Transcript - Account Based Marketing, with Judy Sparks and Katie Cash
Audio: Welcome to AEC Marketing for Principals, brought to you by Smartegies, where we help design and construction firms navigate sales and leverage marketing to win more projects. Here are your hosts, Katie Cash and Judy Sparks.
Katie Cash: Hi everyone. Katie Cash here joined by my partner in strategy Judy Sparks. We are excited to bring some ideas and some strategy discussion to you all today, really around the difference between sales and marketing once again. But today, we're going to take it a level deeper and talk about the difference between account-based marketing, ABM for short, and account-based sales abs that you might know it. As we dive into this conversation a little bit, Judy, maybe you might just rehash for our listeners kind of how we at Smartegies envision and define the difference between sales and marketing just so we're all kind of on the same level again.
Judy Sparks: Sure. Katie it's one of my favorite things to do is to educate our industry in the differences between sales and marketing. As you know, sales and business development and marketing are all used pretty interchangeably still in the design and construction industry. We like to really define the three in a very simple way, in that sales are things that you do one-to-one. You take a client out to lunch, or you meet with them one-to-one, or you maybe take them to a Braves game. Those are all things that I find fit perfectly in the sales category. Product demos, service demos, all those things that you're doing one-to-one.
Judy Sparks: Business development, in my humble opinion, is just a fancy, polite way of saying sales. We do use those interchangeably, but when it comes to marketing, it's really the things that you do one-to-many, and the one is really your brand, not an individual.
Judy Sparks: When you think about the way that you get your brand visible in a mass way, whether that's through a print channel, a digital channel, maybe some traditional advertising, those are all marketing activities. When you talk about the differences between account-based marketing and account-based sales, it's really just taking both of those functions to a more strategic level where you are really focused on your highest value customers.
Judy Sparks: I hope that answers your question.
Katie Cash: I think that's great. Account-based marketing is definitely a term that is trending across the B2B industry, certainly picking up speed and the design and construction space as we start to see clients engage in those business strategies more and more these days. But I think it's helpful to just address the elephant in the room and just kind of acknowledge the fact that the design and construction industry, while yes they're new to ABM and account-based marketing, the industry has almost always been doing account-based sales.
Judy Sparks: That's right.
Katie Cash: Maybe you can go into a little bit more explanation behind what exactly is account-based sales and what are the other terms that people have often called it in our space? Because we like to be very professional and call things all the different things that are widely known in other industries as very simple terms.
Judy Sparks: Sure. Account-based sales is really about focusing on your highest value customers and doing all of the things that you normally do in sales. Things I mentioned before, whether it's doing lunch and learns, or it's taking somebody out for a meal, or meeting with them in their office one-to-one, but really allocating your time, and your effort, and your resources, and most importantly your budget to allocate an appropriate amount to the highest value clients and maybe less effort and resources allocated to the lower value clients.
Judy Sparks: I think that principals in every part of the AEC industry, whether you're a principal in architecture firm, an engineering company, or a partner in a construction firm. When you have an dedicated business developer or sales person or sales team, you're always wondering, what is my ROI on this spend? How do I know that that person or that team of people are spending their time wisely where I'm going to get the biggest return?
Judy Sparks: Because there's only, what, 12 hours in a day? Is that the standard working day now in our industry? There's only 12 hours in a day, a work day.
Katie Cash: Yeah.
Judy Sparks: If it's more than that, then we want your resume, because that is probably excessive. But our industry is known for long hours and the cost of client acquisition is quite high. And so principals, myself included, want to know what our sales teams are doing and how they're spending their time and are they spending their time on those customers that are habitual buyers that over a period of time is going to give you the greatest return? It's been called a lot of things.
Judy Sparks: I remember when I was a person prior to starting Smartegies many years ago in my career, I sold national program management services for the K-12 sector. I remember the executives of the firm I was selling for really concerned about my pipeline, because while other sales people had a pipeline of 20 or 30 leads that they had accumulated along the way, I would have less than 10, but my close was always higher than others in my peer group at that company. The reason why is because I felt that less was more, and to really spend a lot of time diving deep into those relationships that were going to give me the greatest return.
Judy Sparks: We call it competitive intelligence marketing or competitive intelligence sales back then, where the premise was if you know your customer or your prospect better than your competitors know your customer or prospect, and that customer or prospect knows you and your firm better than those of your competitor, then it increases the likelihood that you're going to win. We use that philosophy across the board over time. As I proved that that was successful, that became the sales model for our firm.
