In Customer Success, we use data for all sorts of things like analyzing customer health scores, looking for trends in Voice of the Customer (VoC) programs, and capacity planning for short and long-term strategic decision making. If you know anything about us here at ESG, you know that we love data! Big data, small data, it’s all important.
Earlier this year, we talked about Customer Success trends we expect to see in 2023. Checking in on some of our predictions, I’ve recorded some data from reports across the industry to get a snapshot of how we’re faring both from an overarching perspective and from our customers’ points of view. The numbers here tell an interesting story – one where digitalization expands even as customers seek human interaction and one where businesses struggle in their CX transformations in a time of shrinking budgets and resources.
These Customer Success findings illuminate our need to get creative with the investments we are able to make – in our people and our technologies – and to be more aggressive in our pursuit of proving the ROI of Customer Success.
Here is a roundup of recent findings that CS leaders should know…
…on customer expectations and churn
- 89% of business buyers are more likely to buy if companies demonstrate an understanding of their goals. (Salesforce)
- 76% of business buyers agree that most companies have the capabilities to meet their needs and expectations. (Salesforce: State of the Connected Customer, 5th Edition)
- 87% of business buyers expect sales reps to act as trusted advisors, but only 61% say they generally trust sales reps. (Salesforce)
- 59% of US consumers will walk away from a beloved brand after several bad experiences, 17% after a single bad experience. (PwC)
- 88% of customers believe trust becomes more important in times of change. (Salesforce)
Our customers believe we have the capabilities to meet their needs, yet we can still fall short when it comes to their experiences. Building trust through the sales process and in the handoff to CS with tools like Customer Success Plans will ensure the relationship starts off on the right foot. Then, it’s vital for businesses to follow through on their promises and continue to strengthen the relationship with positive customer experiences throughout the entire lifecycle.
…on how Customer Success impacts the customer experience (and the business’s bottom line!)
- 73% of all consumers point to experience as an important factor in purchasing decisions, behind price and product quality. (PwC)
- 59% of all consumers feel companies have lost touch with the human element of customer experience. (PwC)
- “Lower-performing brands are solving basic CX problems, while top brands are struggling to embrace transformative CX improvements. To stand out from this tightening pack, companies must embrace customer obsession and pursue CX innovations that differentiate their brand, rather than relying on CX strategies that consumers perceive as similar.” (Forrester: Predictions 2023)
- Companies that reported the highest NRR also reported investing 10% of their revenue into CS and CS Ops. (Gainsight: The Customer Success Index, 2022)
- 57% of Customer Success teams with a CS platform report an NRR of over 100%. (ESG: 2022 Customer Success Leadership Study)
- Businesses can charge an average 16% price premium for great experiences. (PwC)
Investing in Customer Success capabilities is the key to crafting transformative customer experiences that encourage growth. Companies that forget how critical it is to foster relationships with their current customers risk losing them to the competition.
…on the state of the Customer Success industry
- 3% of CS teams are growing yet 76.5% have fewer than 50 people. (ESG)
- 41% of companies indicated that their CS Ops organization was newly formed. (Gainsight)
- Economic volatility is delaying purchasing decisions at 57.9% of businesses. (ESG)
- “The estimated 80% of companies for which great CX is not part of their brand identity will finally demand proof that spending on CX improvement is necessary, and some of these companies will dissolve CX teams that can’t show numbers.” (Forrester)
- Only 17% of companies assign CS the responsibility of identifying and closing upsell and/or cross-sell opportunities. (Gainsight)
- In the path from cost center to profit center, Customer Success organizations improved by 6% from 2021 to 2022, but when only 28% of the organization is considered profitable, there is a lot of room to improve. (TSIA: The State of Customer Success: 2023)
- One in five CX programs will disappear — and one in 10 will be stronger than ever. (Forrester)
The Customer Success industry is going through a shakeup, and it will only get crazier as the year goes on. CS leaders will play an important role in proving the value of investing in better CX through expanded Customer Success capabilities.