If you're interested in working in a client-facing role, you may have come across the titles "Customer Success Manager" and "Account Manager" within a customer success team in the tech sector. While the two roles may seem similar at first glance, there are key differences between Customer Success Manager vs Account Managers that serve different purposes. Understanding these differences can help you determine which role may be a better fit for your skills and career goals.
At a high level, the main difference between a Customer Success Manager (CSM) and an Account Manager (AM) is their focus. Account Managers are typically responsible for client retention and upsells, while the Customer Success Manager's primary goal is on ensuring that clients are achieving their desired business goals. While both roles involve working with clients, on a day-to-day basis, the responsibilities and goals of each position can vary significantly.
If you're considering a career in either Customer Success or Account Management, it's important to understand the specific skills and best practices that are required for success in each role. They overlap in many areas - for example, both are responsible for curating a great customer experience and increasing customer loyalty. It's worth noting that some companies may use these terms interchangeably or may have slightly different definitions for each position. However, by understanding the key differences between the two roles, you can better determine which path may be the best fit for you.
Role of An Account Manager
In the role of an Account Manager, your primary responsibility is to maintain and grow the relationship between the company and its clients. You are the main point of contact for your assigned clients, and you work to ensure their satisfaction with the company's products or services. You work closely with the Account Executives on the sales team to identify new business opportunities and upsell existing clients, which may include a sales quota. In short, their primary focus is on revenue generation and client retention. Here are some of the key tasks you may be responsible for as an AM:
Renew agreements and identify upsell opportunities
Focus on client retention
Provide reports on renewal rates and ensure sales quotas are being met
Overall, as an AM, your role is critical to the success of the company. You are responsible for maintaining and growing the relationship between the company and its clients, ensuring their satisfaction with the company's products or services, and identifying opportunities for growth.
The Role of a Customer Success Manager
In the role of a Customer Success Manager, you are responsible for ensuring that clients achieve their desired outcomes by using the company's products or services. You work closely with clients through their entire customer journey and with other team members to understand customer needs, help overcome any obstacles, and help build long-term relationships. The primary focus is on customer satisfaction and retention. In the CSM role, you work proactively to address customers' needs and resolve potential problems before they arise. Here are some key responsibilities of a Customer Success Manager:
Ensuring clients achieve their desired outcomes
Focused on increasing product usage and product adoption
Ensuring customer satisfaction and retention
As with any business department, both Account Management and Customer Success Management teams have specific goals and customer success metrics to measure their performance. Here are a few of the most common metrics for each team:
Account Management Team Goals
The primary goal of an Account Management team is to retain and grow existing accounts. The best way to achieve this is to focus on building strong relationships with customers and identifying opportunities for upselling or cross-selling. Some common metrics for Account Management teams include:
Revenue Growth: This metric measures the increase in revenue generated from existing accounts over a specific period. Account Managers are responsible for identifying opportunities to increase revenue and executing on those opportunities.
Retention or Renewal Rate: This metric measures the percentage of customers who remain with the company over a specific period. Account Managers are responsible for ensuring that customers are satisfied with the company's products or services and addressing any issues that arise.
Customer Lifetime Value (CLTV): The Customer Lifetime Value is the amount that the customer spends over during the lifecyle of their journey as a client, which includes revenue generated from cross-sells and upsells.
Customer Success Management Team Goals
The primary goal of a Customer Success Management team is to ensure that customers achieve their desired outcomes with the company's products or services. To achieve this, they focus on providing education, support, and guidance to customers. Some common metrics for Customer Success Management teams include (review this article for a full list of CSM metrics or KPIs):
Customer Health Scores: This metric measures the customers who are engaging with the product and their sentiment towards product/service. The customer health sentiment could be a combination of metrics that factor into the health sentiment score. Often times, it's categorized as colors such as green is healthy, yellow is at risk and red is churn risk.
Churn Rate: This metric measures the percentage of customers who stop using the company's products or services over a specific period. Customer Success Managers are responsible for identifying the reasons why customers are churning and addressing those issues.
Customer Satisfaction: This metric measures how satisfied customers are with the company's products or services. Account Managers are responsible for maintaining strong relationships with customers and ensuring that their needs are being met.
Net Promoter Score (NPS): Net promoter scores measure how likely customers are to recommend the company's products or services to others. Customer Success Managers are responsible for ensuring that customers are satisfied with the company's products or services and addressing any issues that arise.
Customer Success Manager vs Account Manager Breakdown
If you're looking to enhance your customer engagement strategy, it's essential to understand the differences between an Account Manager and a Customer Success Manager. Both roles are crucial to the success of a business, but they have distinct responsibilities and objectives.
The table below summarizes the different approaches and key differences between an Account Manager and a Customer Success Manager:
Both Account Managers and Customer Success Managers are essential to the success of a business in driving strong customer relationships. They work with internal teams to deliver on customer's needs. While the former focuses on revenue generation and client retention, the latter focuses on customer satisfaction and retention by delivering the most value. By understanding the main differences between these two roles, you can better determine which one is right for your customer base.