We’ve all been in a situation where a customer’s health score doesn’t match reality. But how do we figure out what’s really going on with our customers, and more importantly, how do we build a health score that helps us deliver on our business objectives?
Sofia Marrero, Manager of Customer Success (EMEA) at Deel, sat down with Gainsight’s Global VP, Remco de Vries to discuss Health Scoring in the Modern Age. Here are some of the key takeaways from the webinar.
Every Health Score Starts With a Goal
Are you looking to fight churn? Increase adoption? Detect expansion opportunities? Depending on your goal, the structure of your health score will vary. A good first step is to identify a cohort of customers whom you consider to be successful. Then, start drilling down into which metrics best represent their usage of your product.
At the beginning, your health score will need constant analysis and iteration in terms of which metrics you use and how much they are weighted. Iterating with a clear goal in mind will make the process faster and more efficient.
Focus on Your Customer, Not Your Company
In the past, it was common to build health scores based on vanity metrics like logins and monthly active users (MAUs). While these measures of usage might be an indication of value in some cases, too often they are simply statistical noise that doesn’t reflect the customer’s experience.
Instead, focus on which features tie back to actual outcomes that customers have achieved from your product. Different customers will have different use cases, but you should look for commonalities among their feature usage. If a heterogeneous cohort of customers are using the same features consistently, that probably indicates a metric you should be tracking.
Startups, scaleups, and other companies who don’t have a lot of customer data may be challenged when trying to build a quantitative health score. If your company is in this situation, start your health score development by focusing on more qualitative data, like CSAT or NPS. You may also want to consider focusing on a smaller cohort of customers, which will give you the chance to interact with them in a more direct, high-touch way. Talk to your customers as often as possible to find out how they’re doing and what they need. Then use that information as the guide for your initial health score.
Health Scores Must Lead to Action
If a health score doesn’t lead to an immediate and clear action by the Customer Success team, then it is not going to be useful. The solution here is two-pronged. First, you need a well-defined set of Playbooks tasks, assigned to specific CSMs. Second, you need an enablement plan—including the configuration within your customer success tool—from leadership to train CSMs on what to do and what’s expected of them.
Health Scores Should Make CSMs More Proactive and Strategic
There is pressure on customer success to be proactive, and health scores can be a key catalyst for sparking that transformation. When the data is clean and the right Playbooks are in place, health scores will give CSMs the foresight and agility to spot and solve challenges as they arise. As the metrics that feed the health score become more precise and granular, the signals they produce will become more leading and less lagging.
Health Scores Are a Team Sport
Even though Customer Success typically “owns” the health score, the metrics are often sourced from other stakeholders within the organization. Collaboration with these partners and smooth integrations with the data sources are important for ensuring that health scores are accurate and actionable. For example, many usage metrics come from Product, which needs to be aligned with Customer Success on the definitions and meaning of those usage inputs.
Alignment with Sales is also important. Customer sentiment begins forming during the sales process, before the customer has been handed off to Customer Success for onboarding. Customer Success needs to be on the same page with Sales to get the health score right from the beginning.
You Won’t Get It Right the First Time—and That’s OK
Every health score is a work in progress, especially at the beginning. Starting with a very basic score is very much OK. As your health score grows and matures, you will be able to fine-tune the definition of concepts like adoption and value based on your products’ specific use cases. You don’t have to have it figured out from day one. And you shouldn’t be scared of changing your health score every month—that is actually healthy behavior.
The Sweet Taste of Success
As your health score matures, it will become more sophisticated and flexible, giving you the opportunity to create scores for specific use cases and customer segments. Whether you are looking to fight churn or pursue expansion, having true visibility into customer health will put your company in the sweet spot for delivering on business objectives.
Learn More
Check out the full webinar, Health Scoring in the Modern Age for more info on updating your health scoring best practices to be more proactive.
