No matter how long you’ve been doing business, everyone is likely familiar with this fundamental truth — your current customers are your most valuable sales opportunities.
The probability of selling to an existing customer is between 60-70%, compared to just 5-20% of selling to a new customer.
So what does this mean for modern business? There is a direct link between the exponential growth of your business and healthy relationships with your clients, and when you can prioritize those key relationships, your bottom line will be impacted positively.
Effective account management relies on technology. We're living and working in a very technical age, and any department or industry that doesn't keep up with trends in tech will be left behind.
B2B companies should consider creating a key account plan in their quest to develop an effective key account management strategy. Without it, account managers can't create the impression they want on their clients and may end up losing them.
What Is A Key Account Plan?
Before you can understand what key account planning is, you need to know your key accounts. Key accounts are the most valuable customers your company has. These are the 20% that are responsible for 80% of your profits. It's not just about direct revenue; these clients refer new prospects to your group and give your credibility on their platforms.
A key account plan is your guiding star to pleasing these prized clients. It is the map that shows where the customer is today, where they want to go in the future, and what you're going to do to get them there. Expertly crafted key account plans are critical functions in any key account management department.
The Key Account Planning Process
For moderate to big projects, it is a process that takes around two hours to create and a month to maintain. The following steps highlight the key account planning process:
- Account overview. This is the first step, and here you get to define important information concerning your client that's relevant to the account plan.
- Objectives. Highlighting objectives provides insight into the wants of your clients and will effectively develop a yardstick that measures your clients' successes and triumphs
- Solution. The customers’ objectives are like questions, with the solutions being the answers. Identify the potential solutions for your clients' wants.
- Action plan. Have a course of action ready and note down the steps it will take to reach your destination, who is responsible for each step, and the timeline for task completion. Make sure to capture all the sub-tasks if the project plan has many moving parts.
- Change management. Here you will need to have the foresight to judge whether the outcome of your action plan is positive or negative. Use Kurt Lewin's Force Field Analysis here.
Sum up any possible positive or negative consequences, with each pro and con having a value assigned to it. If the value is zero or the forces against change are greater than those for change, your plan is likely to fail. If, on the other hand, the forces for change are greater, then the reverse is true.
- Implementation. Here is where you present the final plan to the client. They will need to agree to the aims, action plan, task owners, due dates, the plan's format, how it will be shared, and how often it will be updated.
- Review. You will have to decide how many times to review the overall key account plan. Things change with time, and you will have to be keen and flexible enough to react and adapt to these shifts. Depending on the sheer scale of your plan and project, meetings can be held bi-weekly, monthly, or quarterly.
How Account Planning Affects Your Bottom Line
Key account management does more than just make your clients happy — when done correctly, it drives revenue, builds long-lasting relationships, and creates referrals. Key accounts spend 33% more than the market average, making them an invaluable asset to your revenue-scaling efforts.
In an article published by the Harvard Business Review, it was stated that within a few years of the introduction of key account management programs, customer satisfaction increased by 20%. This loyalty translated into a 15% increase in profits and revenue. What's even more interesting to note is that programs that have been in place for more than five years have double these results.
While a lot of personal time is invested on the key accounts (the 20% group), what happens to the remaining 80% of client accounts? They need attention as well.
To handle all your customers without neglecting any and not overworking your account managers, you need to incorporate new software into your tech stack. Automated processes and systems improve efficiency and ensure that all clients are receiving the attention they deserve.
You will need software that drives organic growth in all accounts and, more importantly, one that provides unmatched insight into key accounts. Kapta has the software to do all this and more.
Its key account management system is reliable and helps you relate to clients better while measuring the stats that matter so that you can act effectively and fast for their benefit.
Upgrade Your Key Account Planning
Today, key account planning faces two major challenges. First, it has to keep up with technological trends that transform the account management departments and strategies. Second, the plan created needs to match the outcomes required by the clients and their businesses.
The overall progress — i.e. the gains, losses, and other revenue metrics measured — need to be considered over a period of time. Both these challenges can be negated with the right toolset.
Kapta has key account management software available to build and sustain relationships with all your core clients. Instead of holding account planning strategy meetings every year or ignoring them altogether, invest in tools that make your work easier and better.