The Reds are targeting the top four this season but face a fight to get there.
The Reds have been inconsistent so far this year, with a big wins over the likes of Chelsea and Manchester City tempered with disappointing defeats to Watford and West Ham.
A minimum aim for Jurgen Klopp’s side is to challenge for a top four place, although there is fierce competition for that final fourth spot, with a number of clubs all eyeing Champions League football next season.
And Nicholas says that would constitute success for the Reds next season, while next year they should be going for the title.
“I think success would be a challenge for a top four this season,” he told Soccer Saturday.
“If he doesn’t make it, I don’t think the Europa League is of significant interest to them, maybe to him [Klopp] to keep his reputation.
“I have always judged it as next season for Liverpool. They’ve got a few changes to make and I think that’ll take him the best part of six month, after that, he has to go for the title.”
If Liverpool are to challenge for a top four place this season, Klopp will need improvement in both defence and attack.
The German and his predecessor Brendan Rodgers have struggled to stop the side conceding goals and they will be hoping the loan signing of Steven Caulker can help to fix the problems there.
Up front has also been a problem area, with Christian Benteke struggling to impress and Daniel Sturridge failing to maintain his fitness, and Klopp may look to add in that area before the end of the transfer window.