Forget ABM, you should be thinking about ABX

The ABM approach has transformed how many B2B brands operate. But are you potentially missing the mark as a CMO if you're thinking about your accounts-based approach purely as marketing's responsibility?

Jon Miller, CMO of DemandBase certainly thinks so, as he believes ABM has lost it's way. We should be thinking about more than marketing, we should be looking to set up end-to-end accounts-based experiences (ABX), built around inter-departmental alignment.

He shared his approach with us on a recent episode of CMO Convo, now available in written form below.

Jon's professional background

Hi, Jon, welcome to CMO Convo. Before we get into the differences between ABM and ABX, maybe you could introduce yourself to our audience? Tell us a bit about your professional background and what your role as a CMO looks like at DemandBase.

I'm CMO at DemandBase. We are a go-to-market B2B platform. So, we help companies get their sales and marketing to really accelerate revenue with an account-based approach. About my background, I’ve been in marketing technology pretty much my entire career, starting at a company called Epiphany, and then, in 2005, I was one of the co-founders and the first CMO of Marketo, which obviously has become a big marketing automation vendor these days.

I really helped to build, among other things, the go-to-market function at Marketo, where we did things like lead nurturing, lead scoring, and all that kind of stuff. I had a good nine-year run at Marketo, stayed after the IPO, but I left before the private equity sale to VISTA.

I'd sort of gotten the itch to start another company. To do it again, but this time as CEO. In 2015, I left Marketo to start with Engagio. The opportunity that I saw with Engagio was that ABM was sort of becoming a big thing. I had tried to do account-based marketing back at Marketo.

While the tactic worked well, it was really hard to do it with the technology I had. That's sort of what inspired the opportunity for Engagio. I wanted to fill in the technology gaps that I saw when I was trying to do ABM myself. The interesting thing about ABM was that, especially in the early days, it meant a lot of things to different people. And the kinds of ABM that we built were kind of in the middle of the funnel. They were really about understanding accounts that you knew about. It was about engaging with sales or exchange interactions.

But there was this whole other style of ABM that people were practicing, which is more like a digital top of the funnel, things like intent to identify accounts that are in the market of analytics, advertising to attract them to your site, and so on. That's what DemandBase was really good at.

When I started to talk to the CEO of DemandBase, we realized that everything that they wanted to build was stuff that Engagio already had. Everything that Engagio wanted to build was stuff that DemandBase already had. The combination would be a super-platform that we felt would really dominate the category. We decided to merge the two companies during the pandemic in 2020. We moved like the wind to actually integrate the platforms, which we delivered as DemandBase at the end of last year. That’s when I took over the CMO role at DemandBase.

Developing accounts-based experiences (ABX)

Is ABX the synergy of these two approaches? Is this how you developed the idea of ABX?

Yes and no. ABX stands for account-based experience. In many ways, ABX to me is really just the way we should have been doing ABM all along. Here's what I mean by that. Let's go back to my days at Marketo, when we were doing demand gen and lead nurturing. We would only pass a lead to sales when it was ready.

When the signs indicated they were ready, they talked to the salesperson. This was good for the salespeople because they didn't have to talk to leads that didn't talk to them. And it was good for the buyer because they didn't get unwanted calls from salespeople. So, there was almost a respect for the buyer experience with traditional demand gen. As we started practicing ABM, what ABM did was allow you to reach out to accounts who weren't otherwise responding to your campaigns.

It was a very precise, targeted way to say you wanted that account, I'm going to reach out to them. I started using an analogy to describe the difference of ABM versus demand gen. Demand gen is like fishing with a net. You throw it out there, you get your campaign, you catch fish, and you don't care which one you catch specifically, you just care about whether you caught enough. Account-based marketing is fishing with the spear. You find those big fish and you go after that. But, fast forward through a couple of years of this, and I realized the way we were practicing ABM, was that we were reaching out to accounts regardless of whether they had any interest in hearing from us.

Loads of spears, rather than throwing just the one spear?

I mean, I'd say no matter what, it doesn't feel very good to get poked by a spear. And the way we're practicing again, we seem to have lost respect for the buyer experience of really trying to only align the more aggressive sales outreach at the right time. That's what really inspired ABX. It’s not the next generation of ABM. It's just the way ABM should have been practiced all along. Align how you are marketing and selling the account to where and what that account is.

Fixing ABM's problems

So, it's not necessarily the next step, it's cutting out the chaff of what ABM has turned into, rather than what it should have been, the pure ABM?

