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Strategic selling to key customers

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Every sales manager knows that 80% of business comes from 20% of customers... than why is your company not on the right spot... is it so easy to lock-in a customer or to ward-off the competitors …

Every sales manager knows that 80% of business comes from 20% of customers... than why is your company not on the right spot... is it so easy to lock-in a customer or to ward-off the competitors efforts to snatch away your key customers

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  • 1. 1
  • 2. STRATEGIC SELLING – the key account management pathway DR WILFRED MONTEIRO (www.synergymanager.net) India's renowned sales coach and trainer has spearheaded the sales turnaround of several companies afflicted by stagnant sales and erosion of market share. His key account management initiatives have help companies discover new insights and levers for successful implementation DR WILFRED MONTEIRO (www.synergymanager.net) India's renowned sales coach and trainer has spearheaded the sales turnaround of several companies afflicted by stagnant sales and erosion of market share. His key account management initiatives have help companies discover new insights and levers for successful implementation 2
  • 3. 3 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 4. What changes have you seen in the marketing scenario in the last decade?? What changes have you seen in the marketing scenario in the last decade?? 4 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 5. “Selling is the highest business purpose of the organization. Selling is no longer a function within the company; it is the SOLE function of the WHOLE company” “Selling is the highest business purpose of the organization. Selling is no longer a function within the company; it is the SOLE function of the WHOLE company” 5 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 6. HOW TO BEGIN • Key account management (KAM) is essentially the focusing of a supplier company's sales, marketing and service resources, through a select global team, on key customers. • Such customers are deemed vital to the supplier's future because of their potential large volume purchases through an extended time. • Key account management is a strategic sales/support tool that facilitates the development of an effective, long-term customer relationship or strategic partnership • Key account management (KAM) is essentially the focusing of a supplier company's sales, marketing and service resources, through a select global team, on key customers. • Such customers are deemed vital to the supplier's future because of their potential large volume purchases through an extended time. • Key account management is a strategic sales/support tool that facilitates the development of an effective, long-term customer relationship or strategic partnership (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net 6
  • 7. HOW TO BEGIN • You can effectively grow your business "garden" when you know where to prune the bushes and trees that represent your customers. • By cutting or clipping here and there, and being deliberate about removing any unprofitable customers, or ones that are draining your company’s resources, you have a greater chance of surviving and even thriving in today’s ever complex and more demanding marketplace. • You can effectively grow your business "garden" when you know where to prune the bushes and trees that represent your customers. • By cutting or clipping here and there, and being deliberate about removing any unprofitable customers, or ones that are draining your company’s resources, you have a greater chance of surviving and even thriving in today’s ever complex and more demanding marketplace. (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net 7
  • 8. Key Account Based Selling - Advantages KAM can deliver the following benefits : • Increase sales effectiveness by pursuing high potential accounts and opportunities • Increase market share and revenue within existing accounts • Increase profitability through development of the appropriate product & service offering for the customer. • Provide opportunities to contribute to the success of the customer • Improve customer retention through stronger relationships and increased client satisfaction • Facilitate the allocation of marketing and sales resources • Increase sales effectiveness by pursuing high potential accounts and opportunities • Increase market share and revenue within existing accounts • Increase profitability through development of the appropriate product & service offering for the customer. • Provide opportunities to contribute to the success of the customer • Improve customer retention through stronger relationships and increased client satisfaction • Facilitate the allocation of marketing and sales resources 8(c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 9. Why Customers are more Profitable over Time! Profit from Price Premium Profit from Referrals Profit from Reduced Operating Cost Co. Profit (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net 1 2 3 4 5 6 70 Profit from Reduced Operating Cost Profit from Increased Purchases & Higher Balances Base Profit Co. Profit Year Custo mer Acquis ition Cost 9
