Navigating the current business landscape is challenging for your company and clients. Various factors can lead to clients becoming at risk. With the appropriate framework and tools, your account management team has the power to transform at-risk clients into loyal advocates.
What is an "At-Risk Account"?
It's common to associate the term "At-Risk" with unsatisfied clients. While client dissatisfaction is a significant factor leading to client loss, an at-risk account includes any client with a potential for losing the business. The risk can stem from various factors, some of which are under the control of account managers, while others are not.
The Importance of At-Risk Account Management
Regardless, Account Managers must know how to identify, mitigate and manage at-risk clients to:
Allow for budget management or adjustment.
Take a proactive approach, minimising the likelihood of issues escalating and allowing time for targeted strategies to be implemented to resolve issues, improve the client relationship and build client trust and satisfaction.
Safeguard the company's reputation and credibility by demonstrating a commitment to customer satisfaction.
Factors Contributing to At-Risk Accounts
Several factors can contribute to an account becoming at risk, and internal challenges or external market dynamics can drive these. Understanding and categorising these factors can help businesses develop targeted strategies to mitigate risks and preserve client relationships effectively.
Internal Factors | External Factors |
Poor service delivery or inconsistent quality | Changes in regulatory requirements or compliance standards |
Weak client relationships, lack of rapport-building, or insufficient attention to client needs | Rapid technological advancements |
Inappropriate pricing strategies, such as overpricing or underpricing | Intensified competition or the entry of new competitors into the market |
Ineffective account management practices, such as lack of proactive engagement or failure to address client concerns | Unforeseen events such as natural disasters, geopolitical instability, or pandemics |
Failure to innovate or adapt services to evolving client needs and market trends | Client circumstance changes across leadership, structure, or financial challenges |
Regardless of the underlying cause, effectively managing at-risk clients requires three key actions:
Early Identification: to allow for timely intervention and proactive measures to resolve potential issues before they escalate.
Understanding the Root Cause: Look beyond the surface to understand why clients might be considering reducing their business or seeking alternatives.
Strategic Intervention: Matching the right strategy to the root cause is crucial for effective problem-solving.
Key Strategies to Prevent Clients from Becoming At-Risk
Avoiding issues before they arise is better than managing them. Here are steps to keep clients from facing potential problems:
Anticipate Market Trends: Stay informed about industry shifts to advise clients proactively, helping them remain competitive and identifying shifts that may impact their circumstances.
Monitor Client Health: Use client engagement and satisfaction data to identify and address potential issues quickly.
Cultivate Partnerships: Shift from a supplier mindset to a partner approach, deeply engaging with clients' businesses for collaborative problem-solving.
Implement Success Frameworks: Develop a tailored client success plan with clear milestones, ensuring alignment with their goals and proactive adjustments.
Encourage Open Communication: Maintain honest dialogues and establish feedback mechanisms to adjust services and strategies.
The main aim is prevention. When clients become at risk - and some will - quick action and resolution are key, focusing on client success and solid relationships. Understanding your client, market, and business helps you manage all aspects well. A clear process helps account managers deal with at-risk clients efficiently.
Our key account manager training includes this topic in the "Managing Key Accounts" module.
For more information, visit our Account Management training page here or schedule a call to discuss your needs.