Or, the more pertinent question: can we define Key Account Management? We might take it for granted that we know exactly what Key Account Management (KAM) is: it’s looking after large, and important, accounts which are critical for our business isn’t it? But, as I’m about to discuss, it means a lot more than that. In fact it’s a pretty tricky thing to actually pin down.
KAM means far more than just selling products to big customers. It revolves around handling the customers who play a strategic role in the growth of a supplier. It would be easy to assume that these are just the huge accounts. The ones that will bring in the largest profit, but KAM involves a wide range of accounts: big and small, interested and indifferent. The one thing these accounts have in common? They are all critical to the growth of the supplier.
KAM’s core demand has always been to drive never-ending value, but this has become a tough challenge over the years. The way that we measure value has changed dramatically. It’s shifted its focus from short-term cost-optimisation, to a focus on long-term overall value. This fundamental shift has meant that KAM is open to a lot of different interpretations, and it involves a host of different skills.
Just look at people’s profiles on Linkedin. Some Key Account Managers define themselves as more of a General Manager than a salesperson. They have a generalist’s approach to the business, while Key Account Managers in the pharmaceuticals industry tell a different story. Here they act in the capacity of a sales rep who travels around the country visiting doctors, consultants and hospitals in order to sell their products. These two approaches alone highlight that there are completely different understandings of KAM competing against each other. It’s possible to find a wide range of definitions of KAM which cover everything from transactional selling, to Key Partnership Selling.
But there is a common link across these two aspects of KAM: they are focused on the external relationships with buyers. General Manager or Sales Rep, they all revolve around buyer-supplier relationships. Even a Key Account Manager who has more of a sales focus will, at some point down the line, have to begin focusing on maintaining and improving existing relationships as well as capturing new clients, especially since we’ve seen before that it can cost five times as much to capture a new customer than it is to deepen the relationships between existing customers.
So, effective communication is critical to a Key Account Manager. It can transform what is purely seen as a transactional relationship, into a strategic one focused on capturing real value. It can help drive productive collaboration which unlocks innovation and value on both sides of the relationship. Yet, as we’ve discussed before, one of Key Account Managers’ biggest frustrations is lack of regular communication with their customers.
So, if you want to forge deeper and more meaningful relationships. Relationships where you communicate, collaborate and discover rewards for both sides of the relationship, then download the demo below.