ONE OF the fundamental questions of moving to an account-based marketing strategy is which accounts to target. The reality for many companies who have been rushing to get ABM in place is that they simply start by focusing on the biggest fish in the sea or the companies their sales teams feel have the biggest revenue potential.
Highlighting this trend, 89% of respondents to Demand Gen Report’s new ABM Benchmark Survey say the accounts selected by their sales team were a key driver for formulating their targeted account list.
“We conducted research on different organizations and found many were letting field organizations pick the accounts they wanted to target.” Trish Bertuzzi, The Bridge Group
However, while that simple and direct approach often makes sense, it is also backfiring for a lot of companies that are winding up pouring the bulk of their time and resources into pursuing deals that don’t provide the revenue impact to support the increased investments.
Trish Bertuzzi, President and Chief Strategist at The Bridge Group, has been working closely with a number of clients on a new model to better support and measure the impact of the accounts companies are targeting with an account-based strategy.
Well known for its work in helping B2B organizations build and optimize their inside sales strategies, The Bridge Group is seeing a significant need for adding more structure and science to account-based strategies.
“We conducted research on different organizations and found many were letting field organizations pick the accounts they wanted to target,” Bertuzzi said. “In most cases, there was no formal structure for that selection other than they were companies the reps would like to being doing business with.”
PUTTING STRATEGY BEHIND SELECTION
In order to help accounts be more strategic about their selection, Bertuzzi has developed a new model called STEM, which breaks accounts into four core categories:
The model also provides guidelines to help companies measure if the target accounts are converting at higher rates or at higher dollar values. “The reality is everyone is running to account-based [marketing], but many haven’t thought it through,” Bertuzzi said. “You need to know what it costs you in spend, effort and coordination to get that deal signed. If the math doesn’t work, you really need to analyze whether your current focus and strategy is really moving the needle.”
As an example, Bertuzzi said her research showed many companies were spending four times more on marketing to target accounts and seven times more on coordination to close those accounts, but were only seeing deal size double for the accounts.
“Our goal is to help companies have a common framework and a way of measuring what they are willing to invest to focus on accounts at different levels,” Bertuzzi said. “If you don’t have a common language to talk about your accounts backed by metrics and math that track back to revenue then you are just executing the latest strategy du jour.”