A Quick-Start Guide to Hiring and Building a Customer Success Team

I’m a big believer in the power of customer success, but even so, I recognize that it’s not right for all companies.

Sure, the idea of having an entire team dedicated to making your customers more successful probably sounds great. But building out a customer success team can be a big investment – and it’s certainly not one you should undertake without a good plan in place.

So whether you’re on the fence about building a customer success team or you already have one that needs to grow, I’ll walk you through what you need to know.

Are You Ready for a Designated Customer Success Team?

This isn’t a simple “yes or no” question. Take your time answering the following four questions before making your decision.

1. Are you a SaaS, software or other technology company?

You don’t have to be a tech company to have a customer success team. But there are several reasons why they’re much more common at these types of companies than they are in other industries.

For example, tech companies tend to have higher average customer lifetime values (LTVs). That’s obviously not universally true, but think about the difference between a SaaS company with a $300 per month software product and an ecommerce seller whose customers place one $300 order per year on average. 

Building a customer success team costs money; the MRR or ARR produced by most SaaS companies provides both the total revenue and the revenue stability needed to fund them.

Tech companies also tend to have more measurable customer journey stages (necessary for the analytics that drive customer success), as well as longer post-purchase onboarding and activation cycles. Someone who made a $300 retail purchase is either happy or unhappy. Someone who bought a $300 per month project management tool might need hours of coaching to adapt it to their workflows.

2. Are you getting more “how to” questions than “break/fix” questions?

Customer success trainer Lincoln Murphy writes:

“A little hack to determine whether the time is right for a stand-alone Customer Success team is to monitor the number of “how to” questions that come into Customer Support. By their nature, how-tos are not break/fix type questions meant for support, but actually have to do with product adoption, which should fall under Customer Success.”

Measure not just the number, but the types of questions your team receives about your product. If you’re starting to see an increase in “how to” questions, that’s a great indicator that your customers need a success function to remain engaged and happy.

3. Is your average customer LTV high enough to justify adding a customer success team?

Plenty of industry experts have thoughts on when your company can justify adding a customer success function:

• SaaStr’s Jason Lemkin recommends hiring one customer success manager (CSM) for every $2 million in ARR (source)
• Ibrahim Cisse gives a rule of thumb of 10% of ARR (source)
• Nick Mehta suggests tailoring customer success investment to both company stage and level of growth:

You know your company, as well as all the other factors affecting how you budget for head count. If you’re swimming in debt or if you don’t have a path to profitability, for example, these calculations might look very different to you.

If you aren’t sure your business can sustain a full-time customer success team, look for opportunities to test the waters with a part-time hire or contractor. You may not get the full measure of the impact a customer success team might have on your company, but you’ll be able to work any kinks out of your process before making the full investment. That’s what we did at Mailshake and Voila Norbert. In just a few short months, we saw the impact of customer success on the business, and we decided to hire full-time. 

4. Are you having problems with high churn, high customer dissatisfaction or any other customer success issue?

If this is you, don’t feel bad. There’s not a business I can think of in the world that isn’t struggling with one or more of these issues. Even companies with great stats are continually looking for ways to improve (that’s part of what makes them great, after all).

Yes, you still need to check your numbers to make sure investing in customer success is financially sustainable. But if you’re choosing between budget priorities – as most of us are – problems in these kinds of metrics can be a signal that your money will be best spent on customer success.

Building a Customer Success Team

If you’ve gone through the four questions above and you’re still with me, you’re ready to build a customer success team. There are three primary components you need to consider: technology, processes and people.

Technology

Customer success is built on numbers, from the metrics you track on a per-customer basis to the overall improvement seen in your company’s KPIs. Producing all of this data requires the right technology – and fortunately, there are plenty of programs for you to choose from.

The following are a few popular options, according to G2:

• Custify
• Gainsight
• Natero
• ChurnZero
• UserIQ
• Totango
• ClientSuccess

Here’s how these and other tools stack up, according to their market presence and overall customer satisfaction:

The right tool for your company depends on plenty of different factors. The following questions can help shape your decision-making process:

• Has the company’s software been used at a business like yours before? Having common use cases may make it easier to get up and running quickly.
• Does anyone at your company have experience working with a specific tool? Don’t discount how valuable this internal knowledge can be.
• What are the licensing terms? Are you required to purchase a certain number of user licenses, or will you be locked into annual terms from the start? As a new customer success program, having flexibility can be incredibly beneficial.
• How easy is it to track your target metrics within the tool? Every company’s customer success priorities are different. Make sure the system you choose makes tracking yours as simple and pain-free as possible.

Processes

When it comes down to it, there are a virtually unlimited number of tactics that could be deployed to make customers more successful. Without established processes in place for supporting them, you risk wasted spend and effort if each customer’s engagement with the success team looks completely different. 

New customer success teams can create a more streamlined approach by mapping the customer lifecycle and establishing responsibility for each stage (for instance, when does sales transition a new account to customer success for onboarding). Once defined, teams can create a cadence of interactions that reach customers at the specific moments when they’re most likely to experience issues.

Having clearly-defined stages and hand-offs also makes it easier to tie customer success metrics to the health of each stage of the lifecycle. If no one role has responsibility for renewals, for example, it’ll be tough to gauge whether your customer success efforts are making a difference at this critical point.

If that all sounds like a huge undertaking, that’s because it is. But you don’t have to get everything right from the start. Make your best guesses based on what you know now, but don’t be afraid to iterate – and even change course entirely – as you learn more about your customers and their needs.

People

I’ve written a lot about hiring before, so I’ll just recap the highlights here:

• Define your needs before you start looking for people. “Customer success” might sound universal, but how it’s applied can look very different from company to company. Do you need someone with a sales background to really drive home upsell and cross-sell opportunities? Or would you benefit more from a tech wiz who can customize customers’ instances on the fly? Put the effort into developing your job descriptions from the start so that you don’t have to put it into replacing team members down the line.
• Go beyond generic job sites. Posting to Monster and Indeed isn’t enough. Whenever I’m hiring for a new role, I’m out there searching LinkedIn, talking to people in my network and even checking out my competitors’ websites to increase my odds of finding the right person.
• Update your interview questions. Because customer success is a data-driven role, I like to approach hiring for customer success positions the same way I hire for marketers. You can see some of the questions I ask marketers here – nearly all of them can be adapted to support my hiring process for customer success.

As an example, take the question, “What’s been your most successful marketing campaign, and why?” My goals here are to a) see if they can actually produce results, and b) see if they use modern industry terminology when talking about their work.

If I was hiring for a customer success role, I could easily tweak the question to be, “What’s been the most successful customer engagement you’ve worked on, and why?” Here, I’m not looking for marketing results. I’m looking for a candidate who can tell me about the ways they made a tangible difference in a customer’s performance (and who can tell me enough about their process that I can be sure it wasn’t a fluke). 

Create your own set of similar questions based on your company’s needs, but don’t stop at the interview process. The field of customer success is evolving so quickly that continual investment, training and upskilling – in addition to keeping an eye on trends – are a must. There are plenty of certification programs, trainings and events you can send team members to, but it’s your attitude that’s most important. Treat ongoing training as a priority if you want to get the most out of your new customer success team.

Have you built a customer success team (or been a part of a really successful one)? Share your insight into what it takes to make customer success work by leaving me a comment below: