A Very Large List of Account-Based Pitfalls (and How to Avoid Them)
In nearly every TOPO engagement with clients who are launching an account-based GTM strategy, a common question we hear goes like this:
“How can we learn from others’ mistakes so we can realize the benefits of account-based (e.g., higher ACV, LTV) faster?”
We love hearing this question because we have, indeed, observed the habits of many clients as they implement their account-based programs. We’ve seen them get awesome results and we’ve seen them struggle, too. Here is a summary of their struggles, with recommendations for how your company can overcome them.
Ideal Customer Profile
The Ideal Customer Profile (ICP) defines the firmographic, environmental and behavioral attributes of accounts expected to become a company’s most valuable customers. Unlike the term “target customer,” which is often used to describe any company that might buy a product or service, the ICP is focused on the most valuable customers and prospects that are also most likely to buy. The Ideal Customer Profile should also not be confused with the Total Addressable Market or Total Available Market, which are calculations or estimates of the universe of potential target customers.
- Asking the sales team to give you their target lists and calling that the ICP – it’s not.
- Not leveraging in-house expertise and data from key stakeholders.
- Lack of quantitative analysis.
- Lack of qualitative analysis.
- Lack of buy-in and cross-functional alignment on the ICP.
- Making it too broad due to fear of missing out (FOMO).
The ICP is developed through both qualitative and quantitative analyses, and may optionally be informed by predictive analytics software. The ICP you develop should be supported by the executive staff. This is why it’s important to leverage the expertise of internal stakeholders in Finance, Sales Operations, Sales, and Customer Success. When you can tell the executive staff that you have worked with their respective teams to develop the ICP, it will be easier for them to support the recommendation or make helpful refinements.
Target Account List
A time-honored principle of direct marketing is the “3-legged conversion stool” of list, offer, and creative. Get one or more of these wrong and the stool falls over. The target accounts list (informed by a well-developed Ideal Customer Profile) is the lynchpin of any account-based strategy.
- List usability.
- Limited ability to segment the list
- Incomplete list data
- Poor data management process.
- Sizing the list without considering the numbers of sales reps, SDRs, or marketers who will execute plays/campaigns against it.
- An unbalanced list. Usually this means having too many “A” accounts.
- Aspirational vs reality-based list creation. (Example: targeting companies that are highly desirable, but for which your product is currently a weak fit.)
- Ditching target accounts too soon.
- Ditching target accounts for the wrong reasons.
Because the target list is vital to the success of the program, invest the time needed to ensure that the list is sized correctly. If there are more accounts than salespeople to work them, trim the list down. If there are so many “A” accounts that marketing can’t help to activate them, narrow the definition of an “A” account until marketing can help.
Also, make sure that the list is accurate and actionable, both at the outset of the project, and on an ongoing basis. Data management is not just about countering the effects of stakeholder turnover on target list accuracy, it’s also about appending inbound leads and joining them to target accounts when necessary. And it’s about scoring the database against agreed-upon, tier-specific data coverage benchmarks, e.g., 80% accurate and complete contact data for Tier A accounts, 70% for B accounts, etc.
Finally, once you have a good list and process, stick with it. If the list is turning over more than 25% every 6 months or so, ask why. And if accounts are coming off the list for inadequate reasons, such as the lack of accurate or complete stakeholder records, fix the underlying issue on the affected accounts.
Account Team Alignment
Defining account teams and aligning them to the target account list is where the rubber meets the road (or not) in most account-based programs. In some companies the notion of an account team is a foreign concept unless it describes the pairing of an account executive and sales development rep. In account-based programs, teams can take different forms at each account tier, according to the aggregate Potential Account Revenue (PAR) of the accounts within that tier.
- Not adequately making the investment case.
- Lack of clear accountability for results.
- Trying to scale without dedicated resources.
- Poor, or nonexistent, account planning.
- Not discussing the resources needed to support account plan requests.
- Lack of regular account reviews.
- Sacred cows, defense of turf.
Defining and aligning account teams with account tiers starts with a business case. For each account tier, calculate the aggregate historical TAV as a baseline. Then, use funnel metrics from your earlier ICP quantitative analysis to make reasonable projections of the revenue lift within each tier. A recent TOPO study showed organizations achieving revenue lifts of up to 170% from their high-value accounts using this projection model.
Building a business case helps to justify dedicated resources (e.g., sales reps, SDRs, field marketers), who will be accountable for program success. Accountability is vital to creating alignment. If most sales reps can make quota without working the target accounts list, the likelihood of success is significantly diminished.
Finally, being accountable for results includes being accountable to each other. Successful account-based organizations have quarterly account plan reviews, monthly account plan progress reports, weekly dashboard reviews at the team level, and daily collaboration between sellers and the people who support them.
In account-based programs, orchestration is defined as:
- The coordination of different activities, programs and campaigns used by marketing, sales development, sales and customer success to engage the target account, or set of accounts;
- The use of these activities, programs, and campaigns to connect with multiple stakeholders within the target account(s), and;
- Intelligence-driven timing and sequencing of activities, programs, and campaigns in order to maximize conversion within these account(s).
- Insufficient tracking of touches.
- Overly complex orchestrations given available delivery tools.
- Limited resources to manage more complex orchestrations at scale.
- Not orchestrating against the target accounts list. (!)
- Air cover (marketing) deploys without infantry (sales development)
- Infantry deploys without air cover
- Both air cover and infantry deploy, but to different combat zones
A well-defined ICP, an actionable target list, and compelling offers put successful orchestration of campaigns within reach. But that elusive “last mile” of account engagement requires thoughtful planning and expert coordination across teams. High-value accounts are inherently hard to engage. Whether you are executing a custom campaign against one very high value account, or a scale campaign against a broader group of accounts and contacts, it is essential that touches (marketing, sales development, executives, and sellers) are delivered within the proper sequence and time frame. The reward for successful orchestration is a target account where more stakeholders are engaged concurrently across diverse touchpoints, opting into high-value offers such as private webinars or custom on-site workshops.
Measuring the success of account-based programs is different from measuring volume and velocity or waterfall paste programs. In account-based, there is a greater emphasis on driving pipeline and revenue within the context of the potential of an account. By contrast, there is less emphasis on driving top of funnel inquiries and marketing qualified leads (MQLs).
- Lack of a baseline against which results can be objectively measured.
- Not monitoring the metrics that matter in account-based programs (TAP, TAV, TAV/PAR).
- Not measuring account engagement holistically. (e.g., Conflating any one type of website visit (or email, or reg form, etc) with engagement vs. a multi-touch, multi-stakeholder POV.)
- Defining objective measures, but not meeting regularly to review them.
- No consistent executive oversight and scrutiny of metrics.
Effective measurement of account-based programs begins in the ICP process. Quantitative analysis can be used to establish a historical baseline for each account and tier of accounts. Predictive analysis can be used to define the Potential Account Revenue (PAR) of every account or tier of accounts. Knowing the PAR For each account or tier allows for more honest and rigorous evaluation results. Now, instead of obsessing over how inbound leads filter down to a single opportunity and and (we hope) a purchase order, we look at our total potential to expand and maximize each customer relationship, so we reap the ultimate reward: growing customer lifetime value.
About the Author
Tom Scearce is Senior Demand Generation Consultant for TOPO, bringing clients more than 20 years of experience developing and executing high-growth marketing and sales programs. Tom has an insatiable curiosity for the people, processes and platforms that drive world-class demand gen organizations.