Rachel Teare, Head of Global ABM & Customer Lifecycle Marketing at Cloud Software Group, shares her approach to selecting target accounts and verticals for ABM and managing expectations between sales and marketing teams.
Choosing the right target accounts is crucial for the success of an Account-Based Marketing program. At xGrowth, we believe this is where half the ABM battle can be won.
As the discipline of Account-Based Marketing evolves, the approach to evaluating customers and creating target account lists has become more sophisticated and complex.
In this article, I will discuss how marketing and sales teams can work together to decide what accounts and industries they should focus on while implementing their Account-Based Marketing campaigns. I will also share powerful learnings from my discussion with Rachel.
Phase 1 - Deciding the Kind of Growth You Want from Your Account-Based Marketing Efforts
As a marketer, you eventually want to drive growth from your efforts. So, before selecting accounts for an effective ABM program, define what growth means.
This requires an agreed-upon definition that the sales team understands and is aligned with. For instance, the marketing and sales team mutually agree upon expanding into existing accounts as growth.
Apart from sales alignment, you also need to be mindful of your organisation's business imperatives.
For example, your company wants to acquire new customers in a specific industry. In this scenario, gearing your Account-Based Marketing efforts towards expanding into existing customers might not get the mileage you need from the leadership, which eventually can dilute your ABM strategy.
Having business and sales alignment while defining growth guides you to take a more strategic view of revenue potential while selecting and scoring accounts.
Phase 2 - Building the Right Team
The next phase is to have the right internal stakeholders involved. They will give you input on the selection process. They will also help check your account scores and metrics, a topic I will cover in the next section. For accounts and vertical selection, you should leverage feedback and input from the following key stakeholders.
1) An ABM Friendly Account Executive (AE) or Sales Representative
An ABM-friendly Account Executive (AE) is a salesperson who is receptive and collaborative when it comes to working with the Account-Based Marketing team. They are also open to incorporating ABM strategies into their account plans.
Sales Reps can provide insights into key accounts and how the complexity of the sales process, in general, can influence which high-value accounts should be selected.
2) Customer Success Teams
If your company employs customer success managers (CSMs), marketers should talk to them to understand more about how your company's brand is perceived in the industry.
CSMs are closer to the clients than anyone else in an organisation. They know the pain points and understand the sales cycle of expanding into existing customer accounts.
The kind of access that CSMs have to high-value target accounts can inform account selection for implementing a successful ABM strategy.
3) Vertical Subject Matter Experts (SMEs)
Having Subject Matter Experts (SMEs) within certain verticals is critical if your company is going for a vertical strategy in account selection. These SMEs understand the domain-specific challenges customers face. These are important to understand since they will indicate what sectors can be best catered to by your product and where you have the highest probability of conversion.
Taking the example of Cloud Software Solutions, their marketing teams have access to field CTOs with specialisations in certain verticals and technical specialists with vertical expertise.
If you don't have an internal SME, consider external options, such as influencers or analyst firms that have the vertical expertise and the Account-Based Marketing tools you need.
Phase 3 - Metrics to Use for Account Scoring
You have your end objective through your definition of growth, and you also have the right team to give you input on the kind of accounts to select.
Now comes the most important piece, data and metrics.
In this section, we’ll discuss what parameters you can use to score accounts on and finalise your target accounts list.
Some of the key ones that we here at xGrowth use and are also used by the marketing team at Cloud Software Group are as follows:
Annual Recurring Revenue (ARR): This is the total revenue generated by a company's subscription-based products or services over a year, considering any cancellations, upgrades or downgrades during that period. An account with a higher ARR will have a higher score and will be prioritised first in your ABM efforts.
Expiring Annual Revenue: This refers to the amount of revenue expected to expire or be up for renewal during a certain period. Understanding this metric helps a company plan its sales and marketing efforts to retain customers and grow revenue.
Size of IT budget: This is the total amount of money allocated by a company for its IT-related expenses, including hardware, software, personnel, and infrastructure. Knowing this metric helps a company identify its customers' spending priorities and target them more effectively.
Share of Wallet: This refers to the percentage of a customer's total spending towards a company's products or services compared to its competitors. Understanding this metric helps a company identify its customers' preferences and areas of potential growth and adjust its Account-Based Marketing strategies accordingly.
Apart from the parameters mentioned above, you should also try to score your prospective and existing customers on things such as level of product penetration, number of sold users of the product, number of active users of the product, overlap of geographic footprint for larger revenue opportunities, partner's presence within the account, future deal landscape, levels of change within the account (external factors), relationship with key decision-makers and the C-suite and buying committee influences.
The idea is to use your team's wisdom to score each of the accounts that are falling into your ideal customer profile on the parameters above and get the specific accounts that are low-hanging fruit and make the most sense to include in your Account-Based Marketing strategy.
At xGrowth, we have created account scoring templates that you can leverage to fine-tune your target audience. You can also refer to some of our Account-Based Marketing examples and case studies to understand more about approaches to creating a robust target account list.
Phase 4 - Continually Improve the Lists and Verticals
Account-Based Marketing is an ongoing, long-term strategy.
So, it should not surprise you when I say selecting accounts is an iterative process that involves continuous refinement and improvement. You don't need to get the perfect account list for your ABM campaigns the first time. The key is focusing on your strengths, understanding the customers' business objectives, and aligning internally on 70-80% of the prospective customers in specific industries you want to go after.
I hope that the above content gives you a solid account selection framework that allows for adjustments and improvements based on data and feedback. If you are looking for Account-Based Marketing resources, check out our resources page here.
For expert help and guidance on how to implement Account-Based Marketing campaigns, reach out to us here.