Welcome to episode nineteen of the SaaS Backwards podcast, where we interview CEOs and CMOs of fast-growing SaaS firms to reveal what they are doing that's working, and lessons learned from things that didn't work as planned.
You can listen to the full episode directly below via Spotify, or visit SaaS Backwards on Buzzsprout or wherever you listen to podcasts.
How Not to Join the 66% Who Fail at ABM
Kristina Jaramillo, President at Personal ABM
Edited for clarity and readability
Host, Ken Lempit:
Welcome, everyone to SaaS Backwards. A podcast that helps SaaS CEOs and CMOs to accelerate revenue and improve profitability. Our guest today is Kristina Jaramillo. She's president of Personal ABM, a firm that helps SaaS sales and marketing execs make a stronger connection with the human buyers and the accounts they want to win, protect, and expand.
Hey, Kristina, tell me a little bit about yourself and your company.
Kristina Jaramillo:
Yeah, thanks for having me, Ken. As you said, I’m the president of Personal ABM, I have been with it from the start. We work particularly with sales and marketing, but we align closer with sales. Our marketing is specifically for sales conversation.
We noticed that ABM (account-based marketing) was one of those terms that started getting thrown around a lot. We had been doing it, we just didn't know there was an actual term for it.
This is going back maybe five or ten years, and we just noticed that missing layer a lot of people were taking to account-based marketing, account-based sales, account-based everything, whatever buzzword you're using is that personal relevance--that's what we noticed.
It was needed to get tier one accounts that have more complex sales cycles or more decision makers in that buying committee closer to revenue and ultimately to a closed deal and win that personal relevance and the initial thinking about every interaction every step of the way as being as personal as you can.
Ken:
That's really great and very contemporary. Obviously, it’s the way many companies are selling today. And I think marketing is trying to catch up a bit too that kind of sales approach. Let's talk a little bit about your vision for ABM, what you believe it should be, and particular for our audience, which are SaaS firms, what are signs that maybe they're not getting it exactly right?
Kristina:
I'm going to just reference some studies that I saw in the earlier this year.
I'm sure a lot of people that listening are familiar with them, but in the beginning of the year, ITSMA came out with the state of the ABM report. It showed about a third of ABM organizations were actually seeing significant business improvement. And even TechTarget did a similar study that showed about 66% of those ABM programs are underperforming.
I know a lot of people think that account-based marketing and ABM works. I know that it does. We've kind of seen the strategies across the board that they do work, but where was that breakdown? What's going on? And why are those stats coming back like that? And I think that it's because there's too much confusion for what ABM is. I think that the definition is all over the map.
Recently, I saw on LinkedIn that the person who was part of DemandGen and growth at Nextiva mentioned that ABM is a code word for marketers doing sales and lots of ads.
But I believe that ABM is a business strategy that actually is driven from the top down. It's supposed to be tied to revenue fundamentals and everything should be tied to your ABM strategy like sales velocity, win rates, deal sizes, sales cycle time, and even customer lifetime value.
ABM to me, and what I've seen work is how you're going those tier-one accounts, your most ideal accounts to revenue and how are you going to drive stronger revenue growth, greater revenue growth from the existing accounts that you have and existing customers.
So in essence, what that means is that everyone, including leadership, sales, marketing, product teams, customer success teams, needs to get in on it and work together as a team and try to work as closely as they can as one unit to land and expand these accounts.
You might agree that ABM has kind of become synonymous with ABM tech. So everyone says, I'm doing ABM--I have Terminus, or I have Demandbase, or I'm running 6Sense, Bombora, Salesloft, whatever tech they want to say that they're using—but ultimately, it’s marketing as usual, but just with new shiny tech.
I think that's what's happening with these ABM programs, not being as successful as people had anticipated. I think we're just doing the same thing as we've always done, but now we're doing it more targeted.
It just winds up being account-based awareness or account-based advertising, as opposed to focusing on the engagement and interactions that we need to have, and those experiences that we need to create throughout the complete buyer's journey and the customer life cycle to get people to work with us, stay loyal to us, and even expand and grow with us.
Ken:
I think you hit it right on the head here. It's not a technology, it's strategy and it's almost like in this context, we're calling for the account-based organization. If we look at it from an organizational standpoint, first, we say, how are we in sales, marketing and customer success going to coalesce around the accounts we want to land or expand, then we can worry about how are we going to do it. We certainly need a why and a what first.