Exactly. It’s a better way to describe how it should be done. The other advantage of ABX is just in the name. One of the problems that ABM has is that it’s just one department in the name of the title. We've all learned that an account-based strategy needs synergy between sales and marketing to work. That's the other advantage of ABX, it's just a bigger umbrella that invites the sales department and the SER department in and really helps them understand this strategy for everyone.

And ABM should have had sales involved all the way through from the beginning, but do you think it was just the title that was causing this kind of division?

I’ve heard account-based revenue, account-based sales and marketing. For a while, I talked about account-based everything! A lot of people, including myself, have been dissatisfied with ABM as the name because it was such a misnomer to what we should actually be practicing.

Okay. Maybe we should go into some of the details about what sets ABX apart? What is ABX doing that ABM should have been doing? What are the core principles that ABX should be following?

I would say they are the principles of what ABM should have been, right? It does start with precision and targeting. Be very smart about which accounts you want to go after. Then it's really about building a strong account intelligence layer so that you can understand as much as you can about these accounts.

I think the most important thing to understand is where that account is in its journey. Different companies should have different journey stages. I'd like to give you a generic one as an example. At the very top, you might have a stage you call ‘qualified.’ These are accounts that you would love to sell to. They look like good accounts, they're in your ideal customer profile. But they're otherwise completely cold. They're not showing any engagement or very little engagement with you or your category.

Then maybe there's an ‘aware’ stage where these accounts are a good fit, and they're showing at least some interest in your category. But they're still not really connecting to you and your brand. You then might have a stage called ‘engaged.’ Alright, now they're starting to show up on your website, read some of your content, and they’re going to your webinars, which is great. But they're still not showing that sign of being ready to engage with the salesperson. And then the ‘magic’ stage is what I like to call the marketing qualified account or a QA.

This is obviously a play on MQL. This account seems to be showing the behaviors and the signs that indicate it might actually be time for sales to reach out. We're in a buying cycle. And then. After QA, maybe there's a meeting stage and opportunity stage, customer stage, post-sale stages, and so on.

There's a lot of account intelligence that goes into understanding where that account is. The key is aligning your GTM to that stage. If I have an account that's in the qualified stage, I should not have my salespeople calling them. I shouldn't even really be trying to get them to watch my demo or something, because they don't even know the problem exists yet.

I really should be focusing on building my brand. I'm just building awareness. Things like advertising can work really well there. The key though is to not focus on logic too much. This is emotion, right? Branding work on emotion. Can you really start to build a little bit of that aura, if you will, for the QA stages?

As they start to become aware and engaged with you, you can start bringing more logic to the table. You can start engaging with them with things like thought leadership, best practices. That is relevant information.

You're not trying to call a meeting, you're starting to engage and help them kind of really structure and understand that there's a solution that can maybe help them with their business challenges. And all the time, you're sort of watching for the signs that they might be coming into QA. When that happens, it's a great time for your salespeople to reach out, for your SDRs to call. Typically what happens when a deal opportunity happens is, the buying committee expands.

The number of people you need to talk to you gets bigger. Now your GTM should be about how you're touching as many members of the buying committee as possible, how you're building consensus and doubt and validation about the decision-making process. It's just the intelligence to understand where the account is, and its journey. And then you're really using different tactics and strategies for accounts in different stages.

Is this one size fits all? Or is this something that's unique to each account? Or is it unique to a business model?

ABX generally is not one size fits all. It has a lot to do with the size of the account and the value. Maybe we should come back to that. Every company is going to define their stages a little differently to match their unique business.

But, if you just go with something roughly as simple as ‘qualified,’ engaged in QA, those are big enough buckets that are relatively applicable across companies. But we can make that a little more nuanced. For example, how are you going to define if an account is engaged? Let's just say you have a 25 person startup. They're probably engaged if you have maybe two people interacting with you. If it's a 10,000 person enterprise, you're gonna definitely want to be seeing probably more activity than one or two, so there are nuances like that.

The importance of account intelligence

Okay. And when you talk about account intelligence, what do you mean by that? Let's get some more specifics on that. What does account intelligence mean? Is it just lead scoring? Or is it more complicated than that?

Yeah, I think it is more sophisticated than that. I counted challenges in general, such as the ability to use all your first-party data, the data that you know about the account, from your CRM, from your marketing automation on your website, etc.

Then combine that with quality, accurate, third-party data. I'll just give you some examples. For example, we've talked about the journey stage. I think this is a really key piece of account intelligence. Another factor is intent data.

A quick definition, third party intent data is where you're able to monitor what content an account is reading out on the open web, and use that search to find patterns of what topics they are interested in, when they’re searching and when they’re expressing new interest.

