So why is key account management important?
Let me count the ways. Actually, you know what?
Let us count the ways.
So why don't we do it together?
Welcome back, Heroes, it's Warwick here,
founder at Account Manager Tips, host of The KAM Club and on a mission
to help busy key account managers get results.
So you won a big client. Congratulations.
But now what?
I mean, if you don't have a key account management strategy in place,
you could be leaving money on the table or leaving your client at risk of defection.
And we don't want that.
Existing business is way cheaper and way more profitable than new business.
That is a fact.
But (and it's a big but) account growth,
renewals and advocacy are very difficult for indirect suppliers to achieve because
procurement is focused on spend management.
Key account management to the rescue.
So why don't we start with what is key account management?
I like to say key account management is
simply optimising the partnership between you and your clients.
But if you want a specific,
detailed definition, then this one from Gartner says it all.
Key Account Management, which is also known as KAM,
is the process of planning and managing a mutually beneficial partnership between
an organisation and its most important customers.
Key accounts are significant to an organisation's sustainable long term
growth and require a substantial investment of both time and resources.
The benefits of key account management.
Let's get into them. Key Account Management is a critical step
on the path to differentiation, optimising business results.
Now, look, I know I said that already,
but it's worth repeating - and securing revenue.
Strategy. Understanding the relationship between
objectives, capabilities and change to represent the customer's voice
and the organisation's viewpoint and to identify long term beneficial goals.
Innovation.
Key account management helps to evaluate clients goals and requirements to create
solutions that increase account switching costs.
The more your client relies on you,
you know, the tougher it's going to be for them to change suppliers.
Business growth.
Show me the money.
Capture more spend away from suppliers,
expand to new divisions, parent companies, sister companies.
Upsell or cross-sell opportunities,
you know, through larger network of client contacts.
Now cost reduction.
Reducing the cost to serve clients through efficiency, economies of scale,
process development, supply chain management,
avoiding formal tenders, improve forecasting and value exchange.
I mean, the list goes on.
Diplomacy.
Through key account management you identify and connect with decision-makers,
budget holders and you manage complex relationship networks.
Key Account Managers prioritise team alignment to bring clarity to each team
members role in deepening customer engagement and impact.
Change agent.
Pushing clients to greater performance.
Through key account management you launch, implement and monitor account plans
that accelerate business results and client satisfaction.
Customer retention.
Key management is essential to intercept
issues to minimise risk of client defection, sustaining a competitive
advantage to defend clients against competitors, managing capture plans
to avoid RFPs and secure long term client partnerships and loyalty.
Consistency.
Harmonising products, prices and processes across multiple regions or divisions.
Reducing conflict and friction for clients by decreasing complexity and monitoring
and manage performance.
And credibility and trust.
Clients feel secure in their relationships and information sharing and transparency
improve to help everybody make better decisions.
Now, look, the numbers don't lie.
A Gallup poll in 2019 found that when B2B companies implement key account
management, they have higher levels of revenue, profitability and share
of wallet and lower levels of churn so check these numbers out.
50 per cent higher revenue and sales,
34 per cent higher profitability, 55 per cent higher share of wallet,
33 per cent greater likelihood to be the first choice for future business,
63 per cent lower customer attrition and 32 per cent fewer days outstanding.
So what is not to love about key account management?
Key account management shifts clients focus away from cost control
and towards collaboration, away from price towards value.
Through good planning, building influential relationships
and leveraging expertise, key account managers become trusted
advisers to their clients and create mutual growth opportunities.
So what do you got to lose?
If you would like to implement or elevate
key account management in your organisation?
Let's grab a call. We can talk obligation-free.
You can grab time on my calendar at amtip.co/chat.
Let me know in the comments what you think about key account management.
Is it important or you know, not so much? I'd love to hear from you.
That's all heroes. You know where to find me if you need me.
Until next time.