SA E-magazine (Key) Account Management (UK)

(KEY) ACCOUNT MANAGEMENT (KEY) ACCOUNT MANAGEMENT

Develop long-term, profitable Develop long-term, profitable customer relationships customer relationships

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Introduction

(Key) Account management

Key Account Management (KAM) is a sales strategy aimed at building and maintaining relationships over a long period of time at all levels, both in one's own organization and with selected customers (accounts).

These customers are usually large accounts with great potential for long-term business and require specialized attention and support.

The goal is to create long-term relationships by understanding their unique needs, providing customized solutions, and building strong, mutually beneficial relationships.

The importance of (Key) Account management - 1

Account management is critical for businesses to build and maintain successful and long-term customer relationships. Here are some key reasons why account management is essential:

Customer retention: Account management focuses on retaining existing customers. It is often more cost-effective to retain existing customers than to attract new ones. Effective account management can strengthen customer relationships, improve customer satisfaction, and build customer loyalty, reducing the risk of customer turnover.

Maximizing customer value: Account management helps understand customer needs, goals and challenges. By working closely with customers and providing them with customized solutions and valuable insights, customer value can be maximized. This can lead to greater customer satisfaction, increased customer loyalty and potentially upsell and cross-sell opportunities.

The importance of (Key) Account management - 2

Identify growth opportunities: Account management allows companies to gain in-depth knowledge of their customers and their markets. This knowledge allows account managers to identify growth opportunities, such as new projects, expansion opportunities or partnerships. They can proactively address customer needs and develop strategies to grow customer relationships.

Stakeholder management: In B2B environments, there are often multiple stakeholders involved in a customer relationship. Account management plays a critical role in effectively managing and communicating with these stakeholders, such as decision makers, users and influencers. By building strong relationships and maintaining effective communication channels, account management can increase collaboration and engagement with all relevant parties.

Competitive advantage: Effective account management can provide a competitive advantage. By building close relationships and trust with customers, a company can differentiate itself from competitors. Providing excellent customer service, understanding customer needs and proactively offering solutions can have a positive impact on a company's reputation and image.

Difference between Sales en (key) Account management

SALES

< 1 year

Potential short-term sales

VERSUS

Planning horizon

KEY ACCOUNTMANAGEMENT

1-3 years

Potential revenue and strategic criteria

Achieve own sales targets

Existing products

General - Unique Selling Points

Sales (team)

Primary focus on the deal

One approach per sales opportunity

Goals Proposition

Goals of the account - business goals achieved

Existing products

Tailormade - Unique Buying Reasons

Responsible

Account Manager & Account team

Many - depending on industry

<120

Limited, more on tactical level, purchasing, technical

Strategy

# Customers per sales professional

Strategy is discussed and agreed with account Focus on developing close customer relationship. Overall approach with more sales opportunities

Limited (60-100) including internal relationships

Depending on AM experience, account complexity. geographic spread, customer decision-making process

# of relationships

Large, at all levels of customer organization and in own organization.

Customization is key

By customizing solutions to individual customers, account managers can improve customer satisfaction, loyalty and overall business success.

"Get closer to your customers than ever. So close that you can tell them what they need well before they realise it themselves"

- Steve Jobs

The customer relationship ladder

The terms, "transactional, functional, close and strategic," refer to different levels or phases of customer relationships. These levels describe how a company engages with and delivers value to its customers.

The level of the relationship depends on several factors, such as the nature of the business, the industry, the specific needs of the customer and the account manager's efforts to add value and increase customer satisfaction.

ON THE NEXT PAGE YOU WILL FIND AN EXPLANATION OF EACH LEVEL

Explanation of customer relationship ladder

Transactional relationship: In a transactional relationship, the interaction between the company and the customer is primarily based on a single transaction. The company provides a product or service and the customer pays for it. There is generally little to no further involvement or interaction after the transaction. The goal is to complete as many separate transactions as possible.

Functional relationship: In a functional relationship, the company's involvement with the customer goes beyond the transaction. The company adds value through reliable products, efficient service and good customer support. The goal is to meet the customer's functional needs and create customer satisfaction.

Close relationship: A close relationship goes one step further than just the functional aspects. The company builds a strong emotional bond with the customer through personal interactions, customization, loyalty programs and personalized services. The goal is to increase customer loyalty and build a long-term relationship.

Strategic relationship: A strategic relationship is the highest level of customer relationships. Here the company acts as a strategic partner to the customer. There is close cooperation, trust and interdependence. The company proactively thinks with the client, offers strategic advice and helps the client achieve their business goals. The goal is to create a strategic advantage for both the company and the client.

It is important to note that not all customer relationships will automatically evolve to the highest level.

Customers value Key Account Management to

Focus

Relationship building - attention

Streamlined communication

Expertise and industry knowledge

Proactive support

Problem solving

Value creation

Want to learn more about customer experience? Check out the in-depth module.

Wrap Up

Key Account Management (KAM) is a sales strategy focused on building and maintaining customer relationships over a long period of time at all levels, in both the organization's own and key accounts.

Customization is key and is created by uniquely meeting customer needs. It leads to customer satisfaction, loyalty and improving business success.

To achieve customer development, it is wise to properly analyze customers and create a concrete plan of action on how to achieve revenue growth. In addition, the right sales skills are essential to successfully implement the account plan.