Customer Success Managers (CSMs) play an important role in today’s subscription-based economy. Typically employed by Software-as-a-Service (SaaS) companies, CSMs are responsible for ensuring customers receive value from their solutions to decrease customer churn and grow the existing relationship. To accomplish this goal, CSMs require a solid foundation in business and technical skills to help identify their customer’s needs and employ different company resources to improve the health of the customer relationship. Additionally, due to the data-intensive nature of managing customer relationships, CSMs now need to possess some degree of proficiency in data science skills or, at least, have access to those skills.
Many businesses today provide access to their solutions in the form of Software-as-a-Service (SaaS). Consequently, customers are not tied down by long-term contracts and are able to easily leave the relationship (i.e., switch to your competition) when their needs are not being met. Because businesses rely on subscription renewals and up/cross-selling activities as their major source of revenue, it is important to these SaaS businesses to keep customers as long as they can. These businesses rely on customer success managers to ensure their customers realize tangible benefits from their solutions. But what does a customer success manager (CSM) do and what are their skills?
What is a Customer Success Manager?
The Customer Success Association provides a good definition of the role of customer success manager and the issues they face (bold added for emphasis):
“The emerging role is about a solution to the core issues of customer portfolio development, retention and expansion. The long-range vision of Customer Success Management is an integration of Technology, Marketing, Sales, Professional Services, Training and Support into a relationship product for the SaaS/Cloud era. The day of the traditional perception of software as a stand-alone tool, with its historically hodgepodge tactical methods of packaging and distribution, has passed. The ultimate strategic goal of the Customer Success role is sustainable corporate profitability and growth. The method is to make your customers as profitable and productive as possible.”
Let’s break down this definition.
Problem Solver Using All Resources
In the world of B2B SaaS-driven businesses, CSMs form close relationships with their customers. As in all healthy relationships, there must be two-way communication between the CSMs and their customers. That is, CSMs do not only provide valuable information to their customers, but they also receive valuable information from their customers about their needs and expectations, business and departmental goals, new product ideas and more.
In addition to understanding their customers’ needs, a successful CSM needs to be knowledgeable about the product as well as the different ways they can help address customers’ needs. CSMs utilize different resources to help ensure long-term customer success, including technology, marketing, sales, professional services, training and support. Customer success management is not a one-size-fits-all solution. Depending on the customer’s specific problem or their stage in the customer lifecycle (e.g., onboarding), the CSM will generate solutions that move their customers forward. For example, to help their customers integrate their solution with other products that they use, CSMs rely on technology resources. CSMs could rely on marketing resources to communicate with at-risk customers who are likely to leave. CSMs could even rely on training resources to ensure customer understand how to use the features they need to be successful.
Loyalty, Sustainability, Profitability and Growth
The ultimate goal of a customer success manager is to ensure long-term success of their employer. Without sustainability and profitability, after all, the business would not be able to hire CSMs. Without the CSMs, customers are less likely to find value in your solutions. If customers do not find value in your solutions, the less likely they are to stay with you or buy more from you in the future. And the virtuous cycle continues. So, even though the ultimate goal of CSMs is to create a going concern, they do so by focusing on ensuring that customers are realizing measurable results from their solutions.
A primary issue faced by the CSM revolves around customer loyalty. As the definition above outlines, customer success managers can have an impact on different types of customer loyalty, from retaining customers to expanding the relationship (e.g., up/cross-selling). So, while the focus of the CSM is to ensure the customer is successful and realizes value in the solutions you offer, the ultimate outcome is that, as a result of their success, the customer stays with you and expands their relationship with you.
CSMs help their customers by understanding their needs and managing their expectations. Using their business and technical knowledge, CSMs are able to understand their customers’ needs and bring company resources to bear on problems to ensure customers are successfully using the solution. Increasing the success of customers increases the likelihood that customers stay with you and expand their relationship with you, contributing to your business’ long-term success.
What Companies Want in a Customer Success Manager
The customer success manager is an emerging role, and companies are seeking professionals to fill these roles. In a study of the skills required to be a CSM, researchers reviewed 300 job listings from job sites like Indeed, Glassdoor and LinkedIn. They found that employers are primarily looking for people with business degrees (60%) with experience in customer service (65%) and account management (55%) (see Figures 1 and 2).
With respect to technical skills, many companies are looking for CSM candidates who have previous experience using CRM systems (47%). Surprisingly, less than 20% are looking for candidates with Marketing automation skills (see Figure 3).
Based on the review of job listings, the set of requirements and skills for CSM candidates underscores the idea that a successful CSM will be knowledgeable in business and technology and possess good interpersonal (customer-facing) skills. In the next post (Part 2), I will explore why CSMs need to consider how they need to incorporate statistics skills and data mining and visualization tools into their mix of requirements to be an effective CSM.