Your Customer Success Manager is not an Account Manager

In this post, I want to discuss the Account Manager and the Customer Success Manager. Who are they, and why do you need both?

We have seen an acceleration in Companies transitioning to SaaS, aka Cloud. As stated by Laurie Wurster, Gartner Research Director, “Customers have moved from buying or leasing technology to buying IT services, to ‘buying’ long-term relationships with providers.” This shift also includes a change in what metrics a company will track.

I want to focus on: Customer Churn, Revenue Churn, and Customer Lifetime Value. These are all related to retention. A company can improve profits from 5% to 125% (depending on the industry) after increasing the customer retention rate by 5%. These metrics and the results lead to the emergence of Customer Success.

Without a form of customer success that actively manages your customer journey, you are effectively yielding control of your customers over to your competitors to the detriment of your company’s future.

Customer Success differs in one significant way from Account Managers;  Revenue!

Account Manager Responsibilities:

• Generate sales for a portfolio of accounts and reach the company’s sales target through upselling and cross-selling.
• Identify new sales opportunities within these existing accounts to retain a client-account manager relationship by employing ‘playbooks.
• Manage and solve conflicts with clients.
• Interact and coordinate with the sales team and other staff members in other departments working on the same Account.
• Establish budgets or provide ROI use cases with the customer.
• Meet time deadlines for accounts.
• Collect and analyzing data to learn more about consumer behavior.
• Keeping accurate records on installed product and account notes
• Maintaining updated knowledge of company products and services
• Resolving complaints and preventing additional issues by improving processes
• Identifying industry trends
• Acting as a client advocate with a focus on improving the buyer experience

Customer Success Manager Responsibilities:

• Develop and manage a portfolio of customers.
• Knowledge Enablement: providing the customer with the knowledge needed to make the best use of the solution, including product knowledge and customer-to-customer relations, and self-service knowledge systems.
• Identifying Growth Opportunity: Throughout the customer’s lifecycle identifies areas of growth of the customer business. Act as the “trusted adviser” and help identify expansion opportunities.
• Identifying and reduce churn risk: Utilizing a Customer Health score to identify possible churn (or lost revenue)
• Sustain business growth and profitability by maximizing value.
• Analyze customer data to improve customer experience.
• Hold product demonstrations for customers.
• Evaluate and improve tutorials and other communication infrastructure.
• Mediate between clients and the organization.
• Handle and resolve customer requests and complaints.
• Aid in product design and product development.

These job descriptions are similar in nature, but many companies fail to grasp the subtle differences between the account manager and the customer success manager; while the two overlap, they are not the same. Customer Success is not a rebranding of Account Management. The difference comes down to customer lifetime value.

The account manager’s primary role is to make sure customers renew their contracts, reducing churn. They will identify and close upsells and cross-sells for the company. They are the primary point of contact for the customers. They exist to solve the customers’ problems so that customers do not have to deal with multiple people, starting over each time to explain issues or concerns to different employees.

The AM will understand the difference between business challenges/upsell opportunities and implementation issues/adoption challenges. If the AM uncovers problems, such as the sample below, then the AM should handoff to a CSM:

• I have enabled users, but they have not logged in.
• We do not have the time to complete deployment.
• I need help understanding best practices.
• How do I integrate business systems?
•  Reporting is arduous.

On the other hand, Customer success provides best practices, process guidance, and thought leadership to help customers optimize their use of your tool with tangible ROI. They will focus on understanding a customer’s business needs and priorities.

• Guiding customers through the adoption of new features
• Teaching best practices from the existing customer community
• Provide tips and features to improve user experience.
• Monitoring support tickets and escalations
• Conducting Assessments when appropriate

As you look at the responsibilities above, you may recognize the overlap, which should be intentional! At the end-of-the-day, The AM and CSM roles need to delight the customer along their journey and make the renewal simple. The real difference is how they approach the customer.

The customer success manager is responsible for all the above, but here is the subtle difference. The number one goal of a CSM is making a customer successful. The CSM can answer the question, “what does the customer want to achieve by using your service.” They accomplish this by bringing efficiency to a customer’s process, support the scaling of the customer business, or providing them a cost-saving.

Whatever the goal and objective are, the CSMs make sure that customers achieve that. The CSM’s charter is to make the customer goals their own. And when they deliver on those, renewals and account expansion is a natural outcome.

The CSM should not be responsible for generating revenue: This will split their focus on the customer journey and takes away the time they must invest in helping customers meet their goals. If you look at unbiased customer reviews on sites such as TrustRadius or G2 Crowd, you do not want to see comments such as “the only time I hear from {insert company name here} is when they want to sell me something.”

Your customer should view your CSM as the trusted partner who advise them about using your product, when to upgrade, and what is genuinely best for them. If they are trying to ask for money (renewals, upsell, and so on), The customer may question if the CSM’s recommendations are only there to extract money, not help them.

While both AMs and CSMs serve the customer, CSs have a more comprehensive vision than AMs. The focus is on the customers’ long-term goals. They lead the customers through all phases of the customer journey.

The customer and CS partnership will turn your customers into advocates. The result is more leads, new logos with a significantly decreased CAC.

Your account management team has in-depth domain knowledge of your product and your company. They understand the processes for renewals and expansion. The AM is reactive to customers’ needs but proactive towards the end of a contract term.

CS is responsible for all these points, including a basic knowledge of the customer’s industry. Having a CSM who understands the customer and their challenges also provide your company a richer view into the Ideal Customer Profile. This view provides your marketing team insights to build relevant content, your product team in updating your product roadmap, and your Sales team understanding the needs of the “right” prospects for your product or service.

Your company will be stronger when your account management team focused on reducing churn and expansion opportunities while your customer success team builds long-term value for your customers.