer. It shows you the total revenue that you can expect from a single customer over the course of his interaction with the company. Businesses can use CLV to realize the value of their customers over time. If your company knows that your products and services are contributing to your customers' success, then their value increases. If your business may need to re-evaluate its offers and look for flaws in the customer experience frequently, that means their value is decreasing. CLV can be calculated in two simple steps

  • Multiply your average purchase value by your average purchase frequency rate.
  • Take that value and multiply it by your average customer lifespan. This should leave you with the estimated amount of revenue that one customer will spend on your business.

5. Average Revenue Per User (ARPU)

This metric measures the average amount of revenue generated per user within a month. It outlines the amount of money that your customers are spending on your products and services for each given month. You can compare this value over time to determine whether your customers are succeeding with your products or not. This is specially useful for SaaS businesses that operate on a subscription model. In addition, you can use this metric to calculate another metric which is your expansion MRR. Expansion MRR shows how much additional revenue you're getting from customers outside of their monthly subscriptions. This can give you a good idea of how effective your marketing programs are. To calculate ARPU, you just need to multiply your total number of monthly active customers by your average revenue per user. This should give you an idea of how much money you're generating each month.

6. Churn Rate

This metric tracks the percentage of customers who cancel a subscription or discontinue using a service.

A customer support rep who maintains an excellent relationship with their clients is naturally likely to have a lower churn or cancellation rate. Remember customer support is about relationships, and building rapport is what makes the difference. To calculate churn rate: First, determine the time that you'll consider when measuring your data. This can be a week, month, or a year. Next, determine how many existing customers there were at the start of this time period as well as the number of customers that churned within that same time. Finally, divide the number of churned customers by the total number of existing customers to get your churn rate.

7. First Contact Resolution Rate

It's important to measure your first contact resolution rate. This is the percentage of customer service cases that are resolved within the first interaction. If this number is high, that means your team is responding effectively to your customers, and moreover addressing their needs quickly as well. Remember one of the typical customer needs is time. Customers want their problems resolved quickly, so they can get back to pursuing their lives. If they're constantly waiting for your support team, this doesn't add any value to the customer experience. To calculate FCRR, divide the number of service tickets that are closed after the first interaction by the total number of service cases your team received.


In today's competitive business world, customer success metrics are essential for any company wishing to stay ahead of the game. Customer success metrics are used to measure customer satisfaction and loyalty and provide valuable insights into how a company is performing. By tracking customer success metrics, businesses can identify areas of improvement and capitalize on opportunities for growth. They can also compare their performance against competitors to gain a competitive edge and ensure that customers remain loyal to their brand. We hope you had a clear idea of how important customer success metrics are to help you grow your business.

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