Scaling marketing and sales for quick growth can be daunting. Jon Miller explains how he used account-based marketing to speed up sales growth at Marketo.
In 2012, Marketo’s marketing department was generating about 80% of its pipeline and deals using inbound strategies, content marketing and lead nurturing. Then, about a year before their 2013 IPO, the CFO asked Jon Miller, Marketo’s co-founder and head of marketing, what it would take to grow faster. The revenue engine was working, but they couldn’t just write more blog posts and magically generate more pipeline. They had to target larger accounts to achieve the scale they needed, and that was going to take a different approach.
In this podcast, we talk about the problem Jon encountered when trying to rapidly scale sales at Marketo and how he solved it using account-based marketing strategies. We discuss how he:
- Shifted from fishing with nets (inbound marketing) to fishing with spears (account-based marketing and sales).
- Targeted named accounts before they were engaging to help Sales get in the door.
- Nurtured ongoing sales opportunities without stepping on Sales’ toes.
This podcast is all about how to develop and scale an account-based marketing and selling strategy. In it, Jon walks us through the specific steps he followed to win named accounts in collaboration with the Sales team.
So listen in or read the edited transcript below. It was a fascinating conversation.
For background on account based strategies, check out this article: What Is An Account-Based Marketing Strategy?
Transcript for Scaling Up Sales Growth using Account-Based Marketing
Candyce Edelen Thank you for joining me, Jon. I’ve been really looking forward to interviewing you.
Jon Miller: Yes, it’s good. I’ve been looking forward to this for a while.
Candyce: Let’s start by talking about some of the things that you did at Epiphany. In looking over your profile and talking with you, I know that you started there where you guys were chasing more a broad horizontal market, and then you made a shift to look more at a vertical market and even sub-verticals. Can you talk about that and tell me how you approached it and why, and what the results were?
Jon: Sure. Epiphany was one of the leading marketing technology vendors. Over the years, we had tried to expand into being a broader full-suite CRM solution. We found ourselves competing against the likes of Siebel Systems and so on. Not surprisingly, that was actually kind of challenging. One of the things that we realized was that the whole market had moved away from the early adopter, innovator segment and was becoming more mainstream. We realized, very much inspired by Crossing the Chasm by Jeffrey Moore, that we could do a better job differentiating against the competition if we were able to find ways to speak to the more mainstream buyer. That’s not talking about speeds and feeds and features and functions. Instead, it’s about specific business challenges faced by specific personas in specific industries. It really was a strategy of focusing on smaller segments to ultimately be more effective.
I led a project where we identified a few core narrowly defined verticals. We focused on credit cards, retail banking, property and casualty insurance, mobile carriers, and traditional telecommunications companies who were trying to sell triple plays. That’s where they bundle in Internet, voice and cable television. We had these five very focused solutions, and we aligned marketing and sales efforts completely against just those five. No surprising, when you focus, it works. We were able to drive increased pipeline and ultimately increased revenue into those specific verticals.
Candyce: I’ve had the same experience where we changed a company’s strategy from a horizontal focus to a vertical. It did mean that we had to bring in a different type of salesperson. Did you find that also, that your horizontal technology focused salespeople, were they able to wrap their heads around that?
Jon: At the time, that wasn’t actually a big challenge. Epiphany had a very high end enterprise sales force. People with 15, 20, 30 years of selling experience, who were used to talking to the biggest, most complicated companies. This team was already comfortable with the concept of solution selling. Mainly they just needed the vertical support. For example: “who are the companies, who are the people, what are their challenges? Just give us the tools to have those conversations.” I totally would understand why, at many companies, that would be a big deal. But it turned out at Epiphany, we were mostly okay.
Candyce: Tell me about the results when you made that transition.
Jon: It was an awful long time ago. 13, 14 years ago. I’ll struggle to give you specifics, but qualitatively, we had more pipeline from the targeted verticals. We had more revenue, and we had frankly better marketing and sales alignment. As a marketer, it’s pretty gratifying when the head of the eastern sales region asks me to fly out to his executive team offsite so I can work with these sales leaders, talking about these specific industries and these challenges. It was one of the first times they had a marketer come to that offsite.
