17 Customer Success Metrics to Track in 2024

It can't be simpler or more direct than this — if your product or service contributes to your customers' success, they are more inclined to engage with and advocate for your offerings. 

This direct connection has never been more critical, as the boundaries between your products and services and your competitors' offerings continue to blur with each passing day. 

For companies navigating through the challenges of a fluctuating macroeconomic environment, robust customer support emerges as a potent growth catalyst. However, unlocking this potential requires a precise understanding of customer success metrics. 

In this blog, we will explore 17 essential customer success metrics along with their corresponding formulas. Additionally, you'll gain insights into the significant advantages of measuring these metrics and find answers to common questions. 

What are customer success metrics? 

Customer success metrics are measurable indicators that assess how well your company helps customers derive value from your products or services. These metrics offer a concrete means of evaluating customer satisfaction, engagement and loyalty, providing invaluable insights into how well you meet your customers' requirements. By employing customer success metrics, you can: 

• Discern contented customers and those at risk of churning soon. 
   
• Identify pain points that may lead to customer dissatisfaction and take corrective actions to enhance customer retention. 
   
• Trim down your customer acquisition costs, as contented existing customers are more inclined to purchase more from you. 
   
• Cultivate increased sales and bolster your profitability. 

 Learn more: Customer Success vs. Customer Experience: What’s the Difference?

17 Customer success metrics businesses can track  

From tracking customer journeys to devising solutions and nurturing relationships, evaluating customer success metrics has evolved beyond mere efforts to reduce customer churn and risk management, now serving as a driving force for growth. Here are the top 17 customer success metrics you must track.

Net revenue retention 

Net revenue retention (NRR) is a metric to measure your brand's ability to retain customers and earn revenue through renewals and upgrades.  

A high NRR value indicates that the customers find your products and services valuable enough to renew or upgrade them. Find out what will make your customers stick and give it to them to increase NRR.

Customer lifetime value

Customer lifetime value (CLV) measures how much a customer has spent/is expected to spend on your brand before they churn. A high CLV score indicates that your customers are willing to buy more from you.  

You can improve CLV with loyalty programs, customer experience management and exceptional customer service. 

Customer churn rate

Customer churn rate (CCR) measures the rate at which customers abandon your brand. A high CCR score (more than 5% to 7%) can impact the brand's profitability and growth.  

You can reduce CCR by improving customer experience, offering timely customer support and meeting customer expectations.  

Must Read: Customer Support vs. Customer Service: What Is the Difference? 

Customer retention rate

Customer retention rate (CRR) indicates the number of customers a brand retains during a specific duration.  

A high CRR means that your customers are satisfied with your brand and are more likely to remain loyal. You can increase CRR by improving the quality of your services and customer experience.  

Read More: Average Customer Retention Rate by Industry 

Monthly recurring revenue

Monthly recurring revenue (MRR) is the monthly revenue earned from customers. It indicates good business performance and predicts growth. A good MRR means customers are willing to pay for your products or services. You can calculate MRR in two ways: 

1. Total MRR = Sum (monthly subscription charges of all paying customers) 
2. Total MRR = Average payment per user x number of paid customers 
3. Special discounts, prioritizing customer support and upselling or cross-selling new products are great ways to increase MRR.  

Repeat purchase rate

Repeat purchase rate (RPR) measures the percentage of customers who make multiple purchases. A high repeat purchase rate indicates that customers find value in your products or services and will likely continue doing business with you. 

Expansion revenue

Expansion revenue measures the additional revenue generated from existing customers through upsells, cross-sells and upgrades. It reflects the potential for growth within the current customer base. 

Product adoption rate

Product adoption rate indicates how well customers embrace and use a product or feature. It helps in identifying areas for improvement or further education. 

Customer referral rate

Customer referral rate measures the number of customers who refer new business to your company, turning brand advocates. To calculate the customer referral rate, follow these steps: 

• Define the time period: Determine the specific time period for which you want to calculate the referral rate (e.g., monthly, quarterly, annually). 
   
• Count referring customers: Count the number of customers referred to new business during the chosen period. 
   
• Count total customers: Determine the total number of customers you have during the same period. 

Read More: Who Are Brand Advocates & How to Build a Winning Brand Advocacy Program

Customer retention cost

Customer retention costs measure the expenses associated with retaining existing customers. To calculate customer retention costs, you'll need to audit the expenses of all your customer success efforts.  

This includes costs related to support, account management, retention programs, customer surveys, customer success team expenses and any other expenditures directly aimed at maintaining and nurturing customer relationships. 

Net promoter score

Net promoter score (NPS) measures how likely customers are to recommend your brand on a scale of 1-10. You can use it to find the promoters and detractors among your customers. The data is collected through post-purchase or post-interaction surveys. 

Here is a graphical representation of how to calculate NPS. 

You can improve the NPS and convert your detractors into promoters through loyalty programs, faster customer response time and better customer service.  

Suggested Read: How to Improve the Net Promoter Score of Your Brand 

Customer satisfaction score

Customer satisfaction (CSAT) scores measure the customer’s overall satisfaction with your service or product. A high CSAT score implies that customers are happy with their experience with your products and services.  

