Mar 23, 2023

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Customer Success benchmarks: headcount and budgets

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The most important part of Customer Success is the team. Yet, many teams fall well below industry benchmarks. More than three-quarters (77%) of Customer Success teams have fewer than 50 people on staff.

That’s according to our annual Customer Success Leadership Study published in late 2022. Here’s how the responses broke out:

  • 9.8% said their team has 100 or more people;
  • 13.8% said their team has between 50 and 99 people;
  • 20.2% said their team has between 20 and 49 people;
  • 19.0% said their team has between 10 and 19 people;
  • 20.4% said their team has between 5 and 9 people;
  • 10.7% said their team has between 3 and 4 people; and
  • 6.2% said their team has between 1 and 2 people.

Customer Success benchmark: headcount

How many people should be on a Customer Success team

The right answer for you will vary by company, sector and the organizational maturity of the team. We recommend a bottom-up approach to determining the right team size that factors in customer segments and the number of touchpoints in a customer journey to get the most accurate coverage ratio. However, we are using common benchmarks of one CSM per $1M in revenue, or one CSM per $2M in revenue for companies with mature or scaled Customer Success departments to assess team size.

As you can see from the data and these benchmarks, Customer Success teams are short-staffed. In the time since this study was published, a wave of reorganizations in the tech sector has exasperated the problem. This is an additional layer of stress on these already small teams that are proven to have an outsized impact on revenue and growth. 

This can’t go on forever, because the team will get burned out and leave. The only way to get the proverbial “more from less” in Customer Success is to arm them with the tools they need to scale. 

Customer Success benchmarks

Customer Success benchmark: budget

The study also found it’s not only staffing where Customer Success teams find themselves under-resourced:

“The majority of Customer Success teams have budgets of 0.5% of revenue or less…and overall 64% of respondents reported non-headcount budgets of $200,000 or less: a severe under-investment in this critical business function.”

When asked about non-headcount budgets; 

  • 8.3% said they had a budget of $1M-plus;
  • 12.4% said they had a budget ranging between $500,000 – $1M;
  • 15.2% said they had a budget ranging between $200,000 – $499,999;
  • 18.3% said they had a budget ranging between $100,000 – $199,999;
  • 19.4% said they had a budget ranging between $50,000 – $99,999; and
  • 26.4% said they had a budget ranging of less than $50,000.

Every subscription business knows that the responsibility for customer renewals falls to the Customer Success team. More to the point, it starts on the first day of implementation. It’s really hard to be successful when you don’t have the right tools or enough people. We all need to do a better job of setting our Customer Success teams up for…success.  

Customer Success benchmarks

The full report is available for download. It gives you an insider’s look at the evolving Customer Success landscape based on the firsthand experience of those leading the way with details around their priorities, teams, and charters.

If you enjoyed this article, you might also like: Customer Success tech stack: research and outlook.

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