Candyce: It makes it so much more straightforward when you are looking at a specific vertical to give them the talking points, the playbooks, all that they need to be able to more effectively target. It’s much more difficult, I think, in a broader horizontal strategy.
Jon: Totally agree.
Candyce: Then you co-founded Marketo and built that up pretty quickly as well. Did you take a vertical focus there initially, or was that more horizontal from the very beginning?
Jon: Marketo was very much horizontal by design. The big idea of Marketo was that we wanted to leverage the technology transformation driven by software as a service (SaaS) to unlock the marketing category. In slightly more detail, marketing technology had always been a difficult purchase because most CFOs don’t want to invest capital into a cost center. Traditional software purchases were capital purchases. Marketers, historically have large operational budgets to get trade shows booths, print materials, and so on. We thought that SaaS enabled to let us sell high-end, sophisticated marketing software that marketers could buy out of their own operating budgets. That turned out to be, I think, the key catalyst that caused marketing technology to take off.
The reality is, in Marketo’s first two or three years, we were inadvertently vertical because we only sold to high tech companies. That’s just the reality of selling to early adopters. You’re often selling to other technology vendors. Then we expanded out from there.
Candyce: I had an opportunity to interview Amy Guarino not long ago, and she talked a little bit about the channel strategy and some of the surprises that came out of that in terms of you getting access to some of the larger enterprise deals through the channel. She said that was an area that you hadn’t necessarily expected to penetrate. Did that start to make you guys think more about an account-based focus for targeting accounts, or had you already started out with that focus?
Jon: For me, that account-based focus really started about a year before the IPO. The CFO came to me and basically said, “Hey, we want to grow faster. If we gave you more budget and marketing, could you grow more quickly?” He asked me because, at the time, Marketing was generating about 80% of all the pipeline that we were closing. The revenue engine we built was driven by demand generation, lead nurturing and content. It was extraordinarily effective, but in terms of scaling, it wasn’t like I could just write more blog posts and magically generate more pipeline.
When we needed to grow even faster, we looked to more outbound strategies. We identified a list of target accounts that we wanted to win. Then we found proactive, personalized ways to go after them. That’s why I came up with the analogy I’ve been using. The kind of marketing we had been doing that was led by content and demand gen, was like fishing with nets. I didn’t care which specific fish we caught, which company responded. We just cared that we got enough leads to move the business forward.
But once we had a named list of larger target accounts, it didn’t make sense to wait around for those big fish to swim into our net. We needed to reach out to them proactively, that was much more akin to fishing with spears.
The analogy made sense. I also realized is that the Marketo technology and frankly all the marketing automation platforms, had really been purpose-built to support fishing with nets. We were struggling to try to do fishing with spears at scale, using the technology we had. That was the idea for Engagio — to build a great platform for fishing with spears.
Candyce: Just to give listeners some context, Marketo grew pretty fast, all things considered. At the point that you did the IPO, I believe you guys were at around $150 million in revenue and did a billion dollar IPO, had around 700 employees. Am I correct in that?
Jon: It was about $65 million in revenue, I think the IPO initially was about $700 million and quickly got to a billion. I don’t remember the employee count. So we’re in the right ball park.
Candyce: Okay. Around that time, we were running into a problem in the marketing industry. Mark Schaefer coined the term “content shock“, where there was so much content, especially in the marketing industry, that it was really difficult to get the same kind of impact from a content strategy that you were able to do in, say, 2007. Talk about how you’ve addressed the problem of this overwhelming amount of content, but still been able to grow a business, since you launched Engagio in 2015. And you’re really starting to see some serious growth with that company now.
Jon: I think a lot of what’s driving the interest in account-based marketing today is a reaction to content shock. Five years ago, everyone was doing demand generation and content marketing because that was what we were told to do. That was the toolbox we had. In other words, we were only handing out nets to marketers. Regardless of whether you were selling $10,000 products or you were selling $100,000 per year subscriptions, people were using nets. Therefore everyone was producing too much content.
