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Key Account Management

Use this framework to manage customer accounts that are strategically important to the future of your company

One of the first rules you learn in business analysis is the Pareto principle – the 80:20 rule. 80% of your revenue comes from 20% of your customers. These 20% of your customers are well worth looking after. A book by Malcolm McDonald and Beth Rogers – Malcolm McDonald on Key Account Management – provides an effective framework for driving efficient marketing practice within B2B companies.

The term key account implies that a customer is strategically important to a business. This may be because of their size, their profitability and also their future potential. Determining which customers are key accounts is fundamental to this framework. It presupposes that good intelligence exists on customers in terms of the products/services they buy, the revenue this generates, and the profitability or potential they yield.


Identifying which companies should be key accounts is the obvious starting point. It is then necessary to develop meaningful value propositions for each of these accounts. This is achieved by understanding the decision-making teams within the key accounts and what drives their selection of suppliers. This is not easy as the individuals in the decision-making unit of the customer may all have different drivers. It is why an intimate customer relationship is required with these key accounts.


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There will be other customers that do not fit the key account category because of their size and potential. These smaller and major accounts must be serviced in some other way. Those that could grow into key accounts should be groomed while those that want to be serviced as a key accounts but which have no chance of achieving this status must be managed diplomatically. Are they worth holding on to?

In their book, McDonald and Rogers offer good advice on a framework for key account management. They emphasise that it is vital to choose a limited number of key accounts that are strategically important to your business. Then it is necessary to understand the needs of these customers and your ability to meet those needs. From this point you can set objectives and strategies to grow the accounts with a separate plan for each. Relationships are at the heart of delivering great key account services and for this you will need skilled and experienced account managers.

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