I Know Why You’re Here
The account-based model is not the new kid on the block. Account-based marketing (ABM) did it first then target account selling (TAS) branched off of it around mid-2010. It took a while but the concept of TAS has evolved to be the first choice, go-to approach to closing huge deals. You’re probably reading this blog for two reasons.
One, target account selling is hard and you’re looking for actionable solutions to make it easier.
Two, it is expensive and you’re looking for ways to cut costs.
Don’t worry. I got you.
Target Account Selling: Is It The Right Fit?
The reality is that TAS will not fit any business size such as small-midsized businesses (SMBs). TAS is also known as account-based selling which targets large company accounts, unlike lead-based selling which focuses on individual prospects.
TAS is a sales method that requires a lot of manpower and resources which means that SMBs will not give you the return on investment (ROI) you need. Target account selling is the best fit if:
- It has a long sales cycle from 6 months to a year
- Your targets are midsized to large enterprises
- Your average deal size is at least $50,000
- There is access to a huge customer base
- You have identified your Ideal Customer Profile (ICP)
- The product or service is upgradeable
- You have the right type of product
Do these all sound like you? Then you qualify! However, some objections may be lingering in the back of your mind. I’ve found that a lot of the sales guys have a common fear of drying up the enterprise buying pool too quickly, “How are we gonna find more in the most cost-effective way possible?” Will traditional lead-based selling work for enterprises too?
Lead-Based Selling vs Target Account Selling
Let’s look at the key differences in the sales process between the two referenced in the figure above. Lead-based selling maximizes business opportunities by casting a net to pull in as many prospects as they can. Target account selling focuses on accounts that use hyper-personalized campaigns designed for each of them. There are other things they differ in as you can see below.
1. Short Sales Cycle vs Long Sales Cycle
There are at least 10,000 leads and more before they go down a sales funnel. The number goes down after qualifying them. Nonetheless, we’re still looking at a good amount of conversions to go through. Having a shorter sales cycle will allow you to close as many deals as you can. This is what happens in lead-based selling.
Target account selling on the other hand has 5-50 accounts (scalable up to 5,000), identified as highly qualified at the onset. The decision-making process for these accounts is long and complex. Hence, they typically have longer sales cycles.
2. Maximize Small Sales vs Continued Massive Deals
Since lead-based selling happens in small to mid-sized companies, the sales process happens with unconnected individual prospects. As mentioned above, SMBs are numerous and you can maximize these small sales with a shorter sales cycle.
Meanwhile targeted accounts have several connected prospects or decision-makers working in the same organization. Properly aligned, account-based sales & marketing can drive account expansion with existing customers.
The knowledge and intimate familiarity with your clients, their organization, their competition, the industry, pain points, and more, will give them a valuable experience with your product/service. This will ensure that sales can continue with your existing customers and create cross-sell and upsell opportunities.
3. Departmental Silos vs Sales + Marketing Alignment
In a traditional company organization, sales and marketing tend to be on different floors. Marketing handles demand generation, lead generation, and lead nurturing before passing them on to sales. This is the standard workflow between these two departments.
With the rising demand for self-service and where personalization has become the norm, it has become necessary to develop alignment between sales, sales development, marketing, customer success, and account management.
Account-Based Everything comes into play by getting these departments to collaborate more closely together to create the best-personalized buyer’s journey and tailored customer experiences for target accounts.
4. Cost Effective ̶V̶S̶ and Capitalizing
You pay more, you get more. This is why the higher ROI, the higher the expenditures are to obtain great leads and customers. B2B lead generation services and customer acquisition are not cheap. Executives are always in the market for methods to make this cost-effective. The customer acquisition costs (CAC) for target account selling are double the amount that of lead-based selling.
But wait! Don’t let that scare you off! The lifetime value (LTV) that you get in return is significant! You may already be aware that B2B customers almost always stick to a product or service for a long time. This means that if you continue to give them solid reasons to stick with you, they won’t have any reason to switch over to your competition.
