Why Chief Customer Officers in SaaS Companies Are Struggling to Achieve 90%+ Renewal Rates—and How to Fix It

Introduction

In the world of Software-as-a-Service (SaaS), customer retention is everything. Unlike traditional software sales, where the revenue is largely front-loaded, SaaS companies rely on renewals and expansions to drive long-term profitability. Chief Customer Officers (CCOs) are tasked with ensuring high customer retention rates, ideally surpassing 90% renewal rates. However, many SaaS companies are falling short of this target.

Despite investments in customer success technology, automation, and analytics, renewal rates are stagnating or even declining. The reason? Many CCOs have lost sight of the fundamentals of customer relationships. Instead of focusing on relationship-building, proactive engagement, and clear role accountability, they have become overly reliant on technology-driven customer success strategies that fail to connect with customers on a deeper level.

This article will break down the key reasons why SaaS Chief Customer Officers (CCOs) are failing to achieve 90%+ renewal rates, and why a back-to-basics approach—one that emphasizes RACI models, team accountability, and relationship building—is the key to reversing this trend.

Why SaaS CCOs Are Struggling with Renewals

While many factors contribute to poor renewal rates, these are the most critical challenges facing SaaS CCOs today:

1. Over-Reliance on Customer Success Technology Instead of Human Relationships

CCOs have heavily invested in automation, AI-driven analytics, and customer health scoring tools—all designed to help predict churn and drive engagement at scale. However, these tools often miss the human element that is critical in customer retention.

• Problem: SaaS companies assume that automated check-ins, surveys, and dashboards can replace real conversations.

• Impact: Customers feel like they are interacting with a system, not a partner, leading to disengagement and eventual churn.

• Solution: Customer Success Managers (CSMs) need to focus on relationship-building rather than just reacting to health scores and system-generated alerts.

2. Weak Executive Alignment with Customer Success

Many SaaS companies fail to engage executive sponsors from both the vendor and the customer side.

• Problem: Customer Success teams are engaging only with operational users, not with decision-makers who control budgets and renewals.

• Impact: By the time renewal discussions happen, executive stakeholders may not fully recognize the value of the software, leading to budget cuts and non-renewals.

• Solution: CCOs should ensure their CSMs are actively engaging executives throughout the customer journey—not just when renewal time approaches.

3. Poor Role Definition and Lack of a RACI Model

Without clearly defined roles and responsibilities, Customer Success teams often operate in reactive mode, failing to take ownership of customer health.

• Problem: No clear RACI (Responsible, Accountable, Consulted, Informed) model in place to define who does what in the customer retention process.

• Impact: Customer onboarding, issue resolution, and renewal ownership become chaotic, leading to missed opportunities and last-minute firefighting.

• Solution: Implement a RACI model to ensure clear accountability for renewals, customer engagement, and proactive success planning.

4. Churn Prevention Focus Instead of Value Expansion

Many CCOs focus heavily on churn prevention rather than value expansion.

• Problem: Customer Success teams spend more time solving issues and addressing complaints rather than proactively showcasing new capabilities and upsell opportunities.

• Impact: Customers perceive the vendor relationship as transactional, rather than a long-term partnership that delivers increasing value.

• Solution: Shift the focus from reactive churn management to proactive customer success, ensuring that CSMs are consistently demonstrating ROI and business impact.

5. Ineffective Renewal Strategies & Late Engagement

CCOs often treat renewals as a last-minute negotiation rather than a long-term customer engagement process.

• Problem: Renewal conversations start too late, typically within the last 90 days of the contract.

• Impact: Customers feel rushed, leading to discount negotiations, contract delays, or non-renewals.

• Solution: Customer Success teams must engage in renewal discussions 6-9 months in advance and continuously reinforce value throughout the year.

Back to Basics: Implementing a RACI Model & Relationship-Driven Customer Success

To combat these challenges, SaaS CCOs must return to the fundamentals of customer relationship management. This means:

1. Defining a clear RACI model for customer success

2. Shifting the focus from automation to personal engagement

3. Training CSMs to be relationship-driven, not just tech-driven

Step 1: Implement a RACI Model for Customer Success

A RACI model brings clarity to who owns which parts of the customer journey and ensures no gaps in communication and engagement.

Step 2: Shift from Automated Engagement to Relationship-Driven Success

Instead of relying solely on AI-driven health scores and automated emails, Customer Success teams must prioritize direct, human interaction:

• Quarterly Business Reviews (QBRs) with executive sponsors

• Customer site visits and strategic planning workshops

• Regular check-ins based on meaningful business impact, not system alerts

Step 3: Train CSMs to Be Relationship Builders, Not Just Data Analysts

CSMs need to evolve from reacting to customer metrics to actively engaging and coaching customers on how to derive more value from their software.

• Provide soft skills training in relationship management, negotiation, and strategic consulting.

• Empower CSMs to build deeper connections with customer stakeholders, rather than just monitoring product usage.

• Encourage customer advocacy programs where satisfied customers become champions for renewals and expansions.

Conclusion: The Path Forward for SaaS CCOs

The reason many SaaS CCOs struggle to achieve 90%+ renewal rates is because they prioritize technology over relationships and lack structured accountability frameworks. By going back to basics with a well-defined RACI model, executive engagement, and relationship-driven customer success, CCOs can significantly improve retention rates and drive long-term customer value.

The future of SaaS customer success isn’t just AI and automation—it’s human connection, strategic alignment, and proactive customer value expansion. It’s time for SaaS CCOs to refocus on what really drives customer loyalty: strong, personal relationships.