Whose contributions do you celebrate when you hit your business goals?
Sales and Marketing often get all the kudos while the key account managers (KAMs) stand, unrecognized, in the shadows. This isn’t surprising when you consider that historically 44% of businesses focus on customer acquisition while only 18% focus on customer retention.
However, we tend to forget how difficult it would be to achieve our business goals without
KAMs’ behind-the-scenes efforts. This is true because:
- Existing customers represent up to 80% of annual revenue
- Customer acquisition is 5 times more costly than customer retention
- There’s a 60 - 70% chance of selling to an existing client vs 5% - 20% to a new client.
- A 5% increase in customer retention increases profits by as much as 95%.
Without the contributions of your KAMs, your company would likely struggle to achieve sustainable growth. KAMs are the uncelebrated stars that support your business to ensure your company’s long-term success. Let’s consider the unheralded contributions that key account managers make to your organization.
Minimize Churn
KAMs protect your most important customers, those that comprise most of your recurring revenue by delivering value in the form of measurable customer outcomes. This is no easy feat. It means following a consistent, repeatable process, like our KAM Process™ that enables account managers to know their clients deeply, act on their findings to drive their customers’ goals, and measure these achievements.
Without these steps, your account managers are left to their own devices and are less likely to consistently deliver the customer’s desired results for using your product or service. This would put your VIP customers and your revenue base at risk.
Contain Costs
It costs less to retain and grow business in existing accounts than it does to close deals with new customers. It’s also easier to sell new features or products to existing customers and they tend to spend more in a shorter timeframe.
If KAMs weren’t keeping churn to a minimum by protecting top accounts, your customer acquisition costs would eat away at your profits, making it more challenging to achieve consistent year-over-year growth.
Create Efficient Growth
KAMs’ deep knowledge of their accounts enables them to continually recognize new and evolving customer needs, challenges, and goals that your product or service can address. This allows them to cross-sell and upsell into existing accounts, expanding the current business with a client while driving additional measurable outcomes for these customers.
This not only helps grow your business and achieve your business goals, but it also helps clients meet their business goals and retain existing customers.
Develop Long-term Loyalty
Successful account managers become Trusted Advisors to VIP clients by getting to know them deeply, so they understand their needs, concerns, and challenges. This allows them to be a valued resource for these customers to proactively recognize evolving requirements and identify ways to help them overcome obstacles to achieving success. This level of customer centricity protects and grows the business and builds long-term customer loyalty.
Generate Referrals
Loyal customers are an excellent referral source. 88% of survey participants trust recommendations from people they know, according to Nielson. This high level of trust shortens the sales cycle and costs associated with new customer acquisition of what is likely to be another foundational VIP client that boosts revenue and growth.
Gather Product Development Insights
Effective KAMs consistently conduct voice of customer (VOC) interviews to gather insights, input, and feedback from their customers. This lets them glean valuable product feedback and development input from VIP clients. These insights enable the product team to address issues, improve the product, and prioritize new features.
Support Marketing
As KAMs work closely with clients to achieve measurable outcomes they are in a position to easily identify use cases, success stories, and educational content ideas and sources. This allows them to support marketing by sharing these insights and marketing opportunities to drive efficient and effective results.
Provide Pricing Insights
As KAMs negotiate contract renewals and communicate with VIP clients, they receive valuable pricing feedback and competitive information. This enables you to implement a well-informed and competitive pricing strategy based on market trends and customer input.
Celebrate KAM Contributions
Account managers are often underrated, underappreciated, and undervalued. It’s time to acknowledge their involvement in your company’s ability to sustain consistent year-over-year growth, especially during challenging economic times. Without their support, you’d likely struggle to achieve the same level of business success.
Looking for ways to develop and reward your KAMs? Register for KAMCon, our key account management conference, at super early-bird rates through December 31st.
