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One of the most common challenges CSMs face is figuring out what exactly should go into their customer health score. Is it all about product usage? Do support tickets matter more than Net Promoter Scores (NPS)? How do you assign a weight to each metric?
These uncertainties can lead to inconsistent evaluations, making it difficult to identify which accounts need your immediate attention and which are thriving.
Without a reliable system in place, you might find yourself reacting to problems after they’ve escalated instead of proactively preventing them. This not only impacts customer satisfaction but also your ability to drive meaningful results for your company.
What’s needed is a clear, structured approach – a template that standardizes how you monitor customer health, removing the guesswork and providing actionable insights. With a well-defined customer health score template, you and your team can easily identify high-risk accounts, prioritize your actions, and ensure that no customer falls through the cracks.
In this blog, we’ll break down the essential components of an effective customer health score template. We’ll discuss what metrics to include, how to assign weights to them, and common pitfalls to avoid.
By the end, you’ll have a blueprint that can help you create a consistent and reliable health score, tailored to your business needs. Whether you’re new to customer health scoring or looking to refine your existing process, this guide will provide the clarity you need.
Understanding the customer health score
Evaluating the health of your customers is a fundamental part of any Customer Success (CS) strategy. Without a clear understanding of where your customers stand, you’re essentially flying blind.
You might have some customers who are thriving and others who are quietly disengaging. But how can you tell the difference before it’s too late? This is where the concept of a customer health score comes into play.
What is a customer health score?
A customer health score is a composite metric that aggregates multiple data points to give you a clear picture of your customers’ overall well-being and satisfaction. Think of it as a report card for your customers, highlighting areas of strength and potential risks.
It helps you answer key questions like: Who are my potential advocates? Which customers need more support? And who is at risk of churn?
Measuring your customer health score is crucial because it allows you to be proactive rather than reactive. It provides a structured way to track customer engagement, product usage, and overall satisfaction. This helps you prioritize your efforts, ensuring that your team focuses on accounts that need attention while also nurturing those that show promise for growth and advocacy.
The key components of a customer health score typically include product usage, engagement, support interactions, customer feedback, and more.
Understanding and tracking these metrics is essential, but if you’re looking for a deeper dive into the basics of customer health scores, check out our comprehensive guide that covers the fundamentals in detail.
With a clear grasp of what a customer health score is and why it matters, the next step is to create a template that works for your business. After all, the right set of metrics and weights can vary greatly depending on your industry, customer base, and business model.
In the next section, we’ll guide you through the process of building a customer health score template that fits your unique needs and helps you manage Customer Success more effectively.
Creating your customer health score template
Now that you understand what a customer health score is and why it’s important, the next step is to create a template tailored to your business. While there’s no one-size-fits-all approach, having a structured process can help ensure your health score accurately reflects the well-being of your customers. Here’s a step-by-step guide to creating a customer health score template that works for you.
Step 1: Identify key metrics
Start by choosing the metrics that are most relevant to your business objectives and customer journey. These should be aligned with the outcomes that define success for your customers.
For example, you might consider metrics like feature adoption, frequency of log-ins, and support ticket volume. The key is to focus on metrics that provide a clear picture of customer engagement, satisfaction, and potential risks.
Step 2: Assign weights to each metric
Not all metrics are created equal. Once you’ve identified the key metrics, the next step is to determine their relative importance by assigning weights. For instance, if your business relies heavily on customer engagement for success, you might give more weight to metrics like webinar attendance and email response rates.
On the other hand, if product usage is a stronger indicator of customer health, metrics like log-in frequency and feature adoption should carry more weight. The goal is to reflect the impact of each metric on overall Customer Success accurately.
Step 3: Create a scoring system
With your metrics and weights in place, it’s time to develop a scoring system. This involves defining a scale for each metric, such as 0-100, where higher scores indicate better performance.
You’ll also need to establish what constitutes a ‘healthy’ customer versus an ‘at-risk’ one. For example, a customer using 80% of your product’s core features might score above 80, while a customer with minimal engagement could score below 30. This scoring system will serve as the foundation for your customer health score.
Step 4: Aggregate scores to form the overall health score
Now that you have individual scores for each metric, combine them based on their assigned weights to calculate an overall health score. This aggregated score provides a holistic view of the customer’s health, allowing you to easily identify accounts that need attention and those that are on track.
It’s a good idea to use a simple formula, such as a weighted average, to ensure the calculation remains straightforward and easy to interpret.
Step 5: Test and iterate
No template is perfect right out of the gate. After creating your initial customer health score template, test it on a small set of accounts. Observe how well the scores align with actual customer behavior and feedback.
If the template flags too many healthy customers as ‘at-risk’ or vice versa, consider adjusting the weights or the scoring criteria. Gather feedback from your Customer Success team and refine the template until it accurately reflects customer health.
