From A Gartner Survey
According to an August/September 2021 Gartner survey, 95% of chief sales officers (CSOs) expect a higher growth rate from their organization’s key accounts; however, 58% of B2B sales organizations report they miss achieving quota for key accounts. Of the 69 CSOs surveyed, 85% are prioritizing increased returns on key accounts in 2022.
With this level of attention and investment, CSOs must first focus on defining (and setting strategy around) what key accounts mean to their organization.
“Our research showed 46% of B2B sales organizations have rebuilt their key account programs twice or more in the past seven years due to underperformance,” said Brent Adamson, vice president in the Gartner Sales practice. “This is a trend we’ve seen for nearly 15 years now. This ‘rinse and repeat’ approach to rebuilding key account programs has yet to generate any kind of systemic, predictable improvement.”
“Instead of a sales-centric view, sales organizations need to start focusing on what key accounts mean to their broader organization, and determine what they are willing to invest – with time, resources, and finances – to maintain and grow those accounts,” said Robert Blaisdell, senior director analyst in the Gartner Sales practice.
Gartner research reveals four key areas CSOs and their teams should focus on for key account program success:
- Define what a “key account” means to your organization: CSOs and their teams should establish enterprise-driven key account criteria to identify customers with true growth potential. Focus on being able to articulate the organization’s vision for managing key accounts – the value these accounts bring to the organization and the value the organization brings to them – in a programmatic, enterprise-driven way. The largest accounts are not always the best candidates for key accounts. In fact, Gartner research shows that customers elevated to “key account” status specifically because of their large spend are 51% less likely to increase that spend over time.
- Secure organizational alignment on key account support: Sales leaders must pursue a formal, iterative approach with cross-silo stakeholders to deliver on “enterprise” key accounts. Leading sales organizations assemble early a cross-functional team to redefine key account criteria, identify the resources available, and make final selection of the key accounts. According to Gartner research, key account managers who report a high degree of cross-functional collaboration in their organization see, on average, three times higher levels of spend from their key customers.
- Formalize the boundaries of key account partnerships collaboratively with customers: Sales teams should focus on engaging in bilateral discussions with each key account customer to jointly calibrate partnership potential and organizational compatibility. One leading B2B sales organization did this by right-sizing their partnership investments based on proactive supplier-customer compatibility assessments.
- Avoid overinvesting in underperforming key accounts: Sales organizations must systematically monitor the health of key account relationships and proactively re-tier those accounts for mutual value. Implementing a performance-based key account re-tiering strategy helps the organization stay ahead of issues that erode key account profitability and growth potential.
Gartner for Sales Leaders provides heads of sales and their teams with the insights, advice, and tools they need to address mission-critical priorities amid mounting pressures to drive growth through new and existing customers. To learn more, visit gartner.com.