Here is a recent presentation I gave at the OpStars event alongside Dreamforce. It describes the motivation behind eliminating the Lead object in CRM to support ABM and gives the experience of one startup making the transition.
Here is a recent presentation I gave at the OpStars event alongside Dreamforce. It describes the motivation behind eliminating the Lead object in CRM to support ABM and gives the experience of one startup making the transition.
Challenge: With Sales Increasingly Adopting Account Based Sales, How Do Marketing Systems Support the Effort?
I recently asked a simple question on LinkedIn:
Anyone know of an organization that has eliminated Lead management in Salesforce.com and moved to prospecting solely using Contacts/Accounts? Love to chat with them about their experience.
I was quite surprised to see a resulting 23 comments and over 10K views. Clearly this struck a nerve. Full disclosure: I am currently working with a client to migrate the management of prospects as Contacts rather than Leads.
In most B2B environments, sales reps have long thought about their efforts on an account basis. In fact, this recognition has driven the rise of Account Based Marketing to better support their efforts. Even when selling solutions with smaller ASPs (lets say ~$5-10K annually), reps map out their target account with key target personas. Further they use an array of modern account prospecting tools brought in by Sales Operations to support their outbound activities – tools like Tout, Yesware, Outreach.io, LeadSpace and LinkedIn Sales Navigator, to name just a few. This complexity combined with the marketing team’s involvement in attempting to manage the customer journey at the Account level caused me to rethink CRM structure.
Certainly there is a data sync between CRM and these sales outreach tools, but it is far from perfect in creating a complete view of a given account. As new Leads enter CRM from a variety of sources, how does a rep maintain that complete view of their target prospect or customer? As more tools are added, reps find it increasingly challenging to view Account details – such as people, relationship, and activity – in both CRM and prospecting tools. Just a few short years ago, CRM was the central database as well as the destination for prospecting. That is no longer the case.
Back in the day, marketers used the CRM Lead object for qualification and nurturing until they were ‘sales ready.’ Best practices were for marketers to nurture Leads with content relevant to their sales stage (still a great guiding principle). However, because there is a visibility and reporting gulf between the Lead and Contact objects, this makes rep outbound efforts much more challenging. There are some newer solutions to help both Marketing and Sales ‘see’ an Account view of all Leads and Contacts like Engagio, LeanData and ZenIQ. Mapping or matching Leads to Accounts is nice – IF the reps lived in SFDC – but as noted above, this is becoming less common with new prospecting tools.
With a more complex martech infrastructure and with reps ‘living’ in systems other than the primary CRM, how can Marketing best support these efforts with CRM structure?
I now believe that most sales organizations with heavy outbound prospecting in third party tools would benefit by managing Leads as Contacts. Both marketing and sales teams will enjoy improved Account visibility. Making an effort to map key personas within the account, to convert matched Leads to these Accounts and to update the Account information will prepare marketing to best support sales in their outreach efforts. However, making this move requires a close look at several things, including: lead to account matching, Lead/Contact enrichment, management of Leads that don’t match to Accounts, Account statuses and progression, funnel stages for both Leads and Contacts, MQL processes, Lead/Contact scoring and Lead Development Rep process to submit opportunities — to name a few. As we progress through the customer journey, there will likely be other benefits like improved Contact and Account scoring, better Opportunity management, improved customer lifecycle marketing, etc.
I believe the modern marketing and sales tech stack has matured to a point where managing prospecting efforts in a more structured, account-based way will make sense for many more organizations today, even with lower ASPs. There are certainly many details to consider because this represents a fundamental shift and will require a new set of best practices that will be different for each organization. Additionally, for companies migrating a mature CRM instance, it will take careful thought and deployment.
Lesson: Marketing can better support sales and the account buying journey with an Accounted-based process for managing Leads as Contacts – and this may fit many B2B sales organizations.
Challenge: When to Invest in Demand Generation?
Demand generation is a perennially ‘hot topic’ because every organization needs to ensure a consistent flow of prospects ongoing to ensure it can meet its sales objectives. Take the recent focus on Account Based Marketing as refinement of programs, processes, systems and data to orchestrate and optimize demand generation results. Every emerging organization must have a clear customer acquisition strategy – or at least a plan to get to one. These involve go to market channels/programs, MarTech stack, programs and ultimately the expected cost of customer acquisition. Since all early stage companies need to quickly scale sales, isn’t investing early in demand generation the sure fire way to do this?
All too often, companies are pouring money into the demand generation programs and systems without a clear understanding of the customer journey. Demand generation is a set of tools and processes designed to support successful customer acquisition, onboarding through to customer success and advocacy. Without clearly understanding both the buyer persona and their journey, marketing cannot hope to make this process faster and more reliable.
