Using an Account Based Approach To Accelerate Growth
Content is no longer king - context is. Today B2B companies must interact with their prospects on a more personalized level, delivering messaging, content and insights that are both highly relevant and valuable. Traditional demand generation does not support this approach, because it targets a large audience, using less personalized messaging and content.
The thought is that demand generation, which uses more generalized messaging and content to target a wide range of potential customers, will build a level of awareness across a far broader audience, subsequently generating a higher volume of leads.
However, since demand generation casts a wide net in order to yield a large quantity of leads, quality is not always the main focus. Instead, this approach uses less personalized messaging and content that often times is less relevant.
A lower level of personalization and relevance can have a detrimental effect on the percentage of leads at the top of the funnel that convert to customers. In fact, according to Forrester, 99% of leads produced by traditional demand generation efforts never convert to paying customers.
The key is to strike a balance between quantity and quality.
Account based sales and marketing reverses the traditional concept of demand generation. Its goal is to focus on accounts that represent the best potential fit - prioritizing the quality of leads being generated, not just quantity. Once those right-fit accounts are identified, decision makers are targeted using highly relevant and personalized messaging, content and insights, thus generating higher quality leads and creating a better buyer experience.
A traditional demand generation approach asks which channels should be used to generate the highest volume of leads; an account based approach first asks which accounts represent the best potential fit and have the highest likelihood of becoming customers, then targets accounts that meet that profile.
BENEFITS OF AN ACCOUNT BASED STRATEGY
By taking a more strategic approach and targeting right-fit accounts that have a higher likelihood of becoming customers, account-based sales and marketing drives a higher return on investment than virtually any other sales and marketing approach.
Alterra Group reports that 97% of B2B companies achieved a higher ROI when using account based marketing programs than any other initiative.
An account based strategy drives a higher ROI by:
● Converting a higher percentage of leads to opportunities that close
● Targeting accounts that are a better fit, and therefore have a lower likelihood of churning
● Yielding higher average deal sizes
According to TopoHQ, organizations using an account based strategy have seen an average deal size increase of 171%.
HOW TO IMPLEMENT AN ACCOUNT BASED APPROACH
The process of adopting an account based sales and marketing strategy should be approached in five steps.
1. Lay the Foundation
Laying the right foundation for an account based strategy begins with defining and refining your ideal customer profile.
To do so, take a closer look at your company’s most successful customers, and examine their firmographic data, which could include:
● Number of employees
● Annual revenue
● Industry vertical
● Geographic location
Often times, technographic profiles are important to examine as well. Technographic data encompasses technology used by a company, including:
● Software used to manage specific business processes
● Hardware in use and/or overall technology infrastructure in place
Firmographic and technographic data can be used to deliver highly personalized content and messaging that speaks to the unique characteristics of an organization.
It’s also important to tailor messaging to different decision makers across an organization. For example, a strategic decision maker, i.e. a CXO or VP, makes decisions based on high-level challenges, while a tactical decision maker, such as the head of a department, will make decisions based on his/her department’s specific challenges.
Different types of messaging and content will best speak to each of these decision makers.
Customizing messaging and content shouldn’t stop there. In scenarios where companies across multiple industry verticals are being targeted, the messaging and digital assets used in those engagement efforts should reflect the different challenges and nomenclature of a specific industry vertical.
2. Identify Target Accounts
The next step in building an account based strategy is to identify target accounts. Developing an ideal customer profile, and relying on data collected from examining the profile of successful existing customers, will yield the best target accounts to engage.
As accounts are identified, it is important to categorize them into tiers based upon potential strategic value.
These are the potentially high value, strategic accounts. These accounts will receive the most personalization and the highest level of research prior to engaging. Target ten to 25 tier 1 accounts.
Tier 2 accounts are the most typical, right-fit accounts. These accounts yield middle-of-the-bell-curve revenue and therefore will receive a strong level of research and personalization. Tier 2 should consist of approximately 100 to 2,000 accounts.
Among target accounts, tier 3 represents those with slightly lower revenue potential. These accounts are less strategic, but still fall into the category of right-fit accounts based on the ideal customer profile. These accounts will require personalization at scale. Tier 3 should typically consist of 1,000+ accounts.
Account based sales and marketing has been directly correlated to increasing contract value. In fact, this strategy increases the average contract value of tier 2 accounts by 35-40%, and the contract value of tier 1 accounts by 25-35%.
3. UNDERSTAND THE IMPORTANCE OF DATA
For any account based strategy to succeed, it is vital to have thorough data coverage for the accounts and decision makers being targeted. The ability to achieve a strong level of personalization relies heavily on having a strong level of account and prospect intelligence.
In an environment where there is an increasing number of buyers involved in the decision making process, the need for a personalized buying experience is further magnified. According to CEB, the average size of a decision-making team is 5.4 people. This means different messaging, content and insights are necessary to effectively engage multiple decision makers within a buying group.
To be able to effectively deliver highly relevant and personalized messaging and content for target accounts, you should collect the following types of data:
Firmographics and Technographics:
As previously mentioned, firmographics and technographics include data points such as:
● Number of employees
● Annual revenue
● Geographic location
● Industry vertical
● Age of company
● Software systems in use
● Hardware infrastructure
Unique account characteristics:
What characteristics set an account apart from others? They could be recent growth trends, size and makeup of certain departments, types of customers they serve and even competitors.
A trigger event is something that indicates a potential buying opportunity. Leadership changes, mergers and acquisitions, or a recent funding event are all examples of trigger events. Identifying them requires a constant focus on gathering real-time account and prospect intelligence.
Create a Taxonomy
Creating a taxonomy within your CRM that segments accounts and decision makers by key characteristics enables both effectiveness and efficiency when it comes to delivering personalization.
4. BUILD AN ENGAGEMENT STRATEGY
Once target accounts have been identified and the type of messaging, content and insights to be delivered to each account has been determined, the next step is to decide which channels will be used to engage.
1. Account based sales development: Perhaps the most effective and scalable engagement channel, account based sales development uses one-to-one, highly personalized outreach to target decision makers. Various mediums including direct email, and social selling can be used to support account based sales development efforts.
2. Direct mail: Although widely viewed as a very outdated method of engagement, direct mail still has merit. It not only can provide a very personal touch, but also takes advantage of a channel that is far less crowded.
3. Highly targeted advertising: This strategy targets a specific group of accounts and or decision makers by using persona and role based targeting to serve up highly relevant and personalized ads.
5. DEFINE WHAT SUCCESS LOOKS LIKE
The most obvious measure of the success of an account based sales and marketing program is a strong return on investment and an increase in revenue growth.
Other variables that can be used to measure the success of an account based strategy include:
1. Is there an increase in percentage of opportunities/leads becoming customers?
2. Is there an increase in average deal size?
3. How many qualified opportunities are being generated? When measuring this variable, it’s very important to look not only at the quantity of qualified leads being generated, but also the quality of those leads.
4. Evaluate engagement rate. What percentage of accounts being targeted are responding, viewing content you share with them, spending time on your website and converting to qualified opportunities?
An account based sales and marketing strategy aims to strategically target accounts that will be the best long-term fit. The proof of the success of this approach lies in its ability to drive more predictable long-term revenue growth.
By taking the time to identify the right accounts to target, creating highly personalized messaging and content, and building a thorough account and prospect intelligence, the foundation will be in place to establish a solid account-based sales and marketing program.