It's privacy-compliant because you're not tracking individual people, you're just really trying to map to the account level and say, “ Hey, this account tends to be interested in this kind of stuff.” Intent data helps you with counterintelligence in two ways. One, if an account is reading about cybersecurity, then that tells you something about what they might be interested in. It also suggests language you might use when talking to them.

And then, as I alluded to, if you see a spike or a trend in research around cybersecurity, for example, that might be a sign that they're entering into the QA stage, and it's time to reach out. A third type of account intelligence is just their firmographics: the company information. The industry that they're in tells you a lot about what business challenges they might be facing. I guess I'll wrap this with a category that we've become really interested in, which is technographics or install-based technologies. This is relevant for other technology companies as well. In many cases, knowing the other pieces of technology that an account has installed is one of the most important indicators that tells you if that's a good fit for you.

I work with a company that does cloud-based ETL software. They really want to know if a company is using Snowflake. To put it a little bit more simply, for me at DemandBase, I want to know, are you on Marketo or Eloqua? HubSpot or Salesforce?

Not only does it tell me if you're a good fit for me, it also lets me reach out in a more relevant way. For example, let’s say I know you just bought Drift for your conversational marketing tool, I can reach out to you and talk about how well I integrate with Drift.

Another thing that technographics can be really good for is you can start to find patterns. Companies actually follow predictable patterns in how they buy technology. If you know they bought this technology, and then technology B, there’s a pretty good chance six months from now they're going to be looking at technology C.

Thinking about technographics makes you sort of rethink your approach to marketing. It's easy to think about platform integrations as being something that happens after the sale or midway through the sale. But having thought about that as part of the intent stage, it sounds like a very interesting approach. It sounds like an approach that a lot of SaaS companies need to take a look at. Is that a big part of ABM? Is that a big part of the core principles, using that technographic data, or is that just something that you use as part of your own system?

It's not uncommon. What I'll say is that it depends on what platform you're using and whether you have access to it. For the majority of technology companies, the technographics are actually the most predictive factor in terms of who's a good fit for them.

When you can really bring together first-party data, third party data about, intent technographics, and firmographics, and match it to the right account, you start to really form that foundation that lets you be really smart about how you interact with accounts.

It’s an advantage but it sounds like an advantage to the accounts as well, because you've taken care of a lot of the legwork. Before you even approach them, you've taken care of a lot of the initial questions that you might ask them or try to find out from them.

ABX advantages for you and the customer

You've done all that work beforehand. What are the other advantages of ABX and this account intelligence approach to the customers?

I mean, when done well, it means the interactions are relevant and timely. I am pretty anti-marketing, even though I'm a marketer.

Brave words from a CMO!

Yeah, I hit the spam button on so many emails a day. I don't just hit delete. I skip my ads. I pretty actively try to avoid as much marketing as I can. And yet, I am interested in who’s got good solutions for me. I want to learn about it. A good relevant interaction actually is valuable, if it's at the right time.

It's about providing value all the way through the customer journey, right?

Trusted interactions, yes, at every stage of the buyer's journey. ABX is a B2B GTM strategy that uses data and intelligence to provide relevant trusted interactions through every stage of the buying journey. That's sort of my formal definition.

Historically, ‘brand’ doesn't get a lot of air time in discussions about pipeline generation, revenue, and demand gen. Branding is this squishy thing. I really think that there's a much deeper synergy between brand and demand, especially in B2B.

I think trust and brand go hand in hand. Think of the classic phrase, “nobody ever got fired for buying IBM.” It’s that form of trust. If you go with IBM, you can trust me. It's trusted, it's safe. I think your fear, uncertainty, and doubt or fatigue are such a big factor in B2B. The more we can build trust with our buyers, and with the companies, the better.

That's where branding comes in. There are stats and research going around that only 3% of your potential accounts are active buyers at the time. The rest are in those stages you were talking about earlier, and the majority are completely cold.

They don't know who you are, but having a good brand and raising your brand awareness is an effective way of getting yourself on that radar and start pushing them towards the buying intent stage. Without a brand, you can't do that. That's something that, as you said, a lot of B2B Companies are missing: The importance of brand building.

Yeah, that 3% matches anecdotally with what I see. But it's interesting that somebody's done some research on that.

Yeah, it's pretty eye-opening. You think of 3% as being so low, but then you think about the exercise you can take to push people into that 3%. Is that something that's part of a ABX, the brand-building exercises, the groundwork laying exercises that get missed out from maybe traditional ABM strategies?