Judy Sparks: I think that others have called it a strategic account approach or a key account approach, but the whole idea is the same, is that you're not going to spend the same amount of time and effort chasing a two million dollar project if you're a national general contractor as you are a $200 million project. Makes sense, right?
Katie Cash: Yeah, I think it absolutely does. I thought it was funny kind of how you framed up the principles trying to wonder whether or not it's worth that salary and that discretionary expense fund for their sales staff, because do they really need to play golf every day? Are they really getting the leads? Are they really building the relationships that that need to be built in order to solidify a project? I think in our industry that has been so heavily rooted in relationship-driven sales, that one-to-one knocking on a door one at a time and having the personal relationship with the client, has really just kind of been the model and where everybody's been comfortable.
Katie Cash: I think you and I have interviewed countless owners about whether or not the relationship with those particular individuals really weighs on the final selection, and what we find more and more true today is typically everybody that's been shortlisted has a relationship, so it's no longer kind of the defining factor. But what we're seeing more on the account-based marketing side is building those relationships with those prospects really ahead of the sales team even reaching now. In our world, rather, we're calling those marketing qualified leads.
Katie Cash: Let's pivot a little bit from account-based sales and talk a little bit about ABM and account-based marketing. From where you sit, Judy, and working with so many CEOs across the design and construction space, why do you think that ABM is really picking up now? Not that we're abandoning relationship-driven sales, but we're definitely seeing a pretty big uptick in just general marketing efforts these days that are more proactive and targeted.
Judy Sparks: Well, like I said, Katie, the cost of client acquisition is really getting out of hand. You hardly ever see a major project hire an architecture firm that hasn't put some thought into the design or conceptual ideas about that building. You hardly ever see a contractor get awarded a project who hasn't done a lot of preliminary pricing work to get there. So, The cost of client acquisition continues to be problematic and a real cost for many of our clients, and so they're looking for ways that they can have indicators that they are courting the right customer well in advance.
Judy Sparks: Marketing qualified leads has come into play really in the last maybe two to three years in the AEC industry, obviously a lot longer than that in other industries and other B2B industries. But the idea is that your brand is out there positioning for the masses, and really generating leads primarily online. And yes, I did say that professional service firms are generating leads online. That is happening every single day, and if your firm is not doing that, we want to hear from you, because it is the most affordable way to generate a lead and convert that lead into a customer.
Judy Sparks: I think that marketing qualified leads is a concept that, through your marketing efforts and through the behaviors of your perspective customers, you can make informed and educated decisions on whether or not that customer is worth pursuing. If your salesperson only has 12 hours a day, I'm going to stick to that number, to make sales calls, then it would be really super helpful for that business developer or salesperson to have some indicators, key performance indicators if you want to call them that, that there is a customer out there that is interested and his behavior has shown that yes he's clicking on that content offer, he's visiting your website, he's spending more time looking at the content on your website. We call that dwell time. How much are they investing in your brand? There are some indicators that some customers may be more interested than others. Also indicators that the timing to call on them might be right.
Judy Sparks: This is such an on-demand society now. Everybody is accustomed to a Netflix type experience where when you're ready to buy, you want it to be there. And so, the whole idea of a account-based marketing program is to be there and your buyers where they are when they're ready. More and more firms are doing this with great success. I mean, we represent lots of professional service firms from program management firms to real estate brokers. The feedback that we get from our principals of those firms is that they feel like they have more clarity around how the effort is being spent with their business development team, as well as their marketing team, is really driving revenue to the firm and not becoming that, not just being the proposal production house that they've been historically.
Katie Cash: Yeah,. I mean, I think that was really well said, though one thing that you started to kind of touch on is this idea of generating leads online and having content online that meets your prospect where they are in the buyer's journey. But what really makes up and account-based marketing strategy? Is it inbound marketing tactics, like you mentioned having this great website, and these eBooks maybe or content? Is it outbound marketing? What are all the components that are included. That might be a little bit of a mixed bag question, but I'm sure you're up for the challenge.
Judy Sparks: I think that it's all of the above, and no two campaigns or are the same, no two customers are the same. Really understanding where your brand deficits are going into a campaign, and where the gaps are, and how to fill those gaps might lead you down a channel. Like, an email outbound push might be all that you need. Other times you may not have a list available, so you may have to target those people online using things like job titles, and company names, and geographies, or fields of study in terms of where they went to school. There's a lot of different ways that you can target your audience online now and be very precise about it.
Judy Sparks: But the real key to account-based marketing is making sure you structure it right. In account-based marketing, all clients and prospects are not created equal, so we like to tier them in categories, and each category gets a different level of personalization. What we think of as a tier one client, that's your habitual buyer of your service. They are your highest value customer. Everything that customer gets is highly personalized to them. It's one-to-one, it's personalized to them, and it's custom written.
