Whether your organization has a dedicated Account Management team, or your salespeople are in charge of managing their own accounts, it’s important to establish some performance measures focused on account management.
At the end of the day, strategic account management should be all about responsiveness, problem-solving, customer satisfaction, and building long-term relationships that lead to additional revenue. If these areas are well maintained, your team will be able to dig deeper into existing key accounts and maximize the revenue potential that’s there.
Let’s look at the best way to set up KPIs (Key Performance Indicators) for your account managers or sales professionals
Your organization’s account management efforts should be focused on:
- Retaining customers
- Strengthening relationships
- Growing revenue
Keeping these larger goals in mind, you should identify the specific, measurable objectives you want to achieve in each area. Those objectives will help you decide which metrics make the most sense for your team to track.
Setting up goals and metrics will help each team member know where to focus, and they’ll be prepared when it’s time for their performance appraisal.
The Strategic Account Management Training Program will help your salespeople master the art of organizing, managing, and growing their most profitable business accounts. Watch the video below to learn more about the program.
KPI Examples In the 3 Main Focus Areas
According to Gartner Group, 80% of your company’s future revenue will come from just 20% of your existing customers. It’s far more profitable to retain existing customers than to find new ones, so it’s key that your team keep customer satisfaction top of mind.
Performance Indicators for Retaining Customers:
- Retention Rate – Percentage of expiring contract renewals vs dropoffs (for subscription business models)
- Customer Churn Rate – Percentage of customers who cancel their contracts or fail to renew them
- Customer Satisfaction Score – How satisfied customers are with your product or service (you can use client surveys to track this metric)
- Support Requests – Number of calls or emails from customers reporting issues or requesting help
- Support Calls – Number of calls made in response to requests for support
- Support Emails – Number of emails sent in response to requests for support
- Time to Resolution – How long it took to resolve customer support tickets
- Product Engagement – How much customers are using products that can be monitored, such as SaaS software
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In order to recognize new business opportunities—and be seen as strategic advisors when making recommendations—your account managers and sales staff must demonstrate their value to the client.
This requires staying on top of each key account and making sure the customer feels supported and confident in working with your organization.
Performance Indicators for Strengthening Relationships:
- Strategic Calls – Number of calls made to offer best practices, strategic advice, consulting, etc.
- Strategic Emails – Number of emails sent to offer best practices, strategic advice, consulting, etc.
- Referrals – Number of new customers gained via referrals
- Outreach Engagement – The number of times a customer responds to account management outreach, such as calls and emails
In the end, the goal of your account management effort is to increase revenue. For that reason, it’s important to measure growth with key indicators or performance measures.
Performance Indicators for Growing Revenue:
- Customer Upsell Revenue – Revenue obtained via upselling
- Customer Cross-Sell Revenue – Revenue obtained via cross-selling
- Contract Extension Revenue – Revenue gained from contract extensions
UPDATE: KPIs for the Fourth Focus Area During Difficult Times
Since originally publishing this article, salespeople have had to deal with a global pandemic, supply chain disruptions, and record-setting inflation.
Because of this, we feel it’s necessary to track a fourth focus area of performance indicators. We are already discussing this addition in our sales training programs and sales management training.
The Fourth Focus Area: Expanding Relationships
Expanding the number of relationships within an account involves breaking into other divisions and gaining introductions to other stakeholders.
The silver lining of uncertain economic times is they make your customers less likely to seek out new vendors (unless they have a problem) and streamline relationships with existing vendors. Take advantage of this by understanding who you know and don’t know in your accounts.
Performance Indicators for Expanding Relationships:
- Internal Referrals – new contacts in existing accounts
- Opportunities with Internal Referrals – to specifically track revenue from internal referrals
- Contacts in other locations or business divisions
- Any of the “performance indicators for strengthening relationships” for internal referrals
Hunting for new business within an existing account will of course come more naturally to some salespeople than others. The Brooks Group offers sales assessments to help you understand your team’s strengths, so people’s talents can be used most effectively.
Measurement Controls Behavior
Remember, what you measure will steer people’s behavior. If a salesperson knows they’re being measured on upsell revenue, they’ll focus on that. If they know they’re being measured on referral appointments, they’ll focus there instead.
If you focus on more than 5 KPIs your salespeople won’t know where to focus their efforts. So, pick your KPIs very carefully and evaluate them on a quarterly or biannual basis to make sure you’re getting the results you’re looking for.
If your team struggles with asking for internal referrals, then it may be time to reevaluate your sales training programs. The IMPACT Selling System naturally aligns with the buyer’s journey, resulting in great rapport with customers so salespeople can close more deals, more often. Learn more about IMPACT here.
You can use the account management KPIs that make sense for your organization to measure how effective your team is at retaining, growing, and developing long-term relationships with your key clients.
Remember that establishing these measures is just one part of performance management. To set your team up for success, provide them with the training and tools needed to develop their own detailed account plans.
The Brooks Group’s Strategic Account Management training program teaches participants a highly-practical system for developing each of their key accounts in ways that will strengthen the client relationship—and drive additional sales revenue for your company. Learn More.
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