In today’s B2B environment, it’s become increasingly difficult for your clients to differentiate between similar solutions. According to Forrester’s recent report, the answer to this challenge is to become a more customer-obsessed organization. Doing so increases retention and revenue growth.
Part of becoming more customer-obsessed is staying ahead of churn by identifying at-risk key accounts early so you can course correct and address issues.
It should never be a surprise when a key account chooses to discontinue its relationship with your organization. Although there are circumstances where a top-tier account departure is completely out of your control, most churn is preventable if you identify at-risk accounts early.
Recognizing the signs that key accounts may be at-risk is part of detecting potential churn, but it takes more than knowing these risk factors. That’s why it’s important to implement processes that occur on a routine basis that proactively reveal at-risk accounts that require additional attention to prevent churn.
Signs Your Key Accounts May Be a Churn Risk
Before we look at the ways you can identify at-risk key accounts, let’s review the signs that help you recognize these clients that may be considering ending their business relationship with you.
The signs that key accounts might potentially be at-risk to churn are important to recognize.
These include things like:
- Decreased Engagement: Reduced or discontinued interactions with your business including call, email, meeting, and platform visit frequency, or participation in account planning processes.
- More Negative Feedback: A dramatic increase in support tickets or complaints, or an overall display of general dissatisfaction.
- Slow or Negative Account Growth: Reduced revenue from an account unexpectedly is worth investigating.
- Organizational Changes: Whenever a key contact leaves a customer account or changes positions in the company, or when there are events like mergers and acquisitions or the hiring of new leadership.
- Financial Issues: Difficulties leading to budget cuts, downsizing, or mergers.
- Lack of Product Adoption or Value Realization: Failure to fully adopt your product or service can prevent the account from achieving the outcomes they anticipated when they selected your solution.
- Resistant to Renewal Discussions: An account that’s unwilling to discuss an approaching renewal.
- Reduced Referrals or Advocacy: A decreased number or frequency of referrals, testimonials, or other mutual support from a key account.
It’s important that key account managers (KAMs) recognize at-risk accounts early so they have sufficient time to turn the tide and minimize churn. But knowing the signs and catching them early are two different things. That’s why it’s important to establish processes that will help your account managers see the signs as soon as they arise.
6 Ways to Identify At-Risk Accounts
Some practices that you can implement in your business to identify at-risk accounts early are:
1. Voice of Customer (VOC)
Customer discovery interviews need to happen at all levels within each customer’s organization to get a complete picture. It’s especially important that KAMs are engaging with executive-level contacts to understand meaningful customer goals they wish to achieve. This facilitates alignment with the client and value achievement.
Engagement at this level allows KAMs to keep abreast of changes before they occur to adjust account plans and strategies proactively. Ideally, there should be an ongoing dialogue with all levels of the account. And if the dialogue stops, it’s time to identify the cause so you can determine if the account is at risk.
2. Org Charts
Plotting out an organizational chart for new accounts enables you to understand the client, key relationships, and how they function, but it’s essential to keep it current. Doing so ensures you’re always aware of internal changes within client accounts that could potentially affect their relationship with your business.
This awareness of the internal changes within the account can explain or even help you anticipate changes like reduced referrals or advocacy, decreased engagement, or resistance to renewal discussions.
3. SWOT
Strategically and intentionally considering strengths, weaknesses, opportunities, and threats on a routine basis helps you see the account and business relationship more clearly. It can provide a much deeper understanding of the account’s reality in relation to the market, industry, and your business so you can anticipate potential churn risks.
4. Tracking Metrics
Monitoring key metrics jointly established with the customer to gauge goal progress and achievement, and tracking internal metrics as well, help you understand the status of each account. This data reveals things like lack of product adoption or value realization and enables you to adjust account plans accordingly to turn the tide for the customer.
5. Keeping Current
It’s important to stay abreast of the state of client industries as well as the marketplace, economy, and client-specific news. This gives you a deeper insight into what your customer is experiencing. Then it informs how to best help them navigate the current state and helps you anticipate financial issues or organizational changes before they happen.
6. Internal Review Meetings
Compare notes and observations with other team members during routine internal review meetings. This enables you to have a better picture of what’s happening with each top-tier account and proactively recognize churn-risk signs. Then the entire team can collaboratively confirm the at-risk status and determine next steps to save the account if applicable.
Establish these practices in your business for early at-risk account identification. Then you’ll be able to prepare a plan of action to rectify issues and head off churn before it occurs.
Minimize Churn By Proactively Identifying At-Risk Accounts
Becoming customer-obsessed helps you differentiate yourself from competitors to deliver value more efficiently and effectively to your key accounts. It also helps you recognize the signs of an at-risk account when you see it.
Implementing recurring processes that reveal at-risk signs allows you to identify them early to get ahead of account churn. This enables you to course correct by addressing issues so you can boost retention and increase revenue.
Interested in learning more about key account risk management? Register for our upcoming webinar, Risk Management Strategies for KAM Teams.
