The end of last year was tough. While we are all hoping for better things this year, uncertainty remains rife; your LinkedIn feed is probably still dominated by layoff-related news, and executives fresh from their holiday breaks are wondering how they are going to meet this year's growth and revenue targets.
Given the circumstances, many teams and companies have made significant personnel and resource cuts, and the general approach seems to be to do more with less. This is particularly prevalent when it comes to revenue-critical teams like customer success. This is a risk. By shifting more work to an already strained team who, again, are revenue critical, you are almost certain to impact your revenue growth negatively.
The highest margin revenue for any SaaS provider comes from existing customers, so cutting Customer Success budgets isn’t a good idea - Thomas Lah, TSIA
The research highlights that making cuts to or overwhelming your customer success team will, in most cases, not work. In their 2022 customer success benchmarking data, the TSIA highlighted a 163% increase in customers per Customer Success Manager (CSM) from 2018 – 2022. This increase in customers per CSM has, on average, resulted in a 50% decrease in average revenue per CSM. Aside from top-line revenue impacts, you are likely to negatively impact your revenue and employee retention and a decline in your team's focus/quality, which you have probably worked hard to establish.
So, what potential solutions are there?
By automating resource and time-intensive but revenue-critical stages of your customer lifetime cycle, you can maintain and grow your existing revenue without adding headcount. Automation won’t solve all our problems this year, but it will certainly do some of the heavy lifting and relieve some of the pressure on your customer success team.
Here are three ways automation can help relieve some of the pressure on your customer success team.
Churn prediction: Still using complex spreadsheets or other labor and time-intensive methods to predict your churn? It’s time to take a step into an automated and highly accurate churn prediction environment, ideally one powered by AI and Machine Learning.
Automated renewals: It’s time to retire that second spreadsheet tracking upcoming customer renewals. You can go one step further by implementing automated outreach cadences, creating a better buying experience for your customer and, again, saving your team valuable time. Ideally, these automated cadences contain payment links, allowing your customer to pay in a self-service environment – speeding up your time to revenue.
Retention and uplift marketing: Automation shouldn’t just be limited to helping you retain your revenue; it should also be a growth driver – particularly in resource-constrained environments. Automate your cross and upsell customer engagement based on customer activities, product usage, and other insights. Routine customer communication helps keep your customer engaged and can drive cross-sell revenue by 22%, upsell revenue by 38%, and order size from anywhere from 5 to 85%.
These simple yet effective ways to leverage automation may hold the key to your revenue growth in what is set to be a challenging business year in 2023. Remember, all of this comes without additional investment or headcount.
Wait – we’ve got more for you. Join Cleverbridge CEO and John Ragsdale, VP of Technology Ecosystems at TSIA, on January 19, where they will touch on the points mentioned above and share three strategies to help you weather the challenging economic climate and come out ahead on the other side. Click the link below to save your seat.