Customer Health Score for newbies

2 min read

You may have been reading a thing or two about predictive health scores in SaaS and the importance of keeping track of your customer health... that you don’t fall behind and churn your valuable customers.

The saying is basically that customer success management relies on the customer health score – a business critical KPI for your company to track!

This short blog post will help you understand the basics of how you get to a certain “customer health score”.

First some background:

The job of the Customer Success Manager is to proactively engage with customers and make sure that they are realizing the benefit of their product – or simply put, the CSM needs to make sure that the client is seeing the ROI of what they bought from you in the first place.

To keep track of all your customers you need some kind of a “score” that tells you how healthy a particular customer is at any point in time. Most importantly, you need to monitor (the negative!) changes in the customer health score.

To do that you set different parameters that contribute to the overall customer health score (in the Planhat app we call these the "success dimensions” or "KPIs").

Some examples of success dimensions (a.k.a customer health score parameters or "data inputs") could be:

User Activity; number of active users, logins etc

NPS; usually a number between 1-10 coming from your latest NPS survey

Financial data; the number of products or seats purchased

Support cases; resolution of support cases

Subjective "CSM input"; sometimes you have the CSM giving a subjective score that affects the overall customer health score

To get an overall customer health score you typically add the weighted score of each parameter and divide it by the total number of inputs.

Simple example if you only have two success dimensions:

1. Activity (measured 1-10) – you score 8

2. NPS score (measured 1-10) – you score 10

Given that they are weighted equally you'd get a customer health score of: 9 (8+10/2).

If you're using Planhat to handle your renewals that number (in this case 9) will give you a red, yellow or a green light – making it easy for you to understand how urgently you need to dive into the account and do whatever you need to do to make the account healthy.


Planhat is a G2 Leader along the entire customer journey

In G2 Summer Report 2022 Planhat has been named a leader in five categories: Customer Data Platform, Client Onboarding Software, Customer Success Software, Client Portal and Customer Revenue Optimization.

Meet The Customer Success Manager of the year

Gurprem Sagoo, Planhat, has been awarded The Customer Success Manager of the year

What is the customer analytics process?

Behind every loyal and growing customer base is a solid analytics process, which has 6 key steps.

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