Account-Based Sales
Account-based sales is a business approach that lets you discover and target high-value accounts via personalized sales/marketing strategies.
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Account-Based Sales
In recent years, the account-based sales model — a relatively old selling model — has resurfaced to become a staple in the modern B2B marketing toolkit. Account-based selling allows B2B companies to efficiently discover and target high-value accounts with personalized sales and marketing strategies.
There are many benefits to the account-based sales model. The model, however, is resource heavy, and that means it isn’t for everyone. In this article we’ll walk you through what account-based selling is and the benefits to implementing this business model. You’ll also find a guide to how to get started with account-based sales.
What Is Account-Based Sales?
“Account-based sales” — or “account-based selling” — (ABS) is a sales model primarily used within B2B sales. There are a number of different names for the account-based model, the most well-known of these being account-based sales, account-based marketing (ABM), and account-based sales development. All of these models refer to a relatively similar business approach.
Account-based selling makes use of sales intelligence and differs from many other business models in its targeting approach. Rather than target individual leads, account-based prospecting targets companies — also referred to as accounts — and treats them as a market of one.
The account-based selling model is a highly collaborative sales model. This means that rather than one salesperson targeting a single or a few contacts within a company, an entire team consisting of marketers, salespeople, and other relevant teams is dedicated to targeting multiple stakeholders at the prospective company with tailored content and marketing.
Though interest in the model has been steadily rising in recent years, ABS is not a new selling model. However, the model is resource heavy. The personalized approach to the sales prospecting model requires company-wide buy-in, and the collaborative model requires constant alignment between departments. Further, the goal with this model is to nurture high-value accounts, which is achieved in part through delivering a tightly integrated experience that doesn’t end when the sale is made.
This means that for a long time, the model was not only challenging, but also an expensive initiative to scale. While still a resource heavy initiative, thanks to recent technological innovations the account-based sales model can now be implemented much more widely and effectively than previously.
The Benefits of Account-Based Sales
There are many benefits to employing the account-based sales model. Some of these include:
- Better resource management: Other selling models target individual contacts, meaning they may focus their efforts on an individual who isn’t the decision maker of the company. One individual’s behavioral data also doesn’t necessarily provide much information about the company’s readiness to buy. However, going after high-value accounts and targeting multiple stakeholders within these accounts ensures that you don’t waste time and resources on companies that are not a good fit for your offer.
- Higher close rate: Concentrating your resources on targeting high-value accounts allows you to dedicate more time to researching that particular account and craft highly personalized messaging for them. Investing time in comprehensive research of one or a few types of accounts means that you’ll gain expertise in selling to their type of company — and this will improve your close rate.
- Lower risk of deals falling through: In other approaches targeting individual stakeholders, deals might easily stall or fall through if the key contact person is unavailable or changes jobs. However, as the account-based approach targets multiple stakeholders, your chances to close a deal depend less on the individual stakeholder. Involving a larger number of decision makers in the purchasing decision thus lowers the risk of the deal falling through.
Despite the benefits associated with ABS, the model remains heavy on resources — and that means it’s not a good fit for every type of business. Read on to learn more about the criteria for gaining success through the account-based approach.
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When looking for the right sales model for your business, your choice should depend on the following:
- What you sell,
- Your average deal size,
- The length of your sales cycle, and
- The types of accounts you usually sell to.
If you’re considering making the switch to an account-based sales model, there are a few things you should consider. Account-based selling has many advantages, but it won’t be a good fit for your business if:
- Your customers are small or medium-sized businesses: If you sell exclusively to small or medium-sized businesses with only one or just a few stakeholders involved in the deal, account-based selling likely won’t be worth your efforts. Account-based prospecting requires a lot of dedicated resources that you probably couldn’t — and shouldn’t — justify putting into each prospective customer.
- Your product is a one-time purchase: The goal of the account-based sales model is to deliver a tightly integrated collaborative experience to customers, and this experience shouldn’t end once the sale is made. If you’re selling a one-time purchase product, nurturing the account after the initial purchase won’t be a natural part of the sales process. The account-based model is therefore a better fit for subscription-based services that encourage building and nurturing relationships with high-value accounts.
- Your sales cycle is short: Deal complexity and the average length of your sales cycle are important factors to consider. If your average sales cycle is shorter than three months, ABS likely won’t be the right fit for you. The model will cost too much, and your sales cycle will be too short for you to improve your return on investment. However, if your average contract involves a minimum of five-figure investment from your customers and your sales cycles are long and complex, ABS is an excellent fit for your business.
- You’re still looking for your market fit: In order for account-based selling to work, you need to be able to identify your target accounts with laser precision. If your customer base has yet to grow large enough for you to identify the characteristic features of your ideal business prospect — or if you still haven’t found your market fit — you might want to hold off on ABS for now.
Account-Based Sales: All or Nothing?
A successful account-based sales model may require alignment between departments, but that doesn’t mean that you have to apply it to every individual in your organization. If your company isn’t ready to fully switch to the account-based model yet, another option is to dedicate parts of your team to working with ABS.
How to Find Your Best-Fit Accounts
In ABS, targeting the right companies is essential. Your efforts and resources should always be focused into your high-value accounts. To do this, you need to know your ideal customer profile.
As mentioned above, the account-based sales model has gained popularity in recent years because technological advancements have made the resource heavy model far easier to execute. Revenue intelligence tools, like Ocean.io, allow you to improve your personalization of marketing/sales outreach following AI-powered analysis of your CRM data that produces detailed insights about your best-fit accounts.
With the Ocean.io revenue intelligence platform, you smooth the process of identifying lookalike, high-value accounts (based on those best-fit accounts in your CRM data) floating in the vast sea of prospective clients that you have not yet discovered. In this way, you can efficiently channel the bulk of your time, money, and energy into executing ABS that drives meaningful growth.
KPIs: How to Track Your Success with ABS
Once you’ve implemented account-based selling, it’s important to continuously track and measure your success and make necessary changes to optimize and improve your methodology.
With an ABS model, the metrics you should measure are outcome-based rather than activity-based. This means that your focus shouldn’t be on tracking the number of phone calls made, emails sent, or contracts signed like you would in traditional outbound selling: instead, your focus should shift from quantity to quality. This makes it far more relevant to track e.g. conversion rates and revenue numbers.
One of the reasons account-based selling is resource heavy is that the model usually comes with higher customer acquisition costs (CAC). This is a direct result of allocating more of your resources to individual accounts. However, a higher CAC won’t be an issue if your average contract value (ACV) and lifetime value (LTV) rise, too.
Another KPI to consider is the length of your average deal. As mentioned above, ABS is a better fit for longer and more complex sales cycles than short ones. It’s also not unlikely that the length of your average sales cycle will increase a little when you implement ABS. However, because the model is resource heavy and requires more time dedicated to each individual account, the length of your average sales cycle shouldn’t go up too much. If it does, consider tweaking your approach.
In summary, when tracking and measuring your success with ABS, keep these KPIs in mind:
- Conversion rates,
- Revenue numbers,
- Customer acquisition cost (CAC),
- Average contract value (ACV),
- Lifetime value (LTV), and
- Average deal length.
CONCLUSION
From better resource management to a higher close rate and a lower risk of deals falling through, there are numerous benefits to implementing account-based selling in your organization. However, before throwing caution to the wind and going all in, it’s important to make sure the model is a good fit for your business.
Remember to consider:
- What you sell,
- Your average deal size,
- The length of your sales cycle, and
- The types of accounts you usually sell to.