We believe in account-based marketing. We believe you should identify a specific set of accounts that you think are going to be the most likely accounts to move your needle, research those accounts to understand what’s going to be relevant and resonant to them, and then find proactive ways to get in front of them in a manner that adds value and is not spamming.
It’s not rocket science. Salespeople have been doing this for years. But it’s taking off for two reasons. One, marketers are looking for new ways to grow, especially when you have higher price points. And then two, technology is making it more scalable than ever before.
Candyce: Yeah, I think it’s especially important in those cases where the deal size is substantial, the impact to the buyers organization or business is significant, and the buying group is larger than two or three people. In many cases, the buying committee is significantly larger than that.
It’s ineffective to look just at those as one-off leads. We run into this problem with our own clients. For example, we might attract a deceiving lead with an incredibly high lead score. But it’s just one person at a firm. If that one contact is the only person engaging from a given account, that is not necessarily as qualified a lead as an account that might have just a couple of pages per visit, but where three or four or five or six people from the same account have visited the website over the course of a couple of months. Even though Marketo or any kind of marketing automation platform may not give them a very high score as individuals, that’s a much more appealing target to me for an early stage opportunity.
Jon: Certainly, what you’re talking about is the concept of what we call the marketing qualified account or the MQA. Most marketers spend all their time with MQLs (marketing qualified leads). When you see a depth and breadth of interest at the target account, we think that’s actionable.
By the way, you don’t need to follow up with the five junior people who downloaded your ebook. Follow up with their boss, right? That’s going to be a more powerful way to get a more strategic, larger deal going anyway. That’s the inbound version of all this, where you see engagement happening from a broad enough trend and that’s who you choose to focus and go after.
There’s also the more outbound oriented approaches. I’ll give you two examples.
In the first example, you identify an account you want to get into. The old way is maybe via sales cold calls, where you have an SDR team (sales development reps) cold call them. The new way has marketing and sales working together. You send them a package to kick things off. Maybe you also buy some display ads to warm things up. The package that marketing sends is then followed up by a series of emails and phone calls from multiple people. From salespeople, from executives at your organization, you name it. They’re reaching out to multiple people in their organization to basically try to unlock the account and get a conversation going. It works extraordinarily well, but, as you can imagine, it’s pretty hard to coordinate. You have to make sure that all the right things are happening at the right time. That was part of the challenge that we saw for Marketo was how to run those integrated plays at scale.
Another example that I’m really interested in a lot these days is the concept of opportunity or deal nurturing. One of the things that I’m noticing is that sales is spending most of their time in the opportunities that are later stage in the sale cycle. You know, negotiation, pricing, legal. That kind of stuff. The problem is that a lot of companies, as soon as the opportunity gets created, stop nurturing the people at that opportunity.
Sales says, “Hey, it’s mine now, keeps your hands off, marketing. I want to be able to control the message and the story here.” And so, there’s this gap created between opportunity creation and the late-stage sales process. In many ways, it’s similar to the gap that existed 10 years ago between marketing getting inquiries and creating the opportunity. Ten years ago, we solved that first gap with lead nurturing. I see today, companies needing to solve that opportunity nurturing gap. What you need is you need something that gives you the scalability of an automated process, but that still lets sales control the message and the account at every step along the way.
To me, that’s account-based marketing too. It’s just taking the concept of account-based marketing and extended it not just into driving new business, but through the sales cycle and frankly into account expansion. That make sense?
Candyce: Totally. I think it’s so essential for a prospect, whether they’re in the later stages of the sales process or they’re already a client. There’s no reason for us to stop communicating with them and engaging with them. We just need to change what we’re saying and who we’re saying it through.
It seems like a lot of marketers struggle with access to the information. I hosted a round table in May where we gathered a group of 15 marketers from the asset management space in the financial services. One of the problems that almost everybody at the table, from the largest firms down to the mid-tier was that the banks have implemented Salesforce.com or whatever CRM without taking into consideration marketing’s needs. They need to be able to look into the system and identify what’s going on in accounts that have already closed or accounts that are in the closing process. They need to understand what engagement looks like at that level and to facilitate that process.
