What Is Account Management? (With Benefits and Skills)

By Indeed Editorial Team

Published 20 July 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Building and maintaining relationships is essential for a business to be successful. Companies often use account management as an important strategy to build and maintain strong client relationships. Knowing the importance and functions of account management can help your business improve customer satisfaction and generate more revenue. In this article, we will discuss what account management is, how it can benefit a business, what account managers do and what skills you need to become an account manager.

What is account management?

Account management is the daily management of client accounts to ensure they continue to do business with your company. It is an extension of the sales process that begins immediately after a business gets new customers. The purpose is to show clients the value they will enjoy if they continue to use the company's products or services, making it especially important for companies with long customer cycles.

Account managers are responsible for account management functions within various types of organisations. This requires a combined knowledge of sales, customer service and interpersonal relations as well as a detailed understanding of your company's offerings and sales practices. Account managers complete in-depth customer research to best understand clients and their needs to know how to present your products or services as a viable way to resolve their issues. Effective account managers help organisations retain clients, upsell their business, improve customer satisfaction and achieve strategic objectives.

Why is account management important?

Account management helps companies maximise the business opportunities it can derive from loyal customers, improve customer satisfaction and help achieve organisational goals. Some reasons why it is important for organisations include:

  • Establish client expectations. Account management utilises feedback to better understand client expectations and how the organisation and its products or services can serve the clients. Knowing exactly what a customer wants can help you meet their needs, which helps improve customer satisfaction.

  • Get a revenue commitment. Account management may help your organisation secure a revenue commitment from your clients. This helps both you and your clients better plan for expected spending and allows you to tailor your pitch around the products or services the client is more likely to buy.

  • Identify new opportunities. Account managers have valuable insights from their clients' account data or business decisions clients make, such as making new investments or commitments. This helps them identify potential new opportunities for sales or success.

  • Improve performance measurement. Account management often improves organisational performance metrics. Having established client expectations allows the organisation to create standards to best measure how well it meets client expectations.

Benefits of account management

Account management can offer a range of benefits, such as:

  • Improved client loyalty: Account management focuses on building lasting relationships based on trust and value addition. This can help keep profitable customers for the long term because of a preference for reliability, stability and trustworthiness.

  • Improved sales resource allocation: Account management can help you identify which customers are more likely to generate revenues and profits. This helps organisations find their target markets and where to focus their sales efforts.

  • Increased customer satisfaction: Account management uses data from client accounts to ensure products and services meet the needs and expectations of clients. This helps improve the customer experience and avoid client disputes.

  • Increased growth potential: Account management strives to strengthen relations between customers and companies. Nurturing larger accounts helps create loyal customers, providing the organisation with steady long-term revenue streams.

  • Increased referral rates: Account management includes pursuing potential new leads or business opportunities. Your organisation may experience an increase in referrals if your existing customers feel satisfied with your products or services.

What does an account manager do?

Account managers work with clients to ensure they receive the products or services they want at the best price. Most oversee multiple client accounts simultaneously, and they help grow the business with existing clients through customer relations, dispute resolution, upsells and cross-sells and valuable insights about customer buying behaviour. They are essential in gaining the trust of clients and ensuring everyone understands each clients' unique needs.

Account managers are responsible for creating a link between the business and the customer. They identify the short-term and long-term needs of customers to nurture relationships between the organisation and the client. They provide insight to the organisation to ensure it offers products and services that effectively meet the clients' needs and expectations in terms of cost, results and time. Some specific examples of account management responsibilities include:

  • Act as a client's first contact person for the customer's account

  • Advocate for client needs to improve the buying experience

  • Alert sales department about potential business leads

  • Collaborate with marketing and sales departments to develop strategies that meet client expectations

  • Communicate with clients to understand their needs and share details and value of the available products and services

  • Create strategies to meet customer needs

  • Demonstrate an in-depth knowledge of the company and its products and services

  • Develop and maintain long-term relationships with clients based on respect, trust and value

  • Gather, organise, analyse and interpret data to learn more about customer behaviour to influence decision-making

  • Look for cross-selling, renewal and upselling opportunities

  • Maintain accurate notes and inventory records for clients

  • Manage customer accounts, including contract negotiations to meet client expectations and maximise profits

  • Monitor industry trends relevant to the company and its customer satisfaction levels

  • Resolve customer issues promptly to prevent issues from escalating

Related: Customer Satisfaction: How to Measure and Tips for Improvement

What are account management skills?

Being an account manager requires developing specific hard and soft skills. Hard skills, or technical skills, refer to your job-specific skills and abilities. Soft skills, however, relate to your personality, character traits and work ethic or habits. Some examples of account management skills to develop include:

Ability to build and maintain relationships

The ability to build and maintain relationships involves using interpersonal skills to form lasting and productive relationships with clients. Account managers must be able to attract potential clients and build relationships with them. It is also important for them to build lasting relationships with their existing clients and promote their success. They often represent their clients and are the main contact point for clients, so it is essential they know their clients well.

Related: Importance of Soft Skills in the Workplace

Problem-solving skills

Problem-solving skills refer to the ability to analyse a situation and identify potential resolutions. This is an important skill for account managers to have to assist them in developing new strategies for businesses. Account managers are responsible for creating solutions to enhance the success of their company or clients.

Communication skills

Communication skills relate to the ability to share and understand any ideas or information easily, and these skills include both written and verbal communication. It is important for account managers to speak with clients about their needs and goals and recommend strategies. Account managers also need communication skills to create accurate records of their client's accounts.

Read more: Communication Skills: Definitions and Examples

Customer service

Customer service skills include the skills that help you address customer concerns and ensure a positive customer experience. Excellent customer service skills may help you increase your customer satisfaction rates and improve client retention. It is essential for account managers to have strong customer service skills to resolve client issues and maintain good relationships with each customer.

Leadership skills

Leadership skills refer to skills that help you motivate and organise others to achieve a common goal. It is important for account managers to collaborate with others effectively to agree upon what success is. Also, account managers may serve as department leaders and oversee account executives, so it is essential for them to know how to manage and inspire others.

Read more: Leadership Skills: Definitions and Examples

Knowledge of business

Having a knowledge of business and an understanding of best business practices are essential hard skills for account managers. They should understand business trends to make recommendations for businesses. It is also important for them to keep up with the current market to identify new opportunities.

Active listening skills

Active listening skills refer to how well an individual listens to others and processes information. This skill is essential for account managers to enable them to best understand the needs of their clients. Active listening ensures they understand their clients' goals and concerns.

Read more: Active Listening Skills: Definition and Examples

Analytical skills

Analytical skills include the ability to gather, organise and interpret data. Business analysis skills are essential for account managers so they may assess the current status of a company. They may compare the data to industry trends to make the best recommendations to their clients.

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