This is a guest post by Marley Wagner, head of customer success programs and strategy at EverHealth.
Quick summary: Three mistakes explain most of the green accounts that churn: measuring activity, overweighting product usage and leaving relationship health out of the score.
Every customer success leader has experienced this moment:
A customer submits their notice to cancel. Everyone scrambles to understand what happened. “Where did we go wrong?”
Someone pulls up the health score. “Wait … they’re churning? They were green!”
The immediate reaction: “Our health score isn’t working.”
The problem usually isn’t the health score itself.
Health scores fail because organizations measure the wrong things.
A customer health score should answer one simple question:
How confident are we that this customer will get the result they desired?
If your inputs don’t help answer that question, your score won’t either. That’s why some “green” customers churn without warning while other “yellow” (or even “red”) customers renew year after year. The difference comes down to what you’re measuring
Why CSMs are missing churn.
Mistake No. 1: Measuring activity.
The easiest metrics to collect are often the least meaningful. Think about the metrics many organizations include in their health scores:
- Number of logins
- Session duration
- Website page views
- Email opens
- Webinar attendance
- Number of meetings
These metrics can offer revealing insights but rarely tell the full story.
Visiting the billing tab of your product or the pricing page of your website could mean a customer is comparing your costs with those of competitors. It could also just mean they’re working on next year’s budget and didn’t feel like digging out their contract. The problem starts when activity alone becomes a proxy for customer health. I recommend using activity metrics like these more heavily when it comes to alerts and tasks for your CSMs, rather than allowing them to dominate your health scores.
Consider these two customers:
Customer A
They log in every day, and your primary point of contact reliably joins your regular meetings. Your dashboard shows activity, but you notice …
- Only one user actively uses the platform.
- They’re using a single feature.
- They never implemented the workflow they originally purchased the product for.
- Their executive sponsor hasn’t attended a business review in months.
High activity. Low business value.
Customer B
They only log in twice a month, which makes them look disengaged. But because they’re a payroll company, they only need to use the product twice a month, which matches their pay schedule. Customer B’s activity means something else …
- Every process runs smoothly.
- Multiple administrators are trained.
- They’ve renewed for three consecutive years.
Low activity. High value.
“Healthy” usage looks different depending on the customer, the product, and, perhaps most of all, the business problem they’re trying to solve.
Ask, “Is this customer successful?” before asking, “Is this customer active?”
Mistake No. 2: Overweighting product usage.
Product usage absolutely matters, but without context, it can create a dangerous false sense of confidence. Many health scores reward customers for logging in frequently or using lots of features. What matters is whether they’re using the right capabilities to achieve the results they care about.
So, instead of focusing on frequency alone, ask questions like:
- Are customers using the core workflows tied to their original business goals?
- Have they adopted the advanced capabilities that drive long-term ROI?
- Is adoption expanding across teams or business units?
- Are they completing the activities that indicate meaningful progress toward their desired outcomes?
When usage hides risk.
Imagine a healthcare customer who purchased your platform to automate patient communications. Six months later, they’re logging in constantly. At first glance, everything looks healthy. Until you discover they’re still sending reminders manually because they never completed implementation of the required automation workflows.
The product became another tool rather than a business solution. The usage was there, but the value wasn’t.
Beware the “power-user” trap.
Another common blind spot is what I call the power-user effect.
Every customer has that one champion. The one who knows every feature, shares ideas constantly and logs in daily.
Meanwhile, nobody else at the company uses it.
If your health score heavily rewards individual engagement, that customer may appear extremely healthy, until your champion accepts a new job. Suddenly, your healthiest customer becomes one of your riskiest.
Product usage didn’t change overnight. Your adoption never extended beyond one person.
Product adoption should measure depth over frequency. Healthy customers build your product into the way their organizations operate.
Mistake No. 3: Ignoring relationship health.
Software doesn’t renew itself. People do.
Yet relationship health is often underrepresented in (or completely absent from) customer health models. That’s a mistake because relationships often provide the earliest warning signs that a renewal is becoming vulnerable.
Signals worth paying attention to include:
- Executive sponsor engagement
- Champion responsiveness
- Multi-threaded relationships
- Participation in executive business reviews (EBRs)
- Willingness to share candid (sometimes even negative) feedback
Customers who frequently share negative feedback often aren’t disgruntled or feeling unheard; they’re deeply invested in your product and want it to be the best it can be. Constructive feedback is one of those tricky indicators that could signal either relationship strength or renewal risk, depending on context. AI can help tell the two apart but may still require manual review to ensure correct interpretation. Whether or not it makes it into your health scores, make sure it triggers CSM investigation and follow-up.
But the dashboard says green.
Product usage hasn’t changed. Support volume is consistently low. On paper, everything looks healthy.
Then your champion stops responding. A few weeks later, they leave the company. Their replacement wasn’t involved in the original buying process, which means they don’t fully understand the business case.
Nothing changed in your product, but everything changed in the relationship.
Relationship health often changes long before product usage does, which is exactly why it belongs in your health score.
Success is harder to measure than activity.
It’s tempting to build health scores around the data that’s easiest to collect: usage, meetings, emails and logins because they’re objective and readily available. But customer health has never been simple. The strongest health scores combine product data with business outcomes and relationship signals to create a more complete picture of customer success. Your customers renew when your software helps them achieve something meaningful.
Two more mistakes quietly undermine customer health scores: relying too heavily on lagging indicators and treating every customer the same. We’ll cover both next, along with a practical framework for auditing your existing health score so you can identify which inputs deserve a second look.
Until then: if one of your “green” customers churned tomorrow, would you understand why?
If the answer is no, don’t start by changing the score. Start by changing what goes into it.
