Total CS Spend as a % of Company Revenue?

Mark Holland
Mark Holland Member Posts: 4 Navigator
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Hello all,

As we have been progressing through our 2023 planning efforts, one of the questions that was asked was "What percentage of our company revenues should be our corporate spend for Customer Success and Support?" 

I realize that every company is at different levels of CS and corporate maturity, revenues, serving different markets/segments, etc. but I thought it might be interesting to try to understand how other companies are spending on all things CS (headcount, software, customer marketing, etc.).

To start the sharing, for 2023, we are targeting an all-in CS spend of about 11% of forecasted revenue. What level of CS spend are you planning for in 2023? 

Comments

  • Heather Wendt
    Heather Wendt HLAdmin, Member Posts: 285 Gain Grow Retain Staff
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    This is an interesting question! Would love to get insights from @Jay Nathan and @Jeff Breunsbach!
  • Jordan Silverman
    Jordan Silverman Member, CS Leader Posts: 109 Expert
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    We target SMB customers mostly - we used to be at 25% CS Spend. Now we are down to 18% and the goal is to be at 15% by EOY 2023.

    This is just head count. So base + bonuses + benefits and does not include tools, servers, etc.
    Jordan Silverman
    jordan.silverman@usestarfish.com
    (914) 844-5775
    https://www.linkedin.com/in/jordansilverman/
  • Mark Holland
    Mark Holland Member Posts: 4 Navigator
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    Thanks @Jordan Silverman! If you were to estimate, how much do you think the company spends on non HC related costs for CS? I saw a recent report from ChurnZero where they stated that something like 70% of companies spend less than $200k on non HC CS spend. Thanks!

    - Mark

  • Jordan Silverman
    Jordan Silverman Member, CS Leader Posts: 109 Expert
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    We are between $150-$200k in annual spend on tools with Totango being 50% of that.

    Other tools include: Zendesk, Slack, Zoom, etc. That is for 30 people on our CS team.
    Jordan Silverman
    jordan.silverman@usestarfish.com
    (914) 844-5775
    https://www.linkedin.com/in/jordansilverman/
  • Mark Holland
    Mark Holland Member Posts: 4 Navigator
    Name Dropper First Comment First Anniversary
    @Jordan Silverman
    Thanks so much, appreciate it! Would love to hear from others if they have insight
  • Chaun
    Chaun Member Posts: 4 Newcomer
    First Comment
    At a previous company focused on enterprise customers, out post-sales team accounted for approximately 20% of revenue. The avg ACV per customer was about $365k and the company’s annual revenue was $50-60M.
  • Chaun
    Chaun Member Posts: 4 Newcomer
    First Comment
    When I was at LinkedIn, our CS Ops team did some benchmarking and set a target for us to aim for account for 15-30% of total revenue. 15% was for more mature business lines and 30% was for newer businesses. I’m sure the goals are a bit more aggressive now due to the economic environment.