Kristina:
Yeah. It's interesting to say that. I think a lot of people assume ABM is just the technology, when I think the technology is one of the last pieces of the puzzle of a great ABM program actually, being successful as it can be. I think you have to get that strategy ahead of anything before you start making these large investments and just getting the right content and interactions along the way, maybe at a smaller scale before you can scale.
Ken:
Let's take out the punching bag and talk about some things you've seen that might not have gone so well, I imagine you're going to protect the identities of these organizations, but some case studies in ABM gone wrong might be fun to do. Let's hear a few if you've got them.
Kristina:
Yeah, I do. One is a recent one.
I was talking to a CMO of a channel sales and marketing firm, and I asked her “What's your approach to ABM?” Because I know that they were taking an account-based approach. And the first thing she mentioned is that they were using Outreach, they were using 6Sense, Marketo, and Zoom info. She just gave me her tech stack basically. And she talked about how her organization was a case study for 6Sense because they were using the platform so well and using it so successfully.
But to me, using a platform correctly and getting results is different from executing ABM effectively. So what I basically heard in that conversation is what we were talking about earlier--why two thirds of organizations aren't seeing the significant results that they wanted, or those improvements using their ABM programs.
And this organization was challenged to win with target accounts that were stuck in the status quo. And it was why her team was challenged to get multiyear deals greater than 70K. That’s where they were trying to grow and expand their accounts. But they kept getting stuck at that mark and her prospects.
She told me they were continually losing deals to the comfortable safe choice, the larger well-known brand, which in their case was Salesforce. It was an uphill battle for her. But I think it was also because the way that they had defined ABM at their organization was, again, that technology versus just the strategy.
One of the things they should have started with is creating a strategy to fix the business revenue challenges they were having and using the tech to support the strategy versus the other way around.
I heard from her that they weren't improving the interactions and that the go-to market teams were having with prospects with customers, and they weren't improving upon those experiences.
One of the key things that I noticed was that they were not changing sales motions and conversations to reframe the prospects--to move away from the safe bet or to lean in their direction.
If they had gone beyond that ABM tech and maybe general campaigns, they would've been able to put together a strategy for those tier one accounts they're getting stuck in the funnel. And I know that ABM, you can compete with other organizations using ABM because we've helped a supply chain SaaS startup who were pretty green and no one knew who they were. We helped them replace legacy systems like Oracle at enterprises that were pretty large like GE Healthcare.
It's something that's not impossible to do, but in order to compete with the bigger organizations, you're going to have to focus beyond getting accounts into your pipeline.
And another organization that I was talking about was a FinTech SaaS firm.
They were serving mid-market banks as well as larger ones at Wells Fargo. And they had recently gained some gross funding and they were looking at ways to use that money and they wanted to expand their sales force with it.
But they told me that there was a bit of an issue with it because they have a 5% conversion from stage one to close, and they were losing most of those opportunities before stage three. Once they got to stage three from stay three to close, they only had a 48% win rate.
They wanted to add new sales team members, but their ABM was still focused the top of the funnel because they were using Terminus, and about 95% of those organizations, weren't moving to revenue.
So again, we have to change sales motions with ABM and fix these business problems and revenue leaks before just worrying about pipeline growth.
The last example I wanted to talk about was a CMO at an AI company and they were really excited because they were having conversations with large enterprises like Walmart, MasterCard, and other organizations. But they had been in conversations with them for 14 months and they weren't getting any closer to getting a deal sign.
She figured that it was because they needed closers, which may be true in their case. But what they really needed on top of that was ABM to influence internal selling conversations that were holding up the deal--what was going on behind closed doors that they could maybe influence, they need their account-based strategy to accelerate accounts to revenue.
ABM is about sales and marketing winning together as one team, and done right, ABM can even reverse “no” positions, because I've seen it done with enterprises. Like I mentioned, GE Healthcare as well as UPS.
Ken:
So maybe digging in a little bit here, seems like from a diagnostic point of view, there are some KPIs that the ratios of these measurements' lead us to conclude there might be account-based strategies needed. So if we have 5% of our opportunities getting the revenue, that might tell us we're not targeting the right people, we're wasting a lot of time.
Are there other ratios like that? I think especially new CMOs, when they come into a situation, they're doing a wide view of all the diagnostics they might apply. So there's one--your identified opportunity to close is 5% or 8%. Something like that. That's a lot of wasted effort.
Are there other high level measures that maybe would tell the new CMO, she or he has to look at the sales targeting?
Kristina:
I also think they have to look at sales cycle time.