Successful companies have capitalized on outsourcing to more experienced and proficient firms as a way to cut costs and leverage their expertise. Firms such as lead generation companies come equipped with their premium tech stack, and even specialists to help train/educate your team should you decide to do it in-house.
5. Satisfied Customer vs Customer Evangelist
Your lead-based clients can be turned into brand advocates depending on the nurturing efforts of your team. Sometimes, they come out of their experience as satisfied customers or they become raving fans.
Targeted accounts are high-potential from the start. Remember that the goal of TAS is to deliver a customized and intimate experience for your prospects. So when you close these accounts, you are not just getting happy customers but the entire organization may become your brand evangelist. Ecstatic customers can help promote your business in ways that feel more authentic and relatable than any marketing campaign ever could.
Finding The Right People For The Job
I listened to a podcast featuring Mario Martinez Jr., CEO, and co-founder of Vengreso, with guest speaker Jaako Paalanen. Something Mario said struck me and I want to share what I took away from this session. I’m going to be paraphrasing but this is what he said at the core:
Everything has gone up in digital format and what we’re looking at is digital pollution. That’s what our buyers are faced with. That’s why personalization is so important. Your customers need and want that human-to-human engagement. But if you want your salespeople to be interesting, you have to teach them to be interested.
Mario Martinez Jr.
When asked what is the starting point for target account selling, a lot of people would reply with, “Create your Ideal Customer Profile!” To be fair, the people who look into TAS already belong to organizations with several employees available to be repositioned as account development representatives (ADR) with years of experience in lead management solutions.
But as Mario would say, buyers want interesting people selling to them. So let’s start with…
Ah, Sales and Marketing. If you belong to one or the other, you know that there’s some unspoken Montague and Capulet tale of two houses thing going on. And that’s because… Marketing will never, one hundred percent, serve Sales needs. Sales would have to do some prospecting of their own if they want to meet the quota. It is often a source of contention: getting qualified leads.
The good news is that the account-based methodology requires the formation of an account team. The entire organization doesn’t have to be involved in this model but it does require selected individuals from different departments to squad up for these accounts.
Here are the roles essential for target account selling:
|VP of Sales||They are not only overseeing account-based campaigns but they are also your brand ambassadors and brand evangelists. Their main focus is, of course, making sure that goals and quotas are met while securing partnerships with high-value stakeholders. This is the guy you want sitting in on critical meetings with decision-makers.|
|Sales Development||SDR/BDR (Sales or Business Development Reps):
Also known as Account Development Reps (ADR). They are in charge of researching accounts, inputting data in CRMs, handling a majority of the outreach campaigns, and establishing the right cadence per account. Sometimes they work closely with the account marketers to test and personalize the messaging that helps build relationships in a multi-threaded approach.
Sales Engineer (optional):
|Closing||Account Sales Executive:
They are always working closely with the sales development team for the entire sales cycle, and they lead the charge on closing deals. The account executive (AE) is the primary contact person of the prospects that evolves as their trusted advisor.
AEs are also considered the account team leaders that ensure that everyone is on the same page regarding account strategies.
|Account-Based Content Management||Marketer:
They create and promote personalized content for each account, and handle all SEO efforts. Marketers act as the tipping point that penetrates the prospect’s awareness. They find ways to expose the problem (pain point) of the reluctant buyer by using muti-touch, multi-channel marketing.
Industry Marketer (optional):
|Account-Based Customer Success||Account Manager:
They will continue to be around for as long as the clients are still using the product or services, and are primarily in charge of onboarding, renewals, and expansion. They work together with the customer support team.
Product Manager (optional):
The Tiger Team
Although TAS is the best fit for enterprise-level businesses, midsized companies are doable IF you have a Tiger Team. These teams are also ideal if you’re testing account-based strategies on smaller accounts.
Think of tiger teams as small and elite strike teams. They are fast, agile, and decisive. They don’t usually wait for verification from stakeholders before they move forward. Members need to be made up of specialists in their field or bring in a third-party subject matter expert if you need a complex problem solved within a limited amount of time.