This thought was raised in a recent article posted by a CEO entitled “How I Burned 10 Million Dollars So You Don’t Have To”. In the article, Matt Munson notes:
“We went ALL IN on an inside sales driven model. For good reason. With solid proof. But we nearly broke the company. We certainly caused incredible heartache for dozens of people.
I wish we’d tested earlier. More thoughtfully.
I regret not staying smaller for longer. Living off $3M to find product-market fit, with a real, scalable acquisition channel. And keeping the other $5M in the bank for scaling powder.”
Matt’s quote is spot on. It is so clear that we need to get this right. Every discretionary dollar is precious – and we can’t start data gathering and testing early enough. Moreover, before we spend anything, we need to clearly understand where in the customer journey this program or tool will have impact and how we will measure its effectiveness.
The best early stage companies I have seen most recently focus solely on sales in the early stages before engaging marketing to help scale. Even later, with a defined sales process, these early investments need to be scoped and measured appropriately. Over the past several years, I have been continually surprised with results and had to make significant resource allocation changes. Matt’s advice is true for us all. First identify the buyers and their process from awareness to engagement to purchase and to ongoing success. Set in place expectations for your programs – in cost, conversion rate, timing and more. Doing this on a shoestring marketing and sales budget is the right place to start and forms the basis of ongoing testing and optimization.
Investing in demand generation people, systems and processes too early can easily drive interest and engagement that does not result in revenue. The result is a recipe to burn cash and miss key milestones.
Lesson: Understand your sales motion first and only then scale demand generation with a measurement and test plan in place.
Challenge: A case study in paying prospects for a trial experience
Blog Note – this is an edited version of a longer write-up.
Many companies rely on a free trial experience to drive prospect engagement. I had this very experience at with a company, a journey that took 18 months.
The objective was to drive the target buyer into a 14-day free trial (which, at the time, influenced more than 70 percent of closed-won business). Marketing’s goal was to dramatically increase the quantity of trials at the same conversion level while closely managing the cost of customer acquisition.
We experimented with a $25 Starbucks gift card offer for installing the trial as well as attending the daily demo. By tying the incentive to both the trial and demo, prospects would see the product capabilities and try it out for themselves in rapid succession in an attempt to drive that “a-ha moment” when the prospect clearly sees the value to them personally and to their company.
To evaluate impact of this offer, we broke this down in phases. First we tested it as a one time email offer to our database, then identified mechanisms to automate both the offer and card delivery in select channels like our integrated nurture process and finally expanded to an offer on our website to dramatically scale the offer. And after 18 months of great results, we eventually pulled the offer – and this is the story of that journey.
First, the team sent a one-off database email with a split test comparing a basic trial offer with no incentive to the offer of the Starbucks gift card, requiring both trial installation and daily demo. We measured impact on both click thru rate (CTR) and form completion rate. Email CTR increased by 3x (.9% to 2.7%). However, in order to qualify for the gift card, the prospect had to fill out two forms – the trial and the daily demo. When comparing the single trial landing page conversion rate with the rate of those completing both forms, the completion rate went from 68% for the trial alone to 42% for both forms. Digging deeper, the trial form completion rate was identical (68%) – so the subsequent demo registrations represented a net gain and therefore was viewed as a cost-effective promotion (and down funnel conversion rates remained unchanged). Net – 3x increase in CTR with the same trial landing page conversion rate with incremental increase in daily demo registrations. After 4-6 weeks, the down funnel conversion rates were comparable to non-incentivized trials.
With this proven one-time offer, the team evaluated ways to expand the reach of this offer. The decision was to run an A/B test of the trial incentive in our ongoing integrated email nurture. The trial was a middle of funnel (MOF) nurture offer to prospects who met quality scoring thresholds. Again, the results were positive. The CTR for the trial alone was 3.9% versus 10.6% for the Starbucks offer with similar landing page results above. However, now we had instrumented an automated delivery and fulfillment of this offer – so we dramatically increased trials while only rewarding for success events – namely participation in daily demo and trial campaigns that were highly correlated with closed-won business. But we only made this offer to qualified prospects who entered the funnel from a variety of other marketing programs. And with automated fulfillment, there was minimal additional labor required from the team. But could we do more?…
Next, the team examined if it was possible to further broaden the offer but still maintain high down-funnel conversion rates. At that time we implemented a website conversion optimization technology called BounceExchange (BX), which detects web visitors ready to abandon and raises an offer via a pop-over window. BX would make the Starbucks trial incentive even more broadly available to some/all website visitors. We added the Starbucks offer to BounceExchange with great results: the website trial CTR increased from 1.72% to 2.48%, a 44% conversion rate bump. With our growing website traffic, this had a tremendous impact on our trial conversions, driving over 4000 incremental trial conversions at a CPL of approximately one-tenth of paid search campaigns.
