The following is a guest post by Dan Sincavage, Co-founder and Chief Operating Officer at Tenfold. The original article appeared here.
Account-based selling is nothing new. We practically saw it every week back when the series “Mad Men” ran. Remember how ‘cool’ it was for Don Draper to get personal and talk his way into big deals? That’s at the core of account-based selling (ABS): it’s personal, focused and multi-touch. It can also lead to bigger revenues.
In fact, according to Sales Hacker, account-based selling can generate higher win rates and bigger deals within shorter sales cycle, as well as improve sales productivity and team efficiency.
There is renewed interest in ABS in recent years. In 2016, it was counted as one of the hottest B2B sales trends. Many attribute this interest to the improved capabilities of today’s CRM technologies.
These technologies have made it possible to accurately pinpoint enterprise companies that are likely to buy through criteria, such as:
- Purchase history
- Number of employees
- Technology used
What Is Account-Based Selling?
Account-based selling refers to a sales model often used by B2B companies. It employs an account-based approach to prospecting, instead of the more popular lead-based and contact-based approaches.
Here, the focus of highly-personalized high-touch marketing efforts is on high-value accounts. Unlike other approaches, ABS involves teams across practically all departments. It is not just one marketer or salesperson who has engagements with a target company. The effort is coordinated across the entire organization.
This approach is best suited for targeting enterprise companies. Smaller targets, such as individuals and SMBs, may be put off by the high-level multi-channel interactions. Likewise, you invest more, in terms of manpower and resources, when you implement account-based selling. The deal sizes have to measure up.
Account-Based Selling VS Account-Based Everything
Account-based selling, which is also referred to as account-based marketing, may not be the best term for this approach.
This is an issue brought up by Scott Albro, CEO of research and consulting company TOPO. According to him, account-based selling is a limiting term. The approach extends beyond sales and marketing. It involves sales, marketing, sales development, finance, customer service, engineering departments, among a long list of others. He proposes the term “Account-Based Everything” instead.
Jon Miller, CEO of software company Engagio, follows up: “There are no ‘hand-offs’ in an Account-Based Everything model. Instead, marketing and sales work together from the very start, and throughout the revenue cycle.”
A typical scenario in account-based selling/account-based everything starts with sales managers and marketers identifying opportunities and launching marketing efforts that target these opportunities. The higher ups at the executive level help by providing resources and strategic directions, as well as meeting with their contacts within the target enterprises.
Relationships are at the core of account-based selling. Closed deals hardly signal the end of the sales cycle. Instead, it is the point where other members of the team step in. The support group provides customer care. Product planning and engineering teams work with customer feedback for improving product specifications. Sales managers and marketers, on the other hand, work on identifying cross-sell and up-sell opportunities, renewing the cycle.
Benefits of Account-Based Selling
If ABS fits you, there are several advantages you can look forward to.
Find New Business Opportunities
Account-based selling’s highly targeted marketing strategies are best suited for finding right-fit target companies, as well as qualified point persons within these companies. These strategies include medium effort marketing, such as webinars and customized reports, and high-effort marketing, such as company workshops, demos and trials.
Improve Email Response Rates
When you know who you’re talking to, you are in a better position to personalize your communication with them. Email open rates, for instance, are observed to improve dramatically by as much as 60% when ABS is employed. Reply rates also improve by almost 50%.
Because the focus is on enterprises that are likely to purchase, deals are often big and efforts pay off within shorter sales cycles. This can potentially mean increased revenue from larger deals and more efficient use of available resources.
According to a survey conducted by Demandbase, 60% of companies that use account-based selling for at least a year experienced an increase in revenue.
Increase Deal Size
Your CRM system’s features can be put to great use in determining a company’s fit as an ABS target. Note their purchase history, firmographics, and buyer behavior, among other metrics. These metrics help you zoom in on qualified targets, and draft deals that suit their size and requirements.
Maximize Use of Resources Within Shorter Sales Cycles
A study by ITSMA, a B2B services marketing company, found that 80% of marketers believe that account-based selling outperforms other marketing investments. This is often attributed to the approach’s highly targeted methodologies. When your coordinated efforts are on a target that is likely to buy, then you can look forward to a win – as long as your efforts are data-driven and well-planned.
Is Account-Based Selling For You?
Account-based selling is not for everyone. Here are some considerations before you adopt this marketing approach.
1) Who are your customers?
Individual prospects and SMBs aren’t the ideal targets of account-based selling. First of all, your deal sizes from these efforts may not justify dedicating the manpower and resources typical in ABS.
The distinction is less clear with mid-sized targets. Trish Bertuzzi, author of “The Sales Development Playbook,” says that the account-based approach is best suited for deals that are greater than $50,000.
2) What do you know of your ideal customers?
Before you implement account-based selling, you have to know your ideal customer first. When you’re still at that point wherein you’re finding out about your markets and the products they’re interested in, then it’s better to hold off implementing ABS.
3) How many people are involved in the purchasing decision?
ABS is the best approach to use for sales decisions that involve a good number of decision makers. Because account-based selling puts people from multiple teams to work, you can cover all bases and target every stakeholder involved.
4) How long is your average sales cycle?
Complex deals and sales cycles often mean that it takes at least three months before making a sale. This scenario is best approached using ABS. When more people are focused on the account, the sales cycle can potentially be shortened.
5) What are you selling?
Companies that sell high value solutions and subscription based products experience the highest returns from account-based selling. It’s these products that best showcase business relationships that involve sales, marketing, support and product development. These relationships extend for as long as you are consistent in your service. This consistency requires the involvement of most, if not all, of your departments.
To learn more about Dan and Tenfold, click here.
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