That is not to say that these teams should exclude stakeholders in the problem-solving process. Keep them in the loop by regularly sending them progress or status reports.
Are you on the same page?
Do you know what a buyer’s journey is like for the buyer? When you and your team do your jobs right, it won’t be like this:
No doubt that in the world of B2B, the transition from awareness to consideration to decision can be long and convoluted. The larger the account, the more people are involved in the purchase decision, and the more entangled it becomes. I know that we’re usually focused on making sure that there is Marketing and Sales alignment on our end. But we also shouldn’t forget that we can help them streamline their buyer’s journey by making sure we’re all going in the same direction. When we do it right, the outcome should be like this:
- Simplicity and expertise in handling target accounts will increase domain visibility and knowledge
- Increased visibility accelerates the identification and development of the stakeholders required
- Successful stakeholder relationships lead to increased alignment between client business goals and the value your products/services deliver
- Beneficial stakeholder relationships and business alignment accelerates revenue growth and opportunities
- Sustained growth is possible with alignment and proven value
For the above to happen, let’s determine the needs and expectations between vendor and customer, and how we should be aligning our expectations.
|Buyer Needs||Category||Seller Needs|
|Leverage national or global presence and spending. Uniform terms of trade. Global reporting to support their purchasing, service, and support needs.||Customer Agreements||Increase loyalty, engagement, retention, renewals, and share of wallet. Access to new business units, geographics, and lines of business.|
|Consistent strategy, product offerings, pricing, proposals, and level of service.||Consistency and Transparency||Worldwide visibility into account needs, activity, and purchasing behaviors.|
|For sales, account management, executive interaction, problem escalation, and service.||Single Focal Point||Improve resource utilization and reduce duplication of sales efforts. Improve partner utilization and engagement.|
|Influence on product offerings, features, and roadmap.||Products||Increase share of customer category spend and breadth of product placement.|
|Leverage sellers’ expertise to improve their customers’ experience and/or increase the efficiency of operations.||Partnership||Preferred supplier status and executive access. Long-term purchasing agreements that lock in revenue and lock out competitors.|
How To Operationalize Your Target Account Selling Program
With the correct planning, processes, and technology, you can help facilitate account growth and increase key account sales. To do that, we should identify the four key functional areas in operationalizing your account-based sales program:
I. Data Visualization
Mapping an account or having a visual representation of the data will reveal how everything integrates. Points of optimization will stick out on where you can do better. The graphs and pie charts you usually see in CRMs for example. Ideal Customer Profiles are also considered data visualizations and the key to an effective account selection procedure. Wanna learn more about how account selection and account profiling works? More details on ABM Best Practices: Selecting and Profiling High-Value Accounts.
II. Organizational Alignment
When you want to be highly effective in TAS, the organization’s commitment must go beyond sales. To start with, there should be an agreement on goals, process metrics, reporting mechanisms, and sale management cadence wherein ABM members are ready to engage and support TAS initiatives. Everyone in the account team should participate in the business or account development planning process and roadmap to ensure that goals are met. Quarterly account reviews should also be included in the management plan.
III. Coordination and Collaboration
As mentioned above, the entire account team and other account development partners must work together to facilitate successful account development plans. And because each plan is highly customized to each account, it is important to identify its components.
|Plan Information||Basic information about the account, the plan, and the account team.||– Account Name
– Account team members
– Change and version control
– Plan time period
|– Account rep|
|Executive Summary||Overview of the account.