Remember that the offer was designed such that the $25 incentive would be delivered only if the prospect were to both download the trial and attend the daily demo. So the team felt really good about top of funnel results. Looking down funnel, for the next 12 months, we saw a consistent ~20% MQL to SAO conversion rate for these trial offers – consistent with non-incented trials. Finally, putting an ROI lens on this offer, it increased cost per opportunity by $125 ($25/.2) – staying within our cost-per-opportunity target.
Alas, the good times did not roll on forever. Over time, two developments led to our halting this offer. The first was an erosion of conversion rates, which happened gradually. We suspect that there may have been saturation of the offer with our target prospects. Second, we encountered fraudulent postings to this offer beyond our target audience. While we were able to respond quickly to limit potential expenses, the time required to monitor and correct these offers represented ongoing support by resources that could be focused elsewhere. So approximately 18 months after the start of this journey, we removed the offer.
Incentives to drive the right prospect behavior worked well for a while and supported scaling at a key time of company growth. Designing both the offer and automating fulfillment were key. However, as with many marketing campaigns, great programs have an end-of-life and should be constantly and closely monitored.
Challenge: Is ABM Right for My organization?
Account Based Marketing (ABM) is the rage. All the ‘cool marketers’ are doing this, new martec companies have been formed with ABM solutions, and other martec companies are repositioning their offerings as ABM. We all want new customer accounts and we also want more of our successful customers to grow and advocate on our behalf. But this doesn’t necessarily mean ABM is the right strategy for your organization. After spending significant time & effort into ABM, I thought it would be worthwhile to share high level thoughts on whether this makes sense for your organization.
According to Wikipedia,
“Account-based marketing (ABM), also known as key account marketing, is a strategic approach to business marketing in which an organization considers and communicates with individual prospect or customer accounts as markets of one. Account based marketing is typically employed in enterprise level sales organizations.”
Put a different way, ABM is about aligning sales and marketing with the purpose of targeting a small set of highly valuable accounts with a customized approach. In my experience, this means between 20 and 200 customer accounts each with a deal or lifetime value of $100K+. In ABM, both marketing and sales dedicate a disproportionate share of time and budget to accounts that will pay the largest dividends. This makes sense economically – and a company can justify the added expense (hard and soft dollars) based on larger returns from these customers’ initial and subsequent purchases.
But I’m wary of articles describing ‘how to scale ABM’ because it’s difficult to differentiate large scale ABM from Target Account Marketing or Industry/Vertical Marketing. Let’s consider the differences between ABM and general best practices of persona and customer journey marketing. In well-formulated Target Account Marketing, customized content is delivered at scale via email, phone, web, social and postal. This content may be customized to persona, level, role, industry and more. But I would not call this ABM, which is specific pieces of content, specialized events and other materials created for a single account or a very small set of accounts. Generally speaking, to ‘scale’ ABM means that you forfeit 1-1 customized programs.
How to decide – should you pursue ABM or more traditional Target Account Marketing? Let the data decide. Run the economics of additional ABM labor and program costs against the expected increased revenue from that set of accounts and compare this ROI to your next best set of marketing programs. Put slightly differently, consider and analyze your marketing programs as a set of investments and select based on the best performance, whether ABM or another program.
You’ll ask several questions along the way, for instance:
You must also assess your current systems and the level to which you can provide Named Account Marketing – or customization at scale. Current Marketing Automation, CRM and third party systems allow for sophisticated engagement based on time and activity by the account. A fully deployed Named Account Marketing program may require account-based advertising programs, website customization, dynamic nurture content, targeted contact acquisition, custom field events/programs, direct mailers and more. Do your current systems allow you to provide the level of customization your accounts need without the added time and expense of ABM?
The bottom line is that you need a clear understanding of revenue objectives, how marketing and sales together will drive this revenue, and the economics of these programs.
Lesson: ABM can be a great fit if you are willing to spend more time and budget per closed-won deal at a small number of accounts compared to more traditional Target Account Marketing programs.
Credits: Here’s a big shout out to the marketing team at Alteryx for their work with me on our journey to ABM. I’d also like to thank Jon Miller and the Engagio team for their thorough work in creating seminal ABM materials.
Challenge: Considering the Challenges of Marketing Attribution, How Deep Should You Go?
Marketing attribution is a hot topic. You need to know which programs are worth the effort and expense and marketing must demonstrate its contribution to revenue. In fact, both marketing and sales must both carefully plan and measure their unique contributions to more accurately predict revenue.
However, Sergio Maldonado’s recent guest post on Scott Brinker’s Chief Martec blog raised some very important questions about the veracity of marketing attribution. The article challenging various aspects of marketing attribution is timely and worth a careful read. It also caused me to re-evaluate my ongoing efforts to focus on attribution.
The journey starts with developing a standardized way to tag Leads, Contacts and Opportunities to marketing campaigns, followed by a methodology to differentiate sales from marketing contribution (as well as sourced versus influenced). Adding various program costs and labor investment to the formula provides a more complete picture. However, this tells just part of the story as it analyzes attribution from first ‘form conversion’ to closed deal, without consideration for pre-conversion activities.