Are they able to shorten them?
Or are they growing for some reason?
Are deal sizes kind of stagnant at X amount for the last year, or the last couple of quarters? Are they expanding?
Are we able to upsell, cross sell?
Retention rates are always a good thing for CMOs. I think people think that it's only customer success or it's only account teams, but I think CMO should be worried about that as well.
Ken:
Yeah. We start there because we figure a lot of good insight comes out of what's going on with churn. We talked about a few situations, where ABM went wrong or didn't achieve what was envisioned. And I love the idea by the way of, if you're focused on the tech stack, you're focused on the wrong thing, because I don't think you need a lot of tech to make this go. Certainly your first gains don't have to be technology driven, right?
Kristina:
Absolutely.
Ken:
But where are things going right? Do you have an example with some learnings for our SaaS audience?
Kristina:
Yes. We mentioned earlier that people weren't seeing the results that they wanted, and I think it's because they're not balanced programs.
What I mean by that is they need to have a one-to-one program, a one-to-few program, and a one-to-many program.
They usually do the one-to-few and one-to-many, because they're using tech, but they're leaving the one-to-one either by the wayside or neglecting it altogether.
Ken:
So they're leaving the sales people to manage that on their own? They're not helping them do a good job with it?
Kristina:
Correct. And just treating all accounts the same, like if you know that this particular account is going to be a potentially six or seven-figure account, we're going to want to put more resources into that versus an account that might be only five figures and probably it'll only be a one year or two-year contract.
So you have to look at the bigger picture, and I think when we classify all prospects the same, we're doing a disservice internally to ourselves, but also to them as well because some just need more attention.
And I wanted to show this year, the example was we had started working with a UK ITSM analytics SaaS firm. So they were trying to break into new markets to create a category of capacity planning as a service, which was at the time was not a solution, or no, it was not an offering that a lot of companies were doing.
This company is an on-demand, cloud-based subscription basically showed customers what resources they had, what they were using, and where there were opportunities for growth--Calculated capacity, objections, and potential outcomes for months in advance.
So they could basically could make system upgrades before performances were affected before there was crashes, things like that.
And their competitors, it took them hours or days to do this where they were able to do it a lot faster.
But when we worked with them, we noticed that they weren't segmenting their targets. They weren't figuring out who was more of a priority versus not, and they were trying just to go for scale and they didn't really have an account plan.
They were seen as irrelevant because they weren't getting responses from their prospects. They were not well known and buyers weren't moving forward because they didn't see themselves and the stories that they were sharing.
So the stories that sales was telling, the stories that marketing was telling. They weren't seeing themselves there.
And when sales did have a conversation, they weren't creating a business case. They were kind of just features and benefits and not giving them the actual bigger picture of what their solution could offer. So, a lot of these sales conversations didn't go anywhere because it's a nice tool to have, but we don't see the need for it.
What we did was we had this company change their sales and marketing processes and the motions and the conversations.
And that's ultimately what ABM should be doing.
We made their LinkedIn profiles, the content they were sharing, the messages that they were sending out through sales and marketing were designed for the conversations that these sales teams were actually having with these key accounts and their key prospect buyers.
And we were showing impacts of what this tool would have—how the tool impacts IT finance, how it impacts IT security, operations, and even their customers.
Being able to quantify these personal impacts to the employee and their KPIs and explain to them what outages could mean to them as an individual versus outages just to the organization, we're able to create a stronger buying vision and able to tell the story to them versus reacting to pain points and typical sales and marketing pain points and personas.
And as a result, they were able to get attraction with larger enterprises like JC Penney and GoDaddy, and it enabled them eventually they were bought out by ServiceNow, but because of that growth that they were able to achieve by this approach. That's what happened.
Ken:
We certainly pursue the pain points here at Austin Lawrence, but I think your next step is what we all need to do, which is find a way to make that relevant to the people we're trying to put into a sales process.
And if we can't come up with a good email, we can't come up with a good phone call. We don't have a good presentation to pursue those pain points. Then it's like, "Yeah, I want to save money." Everybody wants to save money. They want it faster, better, cheaper, basically, right?
That doesn't differentiate a solution. So that the real question is how do we make that relevant personally, to the people who would be part of a sales process, right? That's really what you're talking about.
Kristina:
Absolutely. What's important to each person on that buying committee, because they're going to have similar KPIs as an organization, even as an internal department, but individually, what makes them do better at their job, what's important to them, what's going to influence them to work with you.
