Customer Success Management (CSM): What you need to know
In this blog post, we’ll explore what is CSM, what are the 5 fundamental principles of CSM, the role of a Customer Success Manager, and how to measure the success of the CSM program.
First introduced by tech companies, Customer Success Management (CSM) finds its way (and rightly so) into every customer-centered business. Businesses of all sizes have embraced CSM in an attempt to increase retention, revenue, and Customer Lifetime Value.
Let’s start from the top.
What is CSM, exactly?
Customer Success Management (CSM) is the practice of managing customer relationships to maximize customer satisfaction and the value they get from a product or service.
The goal of CSM is to take proactive actions to reduce problems customers may experience with a brand – which helps increase customer loyalty and improve a company’s bottom line. It involves a variety of activities and processes, including onboarding, training, guidance, customer support, and customer feedback.
The 5 fundamental principles of CSM
Below are the five pillars of customer success management that you should know:
- Focus on the customer: Creating a customer-focused culture and ensuring that you tailor each interaction with customers to meet their individual needs.
- Proactive engagement: CSM involves proactively reaching out to customers to understand their needs and help them achieve their goals.
- Collaboration: Customer success management involves collaboration between the customer, Customer Success Managers, and other teams within the company, such as product development and sales.
- Monitoring and measuring success: Measuring success through regularly monitoring key metrics will help identify areas where customers may be struggling.
- Continuous improvement: CSM should be seen as an ongoing process rather than a one-time project. This includes continuously measuring performance indicators such as retention rates and satisfaction scores.
How does a Customer Success Manager (CSM) role fit in?
The role of a Customer Success Manager is to ensure the implementation of CSM practices. They act as the customers’ voice, cultivating strong customer relationships, and demonstrating that they have their best interests at heart.
Aside from good soft skills, Customer Success Managers must have a strong understanding of the product or service they are selling in order to provide knowledgeable support when needed.
Think of CS Managers as a combination of white-glove support and sales experts.
Customer Success Manager roles and responsibilities:
- Onboarding of new customers, which includes educating the customer about the product’s features and functionality, defining specific goals, and providing customers with everything they need to be successful and complete those goals.
- Providing support and guidance to customers to help them get the most value out of the company’s products or services.
- Responding to customer inquiries and concerns in a timely and professional manner.
- Identifying and addressing potential issues that may impact customer satisfaction.
- Upselling and cross-selling the product.
- Collaborating with other teams within the company to resolve customer issues and identify opportunities for improvement.
- Analyzing customer data to identify trends and opportunities for improvement.
- Developing and implementing customer success plans and programs.
- Acting as the Voice of the Customer and fostering solid relationships with customers.
- Collecting feedback and reporting on the effectiveness of customer success initiatives.
- Building and maintaining solid relationships with customers to encourage loyalty and retention.
Customer Success Manager traits:
- Can sympathize with customers and prioritize their needs while establishing long-term ties that go beyond simple rapport.
- Is adaptable to changing customer needs and expectations, and able to identify and implement solutions quickly.
- Possesses customer-facing experience, especially in support or sales.
- Has a thorough understanding of the product, its value, and the results it produces.
- A proactive and strategic thinker that anticipates future trends.
- Great leadership, analytical acumen, and problem-solving skills.
- Strong communication, organizational analysis, and solution focus.
- Ability to handle stress.
Measuring the success of your CSM Program
One way to measure the effectiveness of the CSM program is to track key metrics such as:
- Customer Effort Score (CES) measures how much effort is put in by customers to interact with the business.
- Customer Lifetime Value (CLV) calculates a customer’s total worth to your organization over the course of their relationship with you.
- Engagement Rate measures the level of interaction and engagement of a group of people with a particular product, service, or organization.
- Retention Rate measures how many customers continue to use a product, service, or organization over a certain period of time.
- Net Renewal Rate measures how many customers renew their use of a product, service, or organization over a certain period of time.
- Customer Health Score reflects the overall well-being of a company’s customer base. It is often used to identify customers who may be at risk of churning or stopping their use of a company’s products or services.
- Customer Satisfaction Score measures how satisfied customers are with a company’s products or services. It is typically calculated using customer feedback, which can be gathered through surveys, interviews, or other forms of customer research.
- Expansion Revenue is the additional revenue generated by existing customers as they increase their use of a company’s products or services.
- Onboarding Engagement Rate measures the level of interaction and engagement of new customers or users with a product, service, or organization during the onboarding process.
- Daily Active Users (DAU) and Monthly Active Users (MAU) measure the percentage of a company’s user base that is active daily and monthly.
Depending on the goals of the customer success program and the specific needs of the organization, there might be other, more relevant metrics to be tracked. To evaluate the effectiveness of the program, carefully choose the essential metrics and track them over time.
How FrontLogix can help
Do you require the services of an experienced Customer Success Manager?
FrontLogix is a BPO specializing in customer experience (CX) and can assist you with skilled Customer Success Managers to track specific customer KPIs. Above all, we sincerely care about keeping your current subscriber base, exceeding their expectations, and adding additional delighted consumers.