Poor Account Growth

Account growth is your ability to increase share of wallet with existing clients. Acquiring new clients is one thing and retaining them is another. And yet, growing revenue from existing accounts is completely different. If you aren’t able to grow the revenues from existing relationships, you have to question, what are these relationships worth?

Impact on overall company growth

Poor account growth in B2B companies can have a negative impact on overall company growth in several ways:

Revenue loss: If a B2B company is not able to grow its accounts, it will likely experience a decline in revenue. This can be especially detrimental for B2B companies that rely on a small number of large accounts for the majority of their revenue.
Limited market share: Without account growth, a B2B company may find itself losing market share to competitors. This can make it increasingly difficult for the company to compete and grow its business.
Lack of scalability: If a B2B company is not growing its accounts, it may find it difficult to scale its business. This can make it difficult to expand into new markets or develop new products and services.
Difficulty in forecasting: Without steady account growth, it can be difficult for a B2B company to accurately forecast its future revenue and profitability. This can make it difficult to plan for growth and make important business decisions.
Difficulty in retaining clients: When the company is not growing the accounts, it can be difficult for the company to retain its clients. The company will have to put more effort to retain the clients and that will lead to additional cost.

Overall, poor account growth in B2B companies can have a significant impact on the overall growth and success of the company. By implementing customer-centric strategies, B2B companies can work to grow their accounts and ultimately drive sustainable growth for the company.

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Measure of Success of Account Growth

One of the common measures of success for Account growth is revenue growth from existing accounts. But that’s not it.

There are 4 dimensions for B2B Account growth:

Renewal of existing client contracts (revenue assurance)
New Revenue from Cross-sell
New Revenue from Up-sell
New Revenue from account penetration

This can be further broken down by product or service penetration based on potential, cross-selling success, share of business, mining of value added services, service or product or client wise contribution margin.

Other measures that directly demonstrate account growth are the Retention rate and CLV. Retention rate is a percentage of existing customers that continue to do business with a company. A high retention rate indicates that a company is successfully retaining its existing customers and growing its business. Another measure is Customer lifetime value (CLV). It is the total value a customer is expected to bring to a business over their lifetime. It’s an important metric to measure account growth because it shows how much revenue a company can expect to generate from a customer over time.

Short term and Long term Impact of Poor Account Growth

Poor account growth can have both short-term and long-term negative impacts on a B2B company.

In the short-term, poor account growth can lead to a decrease in revenue, which can cause financial strain on a company. It can also lead to a decrease in customer satisfaction and retention, which can further impact revenue and growth potential.

In the long-term, poor account growth can lead to a decline in market share and competitiveness. It can also lead to a decrease in brand reputation, which can make it more difficult to attract new customers and grow the business. Poor account growth can also make it difficult for a company to scale and expand, which can limit its potential for future growth and success.

Additionally, poor account growth can create a negative spiral where it becomes harder to acquire new clients as the reputation of the company is affected, which in turn leads to more difficulty in retaining and growing existing customers.

Overall, it is important for B2B companies to focus on account growth in order to drive sustainable revenue and growth, and to avoid the negative consequences of poor account growth.

If you are looking for ways to improve your account growth, contact us

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