It’ll come as no surprise that the tech world moves fast. SaaS is no new phenomenon. It is, however, becoming nigh-on ubiquitous. That means there’s a tool or a widget for pretty much everything. That comes with a seat, a subscription or a recurring relationship. That changes the way our customers operate and, for some reason, many of us haven’t quite been quick enough to adapt at the same pace.

We can’t rely on what’s always worked anymore. For SaaS scale-ups, the playbook needs an urgent refresh.

 Let’s dive a little deeper. The last decade was an ‘easy money’ era where venture capital flooded into SaaS companies pursuing growth at all costs. We know, and we’ve seen, that relying on this model going into 2024 can only set you up for failure. There’s data to prove it, too. Industry reports show that median CACs increased over 40% from 2020 to 2023, while average SaaS churn rates now sit at around 15% annually.

The legacy metrics don’t add up! With more competition and open-source alternatives than ever, customer retention and in-life value now determine success. Customer success has become everyone’s business, and it’s time for founders to recognise that. The ones that have, and that are doing, are the ones seeing the most success. Start-ups wedded to the old ‘growth hacking’ tactics will churn through hard-won customers and pursue the wrong ones going forward. They’ll bleed out their CAC on every new logo without earning it back.

So what does this new playbook look like? You won’t be too surprised to read that it starts with customer centricity. That means aligning with real needs, solving burning problems, delighting users with value and building loyalty. However, that’s not as simple as it sounds with the traditional worldview. This approach demands an overhaul of how we perceive the role of the CSM too, and it involves a lot more data insight and a serious amount of kicking down organisational silos to get the data house in order.

The outcome? A bit more simple. Reduce churn, but understand it, too. Power revenue growth through in-life expansion. In fact, studies show that companies ranking in the top 25% for customer experience retain on average 5% more of their customer base year-on-year.

 It’s time to stop clinging on to legacy growth tactics like aggressive sales, leaky funnels, lofty acquisition targets and excessive CAC. That’s the stuff that’s sinking start-ups. As mature SaaS categories saturate, you have to win on customer success.

Similarly, the rise of open-source tools is making self-led development less scary and less coder-dependent, too. It’s revealing an increasing viability of alternatives to traditional SaaS.

The main objective is determining how we take this thinking into 2024. My view is that the leaders ahead will become stewards for their customers’ evolving needs, beyond what they already have been doing. That means forging strategic partnerships beyond transactional relationships, and allowing proactive account management to uncover new opportunities.

The next step is forging a culture built on the foundation of customer data. User insights and total cross-business visibility must inform every decision across product, sales, and marketing teams. We have to squash this world where GTM is silo driven. KPIs need to shift away from vanity metrics like sign-ups and net new to pragmatic alternatives like retention and LTV. This demands integration, though. I’m talking unified data and workflows to prevent customers from falling through the cracks between sales, onboarding, support and account management. Back to silos. Contextual intelligence ensures that every interaction is monitored, understood, and actionable.

That means that operating models must enable customer success ownership and advocacy. It’s no longer a cost centre. It’s a revenue driver. Siloed teams with misaligned goals will fail customers.

The SaaS landscape has evolved. Companies that evolve with it will lead through renewed customer centricity - the ones who cling to legacy models will continue to churn and get distracted by new business and misguided metrics.

My advice? Choose wisely. Build for the users, not the metrics. Make customer success the beating heart of your organisation, and sustainable growth will follow. The playbook has changed; success now starts with the customer.