Account history and summary of prior interactions.
|– What it does
– Where it’s based
– Install base, current, and past opportunities (won/lost)
– Customer satisfaction scores
|– Company website
– SFA (Sales Force Automation) and financial systems
– Financial reports and filings
|In-depth Account Profile||In-depth profile that provides insight into buying behavior and growth potential.||– Corporate structure
– Financial condition
– General business trends
– Corporate objectives
– Competitive landscape
|– Financial reports
– Investor materials
– 3rd party sources
– Social media
|Buying Center Segmentation||Framework for focusing sales efforts and balancing sales investment with revenue potential.||– For each buying center:
– Revenue potential (low vs. high)
– Relationship status (vendor vs. strategic)
|– Account rep
– Account team
|Value Pyramid||Identify strategic initiatives that lead to growth opportunities.||– Strategic initiatives
– Critical issues and challenges
– Departmental initiatives
– Growth opportunities
|– Financial reports
– 3rd party sources
– Key stakeholders
|Relationship Power Map||Organizational charts that map key contacts, stakeholders, and decision-makers||– Reporting structure
|– Social media
– Account profiling services (e.g. LinkedIn)
|Product Landscape||Account addressable market.||– Installed base
– Current opportunities
– Growth opportunities
|– Account team
– SFA tool
– Financial systems
|Goals and Actions||Goals and actions to be accomplished during the planning period.||– Quantitative objectives
– Qualitative objectives
– Action items
|– Account reps
– Account team
– Sales manager
IV. Metrics designed to track results
The use of data visualization for keeping track of metrics should help identify areas of optimization. However, a lot of the sales metrics are being used to track agent performance and campaign progress, and to use the numbers to refine strategies. However, the account-based model should be more outcome-based because of the higher customer acquisition costs. It’s better to track results for near-term activity, mid-term pipeline output, and long-term impact on revenue growth.
|Near-term metrics: Activity||Mid-term metrics: Output||Long-term metrics: Impact|
|– Account plan created & reviewed internally
– Account plan reviewed with the customer
– Breadth & depth of relationships, number of contacts
– Number of executive interactions
– Progress against account plan milestones
– Number of opportunities identified
|– Increase in the pipeline: new opportunities, cross-sell, upsell
– Offering mix and placement of new products and services
– Competitive wins
– Penetration of new business units
– Renewals vs. targets
|– Retention & renewals
– Average contract value
– Revenue attainment and growth
– Revenue by business unit, geography, or buying center
– Win rate
– Average deal size
– Customer satisfaction, loyalty, and advocacy scores
– Forecast accuracy
Check Your Targets
Before the account selection process can happen, you must understand who your ideal customers are, which accounts are in your market, what your market share is, and how many you can realistically serve. Even before you could create our ICP, you need to define the firmographics of your target accounts and check if they belong to your Total Addressable Market (TAM).
How To Identify The Total Addressable Market
Your TAM is the total of accounts you can sell to at 100% market share. It also helps you narrow down your prospects and even enables you to craft effective go-to-market (GTM) and account targeting strategies for upselling, cross-selling, and account expansion to a new market. You need to ask yourselves the following questions when defining your total addressable market:
- Which industries have we sold into?
- Where is the location of our current and previous customers?
- What is their business size?
- What are the characteristics (firmographics & technographics) of your existing and potential customers?
- How is the market growing?
- Where can we expect the market to grow?
By understanding the attributes based on your answers above and identifying your company’s current market, you should be able to calculate your total addressable market.
Account stakeholders and investors want to know where your company stands and what your goals are, and they’re looking for the numbers to back it up. An accurate TAM measurement will help you and your customers gauge how much of the market you’re able to obtain. A well-formulated TAM also plays a huge role in budget and investment decisions by helping you understand how your strategies will affect your financial results.
We’re Not Done Yet!
My goal in this deconstruction of target account selling is to give you that eureka moment of, “Oh, so this is why.” Whether you’re new to the job or an old player in the sales field, there are moments when we’re so focused on the quota that we forget the fundamentals that make it a successful sales methodology in the first place. Part 1 is written with the hope to offer new insights or help you look at your target account strategies in a new light.
Stick around! In part 2, I will be covering actionable tips and TAS campaigns such as:
- Creating An Account-Based Opportunity Plan
- Account-Based Routing
- How To Leverage Competitive Intelligence
- Building A TAS Outreach Strategy
- Opportunities to Cross-Sell And Upsell
- Why We Should Use AI For Account Sales