POV

I recently asked a CMO of a channel sales tech firm about her ABM program. She rattled off the technologies they were using....6sense, Terminus, Xant, Outreach and others. She mentioned how they were a case study for 6sense.

While they were getting traction with their program, they were challenged to win multi-year contracts with accounts that would need a deal size of more than $75K per year. Accounts that large would consistently move forward with what they "saw" as a safe bet, which was Salesforce or another large player in the market. They were obviously not teaching for differentiation with content and messaging that shows the impact that competitor-specific gaps would have on the target accounts. They weren't changing the sales and marketing conversation. They weren't changing the interactions that sales and marketing were having with larger accounts that can provide the strongest revenue growth. They treated all accounts the same. The focus was on driving targeted demand to get accounts into the funnel instead of driving revenue growth with the accounts that could have the greatest impact on the bottom line.

ABM Should Not Be About Targeted Demand Gen

The CMO in my story above viewed ABM as a targeted account-based advertising and targeted demand-gen program that’s enabled by and scaled with ABM tech. While Demand Gen should play an important part in an ABM program, there is a difference.

During an ABM Done Right Podcast, Corrina Owens (Senior ABM Manager for Gong) mentioned that ABM platforms have diluted the market on what ABM is about. Their big selling point is the targeted advertising approach -- and it has become the norm, where many have forgotten the principles of ABM and how it needs to be hyper-personal to the account, the individual buying committees, and to the human buyers themselves. This tech focus makes ABM all about campaigns and touches vs. creating differentiated, relevant moments, interactions and experiences. It’s become a bunch of tactics (retargeted ads, emails, Outreach campaigns, etc.) to get accounts into the pipeline. But it should not be about getting accounts into the pipeline. The ABM organizations that focus on pipeline KPIs and marketing sourced revenue are only doing account-based lead gen, account-based advertising, account-based awareness, and account-based demand gen.

ABM Becoming Targeted Demand Gen – Can This Be Why 66% of ABM Programs Underperform?

ITSMA and Tech Target both recently reported that 66% of ABM programs underperform when it comes to revenue growth.  I believe the underperformance is because ABM has become a “thing to do” for the top of the funnel to drive a stronger pipeline with target accounts. But ABM should be about how leadership, sales, marketing, revenue, sales enablement, customer success and product teams together will hit the numbers the business needs to get to the next level. It's a strategy on how the teams will fix business challenges that are tied to the fundamentals of revenue: win rates, deal sizes, sales velocity, stage progression, sales cycle time, retention, ARR, margin growth, and expansion. Because ABM has become targeted demand gen, GTM teams are challenged to go upmarket, drive stage progression and create larger closes faster.

• A cybersecurity firm only engaged low-value deals with its ABM program - In talking to the CMO of the cybersecurity and managed detection response firm targeting organizations using Microsoft Defender 365, we learned that they were only getting $65K accounts into the pipeline vs. $125K to $250K. The problem is... they were simply doing targeted demand gen as they were only engaging in a personalized 1: few and 1: many approach. Their campaigns spoke at targeted accounts and "personas" and focused on general assumptions and pain points. They made their ABM program campaign-based vs. focusing on the interactions that sales and marketing teams needed to have with accounts that can deliver the greatest revenue growth. Sales and marketing teams were pushing out content and messaging and hoping that something sticks. They were still telling "everybody's" story. As Matthew Dixon and Brent Adamson mention in their book, "The Challenger Sale," in most cases, buyer unresponsiveness is not because you failed to make a logical argument. It's because you failed to make an emotional connection. It's not that those buyers didn't believe your story. It's because they didn't see it as "their" story. So, in other words, they were doing marketing as usual, but now they were using intent data and ABM technologies to take a more targeted "spray and pray" approach. They weren't speaking to and with the human buyers on every channel within target accounts that they wanted to win, protect, and expand. They didn't go directly to key decision-makers and influencers with insights specific to their gaps, impacts, and content that speaks to them specifically. They didn't focus on every single interaction and touchpoint that GTM teams should have with the human buyers and how they are relevant at the industry, company, rank, division, operational, financial, personal, and customer levels.
• A fintech firm was building a pipeline that goes nowhere - In talking to an RVP of Sales at a fintech firm serving mid-market banks, as well as national institutions like Wells Fargo, I learned that the company was focused on scaling ABM to build a stronger pipeline. Their focus was on increasing the number of appointments that sales were having. But their stage 1 to close rate was 5%. And after losing most of their opportunities right from the beginning, they lost more than half the deals that progressed to stage 3. The issue was that they were doing targeted demand gen -- not ABM, which should be about getting key accounts to revenue. They relied on technology to put out content and messaging to targeted accounts, but they didn't change sales motions, sales processes, and conversations so they could improve their win rates. They didn't think about how they should be changing the prospect experience. The more they focused on scaling ABM with technology, the further away they got from having the right interactions and delivering the right experiences. The more they tried to scale ABM, the more ABM became account-based advertising, account-based lead gen, targeted demand gen, and marketing as usual.
• Conversational AI firm is challenged with accounts going dark after sales engagement - After the VP of Product Marketing for a large conversation AI company with deal sizes of $500K+ was on our ABM Done Right Podcast, we dug deeper into his ABM program. I learned that the team was challenged with stage progression after sales engagement. Their Demandbase campaigns created demand and built a pipeline. But there was no follow-through. There was no account-based enablement and strategy to ensure wins. Instead of a handshake, there was a hand-off, which meant that ABM again was being treated as a targeted demand gen function. When your revenue is on the line, sales and GTM teams need account insights so an alignment can be created with the company, with different teams, and with the different human buyers and influencers. They need relevant messages, content, stories, insights, and skills to enable sellers in the flow of work for specific accounts—when they need it. We need to build situational fluency and influence the selling conversation and internal conversations that need to happen.
• Another AI firm was challenged to close a deal with enterprises like Mastercard and Walmart after 14 months of conversations. The CMO mentioned that they need closers but the fact is that the CMO was not using ABM to accelerate accounts to revenue. They were focused at the top of the funnel vs. using ABM to influence both selling conversations and the internal conversations that sales was not privy too. There needs to be a strategy for those accounts that do not engage in your ABM campaigns, for those accounts that go dark, and for those accounts that are stuck in their buying journey.

In conclusion…

It’s time we think of ABM as ABR (account-based revenue) and focus on how we will drive more revenue growth with the 20% of accounts that can deliver 80% of today’s and tomorrow’s revenue growth. As Corrina Owens (Senior ABM Manager for Gong) mentioned on our ABM Done Right Podcast, “It’s time we take a less is more approach to ABM where we focus less on targeted demand gen and provide hyper, personal attention to fewer accounts at any given time and on the interactions we’re having with these accounts.”