It’s been a really interesting problem. The enterprise implementation of the CRM didn’t take into account the line-of-business field team’s needs, and so they sacrificed effectiveness for time-to-market and cost efficiency. I would imagine that you guys are starting to address that with your product. Are there other ways that companies can look at this to try to overcome that problem, especially for these larger companies that are trying to use a single CRM to target a lot of different vertical markets that behave very differently?
Jon: CRM by itself, I don’t think has ever been built up to support the needs of the marketer. I think part of the reason Marketo was successful is because it leveraged the fact that CRM isn’t really a tool to support marketers. So here’s this other tool built for them that just happens to work seamlessly in synchronization with the CRM.
That’s all well and good, but as we’ve been talking about, even traditional marketing automation is leaving a bunch of marketers behind, including field marketing. Most field marketers don’t get any value from the marketing automation, for the same reasons we’ve been talking about. In field marketing, they don’t want to send big, automated blasts. They want to be more relevant and more personalized. I think partly, implied in your question is this need for a category or something that is not marketing automation, but that d integrates with the CRM to scratch these other needs.
Candyce: That’s really what you’re trying to solve, right? That’s the business problem that you’re trying to deal with with Engagio.
Jon: Yeah. I’ve been playing around with calling this word marketing orchestration. I think marketing automation connotes robots and automation. It’s a very impersonal world, if you will. To me, what I love about the term “marketing orchestration” is that it evokes an orchestra conductor. Marketing is the person that’s trying to make sure everything’s working in harmony, but there are all these other pieces — sales, customer success, channels — that are all involved in the process. What I love about orchestration is it gives you some of the scaling capabilities of automation, but brings the benefits of the personal touch.
Candyce: I like it also from the idea that the conductor is there keeping everybody in sync, but he’s not actually playing the instruments. Likewise, marketing isn’t the one doing the sales. Sales is out there making it happen, but marketing can help by making sure that things are synchronized, right?
Jon: Let’s just go back to that deal nurturing thing I was talking about, where you want to keep in touch with these early stage opportunities, but sales says, “Hands off.” What if there were a process where marketing could automate a series of relevant personalized interactions, but before any email goes out, the salesperson gets to review and approve or customize it as needed? Just that little workflow change is what unlocks this. Instead of the sales person saying, “I don’t trust you, so hands off my accounts. Don’t ever email them,” it lets Marketing and Sales come together. Then they get something from marketing to send and might say, ” Thanks for prompting this for me. You’re right, I do need to stay in touch with them. Click. Go ahead and send.”
Candyce: And if they want to customize it with some note because they just had coffee with somebody that is a relevant connection, they can actually put it in there.
Jon: That’s exactly right.
Candyce: Right. Well, we are running out of time. Is there anything that you want to point out that could help people think about the advantages of targeting accounts instead of individuals that we can use as our wrap?
Jon: I wrote a book, we call it The Clear and Complete Guide to Account-Based Marketing, so I would encourage people to go check that out, which they can get on our website.
Candyce: Great. Thank you for being a part of this, Jon, we really appreciate it. This has been a cool interview and I’m looking forward to talking with you again in the future.
Jon: Always fun. Take care.
Takeaways from this Session
My biggest takeaway from this conversation was how Marketing and Sales should be working together to nurture ongoing opportunities.
I particularly liked how Jon has Marketing prepare content in advance for a given opportunity. Then they can automate alerts for Sales on a periodic basis, reminding them to reach out and touch the account. Marketing provides suggested copy, and Sales can edit as needed. That’s a great way to orchestrate continued contact and help close important accounts.
We do this manually today at PropelGrowth. It would be useful to have a technology platform that enables this strategy.
I hope you’ve enjoyed this episode.
If you have ideas for future guests, please contact me!
For more information about Jon and the companies he’s built, explore the links below:
Jon’s current company: Engagio
Jon’s former company: Marketo
Jon’s book: The Clear and Complete Guide to Account-Based Marketing
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