Good to know: Today, CSAT can be forecasted by examining conversations for indicators like intent, sentiment, emotion, intensity, and response time. AI-driven omnichannel survey tools improve the accuracy of CSAT reporting and activate alerts for supervisors in cases of predicted negative scores.  

First contact resolution rate

First contact resolution (FCR) measures the effectiveness of your service team. A good first FCR score indicates that the customer support team solved the customer's problem on the first try without making them call again. It means that your customer service team is well-trained and working efficiently. 

Do you know: Utilizing AI, a modern unified agent console, empowers agents with productivity-enhancing tools such as AI-generated responses and guided workflows for addressing common issues. This culminates in shorter response times and a rise in first-contact resolution rates. 

Average handle time

Average handle time is the time taken by customer service teams to solve a problem and close a customer's request. 

To reduce the resolution time, find out why it takes time for the customer service teams to solve the issues and give them tools and training to resolve tickets quickly. 

Good to know: Advanced AI-powered agent assist software generates reply suggestions based on the ongoing conversation between your agent and the customer. The real-time nudges on the next best actions and contextual recommendations reduce average handling time and elevate the customer experience.    

Customer effort score (CES)

Customer effort score (CES) measures customer effort to complete a task or solve a problem. More customer effort can lead to more frustration.  

You can improve customer experience by taking feedback from your customers on how easy it was to place an order or how difficult it was to get through customer service.  

CES is rated on a 7-point scale and measured using the following formula: 

Customer Health Score

The customer health score is a composite metric that combines various indicators like product usage, customer feedback and consumer insights to gauge the overall health of a customer account.  Here's a general approach to calculating a customer health score: 

• Identify key health indicators (KHIs): Determine the key metrics and factors of a healthy customer relationship. These can include usage patterns, product adoption, customer engagement, satisfaction levels and any other relevant data points. 
   
• Assign weights to KHIs: Assign a relative importance or weight to each key health indicator based on their significance in evaluating customer success. For example, customer satisfaction might be given more weight than other factors. 
   
• Normalize data: Ensure that all data points are on a consistent scale. This may involve converting raw data into standardized scores or percentages to make them comparable. 
   
• Calculate component scores: For each key health indicator, calculate a score based on its performance. This could involve using a scoring system (e.g., on a scale of 1 to 10) or applying a formula specific to each metric. 
   
• Apply weights and sum scores: Multiply each component score by its assigned weight, and then sum the weighted scores to get the overall Customer Health Score. 

Formula: 

Customer Health Score= (Weight1xScore1) + (Weight2xScore2)+...+ (Weight N x Score N) 
 

Customer feedback and sentiment analysis

Customer feedback and sentiment analysis involves gathering and analyzing customer feedback to understand their perceptions, opinions and emotions regarding your products, services or overall brand experience.  

How it works: 

• Feedback Collection: Companies collect feedback through various channels such as surveys, reviews, social media and customer interaction analytics. 
   
• Text Analysis: Sentiment analysis involves using natural language processing (NLP) and machine learning algorithms to analyze the text of customer feedback. It categorizes the feedback into positive, negative or neutral sentiments. 
   
• Emotion Recognition: Advanced sentiment analysis techniques can even identify specific emotions expressed in the feedback, providing deeper insights into customer sentiment. 

 
Good to know: With modern reporting and analytics tools, you can gain real-time insights on important moments in customer conversations using AI-driven sentiment analysis and manage escalations effectively. 

Top benefits of customer success metrics 

Customer success metrics provide data-driven information that can help you understand your customers, their needs and challenges and implement strategies to meet their expectations. But that's not all. Here are a few benefits of measuring customer success.    

1. Improved customer satisfaction and loyalty: By tracking and analyzing customer success metrics, businesses can identify areas for improvement and take proactive steps to enhance the customer experience, ultimately leading to higher satisfaction and customer loyalty.  

2. Increased customer retention: Understanding customer behavior and preferences can reduce churn rates and retain more customers in the long run.  

3. Optimized resource allocation: Customer success metrics help businesses allocate resources more effectively. By identifying which customer segments or strategies yield the highest returns, you can focus your efforts and resources on activities with the most significant impact on customer satisfaction and revenue generation.  

4. Data-driven decision-making: Customer success metrics enable businesses to make informed decisions based on customer behavior and feedback rather than relying solely on intuition or assumptions.   

5. Increased revenue and profitability: By actively managing customer success metrics, you can drive revenue growth through upsells, cross-sells, and customer advocacy initiatives, ultimately leading to increased profitability. 

Stay on top of customer success metrics with Sprinklr Service

Despite the undeniable importance of customer success metrics, many businesses struggle with the daunting task of gathering, analyzing, and leveraging this crucial data effectively. The challenge lies in not only selecting the right metrics but also in translating the insights gained into actionable strategies that drive tangible results. 

This is why businesses should invest in a comprehensive solution like Sprinklr Service.  

Operating on the world's first Unified Customer Experience Management (Unified-CXM) Platform, Sprinklr Service offers a holistic approach to managing both customer success and customer experience endeavors from a single, integrated solution. With capabilities that facilitate personalized customer interactions and seamless journey management, your brand stands poised to enhance customer satisfaction and loyalty significantly, ultimately driving business growth. 

Sign up for a 30-day free trial or schedule a demo with our experts today!