I think so. In my book, I sort of position it almost as a ‘phase zero.’ It's the foundation on which everything else is sitting. But the reality is, you could have the best ABX or ABM program ever, and if your brand isn't very good, you're gonna face headwinds every step of the way, and it's just gonna be really hard to make that ABX program work.

If people don't know who you are, then they're not going to buy from you.

Or they know who you are, but then they don't think so positively.

That's even worse. It's hard to change people's minds from negative to positive.

Or the flipside is true. You could have pretty mediocre ABM programs in place, but if your brand is awesome, everything's gonna look amazing.

Taking the ABX approach

Yeah, that's the advantage of having a big name brand. So does ABM tend to appeal more to the enterprise stage, when people aren't necessarily on everyone's radar, and that's when you need to engage with the ABX process?

For me, it's more about aligning to the size of the potential deal.

If you’re selling sub 20 deals that are sub $25,000, let's say, you're not going to really use ABX, it just doesn't make sense. You know, it's not cost-effective. On the other hand, let's say you're Accenture, and you're selling a half-billion-dollar contract to whoever, you can pretty much guarantee you're doing one-to-one, completely bespoke marketing for that account. Everything else falls somewhere in between. Whether that’s bespoke one to one, one to few, or one to many, I think it's really about the right motions for different size deals.

Now, if I go back to the other analogy of the journey stages, and you're trying to engage with these, you're trying to connect with the engaged accounts, to move them to the end QA. It's logic and thought leadership. Again, if it's a million-dollar potential account, maybe you do that by FedExing them an iPad that has a customized video recorded just for them on the iPad. Whenever it's a $50,000 account, maybe you're just sending them a digital ebook that has their name on the cover. Even within the same set of stages, the other dimension is potential deal size.

Okay, you've touched on some of the components that you need to be able to implement ABX, now let’s talk about the nitty-gritty. What do organizations need in terms of the tech stack and organizationally, what do they need in place in order to really excel?

The most important thing, honestly, is good alignment between sales and marketing. I've seen companies really tackle an ABM program purely in marketing, generate good engagement from accounts, but then sales really don’t care. They’re not interested. They don’t want to pursue these accounts.

Whereas if sales pitch the accounts and then marketing can show up and say, “look, we got engagement at that account.” then, that's more exciting. In the old demand gen world, sales and marketing was like a lead baton, like a baton pass in a relay race.

This world is much more like a soccer or football team, where you've got people in different positions, and they're passing the ball back and forth. But they're really working together to engage accounts. I was on a call yesterday with the CRO, talking about marketing source pipeline versus sales source pipeline.

And my advice was, especially in the ABM world, you should just blow all that up. There's no such thing as a marketing source pipeline, there's only us-to-source pipeline. If you're going after these bigger accounts, when they’re in motion, you're going to have touches from marketing, SDR, and sales at different levels. I think that mindset shift is important.

The most important prerequisite is good alignment. You did ask about tech. The other route is you can get started with an account-based program without a lot of new tech. I mean, I did at Marketo, I would just try to brute force it. The issue is, it's harder to scale it. It can be pretty time-consuming on your operations teams. When you want to start thinking about investing in technology, there are a couple of vectors. Mostly it’s dictated by people wanting to scale. Secondarily, it’s when you want access to certain kinds of accounts’ intelligence that you just don't actually otherwise have. Those are the main places where people tend to start on the tech side.

So, when it comes to account intelligence, is there a kind of one-stop shop that you can go to? Or is it something you better put together piece by piece?

Well, I mean, that is what DemandBase does. At DemandBase, we start with that account intelligence layer, and then we sell for clouds that can activate that intelligence. You could activate that through your ABX program, you can activate it through your advertising, or you can activate it just by giving insights into your sales team.

To a lesser degree, you have folks like ZoomInfo, who can sell you a lot of the pieces to it, but ZoomInfo’s problem has always been that they don't help you activate the intelligence as well. They're making acquisitions rapidly to change that.

Then you have other ABM platforms, like Terminus, that are trying to do some pieces of it. I think that those are kind of the main vectors of where you're going to see vendors for counterintelligence.

Accounts-based activities aren't just marketing's job

You talked about alignment. Let's go back to that. Because the CMO is going to have to have that conversation to get people aligned.

What advice do you have for CMOs looking to start off that conversation? How would you get the head of sales or the CEO on board with the implementation of a new system? Maybe if they've only just been going with ABM for a few years, and they're seeing success with that, why would they make the change? Why make a shift to a new way of doing ABM?