  • 10. KAM- the STEPS of strategic selling • Establishing a full understanding of the customer - This includes size, success, vision of the future, corporate personality, culture and needs. • Developing a detailed knowledge base, fab by fab, throughout the world - The team must collect information on the installed base of the supplier's products and that of key competitors to understand the supplier's competitive position. • Developing a broad strategic plan- Building a significant position within a customer takes time, tenacity, and consistency in movement toward objectives. • Establishing a full understanding of the customer - This includes size, success, vision of the future, corporate personality, culture and needs. • Developing a detailed knowledge base, fab by fab, throughout the world - The team must collect information on the installed base of the supplier's products and that of key competitors to understand the supplier's competitive position. • Developing a broad strategic plan- Building a significant position within a customer takes time, tenacity, and consistency in movement toward objectives. 10 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 11. What are the challenges in the business scenario? What are the challenges in the business scenario? 11 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 12. Synergistic KAM/Integrated Strategic intent of seller Partnership KAM/ Interdependent KAM relational development model Strategic intent of seller Pre KAM/ Exploratory Early KAM/Basic Mid KAM/Cooperative Strategic intent of buyer 12 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 13. Needs of a strategic customer ? - Needs are based on the type of strategic customer being targeted. - Classic sales applies: known needs, unknown needs, competitive driven needs, personal needs etc. - Vertical and/or industry knowledge is a must. - Competitive knowledge can highlight deficiencies in existing solutions - Good understanding of metrics that present value to the customer. The goal of any Key Account Manager is to develop an understanding of the needs of the strategic customer being targeted, and develop an ongoing rolling strategy to acquire an expertise that demonstrates this. - Needs are based on the type of strategic customer being targeted. - Classic sales applies: known needs, unknown needs, competitive driven needs, personal needs etc. - Vertical and/or industry knowledge is a must. - Competitive knowledge can highlight deficiencies in existing solutions - Good understanding of metrics that present value to the customer. The goal of any Key Account Manager is to develop an understanding of the needs of the strategic customer being targeted, and develop an ongoing rolling strategy to acquire an expertise that demonstrates this. 13 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 14. What is the special offer ? - Each strategic customer is likely to consider ‘offers’ differently. - The ‘special offer’ can only be something the customer values. - The ‘special offer’ may generate revenue – or not e.g. 24/7 support. - The ‘special offer’ needs continual re-assessment to determine its continued value to the strategic customer. Pavlov effect. - The special offer can be both specific to an individual or generic to the organisation. -There may be multiple ‘special offers’ that are applied to any one strategic account to meet multiple objectives – subject to time, resource and money available. The goal of any Key Account Manager is to understand and develop a ‘special offer’ that appeals to the strategic customer. - Each strategic customer is likely to consider ‘offers’ differently. - The ‘special offer’ can only be something the customer values. - The ‘special offer’ may generate revenue – or not e.g. 24/7 support. - The ‘special offer’ needs continual re-assessment to determine its continued value to the strategic customer. Pavlov effect. - The special offer can be both specific to an individual or generic to the organisation. 14 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 15. What is the differential advantage ? - You can’t differentiate unless you understand your competition. - You can’t differentiate unless you understand the customers vertical or market and associated challenges. - An advantage is only a differential one if the strategic customer perceives and accepts it to be such. - Existing references or repeated solutions are often the easiest way to differentiate a solution from the competition. - Good Key Account Management can be a differential advantage. - The goal of any Key Account Manager is to learn, understand and exploit the differential advantages at the beginning of a sales cycle as well as re-enforcing them post sale . - You can’t differentiate unless you understand your competition. - You can’t differentiate unless you understand the customers vertical or market and associated challenges. - An advantage is only a differential one if the strategic customer perceives and accepts it to be such. - Existing references or repeated solutions are often the easiest way to differentiate a solution from the competition. - Good Key Account Management can be a differential advantage. - The goal of any Key Account Manager is to learn, understand and exploit the differential advantages at the beginning of a sales cycle as well as re-enforcing them post sale . 