This article is Part II of a 4-part series on the shifting landscape in B2B buying and selling, how revenue teams have adapted, and where we think the market is headed next.
- The reduction in force in 2023 has accelerated the need for agile organizations in B2B buying and selling.
- Account Based Marketing (ABM) has shifted the focus from individual leads to the account level, improving efficiency and relevance.
- Understanding the buyer's journey and using automation and AI can increase sales velocity and conversions.
- However, there are limitations to ABM, including the challenge of data silos and the need for speed, coverage, and consistency.
- The next phase in demand capture and demand creation is Account Based Orchestration (ABO)
Headcount Reduction Accelerating the Agile Organization
As of August 2023, almost 300,000 workers in US-based tech companies have been laid off.
Just as COVID was a massive accelerant to the digital buying process, the 2023 reduction in force, because of uncertainty around the economy, was a massive accelerant to the new age of agile organizations.
Dynata conducted a 2023 study across 500 business leaders in the US, Germany, the UK, and France across all industries. Participants included heads of sales, revops, and marketing. A few findings:
- 75% of organizations expected flat or reduced revenue growth this year
- 58% expect to have less personnel to drive sales
So, there is less staff, potentially the same pipeline coverage needed to hit your quota.
As a result, sales and marketing organizations learned how to operate smaller, more agile, and more efficiently. Revenue teams began partnering with the most innovative technologies that used automation and AI to help them execute operational downstream activities, which allowed them to focus on key insights and personalization.
Shift Towards Customer Centricity and Account-Based Marketing
In the past, most go-to-market tooling was focused on helping the seller and marketer get more leads. The experience of tooling wasn't necessarily tailored toward the buyer (e.g. carpet bomb email and relentless cold calls).
There are two options to increase revenue:
- Increase leads
- Improve pipeline conversions, cycle times, ASPs
It seemed easier to get more leads, so many organizations chose that. But it wasn't. It was the more expensive option that had diminishing returns. More leads to sift through and follow up on meant sellers weren't allocating their time as effectively.
The problem was that 3% of your TAM was in-market to buy (Sticky Branding).
Spending time on non-target accounts that were not in-market to buy was a huge waste of time and money for both the sales and marketing teams.
The Importance of Efficient Growth and Timing
Companies like 6sense keyed in on the importance of efficient growth, relevance, and timing. They introduced the idea of account-based marketing (ABM), which took the focus off the individual lead contact and brought it up to the account level.
Understanding the Buyer's Journey
The vision was to break your target ICP accounts into four key stages of the buyer journey:
- Target: Not ready to buy
- Awareness: Waking up to the problem
- Consideration: Learning how to solve the problem
- Decision: Engaging with vendors
- Purchase: Ready to buy
Then, align the sales and marketing team to work together towards delivering the right experience at the right stage in the buyer's journey. Sellers needed the marketers to figure out which leads were in-market. The marketers needed sellers to engage those leads. ABM teams typically align on the same ICPs and metrics to build qualified pipeline together.
There are thousands of potential leads that a seller could follow up on, but they should just prioritize the ones with the highest ROI, and leave the rest to AI and automation.
Here's an example 6sense workflow:
- Awareness: Marketing identifies the best accounts via the buyer's digital footprint on the web, finds the buying committee, and then adds them to social ad campaigns on Facebook and LinkedIn
- Consideration: Marketing adds the buying committee members into nurture/education campaigns to provide value
- Decision: Landing pages and chatbots are personalized to the buyer. Target accounts are routed to the right sales rep
- Purchase: CRM, marketing automation systems and the website capture buying signals. This is when the account is in-market to buy, and sales should chase
Understanding where the buyer was in their journey made marketers and sellers more relevant and customer-centric in their outreach timing, targeting, and messaging.
Taking a multi-threaded approach where everyone on the buying committee was engaged increased sales velocity, conversions, and ASPs.
Sales and marketing were going to market together, which boosted overall ROI.
ABM started to work and cut through the noise:
- The first person in the conversation is 70% more ready to buy (6sense)
- 85% of marketers say ABM significantly benefited them in retaining and expanding their existing client relationships (Triblio)
- An ABM strategy can increase B2B revenue by 208% (Warc)
According to Lars Nilson, VP of Business Development at Snowflake, who ran a 200+ sales development team, when account-based marketing and account-based sales orchestrate, script, and strategize together, they saw a 3x lift rate on their meetings booked.
Limitations of Today's Account-Based Marketing
In spite of the lift from running an ABM motion, companies are still finding difficulty capturing demand. Deals are becoming increasingly complex, with more steps involved and more people to convince. The status of deals is constantly changing and faster than humans can react.
There are also fewer humans to react, period, because of the headcount reduction. Sales reps are working double-time to engage quickly and effectively with more accounts on increasingly complex deals. People are fried.
Sometimes it could take weeks, months, quarters to fully implement an ABM solution. It could take a while before sales and marketing and in full alignment on their ICP and agreed upon processes. Takes time to find a dedicated owner of the ABM tool. People are constantly shifting, so the CMO that brought on the ABM solution may leave midway through implementation. And the sales team that was onboarded today may not be the sales team that uses it tomorrow.
A strong signal on an account that's in-market to buy is only useful if it's acted upon, and better yet, acted upon immediately. Speed kills sales. Drafting a personalized email to a hot account a day after may be too late.
Human systems do not scale well, especially as organizations and the number of leads to keep track of gets larger.
The Challenge of Data Silos and Integration
The market is starting to consolidate tooling; however, you still have 5 to 6 solutions that need to work in tandem to execute effective ABM. For example there's conversational intelligence, sequencing, email, LinkedIn, Slack, CRM, buyer intent, etc. Humans still need to toggle between three screens to conduct analysis and pinpoint key moments in a buyer's journey. Revops needs to manage multiple vendors, which oftentimes have duplicate features.
But the biggest issue is having multiple data siloes to manage. With systems needing to integrate back and forth, it can be difficult to have a single set of robust, accurate data to automate workflows or run AI models off of.
The problem compounds as the size of the organization and prospect base grows.
Pretty soon there are processes to maintain processes, and, depending on your time horizon, the upfront setup and maintenance cost may introduce more harm to the team rather than the ROI promised.
The Need for Speed, Coverage, and Consistency in ABM
For ABM to work well, you need speed, coverage, and consistency.
Most sales teams are not set up to react in real-time, which breaks them out of their workflow. It takes significant orchestration to complete the ABM motion successfully at every step.
If there is a big marketing campaign that drives traffic, there may not be enough rep coverage to engage all the buyers.
In both cases, there is a revenue leak in the funnel because speed, coverage, and consistency fall short.
It means you're not engaging or fast enough with your in-market target accounts (3% of your TAM) who are in the decision/purchase stage, which costs you deals today.
You're also missing out on the opportunity to build relationships with target accounts that are not in-market (97% of your TAM) in the awareness/consideration stage, which will potentially cost you even more deals tomorrow and beyond because those accounts may be building an early relationship with your competitors.
Up Next: The Era of Account-Based Orchestration
Read Part III, where we'll delve into the evolution from account-based marketing to account-based orchestration. We'll explore how this transition enhances the speed and precision of delivering a tailored buying experience to your Ideal Customer Profile (ICP).