How do you get account managers to gladly work on a weekend to help a client or respond to important emails in the middle of the night? The answer is brash but simple: Get them to work like they own the place by paying them like the company’s life depends on them.
In a way, your company’s life does depend on your account managers because, when you boil it all down, your clients aren’t hiring an agency — they’re hiring the account manager they will be dealing with. Well-compensated AMs will put in the extra yardage needed to deliver their clients a touchdown.
Why do most firms pay their AMs less? I haven’t yet heard a good explanation — it’s simply become the status quo. But if you want to create invested, dedicated AMs — and, therefore, loyal clients — you need to examine the true cost of low wages. Our account managers exert more effort because they feel they’re a key part of a team, and paying them better is one way of letting them know it. But we have found at least a handful of other benefits from providing our AMs with higher compensation:
1. Drawing Talent
Word gets around about how well or poorly a company pays its AMs, and that affects potential employees’ desire to work there. By providing better compensation, a company draws in more talented team members who realize the value of their skill.
2. Increased Retention Rates
Our company has a voluntary turnover rate of zero when it comes to AMs taking off for other agencies. So not only do we draw in good team members, but we also hold on to them.
3. Client Satisfaction
A client doesn’t stick with an agency because of its sales team. Clients stay on because they’re happy with their AM. If our account managers are content, so are the clients they work with.
4. Positive Word of Mouth
If you’re keeping your account managers happy and they’re keeping their clients happy, word will get around. Referrals are key when it comes to building, maintaining, and growing any business.
5. Return on Investment
When it comes right down to it, AMs have a better ROI over the long run than members of the sales team, so they should be paid more.
How should you decide how much to pay your account managers? Compensate AMs based on how much profit they generate from a client. If clients become more profitable because they are expanding services with your firm, your AMs make more. If clients fire your company, the AMs feel it hard, too. Ideally, you should pay your AMs more than your competitors to show you value hiring the best of the best.
In the end, it simply doesn’t make sense to undercompensate your account managers. It reduces your chances of building and retaining a quality team. The level of talent and contentment within your team reflects on the service it will provide, which determines client satisfaction. So provide your AMs with a bit of monetary oomph, and consider it an investment.
Ben Kirshner is the CEO of Elite SEM, an award-winning, fast-growing online marketing agency with a passion for building a team of elite industry experts. Elite SEM was recently named Crain’s New York Business #1 Best Place To Work 2013. Ben is an entrepreneurial thought leader and a SEM expert; he can be found on Twitter or Google+.