15 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 16. Plan to do things differently The biggest practical problem is routine, leading to removal of pro active approach. - Identify where value creation can exist. - Plan for account growth. - Focused / account specific strategy for each of the key accounts. Plan to do things differently The biggest practical problem is routine, leading to removal of pro active approach. - Identify where value creation can exist. - Plan for account growth. - Focused / account specific strategy for each of the key accounts. How competitive are you in meeting the needs of your key accounts? 16 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 17. The ‘problem solving’ approach to KAM - Problems are good ! Problems require solutions. - Solutions require software and services = money ! - Problems give us the chance to re-enforce cognitive consonance. - Problems allow us to take them from Sad, Mad or Scared back to ‘Glad’. - Customers will spend money to get back to ‘Glad’. - Solved problems invite confirmation of the strategic relationships worth. The goal of any Key Account Manager is to keep customers feeling ‘glad’ about their relationship including any purchase(s) by identifying and solving past, current and future problems. - Problems are good ! Problems require solutions. - Solutions require software and services = money ! - Problems give us the chance to re-enforce cognitive consonance. - Problems allow us to take them from Sad, Mad or Scared back to ‘Glad’. - Customers will spend money to get back to ‘Glad’. - Solved problems invite confirmation of the strategic relationships worth. 17 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 18. Key Account Management - best practice actions Set account objectives Set account objectivesReview account Analyze AccountAnalyze Account  Rank accounts on “Improvement Potential” index  Re-deploy resources to highest potential channels/accounts  Target category management efforts to accounts with “capability”  Understand account requirements/ needs/ capabilities  Plan account actions to “fix” problem P&L line items  Target account goals/ accountability for profit improvement  Match strategy to “improvement” potential  Tie account team incentives to customer metrics  Reflect “balanced scorecard” in account metrics Set account objectives Set account objectives Plan account strategy Plan account strategy Take planned action Take planned action Review accountReview account  Understand account requirements/ needs/ capabilities  Plan account actions to “fix” problem P&L line items  Target account goals/ accountability for profit improvement  Match strategy to “improvement” potential  Include customer in account planning process  Develop both internal and customer targets  Tie actions/events to improvement opportunities  Monitor performance against tactical plan  Hold account team members accountable 18 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 19. Key Account Management Process • Stakeholder identification and mapping • Identify key decision- maker / influencer needs • Understand competitor landscape • Develop SoWOT analyses • Summarise customer insights Key account identification & prioritisation Understand needs and develop customer insights Review and communicate results • Stakeholder identification and mapping • Identify key decision- maker / influencer needs • Understand competitor landscape • Develop SoWOT analyses • Summarise customer insights Form the Virtual Account Team Develop the Joint Key Account Strategic Plan Communicate and implement the Joint Plan 19 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 20. "The Seven Keys to Managing Strategic Accounts" Let's take a look at what are the aspects that experts recommends as optimal key account behaviour: - Learn how to meet and interact with your customers' top decision makers. - Never take your competitors for granted: they'll usually surprise you. - Set realistic goals, and be prepared for the stress of last-minute problems or changes that will come with no warning. - Get to work before everybody else does. - Know your customers' needs and concerns intimately. - Help customers even in areas unrelated to your product or service. - Only bend the rules when it's necessary to service the customer. - Remember that competitors may sometimes offer better service. - Make sure your customers know when a problem has been solved and that they know you know. "The Seven Keys to Managing Strategic Accounts" Let's take a look at what are the aspects that experts recommends as optimal key account behaviour: - Learn how to meet and interact with your customers' top decision makers. - Never take your competitors for granted: they'll usually surprise you. - Set realistic goals, and be prepared for the stress of last-minute problems or changes that will come with no warning. - Get to work before everybody else does. - Know your customers' needs and concerns intimately. - Help customers even in areas unrelated to your product or service. - Only bend the rules when it's necessary to service the customer. - Remember that competitors may sometimes offer