Ken:
Well, having run production computer systems for a really big bank, I can certainly understand the idea of telling me, I'm not going to get a phone call at three in the morning if I use this product, as opposed to you'll achieve 99% uptime.
I mean, it's a lot more personal to know that I'm not going to be woken up overnight as much. That's really what we're talking about here is making it relevant on a one-to-one basis.
You used a phrase that I don't know if everybody knows what it means, and I'd love to just dig in a little bit into what a sales motion is, and how ABM should change that experience in the sales team, so can you just sort of tell us what sales motion means?
And how we're going to make it better?
Kristina:
When I'm in sales motion, I mean the conversations that you're having. Are there conversations around just pain points and how can your solution can fix that?
Or are you going a little bit more specific?
Obviously, we're going to be discussing those pain points because that's important. But again, getting back to that personal relevance, that's what's changing the actual sales motion or the conversation to move away just from that because that'll open the door talking to pain points, but what's going to close the deal is if you talk about what's relevant to that individual that you're talking to. So what's important to Ken might not be as important to maybe another person on your team.
Ken:
We're almost talking like sales plays here, where it's the things that we want to bring into the conversation, the experiences we want to offer have to be attuned to who we're speaking with.
Kristina:
Correct.
Ken:
What about on customer success? I mean, are their customer success motions? And what is the role of customer success here in the upsell, cross sell?
Kristina:
Yeah, absolutely. How we talked about changing motions and conversations of sales and marketing or it should also be for success teams. So for example, I'm in a proposal stage with an AI firm and they've recently gained funding. So they're looking to expand sales and marketing and they're focused on new growth. But when we peel back the layers a bit, we notice that they have a lot of accounts that are in red and are at risk, so you can't protect and expand these key accounts.
If you can't do that, then it doesn't matter how many new prospects, or new accounts that you bring in. You're still going to miss those long-term revenue growth numbers. So there's that misalignment somewhere, which again, we need to all come together with sales, marketing, product, account management to fix together.
We can't change these conversations for customer success teams because in most cases, sales and marketing are putting a little resource to it and time and focus is on very little resources on existing accounts. We're always worried about the new logos. And customer success teams are kind of left to their own devices, but they need that support.
They're having conversations around activities completed, benefits gained versus why you should stay with us, why you should expand, why you should grow with us. They need to have content from marketing--messaging and stories around the gaps that they filled with their solution, the impacts of the organization.
How did it affect other aspects of the organization? Maybe not just the people that were using it.
Lessons learned along the way--that's what they should be sharing with their customers as well and how and why that program needs to either evolve to ensure that the company achieves the greater vision or why they need to expand, because these customer success teams are having the wrong conversation.
It's making it difficult for them to protect and even expand those accounts. I have an example of a client of ours, that they almost lost their biggest account in terms of revenue, which was Procter & Gamble.
By shifting the customer success team's conversation (what they were emphasizing on their end) the account was not only protected, but also expanded, which is what they were hoping to do. But they were really scared that it might be a loss for them.
Ken:
I think it's interesting--there's some good data out there that 70% or more of the lifetime value of a SaaS deal occurs after the close.
And I also agree with you that the new logo is what gets all the glory in many of these organizations. And it's definitely a big miss if the CMO is not lobbying for a focus on success or it's not on your radar as a CMO, it really should be because that's where the revenue gains are going to come from, unless you're a startup and you've got no paying customers.
But once you've got a body of customers who are paying you, you must be focused on the retention and expansion. It makes intuitive sense, but the data is compelling.
What do you think we can expect from this approach in terms of helping reduce churn and increase the lifetime value in SaaS?
How impactful is the approach you work with your clients in terms of addressing that specific issue?
Kristina:
It’s interesting because most of the time when people come to us, they assume, "Oh, you're only going to do new logos, or expand current ones." But the risk is really where the approach that we take is successful because I think people don't look at the conversation they're having.
I think once the customer becomes a client, they continue to have a sales conversation with them, which is odd to me because they're already bought into you, and you must explain why they should continue to evolve.
You must explain what it is that you're doing for them. You can't just say we're doing X, Y, Z. You have to give it to them in as quantitative and results as you can. And if you're going to say that your solution is affecting different aspects of the organization, even their customers, even operations, then I think that's going to make a more compelling case.
Ken:
Huge opportunity there. In fact, some of the interesting CEO conversations I've had on the podcast have revolved around the CEO focused on the customer success operation himself.