If you're already doing ABM, ABX would just feel very natural. Again, it's not ABM 2.0. Yeah, it’s just the way we should be doing ABM. The only tricky part probably is getting sales to agree to hold back sometimes. Maybe we shouldn't call that account quite yet. The way I handle it is, I tell them that they can call whoever they want, but my goal is to give you good QAs that you should spend your time calling.

You don't need to think about calling the other ones. If I'm not doing my job well enough, then you should start calling into some of these accounts. But please use all the accounts intelligence to be as relevant as possible. Again, that's generally not that hard.

The bigger challenge that companies have is if they're very much in a traditional lead motion, but they want to migrate to more of an account-based world. It's not so easy to change that engine. Their ABM programs can take longer to develop a pipeline. The deals that they create tend to be larger, you tend to win them more often. They tend to retain better. There are lots of long-term benefits, but they can take longer to build. What a big company shouldn't do is just drop all their traditional demand gen programs, and then start ABM programs, because you'll go through a dip that nobody would be very happy about.

Like many things, you should convince your CEO and the sales team to start moving towards an account-based direction. Starting small, you should layer on some account-based programs on top of what you're already doing. During COVID, we saw people all of a sudden had a budget free up because they weren't doing these big trade shows anymore. It was a great opportunity to move those somewhere, like an account-based advertising program. When something is working, you can build the case to do more over time.

Is that some sort of layered hybrid system? Is that sustainable? Is there a time frame where you have to say, “Listen, this isn't working, or this is working, we should make the big switch over?” Is it dependent on the company?

Let’s go back to your deal sizes. You should ultimately be using the right GTM for your deal sizes. There are a lot of companies that are going to span across multiple styles. Even though we're an ABM company, we also do traditional demand gen, because that's what's appropriate for some of our deal sizes. I don't know if there's ever a binary switch.

For most companies, it's about moving your mix of dollars around. If you are in a company like us, where you are kind of doing some of both, that might lead you to actually start tracking a double funnel, where you might have a lead-based funnel for your demand gen programs, and you might have an account-based funnel for your more account-based programs. And that's okay. I've had customers worried. They say they wanted to do ABM, but they can't because it doesn't work on their lead bases. Use the right GTM for your deal sizes.

Maybe that's a good way of getting other departments onboard? You're saying we're not completely starting from scratch, we're not getting rid of all the stuff that's been working for us so far. We're just adding a new system or evolving certain systems in a certain direction that's going to help us land bigger deals at the end of the day?

Salespeople tend to really like marketing taking an account first approach, right? If you can name the 30 accounts you care about the most, you can talk about how we're going to market to those 30. There's pretty much no salesperson in the world who's going to reject that. It's got to start with the salesperson carrying out the accounts.

Definitely, and it's always good to have sales along with you, happy to feel like they're in the driving seat. They’re happy for them to tell you who to market to when it comes to ABM and ABX? Is that what you're saying?

There's a whole big chapter on this in my book. There's more detail than we have time to share here on the podcast. But, ultimately, I like the process to be marketing-driven, but sales-owned. It starts by basically summarizing, by writing down and actually documenting how you are going to treat different tiers of accounts.

Okay, and I talked about one to one, one to few, one to many earlier. If you have a one-to-one account, what are you going to do? I'm going to send them iPads and videos, you know, to spend $4,000 a month advertising to them. Blah, blah, blah, right? Write down your entitlements for each of these different tiers? What's that gonna tell you ultimately? How many can you really support?

With DemandBase, I can have five-tier ones per rep, 30 tier twos per rep, and about 100 tier threes per rep. By aligning with sales on what the entitlements are, we're first agreeing this is what we're going to do. What we do is we give the reps a bunch of data and accounts intelligence about their accounts, and we ask whether this is a good fit. Are they showing intent? What's the context of our relationship? Are they engaging? And then based on that we say, ”you have this information, go pick your top five, your top 30, your top 100. And so we've sort of guided the process, but they actually picked the accounts.

Further resources

Awesome. There's probably a lot more detail that we could dive into, but we don't have all day. Maybe one last thing, what are the resources a CMO can look at to explore a bit more?

Yeah, so in terms of my stuff, there's my book, The Clear and Complete Guide to Account-Based Experience, it's 260 pages, and you can get it for free on the DemandBase website.

I wrote it to teach everything I know about how to do this stuff. It's not a demand-based commercial. I do recommend it. If you're more of a visual person, there’s a bunch of videos on DemandBase TV on our website.

But, beyond that, the best resources come from the vendors.

Are you rethinking your approach to ABM? Got questions and advice to share with others? Head to the CMO Alliance Community Slack Channel!