better service. - Make sure your customers know when a problem has been solved and that they know you know. 20 (c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 21. CAMPAIGN PLANNING QUESTIONS • How many times have you heard: • "You've got to drop your price by 10% or we will have no choice but to go with your competition." • "You will have to make an exception to your policy if you want our business." • "I know that you have good quality and service, but so do your competitors. What we need to focus on here is your pricing." • "I agree that those special services you keep bringing up would be nice, but we simply don't have the funds to purchase them. Could you include them at no additional cost?" • How many times have you heard: • "You've got to drop your price by 10% or we will have no choice but to go with your competition." • "You will have to make an exception to your policy if you want our business." • "I know that you have good quality and service, but so do your competitors. What we need to focus on here is your pricing." • "I agree that those special services you keep bringing up would be nice, but we simply don't have the funds to purchase them. Could you include them at no additional cost?" 21(c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 22. CAMPAIGN PLANNING QUESTIONS • What is the prospect's current situation? Ask this question to give yourself the lay of the land. Often your goals for the client, the value your services can offer the client, and your action planning for the rest of the sales call come out of your detailed knowledge of the prospect's situation. • What is the prospect's current situation? Ask this question to give yourself the lay of the land. Often your goals for the client, the value your services can offer the client, and your action planning for the rest of the sales call come out of your detailed knowledge of the prospect's situation. 22(c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 23. CAMPAIGN PLANNING QUESTIONS • What are my business development goals for this client or prospective client? • Different goals for your clients will make for very different sales conversations. Questions you can ask yourself will include: – Is this the 'discovery' meeting where we get to know each other and build rapport while learning how I might be able to help them? – Am I reviewing the results from the previous year with a client and this is the meeting where I 'resell' my value so the client stays loyal? – Am I trying to supplant a competitor? – Is this a current client where I work in one of their divisions and I would like to get introductions into the other three divisions where I can also help? • What are my business development goals for this client or prospective client? • Different goals for your clients will make for very different sales conversations. Questions you can ask yourself will include: – Is this the 'discovery' meeting where we get to know each other and build rapport while learning how I might be able to help them? – Am I reviewing the results from the previous year with a client and this is the meeting where I 'resell' my value so the client stays loyal? – Am I trying to supplant a competitor? – Is this a current client where I work in one of their divisions and I would like to get introductions into the other three divisions where I can also help? 23(c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 24. CAMPAIGN PLANNING QUESTIONS • What is my desired next outcome? • Sounds simple enough, but this question is so often overlooked by professionals before they meet with clients or prospects • What is my desired next outcome? • Sounds simple enough, but this question is so often overlooked by professionals before they meet with clients or prospects 24(c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 25. CAMPAIGN PLANNING QUESTIONS • What are my relative strengths? In every sales situation various forces are working in your favor. Know what these forces are for this particular client or prospect situation so you can leverage them to help make the client more successful. This will give you increased odds of winning the client. • What are my relative strengths? In every sales situation various forces are working in your favor. Know what these forces are for this particular client or prospect situation so you can leverage them to help make the client more successful. This will give you increased odds of winning the client. 25(c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 26. CAMPAIGN PLANNING QUESTIONS • What are my relative vulnerabilities? This is the corollary to number four above. Maybe you have less experience than the competition. Maybe another company is the incumbent service provider and you are the challenger. Maybe you are usually at the higher-end of the fee scale. Knowing what your relative vulnerabilities are will allow you to prepare in advance to either turn them into advantages or at least diminish them as vulnerabilities. With good preparation and call planning you can have your responses to 'objections' and tough questions at the ready when you need them. • What are my relative vulnerabilities? This is the corollary to number four above. Maybe you have less experience than the competition. Maybe another company is the