By following these steps, you’ll create a customer health score template that not only standardizes your approach but also provides meaningful insights to help you manage customer relationships more effectively.
However, it’s important to remember that this is not a one-and-done process. Regular reviews and updates are essential to keep your template relevant as your business and customer needs evolve.
In the next section, we’ll discuss some common pitfalls to avoid when building and maintaining your customer health score template.
Common pitfalls to avoid
Creating a customer health score template is a great start, but it's equally important to ensure it's effective and sustainable over time. Many Customer Success teams fall into common traps that can limit the accuracy and usefulness of their health scores. Here are a few pitfalls to watch out for and tips on how to avoid them.
1. Overcomplicating the template
It’s tempting to include every possible metric to make your health score comprehensive, but this can lead to an overly complex template that’s difficult to manage and interpret. A complex template can also overwhelm your team and obscure the most critical signals.
Instead, focus on the most impactful metrics – those that truly reflect customer engagement and satisfaction. Start with a simple version of your template, and gradually add metrics only if they provide additional, actionable insights.
2. Ignoring customer feedback
Quantitative data like product usage and support interactions are important, but they don’t tell the whole story. Customer feedback, both positive and negative, provides valuable context that numbers alone can’t capture.
If a customer expresses dissatisfaction in a survey or during a call, this should influence their health score, even if their product usage is high. Integrating qualitative feedback ensures your health score reflects the customer’s true sentiment, helping you take a more balanced approach to managing accounts.
3. Neglecting to update the template
Your business, customers, and product will evolve over time, and your customer health score template should too. A template that worked well last year might not be relevant today if your business goals or customer behavior have changed.
Schedule regular reviews – quarterly or bi-annually – to assess the effectiveness of your health score and make necessary adjustments. This could mean re-weighting metrics, adding new ones, or removing those that no longer serve a purpose.
Avoiding these common pitfalls will help you maintain a customer health score that is both practical and meaningful, enabling your team to better understand and support your customers.
In the next section, we’ll dive into best practices for maintaining and updating your customer health score template. We’ll cover how to set up regular review processes, gather insights from your team, and use technology to streamline updates, ensuring your template remains a valuable tool for managing Customer Success.
How to maintain and update your customer health score template
Creating a customer health score template is just the first step. To keep it effective, you need to ensure it evolves with your business and customer needs. A static template can quickly become outdated, leading to inaccurate assessments and missed opportunities. Regular maintenance and updates are crucial to making sure your health score remains a reliable tool for managing Customer Success.
1. Regular review sessions
Schedule regular review sessions, either quarterly or bi-annually, to evaluate the effectiveness of your customer health score template. During these sessions, analyze how well the template reflects your customers' health and whether it aligns with your business goals.
Look for patterns and trends in your data that may indicate the need for adjustments. For instance, if your business has introduced new product features or shifted its target market, you may need to update the metrics or their weights accordingly.
Regular reviews ensure your template remains relevant and accurately represents the current state of your customer relationships.
2. Incorporate feedback from your CS team
Your Customer Success team is on the front lines, interacting with customers daily. They are a valuable source of insights into how well the health score template is working in practice.
Make it a point to gather feedback from them during review sessions or through surveys and meetings. Ask them if there are any metrics that seem over- or under-weighted or if there are any new trends they’ve noticed that aren’t captured in the current template.
This collaborative approach helps you create a template that not only works on paper but is also practical and useful in real-world scenarios.
3. Use technology to streamline updates
Updating your health score template doesn’t have to be a manual, time-consuming process. CS tools like Velaris can automate data collection and scoring, making it easier to maintain an accurate and up-to-date health score.
Velaris integrates with your existing tools, such as sales, marketing, support, and product management platforms, to automatically populate the data needed for your health score and tracks it in real-time – enabling your team to react quickly to changes.
With features like AI-driven insights and automated scoring, Velaris helps ensure your health score remains a dynamic and effective tool for managing Customer Success.
Maintaining and updating your customer health score template is an ongoing process, but it doesn’t have to be overwhelming. By regularly reviewing the template, incorporating feedback from your team, and leveraging technology, you can keep your health score accurate and aligned with your evolving business needs.
Conclusion
A reliable customer health score template is more than just a set of numbers. It’s a tool that empowers your team to manage Customer Success more effectively. By capturing the right metrics and tracking them consistently, you can proactively identify at-risk accounts, prioritize your efforts, and ultimately drive better outcomes for your customers and your business. It’s about creating a clear, standardized way to understand and support your customers throughout their journey.
Velaris can make this process simpler and more efficient. With automated data integration, AI-driven insights, and customizable templates, Velaris helps you build and maintain a customer health score that truly reflects your customers' needs and behaviors. This allows you to focus on what really matters—delivering value to your customers and building long-term relationships.
If you’re looking to streamline your Customer Success processes and gain deeper insights into your customer health, book a demo today and see how Velaris can support your team in making more informed, proactive decisions.
