1.1 Introduction
‘The total number of B2B sales jobs is more likely to grow than shrink over the next several years. In the modern economy, complexity and uncertainty aren’t going away’, wrote Andris A. Zoltners , PK Sinha and Sally E. Lorimer. 1 That’s a piece of cheerful news, especially as it was cited in the context of relentless automation and artificial intelligence (AI) adoption. But we need to deal with the complexity and uncertainty mentioned. And we need to sell more. In the business-to-business (B2B) space, it is a well-accepted maxim that selling more to existing customers is more profitable than acquiring and selling to new customers. Depending on the source, it is believed that the profit differential between the two options is as much as seven to ten times. Given the enormity of this insight, companies often grapple with how to scale up activities with existing customers significantly and for a long period of time. Unable to implement a robust strategy in that direction, many companies continue to seek out scores of new customers, small and big, in order to fulfill top-line goals . That becomes their Plan A by default. What is a coherent sales approach that can deliver superior outcomes with existing customers? Can companies achieve (or even aim for) 100% share of their customers’ wallets? How could companies build a competitive advantage landscape that is woven around this idea? These are interesting questions for which we seek answers here.
Concepts like customer loyalty, customer delight, customer experience and so on have flowered in the B2C (business-to-consumer) realm in the past years. Their parallel in B2B context is different and often measured in soft and ambiguous terms. What will constitute best practices that lead to a high customer satisfaction leading further to retention and realization of long-term customer value ? This is the premise of this book.
I spent over 20 years in account management and sales leadership in a classic B2B industry (selling fragrances to consumer product companies like P&G , Unilever , Colgate and Johnson & Johnson). With four to five top suppliers in the industry serving almost all key customers, their stranglehold on customers was daunting for a non-player or a fringe player. My former company, although several decades old and somewhat strong in Europe, was trying to enter key Asian markets at that time, India being a prime focus. We had to devise different customer engagement and proximity strategies to overcome the non-incumbency disadvantage. In course of time, we converted it to an advantage. At the end of six years of aggressive deployment of the approach, the company achieved a market share of 18%, the highest by far. (This should be viewed in the context of 3–4% share that the company enjoyed globally.) My subsequent experiences in the company’s global operations as well as after I moved into teaching and consulting, kept my interest in the subject of B2B account management alive. I came across some sterling examples of the powerful ‘account management’ approach as much as blissful ignorance of the tenets. These anecdotal experiences led to further insights that form the backbone of this book on Nuanced Account Management.
As I reflected on my experiences, a few things became clear. Our products were not unique, we had few special technologies, our prices were not cheaper, we were not among the top three players in most of the 70+ markets we operated in and our salesmen profile was about the same as competition, by and large. The natural question (indeed, for many of our competitors ) was ‘where is the competitive advantage ?’ It wasn’t just one thing. What made the difference was the overall account management approach. By shifting the center of gravity to the management of customers in a comprehensive way, we positioned ourselves with a clear point of difference . Customers often gave us a seat in boardroom discussions and shared long-term plans. We fine-tuned the approach with every day, every customer meeting, every success and every failure. The multiple touchpoints that the business inherently offers enriched the cumulative learning that settled into a virtuous pattern. These experiences in account management have driven my interest in the subject to an evangelical degree, manifesting in this book.
As readers would notice in the ensuing chapters, there is no single silver bullet or a ‘eureka’ moment in this. It is a bulwark of several inter-related strategies , tactics and skillsets that account teams and leaders need to consistently deploy in order to realize the outcomes. Once connected, the dots present the holistic picture of account management . Adding continuously to real and perceived value for customers is the hallmark of a top supplier. It is not a quick-fix strategy either. The benefits are long term and so is the labor—it’s long-distance running. Some of the ideas are simple and well known (and yet may not be adopted diligently) while the others are deeper interpretations. For some companies and managers, this book may be a further assurance of their customer intimacy and engagement strategy . For many others, it may prompt a radical shift in approach.
Account management is not new. But the understanding and application are varied. Further, its contours are undergoing vast changes. As customers seek more and more from suppliers and even to the extent of demanding them to be stakeholders , every small step to endear to them is vital. Competition gets bigger and tougher while product and service advantages keep shrinking. A powerful coagulation of account management practice is, thus, an investment toward a higher order competitive advantage , not easy to replicate. The book drives that message, with its over 40 ideas.
It is still mistakenly believed that good account management is all about networking, socializing, personal affinity between the salesperson and the buyer, smart-talking and playing ‘Mandrake’. That is not just mythical but is grossly unfair to the professionalism and caliber of buying teams and their companies. Buying is now a specialist career and the professionals are often trained for relevant skills (just as salesmen are trained to sell). People who are called ‘smart salespeople’ are, in fact, the best practitioners of all the lessons in this book. It may be just that they carry their skillsets without advertising them.
The concepts in this book matter more than ever. We are living through a revolution that brings machines close to human areas of work—driverless cars, robots, process automation , artificial intelligence (AI), technology enablers, internet of things (IoT) and so on. It is tempting to imagine that selling and marketing may be part of the next frontiers. (Some customer relationship management (CRM) systems almost allude to that scenario.) That will not happen. Human touchpoints in business will move into a higher plane where machines cannot substitute. The complexity of the buyer-seller dynamics in B2B will ensure that ‘people’ continue to be the anchor for business success. The World Economic Forum , in its most in-demand professions in 2016,2 lists sales at number four (after nursing, app development and marketing), ahead of many technology jobs. The list is measured based on the gap between supply and demand. While that should be great news, the people (in sales and account management ) will need to upgrade skills, tools, nuanced strategies and competitive ideas to keep and grow the distance. Re-scripting the account management code and bringing it into the spotlight is thus important. The anecdotal references cover many industries that I have been associated with in my work, consulting and project coaching experiences—consumer packaged goods (CPG) fast moving consumer goods (FMCG) ingredients, IT services, banking , medical technologies, market research services and so on.
The basic aspects of selling are not covered in the book. The several ‘golden rules’ expounded as a more nuanced approach envelop the following seven broad categories:
- Tactics and approaches for sales effectiveness
- Strategies for deep customer engagement
- Skillsets and knowledge (of account teams)
- Proactive relationship management
- Organizational and human resource imperatives
- Customer Innovation bias
- Pitfalls to avoid
1.2 Account Management
Account Management refers to the sum of all activities that contribute toward acquiring and servicing a customer in the B2B space aimed at long-term sustenance of business and profitability. It is normally referred to in the context of ‘industrial marketing’ or B2B marketing where the customer is a corporate, institution or a government organization and is not an individual. Account management is equally relevant in product or service industries and in product plus service contexts. It has common codes with ‘sales’, ‘business development ’, ‘customer relationship’ or ‘client servicing’ activities, but there are some crucial differences that necessitate a more nuanced and refined approach from vendors. Some of these differences (including some well-established ones) are captured below:
- 1.The customers are usually repeat buyers and have the potential to buy the same product/service or similar range of products/services again. In some cases, there may be several ...