incumbent service provider and you are the challenger. Maybe you are usually at the higher-end of the fee scale. Knowing what your relative vulnerabilities are will allow you to prepare in advance to either turn them into advantages or at least diminish them as vulnerabilities. With good preparation and call planning you can have your responses to 'objections' and tough questions at the ready when you need them. 26(c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 27. CAMPAIGN PLANNING QUESTIONS • What actions do I need to take before the next call? We all have to-do lists that help us do what we need to get done. By taking the time to answer questions 1 through 5, your business development and sales call planning to- do list will be as good as it possibly can be because your actions will be: – Informed by the knowledge of your client's situation – Guided by your goals for the client from a business development perspective – Built to help you achieve your desired outcomes – Planned with the knowledge of your relative strengths and vulnerabilities in this particular business development situation • • What actions do I need to take before the next call? We all have to-do lists that help us do what we need to get done. By taking the time to answer questions 1 through 5, your business development and sales call planning to- do list will be as good as it possibly can be because your actions will be: – Informed by the knowledge of your client's situation – Guided by your goals for the client from a business development perspective – Built to help you achieve your desired outcomes – Planned with the knowledge of your relative strengths and vulnerabilities in this particular business development situation • 27(c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 28. Key Account Tactics To Build Into Your Sales Program: Critical elements of the programme include: • Recognising the Challenge: • Planning:. • Communication: • Networking: • Identifying customer need: • Organisational Change: • Delivering: Critical elements of the programme include: • Recognising the Challenge: • Planning:. • Communication: • Networking: • Identifying customer need: • Organisational Change: • Delivering: 28(c) copyright 2010 Dr Wilfred Monteiro www.synergymanager.net
  • 29. If you have any questions at all please do not hesitate to send a note My email address is: wm@synergymanager.net If you have any questions at all please do not hesitate to send a note My email address is: wm@synergymanager.net 29
  • 30. • is a nationally acclaimed stalwart in the field of business management with an illustrious career spanning over 30 years • He is a consultant and advisor to Board of Directors of leading companies & Chambers of Commerce; • a management trainer of high repute who has conducted over 2250 seminars in India and abroad in areas of business strategy, marketing & organization development. • a Visiting Professor to premier management institutes and staff training colleges throughout India. Dr WILFRED MONTEIRO • is a nationally acclaimed stalwart in the field of business management with an illustrious career spanning over 30 years • He is a consultant and advisor to Board of Directors of leading companies & Chambers of Commerce; • a management trainer of high repute who has conducted over 2250 seminars in India and abroad in areas of business strategy, marketing & organization development. • a Visiting Professor to premier management institutes and staff training colleges throughout India. 30 website: www.synergymanager.net
  • 31. – http://wilfredmonteiro.blogspot.in/ – http://negotiating-wizard.blogspot.in – http://salescoach-india.blogspot.in – http://the-sales-champ.blogspot.in – http://salesforce-excellence.blogspot.in – http://strategic-selling.blogspot.in – http://hrm-excellence.blogspot.in – http://personal-growth-guru.blogspot.in – http://thegreatmanager.blogspot.in – http://leadership-by-values.blogspot.in – http://therightetiquette.blogspot.in Dr WILFRED MONTEIRO please view the blogspots I have developed for my participant ongoing learning – http://wilfredmonteiro.blogspot.in/ – http://negotiating-wizard.blogspot.in – http://salescoach-india.blogspot.in – http://the-sales-champ.blogspot.in – http://salesforce-excellence.blogspot.in – http://strategic-selling.blogspot.in – http://hrm-excellence.blogspot.in – http://personal-growth-guru.blogspot.in – http://thegreatmanager.blogspot.in – http://leadership-by-values.blogspot.in – http://therightetiquette.blogspot.in 31 website: www.synergymanager.net (c) copyright 2010 Dr Wilfred Monteiro www.synergy manager.net
  • 32. CONTACT US Dr Wilfred Monteiro TELE : 91 22 9819843927 EMAIL: wm@synergymanager.net Website: www.synergymanager.net SYNERGY MANAGEMENT ASSOCIATES sales force development expertise since 1993 SYNERGY MANAGEMENT ASSOCIATES sales force development expertise since 1993 OUR AREAS OF CLIENT SERVICE INCLUDE: • Formulating Sales Strategic Plans • Designing of Sales Systems & Process • Auditing Sales Processes & Practices • Leadership & Salesforce Development • Key Customer-Account Management • Improvising Salesforce Motivation & Engagement • Installing Performance Measurement Systems • Building Customer Centric Organizations

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