Tracking and attributing the activity of all stakeholders before form conversion is more difficult. Furthermore, attribution-to-revenue calculations only provide results for Contacts associated with a closed-won Opportunity, whereas other Leads and Contacts not associated often influence the deal. Therefore, this methodology ignores Leads and Contacts that influence but are not associated with the opportunity as well as all awareness phase marketing touchpoints that positively affected the opportunity.
By focusing only on campaigns with direct attribution, marketing may erroneously optimize for those programs only – at the expense of awareness and early stage funnel activities where attribution is much more difficult. The resulting focus on ‘directly attributable campaigns’ that occur at or after the first form conversion can easily result in a decreased ‘share of voice’ and ignore important early stage touch points. Often, sales prospects are unaware they have a problem or they’re unfamiliar with solutions better suited to their challenge. Awareness programs focusing on the earliest stages of the sales cycle are key to growing sales in the long run.
So if strict adherence to attribution metrics will lead to sub-optimal marketing resource allocation, should marketing invest time and resources in it? Unequivocally yes. At the highest level, Lord Kelvin was right when he said, “When you can measure what you are speaking about, and express it in numbers, you know something about it.” The attribution process is not at fault here (though it can and will certainly improve), rather the issue is how this data is used to make marketing investment decisions. Even though early stage program investments are not measurable in the same way that later stage programs are, they remain an important part of the marketing mix. Therefore, it is incumbent upon the marketing team to explain and defend these ‘awareness’ investments for the long-term health of the organization. The marketing team should also look for important correlations to justify these programs (correlations of direct/organic traffic with various programs, for instance).
In my opinion, marketing must continue to pursue attribution while keeping in mind the limitations of the current systems. Marketing investments should be made recognizing that the team cannot measure all aspects of the marketing mix, and more importantly, additional attribution effort investments should be made with an eye on overall effectiveness. While imperfect, I am reminded of the saying, ‘Even one candle sheds a lot of light in a dark room.’ Without attribution, marketing has no guidance about future investments. But at the same time, marketing programs with impacts that are difficult to measure must not be ignored.
[Important note: Management should also look at the costs and benefits of the attribution process itself to ensure it is worth the effort. Tracking every last ounce of attribution adds significantly in terms of labor and cost, and at some point, these programs reach diminishing marginal returns. How a marketing team should optimize its spend on marketing attribution is a discussion for another time.]
Lesson: Spending time and resources on marketing attribution is critical, but it is just as crucial to realize program and system limitations to make truly optimized investment decisions.
Challenge: Drip email campaigns often are not customer responsive
It is common for marketers today to identify customers with common characteristics and drop them into a drip email program because it’s easy and can automate outreach to thousands of customers. The drip campaign creative can be tightly tied to a product or specific value proposition. However, all too often the process is something like this: ‘Prospects with this criteria/engagement are ideal for this product so let’s drop them into the ABC drip series.’ On the surface, it sounds like good marketing: targeted list, customized messaging and marketing automation.
However, this process neglects the fact that these prospects are not uniform in any way. No matter how tightly we segment our lists, each prospect is truly unique. In common practice, drip email campaigns are static, having a fixed number of messages at somewhat fixed intervals with fixed messaging. Those that operate at a higher level have some activity-driven content to alter the messaging throughout the drip to more tightly align to the prospect, but this is as far as most drip programs have progressed. However, with effort, we can aspire to much more targeted marketing. Take Amazon, for example, where recommendations are made based on recent purchases and web visits. I love Amazon because it is timely, relevant and easy to use.
What we need to strive for is something much more responsive. We need to integrate a broader set of inputs to drive a more relevant set of messages for each prospect. These other areas of input may include: last website visit date, website pages visited, other contacts at the same company visiting the website, organic/paid search terms, previous products purchased, industry, and more. Unfortunately this creates more complexity for the marketer, but it creates a more relevant and timely set of messages for the prospect, which is far more important. Additionally, marketers should consider alternate outreach vehicles like a call or mailing.
While the typical drip program is better than ‘spray and pray’ email marketing, the goal should reach higher. Think of prospects who look forward to receiving email messages. Imagine doubling open and click-through rates. This can only happen with significant changes that make your messages much more relevant to your audience. What this takes is monitoring key data elements available in your marketing automation system and leveraging these to send the right message with the right offer at the right time. This is certainly a tough task – and one that will increase complexity over a static drip program. However the result will be dramatically higher engagement levels.
So drip nurturing can make the sending company look like a real ‘drip’!
Lesson: Let’s strive to optimize our outbound programs by including a variety of inputs driven by the actions of the prospect to ensure timely and relevant contacts that move the relationship forward.