It’s been interesting to hear these successful software companies, where the leadership is on the phone, taking customer success calls. And they're using that as an opportunity to do the upsell, but also to guide the vision of the company. So I think the whole focus on the customer, it could even go up to the CEO, not just sales and marketing leadership. So I think this is a real place of opportunity that needs the focus.
Kristina:
Absolutely. I think for this kind of strategy to work, it has to come from C-suite and work its way down into sales and marketing.
I commend any CEO that's going to get on with a customer because that's amazing. I know as a buyer, if I was a customer and they took the time to help me with an issue, that would do wonders for my loyalty and business case to even want to stay with them as much as possible, maybe see what other things they could help me with, but you also get the most value learning what your customers, what are they having problems with, where can you help them better, and if the CEO can get it from them, then he can share it with the rest of the team.
Ken:
It is cool. Yeah. That was actually the CEO of Lemlist. He spends an hour and a half to two hours a day on the phone.
Let’s talk about if I'm a new CMO at a SaaS and I'm pretty sure ABM needs to happen in my organization, how do I get started? What are the things I should be looking to do first?
Kristina:
Well, getting back to what we talked about earlier, I think they need to take a step back. And before they look into the ABM tech stack, they might be able to look at the business as a whole.
Where are their challenges when it comes to customer lifetime value, or retention expansion, sales cycles, win rates, sale sizes, etc?
It's not just one little marketing KPI. It's not just MQLs that we're going to look at. In most cases, it needs to go beyond getting accounts and pipeline. Because I've seen a lot of organizations that don't have a problem getting pipeline growth and I'm not going to say everyone, but if they start putting together ABM strategy to solve a specific business problem and impact specific KPIs, the more focused you are and you start out small and then expand, it's going to be more successful.
I even have an ABM strategy template. If somebody wanted it, they could email me or connect with me on LinkedIn and I could give it to them. But strategy then think about tech.
Ken:
So let's say that I've got some ABM going, how do I get a handle on how successful I'm being? And what are things to look for that I could maybe do better? How do I sort of get a handle on how well I'm doing and what I should maybe do next?
Kristina:
A lot of people are dipping their toe in or already doing a little bit of ABM, but take a look at your strategy as a whole. See if you have a bunch of tactics or are you focused on getting accounts to revenue, because that's going to be a big turning point into which way you go with this.
If you have a strategy that focuses on accounts that are showing intent and are engaged, then that is great. But if not, you should add that in definitely.
Another one that I like to tell people about is, do you have a strategy for accounts that are showing intent, but stopped engaging for some reason?
Usually there's no strategy or go to market teams are losing accounts because they are delivering that better experience than being more relevant. So you have to have a strategy for those type of accounts.
Another one is a separate strategy (like a sub strategy) in all of these within ABM, accounts that are not showing intent and are not engaging with your campaigns, which is typically the bigger part of the market.
I think I've seen statistics say that 60 to 70% of people are kind of stuck in status quo and just waiting for someone to give them relevant reason to change or some compelling reason with what they're doing is not working.
Another strategy people should consider is how they are addressing accounts that are stuck in the journey and are slow to progress, like that organization that was taking 14 months to not even get a deal sign, do you have a strategy for that?
Are you approaching that differently?
And then how about the accounts that are at risk and they're kind of teetering on, will they or won't they leave?
And the accounts that the team could expand because they're only using a small portion of whatever it is that you're offering or only one organization is using it within the giant organization. Look at of overall--are you treating all accounts the same, or are they balanced like which talked about before? Because if you're putting in the time resources and focus on everyone, you're missing a really big opportunity to segment down to tier one accounts and give them that personal attention, that personal relevance that's needed to get them closer to revenue.
Ken:
Well, that's awesome. I think that's a great place to land our podcast episode. Kristina, I really appreciate your insights. We'll put that template resource in the show notes. How can people reach you if they want to do so, based on listening to the podcast?
Kristina:
Reach out to me on LinkedIn or they can check out our website, personalabm.com where we have content articles and guest speakers. It's all a free community called “Stop the Sales Drop” and it's based upon the podcast as well.
Thanks for listening to the SaaS Backwards podcast brought to you by Austin Lawrence Group. We are a growth marketing agency that helps SaaS firms reduce churn, accelerate sales, and generate demand. Learn more about us at www.austinlawrence.com. You can email Ken Lempit at kl@austinlawrence.com about any SaaS marketing or customer retention subject. We hope you'll subscribe, and thanks again for listening.