Key Account ManagementPresentation Question: 12Selling Strategies and Practices

Presented by : Karl Campbell

OverviewObjectivesDefinitionBasic Elements of Key Account

ManagementNature of the JobNature of the Selling taskSkills and CompetencesLevel of QualificationConclusionReferencesSummary of ArticleArticle Review

ObjectivesDefine key termsIdentify elements of KAMTo explain and increase awareness of

what key account isIdentify the skills required for Key

account managementMake aware the nature of the job of

key account managerDistinguish between key account

management and sales engineers

Definitions

What is a Key Account?◦“A customer in a business to business

market identified by a selling company as being of strategic importance” (Millman&Wilson, 1995)

Any customer that is considered prestige or have a high sales potential

The 20% of a firms customers that provide 80% profits

Definitions cont.What is Key Account management?

◦The management approach adopted by selling companies aimed at building a portfolio of loyal key accounts by offering them, on a continuing basis, a product/service package tailored to their individual needs. (McDonald et al.,2000)

Key account management is about managing the future (Cheverton, 2001)

A Key Account

Basic elements of KAMIdentify key accountsAnalyze key accountsSelecting suitable relationship

strategies for themContinuously develop operational

level capabilities to enhance the relationship

Nature of the JobThey are tasked with making the clients

happy by providing good quality service◦Eg. For a company providing services like

telephones, communications or even supplies all their printing requirements and needs. The key account manager has to ensure that his company provides up to scratch and functional hardware

Become PR agents to gather informationBecome a “Charmer”

◦Charm your way through your contacts so that you don’t get easily dislodged by your competitors

Nature of the Job cont.Be very close to contact persons

and decision makers of the accounts you are assigned.◦Knowing their birthdays and

anniversaries if possible, and recognizing those dates.

Nature of the Selling TaskKey accounts must be treated

better than the average Skew allocations of resources

more to key accountsHave to ensure quality and

individual service every timeNeed to be successful at their

task or else lose a portion of profits

Skills and Competences of KAM

Strong communications skillsExcellent selling skillsAbility to motivate and leadGood negotiation and customer

service skillsAnalytical skillsIntrapreneurial abilityGood presentation skillsGood understanding of the industryGood organization skills (Royds,

Muchira)

Level of Qualification• Associate's degree or a bachelor's

degree Business Administration or Bachelor of

Arts

• Sometimes have a Master's of Business Administration

• Most employers prefer candidates with three to five years experience in a business-related position.

ConclusionA key account manager handles

the most important accounts in an organization. These are considered important because of their profitability and strategic significance. You have to possess several skills and competences to perform the job of a key account manager and have a certain level of qualification to hold the position.

ReferencesCheverton, P.(2001) Strategic Customer Alliances.

London: Pitman.McDonald et al. (2000) Key Customers. How to

Manage them properly. OxfordMillman, T. & Wilson, K.(1995) From Key Account

Selling to Key AccountManagement. Journal of Marketing Practice

Royds, T. (2007) Key Account Management: The role of the Sales Manager

Muchira, M.( n.d) Job Description for Key Account Manager retrived from

http://www.ehow.com/about_6576220_job-description-key-account- manager.

Fulcher, L.(2010) Why Key Account Management and Recession were made for each other

Article Summary : Why key account management and Recession were made for each other

According to Laura Fulcher a key account is not just the biggest account but should also be the one with the most potential. She stated it was obvious that it was harder to find a customer than to keep one, and what is much less understood is the difference between active customer account management and just ‘looking after your customer’. One of the first myths when talking about key account management is the Hunter/Farmer paradigm which means that getting new business focused around new customers and all that is required for the existing ones is effective farming. She highlighted that a tool used to expose this approach is wallet share analysis which is how we establish the difference between what customers spend with us as opposed to the completion and in getting sales people to think this way converts from the need for farming to hunting within the account.

Evidence according to the writer shows that as times get difficult buyers become more hesitant, that is staying with what they know which makes it harder to gain new business. However if sales people have a key account approach to their most prestige customers the potential for increased sales is considerable. The word potential is important in that a large, low potential account requires very different management than one of high potential.

Article ReviewThe article:

◦Defined who a key account is◦Identified the need for a key account

approach in sales◦Briefly identified the relationship

between economy and buying behavior◦Concisely explained the concept of

potential as it relates to a sales accountThe article confirmed prior

definitions of key account and its importance to sales people/businesses and has further cemented this to knowledge