What’s good for the customers needs to be good for the business — at least that's the core focus of customer success.

“Customer success is an activity to drive value exchange and value realization for both parties,” said Parul Bhandari, CEO of CustomerXSuccess, which provides customer success advisory services.

Businesses can use the customer success margin metric to determine customer value in the form relative profitability. It’s the revenue a customer generates across all transactions minus the cost of acquiring and serving customers.

It’s an important metric, but experts said understanding organizational or cultural fit, product market fit and even time zones can help assess the overall suitability of customers to the business.

“If your product is designed for e-commerce customers and you have a few insurance customers from legacy sales or your team is based in one region and doesn’t cover the 24-hour time zones, it may not be the right fit,” she said. 

The culture needs to align with customer needs

A range of internal and external forces including changing customer expectations and rapidly evolving technologies like AI are reshaping the business landscape.

As a result, many businesses are seeking partners not simply for a defined set of systems or solutions, according to Niall Cluley, managing director of Dragonfish, a culture performance consultancy. 

“They’re looking to have help with transforming because that’s what many organizations are undergoing at the moment,” said Cluley. 

In this environment, delivering on customer success hinges on understanding the goals and challenges of customers. Doing this successfully requires a strong internal customer culture and organizing the business around customer needs, according to Cluley.

“You can't just improve customer success without strengthening culture,” he said. 

His research has shown that high-performing organizations with a strong customer culture have three important attributes — they’re built with the customer in mind, customer insights are shared with all employees and they practice empathy, which is to listen and understand the needs of their customers. 

In these businesses, profit isn’t the primary motivating factor; rather, it’s delivering value to the customer and return to the business at scale.

“Profit is the outcome,” he said. 

Customer success vs. customer experience 

Customer success includes a range of activities such as onboarding, educating, adoption, value delivery, engagement and customer advocacy. The focus is on meeting customer objectives, satisfaction and long-term growth through the business.

Customer experience, by contrast, is about promises made from the business to the customer and often starts with the sales or process that lays out what’s on offer and suggests what’s customer can expect. 

“When you're prospecting somebody, what you’re selling them is the vision of what they're going to get,” said Bhandari. 

Here’s how the different activities compare: 

• Customer service addresses pain points, queries and escalations and aims to deliver on the promise from the initial engagement with the least amount of friction.

• Customer experience focuses on an end-to-end customer journey across all key touch points including sales, customer success, professional services, customer support and marketing.

• Account management supports individual customers on a case-by-case basis.

Acting as the customer advocate from the outset 

One of the key attributes of effective customer success is acting as the customer’s advocate internally, helping to filter the different goals of internal teams and present value-drivers to both the customer and internal teams.  

With product features, for example, customers often have a lot of asks, while product development teams have roadmaps to prioritize the roll out of new features.

“If a customer success person knows a potential solution impacts multiple customers or has a high impact on revenue growth, they can advocate to prioritize it,” said Bhandari. 

In other cases, the value driver is less tangible, but still important to the business and may come to light through customer insights.

“If a customer success manager notices possible issues surfaced in survey results, they can engage with internal stakeholders to improve the experience,” she said. 

Above all, onboarding customers needs to be handled delicately. Whether it’s high-touch or low-touch, the business needs to design an experience that doesn’t try to do everything at once and feels very personal, Bhandari explained. 

“A lot of value is lost when you don't properly onboard,” she said. 

However, promising too much to land customers and then finding it becomes a taxing exercise to deliver can be a costly mistake, especially with newer businesses that are focused on winning customers. 

“If the business has to continue to deliver on this for the life of the contract, it can become very costly and may well be unachievable,” Bhandari said.

On the other hand, with promises can come unfulfilled expectations if the experience doesn’t live up to the vision presented. Businesses need to ensure they’ve got the teams and processes set up to deliver on the promises made during the initial sales process. If not, dissatisfaction can mount up.

“It can lead to unhappy customers that aren’t getting what was initially promised, she said.