Pareto’s Law of 80/20 is backed up by Gartner on this: so, it comes as no surprise that Key Account Management (KAM) has risen to become one of the biggest (and most profitable) areas of focus in selling over the past two decades.
KAM focuses on the idea of developing long-term relationships with strategically important customers to maximize value and mutually beneficial goals. To be clear, this doesn’t mean focusing on the customers paying you the most right now: it’s a growth approach that looks at the potential value of an account over time.
If you’re here, you likely already know the gains to be made from nurturing those all-important accounts, but it’s worth hammering home the point. Statistically, it costs five to ten times more to acquire a new customer than to retain an existing one. Repeat customers also spend, on average, 67% more. Ultimately, it’s a no-brainer.
We get the why. But what about the how?
Moving from the position of a service provider to a strategic business partner and growing your key accounts is an ongoing process. Here’s my top tips to get you going.
- Map out your accounts.
The clue is in the name: this is about key account management. Not all accounts are equal; you need to determine where to invest time and effort.
This is about more than just revenue. Analyse your current accounts, considering factors such as the current state of the relationship and the long-term potential. Look to your company’s overall strategy and direction. Do the two match up? What value can you bring to the account long-term? Be objective and prioritise accordingly, starting small and building up your client relationship strategy slowly.
- Understand your customer’s organisation
This goes beyond the mandatory homework you did to secure the customer. This is about truly understanding the account, inside-out.
Who are the key decision makers and what do they care most about? What are their priority needs and areas of focus, now and going forward? What about their growth plans and objectives? What are their biggest challenges and threats? What’s their value proposition, their market?
Become an expert: know your client’s business even better than they do, by building an understanding of each department, their competitors, their industry. As you understand more, you’ll be able to identify those areas where you can deliver true value as a long-term partner.
- Build your network
Successful Account Managers don’t just nurture a single relationship. They build and maintain a network of influencers, users and decision-makers within their accounts.
Take the time to identify and engage with different groups or individuals who have a vested interest or influence within the business. Build a stakeholder map of those who can support you in reaching your goals, taking a holistic approach to the account as a whole and working on those meaningful relationships across departmental lines.
Building an intricate web of additional relationships strengthens your value and position as a partner, and may open new doors of opportunity along the way.
- LISTEN
Effective listening is the most powerful skill any salesperson can master. But given the importance and value of customer experience when it comes to KAM, it’s even more vital here.
You’re focused on long-term results, not short-term gains. So, set aside this quarters KPIs or target, and pay attention to the needs, concerns and feedback of the customer. Allow them to take the lead and respect their position. Ensure you have all the information before acting.
- Communicate: honestly
Be honest and transparent with your customer, even – especially! – when problems or issues arise. Nothing damages a relationship faster than being seen as underhand or withholding information. Keep them informed of any relevant developments and information, whether positive or negative, and tailor the communication. A sweeping generalised email to every account won’t cut it.
Communication also shouldn’t just be one-way. Ask your key account stakeholders for feedback: what do they value about the relationship and your offering? What hasn’t worked so well, and where could you improve? Listen carefully to their feedback, take direction, and act accordingly.
- Be proactive.
There’s a misconception that KAM is a more ‘reactive’ style of selling. This attitude can not only cost us valuable opportunities existing within those key accounts; it can prove hugely damaging to the long-term relationship.
Don’t wait for the customer to come to you. Keep them engaged and updated about your products and services; check-in regularly and actively invest in the relationship. Touchpoints allow you to identify opportunity and continue to deliver value, ensuring you remain relevant and front-of-mind.
- Be consultative
The very nature of sales is changing, and this is clear most of all in KAM.
You step into the role of business consultant: supporting your customer to identify opportunity or risk, to analyse situations, collaborating to find solutions and partnering them in developing and executing solutions. You need to be results-orientated, focused on delivering on the customer’s goals; an advocate for your account, coordinating whatever needs to be done to achieve those desired outcomes.
- Follow through
During the sales process, promises were made. It’s the role of the Account Manager to follow through – and to do it right.
When you commit something to the customer, follow through and deliver. This counts for the small things too: call when you say you will, turn up for that check-in meeting, don’t reschedule. Reliability, transparency and dependability will build trust, protecting the longevity of your relationship.
- Go the extra mile
Don’t just meet expectations. Exceed them.
With KAM, it’s always better to under-promise, and over-deliver. Be realistic with what you can do for your customer, strive to go above and beyond, and own that responsibility. YOU are the differentiating factor here: the one shaping that customer experience, the one who can make the difference to how that customer perceive your company brand, product, and service. Strive to never give less than 100%.
Maximising the value of your key accounts
KAM is an investment.
It requires significant time, energy, effort and focus. It can also be risky: you’re putting all your eggs in one basket, and selecting the wrong accounts for focus can prove costly.
However, the pay-offs to be gained from successful long-term relationships over the entire lifecycle of an account are tremendous. Executed correctly, key account management can deliver dramatic results for you and your business.