Tech Jobs: What is a Customer Success Manager?
Do you want to know what a customer success manager (CSM) is?
You came to the right place. In this article you will learn everything you need to know about being a customer success manager in SaaS and IT. We are going into what it is, what they do, and the skills you need to land a job as a CSM.
Depending on the company customer success managers can have alternative titles like technical account manager (TAM), client services manager, client success manager, client solutions manager, or solutions consultant to just name a few.
At Wahl+Case, we have helped hundreds of people land customer success jobs at some of the hottest companies in AdTech, FinTech, Consumer Tech and Enterprise Tech, so keep reading if you want to learn all about customer success positions.
For a comprehensive overview of the different sales positions in tech, check out our Guide to Sales Positions in the Tech Industry 2021.
Definition of a Customer Success Manager
So what exactly is a customer success manager?
Being a customer success manager, as the name suggests, means making sure that your customers are finding success using your product or service.
This could be guiding them through onboarding or implementation, showing them features that they aren’t using or aren’t fully, but that they would benefit from. You will constantly be meeting your clients, going over their results, and coaching them on how they could improve their business even more by using your product.
vendor lock-in
Creating vendor lock-in is one of the key parts of being a successful customer success manager, sometimes also called proprietary lock-in or customer lock-in. Your goal is to make sure your customers are so successful using your product or service that they are dependent on continuing using it for ongoing and future business success. Changing to another product or service would lead to high switching costs.
Targets and KPIs
What are a customer success manager’s targets and KPIs?
Your goal as a customer success manager will be to maintain and grow your customer’s customer satisfaction. This can be measured in your Net Promoter Score (NPS), customer satisfaction surveys, or churn rate.
Churn rate is the term for customers leaving your product or service instead of renewing. Sometimes called rate of attrition, it measures your product’s loss in customers over a certain period of time. A customer success manager’s goal is to keep churn rate as low as possible because in order to be successful, your company’s growth rate must be higher than the churn rate. In most cases it is also cheaper to renew with existing customers than to acquire new ones.
Sales Targets
Most CSM’s don’t have direct sales targets, but they have up-selling, cross-selling and renewal targets.
Up-selling is the practice to encourage your customer to buy or subscribe to a more high-end product than the one currently in use, for example an upgrade from the basic plan of a subscription to a more expensive premium plan. In order to achieve this you have to show the customer how the additional value for their business gained from the premium plan exceeds the additional cost.
Cross-selling on the other hand is the practice to encourage your customer to buy or subscribe to additional and complementary items. These can include paid features, add-ons, training sessions or related products. In this case you have to show how the combination of the product with a paid feature for example will even increase the value for their business.
Renewals are pretty self-explanatory. It means that your customer renews their current plan or subscription by an additional time period, for example another year. In any SaaS business renewals are a major driver of cash flow and are usually easier to predict and forecast than new revenue. As mentioned earlier, the most effective way to have a high renewal rate is to create vendor lock-in with your customers.
Required Skills
So what skills do you need to be a good customer success manager?
A customer success manager has two sides, a technical side, which requires hard skills and a client facing side which needs soft skills. Let’s break those down a bit.
Hard Skills
The technical skills needed will vary depending on the type of product, the company and the industry.
If you are working in AdTech or MarTech for example, you have to be comfortable working with data. This means having a knowledge of SQL, Python, or R would give you a head start. Most companies have different trainings on their specific solutions after you join, but having a base to build on is always a good idea.
Soft Skills
Because a CSM is a very client-facing role, you will need to not only be able to read the data, but also communicate your findings with your clients to help them understand what is working and what is not working.
That’s why you have to be proactive in solving problems and the best customer success managers even anticipate problems before they come up. This requires you to be very empathetic and develop a good understanding of your customer’s business as well as how and why they use your product or service. Some of the main key soft skills you need are active listening, effective communication, coaching, and presentation skills.
Career Progression
Being a customer success manager gives you skills on both the technical side and the client facing side, so there are a few directions you can go for your next career step.
The first and most straightforward is to become a leader of a customer success team. This would include titles like customer success director, head of customer success, or the more recent executive position of CCO (chief customer officer).
Another option would be to move more towards the technical side of the job and become a solution architect or a similar role that takes customer needs and productizes them. Productizing is the process of creating custom solutions for your customers based on their requests.
You could also move to a more sales heavy role that is growth focused, using your soft skills to build a business and using your understanding understanding of the technical side to better illustrate the benefits of a product.
FAQ
As a bonus, here are the answers to some frequently asked questions we get about customer success positions.
What is the difference between customer success and customer service?
The difference between a customer success manager and a customer support can be seen as being proactive vs being reactive. As a customer success manager you will need to be engaging with your customers on a daily basis, making sure that they are reaping the full benefits of your solution, and solving problems before they happen. Customer service on the other hand, is more about responding to the issues that customers are already experiencing and taking care of any complaints they may have.
What is the difference between a Customer Success Manager and an Account Manager?
Here the main difference is the technical aspect of the role. As a customer success manager you will be more involved in the implementation of the product. The customer will have the expectation that you have the ability to dive deeper into the solutions the product offers. Whereas an account manager will also handle reporting, but it will generally be through available dashboards. Another difference is that account managers can be sales roles with targets based on sales results, but customer success roles will usually not have a commission structure or bonus.
I hope this article could help you to get a better understanding of what it means to be a customer success manager. It is still a fairly new position and has become more widespread in recent years due to the growth of SaaS businesses and subscription services.
Do you want to be a customer success manager in Tokyo’s tech industry?
Get in touch and we will be happy to share the customer success positions that we are currently working on.
If you like our content, join our mailing list and receive our latest startup stories, market insights and job trends for Japan’s tech market.