The buzzword “account-based” was first seen in the marketing realm as “account-based marketing” or “key account marketing.” What used to be a novel practice, by which just a handful of large B2B companies serviced key accounts, is now a full-fledged movement.
Key players, like Jon Miller (formerly of Marketo, now the CEO and Co-Founder of Engagio), and businesses, like Terminus, Demandbase, and Bizible, are all leading the way toward streamlined and scalable account-based marketing, and increasingly, account-based everything, solutions.
What is Account-Based Marketing?
The idea behind account-based marketing is that there are two different types of accounts—the “whales” and the “minnows.” Whales represent a limited number of accounts that bring in a significant part of your business’s income; the whales are your key accounts. Minnows, on the other hand, are the smaller accounts, which make up the bulk of your business’s transactions.
The difference between these two types of accounts is significant: Whales require targeted sales and personalized approaches, while minnows can be caught with a wider net—general funnel-type activities. Whales give your business large amounts of work and income through limited transactions. Minnows provide through large amounts of transactions. By recognizing the differences in these types of accounts and developing more effective strategies for targeting them, companies are finding greater overall success.
Last year, SiriusDecisions published a “State of Account-Based Marketing Survey,” which found that over 90 percent of marketers recognize the value of account-based marketing (ABM). However, the actual number of companies that have full-fledged ABM programs is only about 20 percent. According to the survey, 60 percent of B2B companies intend to set up an ABM program, but nearly half expressed concern that they couldn’t find the talent for it. (That’s where those key players are coming in.)
But What About Sales?
Most companies acknowledge that account-based marketing increases sales, by disconnecting sales from marketing in large account clients. But what about account-based sales? The line between marketing and sales is, and always has been, foggy. Although business professionals insist the role distinction can and should be made, confusion in the role divisions between the two often leads to squabbling. People are now talking more about account-based sales, also calling this function “account-based sales development” (ABSD).
Sales development teams have traditionally been the people who find leads using telemarketing or other techniques, so the leads can be followed up by outside sales teams who close them. Followers of the ABSD methodology claim that technology has now freed their sales development from massive telephoning and enabled them to focus on special accounts, likely to deliver more results. ABSD campaigns deal with “specifically targeted enterprise accounts.”
The Shift to Account-Based Everything
Despite their success, people are now asking, is the focus on account-based marketing and account-based sales too limiting? At a recent TOPO Sales Summit, keynote speaker Scott Albro said that companies should be investing in a more comprehensive and effective strategy, Account-Based Everything (ABE).
“…what we’re finding is that Account-based marketing is not enough…only touching 13 percent of accounts on their target list….’Account-based Everything’…requires orchestration across Marketing, Sales Development, Sales, Customer Success, and the C-Suite.”
Interdepartmental alignment is crucial to the success of any account-based strategy. The primary driver to shift to an account-based everything model is that ABM or ABSD only address their specific niche in the business, neglecting the importance of other account-based functions. The goal of ABE, then, is really to obliterate distinctions and align account-based strategies to foster a more holistic approach.
TOPO Chief Analyst Craig Rosenberg defines account-based everything as the coordination of personalized marketing, sales development, sales, and customer success efforts. These programs are based on a set of high-value targeted accounts. The programs are intelligence-driven and orchestrated across all the departments to relate to key clients, with the goal of creating “value and personalized buyer experiences.”
As you work to implement your own ABE program, keep in mind these 5 tips for a more successful account-based approach.
Keep The Pareto Principle in Mind.
The Pareto Principle, or the idea that “roughly 80% of the effects come from 20% of the causes,” provides a good base for understanding key account management. In an account-based marketing system, your key accounts produce at least 80% of your income, even though they may be only 20% or less of your total number of accounts. Because of this, focusing on customer success will increase your base income, even if it does not significantly increase your customer base size.
Understand Inbound vs. Outbound Marketing.
Looking for whales is an entirely different process than setting a net for small minnows. Inbound marketing is the process by which companies set large nets to find leads and transmute them into customers. Account-based marketing looks at specific customers and finds ways to hook them. It pays to keep in mind that key account marketing is not interruption marketing; it uses the principles of inbound (providing something of value, creating an incentive to buy) but focuses them through outbound sales techniques and tailors them to individual accounts.
Integrate Technology, Data, and Analytics.
Great key account management requires extensive teamwork and significant data management to provide the best customer experience possible. This is where the minnows vs. whales metaphor breaks down, because a whale is a single creature, but a key account consists of multiple people and multiple relationships, all coming together in one or more business transactions. That is a significant amount of data.
With modern communication management systems, businesses may track their key accounts. Who in your business has talked with whom in the key account, and what did they talk about? Just asking the question gets convoluted, great customer-focused sales teams use modern software systems to ensure that these relationships are managed in clear and concise patterns.
Focus on The Account, Not Just The Person.
As seen above, account management gets more confusing than just traditional sales or even inbound marketing. There are sales people in both organizations, as well as individuals in charge of purchasing, budgeting, and overall decision making (C-suite executives and owners). There are also gate-keepers for each of these individuals.
Great customer success-focused marketing understands this and always focuses back on the question, “What can we do to provide the best service/product to the customer’s organization as a whole?” When you manage communication, integrate information, and report results efficiently and accurately, you provide quality account-focused systems management.
Target Offers to Key Accounts.
In traditional marketing, the offer is designed to grab potential clients and turn them into actual clients. In account-based customer management, an offer is designed to incentivize continued business from a key customer. Rather than creating an offer of “first month free, if you sign up now,” an account-based offer would say, “Our best customers are equipment manufacturers, if you are a qualifying equipment manufacturer, you get your first 3 months free!” Both of these offers are designed to convert sales, but one is focused on a general market, while the other is focused on converting key account prospects into key account customers.
So, Where Does Key Account Management Fit In?
Under the broader umbrella of account-based everything, we find account-based customer success. Once marketing and sales have attracted and landed a whale, it is up to the key account manager to nurture and grow that relationship, which is, arguably, an even more important part of the account-based everything process. The icing on the cake, so to speak.
With an account-based customer success approach, key account managers focus in on understanding and supporting the unique goals of their key customers and developing strategies that allow your business to play an active and critical role in their long and short-term success.
As businesses develop a more account-centric approach to marketing and sales, it is important that they do not ignore the valuable role key account managers play in retaining those high-value customers.
Curious to see how you can take your Key Account Management skills to the next level? Download this helpful ebook on how to create powerful engagement plans for your key accounts or sign up for a demo of Kapta.