Knowing who is your most profitable client, and understanding how to manage your relationship with them, is the main responsibility of a key account manager in Dubai, Riyadh or London.
In fact, the role of a Key Account Manager (or KAM) has become more important as companies spread their business dealings across the globe. The Financial Times defines the role of a Key Account Manager as: “The art of developing long-term relationships with selected customers.”
These selected customers are those that provide your business with the most income, or are strategically important to your company. So maintaining a good working relationship with them means you first have to identify who they are, and then you have to plan how maintain or develop your working relationship.
How to Identify Your Key Customers
You may think you know instinctively who your key accounts are. Yet it is possible that you are focusing on the larger companies you deal with, to the detriment of smaller ones.
Take a step back and look at your sales and where they are being generated. There is a particular rule in business that 80% of business comes from only 20% of your customers. Finding out who belongs in this 20% is essential for identifying your key accounts.
You also have to assess how much effort you put into bigger companies compared to the orders you receive from them.
Once you’ve found this set of customers it’s important to also look for the strategic ones. For example, do you have a small customer who is excellent at referring you to bigger companies? Is your signature product sold in a particularly important boutique?
Understanding the difference between the volume sales, and the strategic sales customer is crucial for the planning stage. When you know who is most important to your business you can begin the next step:
How to Maintain/Develop the Relationship
There are different approaches to planning a relationship with key customers, but the most important action is the actual planning itself. Managing a customer on the fly is highly inefficient and at one extreme may lead you to lose the customer completely. Firstly you need to sit back and create short term, medium term and long term plans for each of your key accounts.
Each of your customers has a very different set of company goals and market challenges. When you have identified these key accounts it’s essential you understand their particular circumstances and how your business can help them achieve them.
Put in place objectives for each customer. Initially you’ll need three: vision, relationship, and business. Your vision is to have an image of the best outcome from your dealings with a business. The relationship objective centres around building a strong relationship where you deliver on time, fix problems quickly, and are there for the customer if they need extra support. The business objective is the solid financial outcome of the business relationship. You want to have a clear (and achievable) sales forecast for this customer.
Although there may be just one KAM for each customer, the planning and implementation needs to be carried out on a wider level. If you want your plans for a key account in Dubai to work holistically with your other key accounts in Abu Dhabi and Jeddah, have a series of planned meetings to form a cohesive overall strategy for your business.