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Position Sales Teams to Grow Accounts, Not Just Retain Them

December 21, 2018

Contributor: Kelly Blum

Sales leaders must reorient account managers toward customer improvement strategies that focus on the future needs of buyers.

Lola, an account manager at a business services provider, repeatedly goes above and beyond for her clients. She expects this extraordinary effort to delight the client so much that they will purchase solutions they’ve never bought before. Unfortunately, this approach takes a significant amount of Lola’s time and doesn’t drive results.

Gartner research finds sales’ teams portfolios have grown 2.3 times on average, but sales organizations see little growth in existing accounts. In a survey of sales leaders, only 28% report that account management channels regularly hit cross-selling objectives. Gartner research reveals that the problem stems from the design of the account manager role and an organization’s overall approach to growth.

“ Customer improvement drives growth because it provides customers with an urgent reason for change”

Typically, in an effort to keep existing customers, account managers prioritize the status quo. Their primary goal is to prevent loss rather than promote growth. Sellers are often goaled on metrics that enable them to opt of the harder task of account growth.

“Of the nearly 700 account managers surveyed, 49% are measured by a single revenue goal that makes no distinction between retention and growth,” says Scott Collins, Vice President, Advisory at Gartner.

Also, Gartner research found that 88% of surveyed account managers conclude that the best way to drive growth is to delight customers with world-class service. But in reality, providing customers with high-quality service and ensuring they receive maximum value from the solution they’ve bought will double their likelihood to renew, but has no measurable impact on driving growth.

“Customer improvement” is the key to account growth and retention

Research shows that B2B buying behaviors are changing and customer improvement is the key element in growing existing accounts. Customer improvement drives growth because it provides customers with an urgent reason for change.

Gartner defines customer improvement as the degree to which account managers provide customers a new perspective on how they might operate their businesses (i.e., new ways to make money, save money, mitigate risk, etc.), a vision forward for their business and the value of a commercial relationship with the supplier. Customer improvement, research shows, can increase the likelihood of growth by 45%.

Customer improvement also has a significant impact on account retention. In fact, above-average performance in customer improvement can increase the likelihood of account retention by 94%.

“A customer improvement approach will counteract competitor efforts, because it provides the incumbent account manager a privileged position and insider knowledge of the account to suggest change and improvement before competitors,” says Collins. The net result is that customer improvement increases the odds of preventing competitor consideration by 32%. That is critical, given customers consider an average of 2.2 suppliers — in addition to the incumbent — during every decision to renew or repurchase.

Sales teams that practice customer improvement deliver future-focused, supplier-neutral messages about how customers can improve their business

Making the shift to a customer improvement approach requires an organizational commitment. Each company will need to determine the best way to incorporate and support account managers in this customer-improvement role, including:

  • Enable sellers to drive growth by providing them with tools and support to make identifying and pursuing improvement opportunities.
  • Measure account health and viability to determine where to direct customer improvement efforts.
  • Structure and staff account teams to drive customer improvement.
  • Consider implementing a customer success function to handle the product and service success aspects of the account manager’s role.

In the end, sales teams that practice customer improvement deliver future-focused, supplier-neutral messages about how customers can improve their business, securing both retention and growth.

This article has been updated from the original, published on April 24, 2018, to reflect new events, conditions or research.

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