Katie Cash: But when you say personalized to them, is it personalized to the organization that this particular prospect represents or to the person themselves? Like, would it be specific to Katie in my case or specific to Smartegies?
Judy Sparks: We've seen it done both ways. For example, one of our clients is a program management and facility maintenance company that caters to public sector clients in a space that's not easily understood and very, very technical. They sell to state governments. This last election cycle, there was 27 new governors, for example, across the US. Those 27 new governors, and their legal aids, and their staff received a very customized, personalized message from our client. That was all automated.
Judy Sparks: That would be considered a tier one client if it is specifically addressed to that said governor. Let's say that they are doing a mass customized the content offer to governors all across the US. Well, we would put that in a tier two category, what we call a micro cluster. Maybe they don't have exactly precisely the same issues these customers, but they are in a micro cluster where they have a lot of common issues. So maybe it's not personalized, but it's customized to those common issues.
Judy Sparks: Then your tier three category of clients is really talking about lots of times we see it as a category that is a pipeline builder or just keeping your name out there to the masses in a select group. But it's not customized at all. It's more of your boiler plate marketing messages. Does that make sense?
Katie Cash: Yeah, I think that makes a lot of sense. You know, if I were just to to recap that what you're saying is not all client accounts are equal. Certain clients and certain prospect accounts, if you will, warrant more attention, and warrant that personalization. You put those in your top tier. Those are the ones that you described that are habitual buyers. They're going to be a longterm relationship. You're going to invest heavily in speaking directly to them, their language, meet them at their pain points, and build that relationship along the way over a course of years. Then your tier twos kind of are similar, but similar groups if you will. They might be the example you gave, might be the governors in general. All governors kind of have these general pain points that would appreciate client XYZ's offering in this level.
Katie Cash: Then you have your tier threes that are a little bit lower, and as you go down the tiered pyramid, if you will, kind of that level of personalization diminishes. It also allows you to focus the time and the effort it sounds like on those that are more your tier ones that are in a position to bring better or more value to your client.
Katie Cash: You've talked a lot about structuring, kind of picking those key accounts. I think the other question we get most often from principals who are just learning about account-based marketing for the time is, "Okay, well my sales and marketing team, they are two different silos. They don't work together. They're separate. Sales is in charge of this lane, marketing is in charge of this lane, and I've got my business unit leader over here."
Katie Cash: So, who owns account-based marketing? Who comes up with the list, who determines the targets, who's generating this content, who's doing the strategy, who's running it? Do you have any advice there? Like, how do you build your structure for your account-based marketing team within an organization if you're going to adopt this business philosophy?
Judy Sparks: Well, I think it's different for every industry really in the B2B space, but for our industry primarily, design and construction, I think it's super important that it's a partnership between the C-suite, the people who are setting the goals and measuring the success. Then sales takes a really big role in owning that list of target accounts. It's super important that they buy in, because that's how they're going to be measured, and so you really allow them the autonomy to come up with their list of key accounts. Obviously it needs to be blessed from the top down. Then marketing really needs to step up to the plate and show the sales team how they can support them better.
Judy Sparks: The way this all works is, let's say the C-suite says fur next year's fiscal year, we want to increase our market share by 20% in said geography or said market, or maybe there's an actual numeric number or dollar amount assigned to that. The sales person then should name those key accounts that's going to allow them to meet that monetary goal. Then the marketing leadership and marketing contributors need to come up with the marketing ideas and channels that are best going to support that salesperson to generate marketing qualified leads.
Judy Sparks: You see how they all have to work together and in collaboration with one another? One of the reasons why our customers absolutely love account-based marketing is that it forces their silos to come together as one. No longer is sales out there just hitting the pavement without a roadmap, no longer is marketing doing independent marketing activations with no regard to what the sales goals are, and no longer is marketing just a reactive proposal production group.
Katie Cash: I do think that's probably the biggest success story there is just the alignment between the two efforts and the ability to penetrate the market more effectively, more consistently when you have sales and marketing align there. I think you're probably in a better position than I am maybe to share some before and after.
Katie Cash: Typically when you have sales and marketing in their own little silos, the world looks like this. You've got the sales team out there, like you mentioned, hitting the pavement. You've got marketing responding to RFP, sometimes the sales team might give them a little bit of insight on the project or who the selection committee might be, but they're often very independent, individual contributors to the business unit. What does life look like when you have them collaborating together and they are actually aligned? Like what does that picture look like?
Judy Sparks: Eventually it looks great, but I will be honest with you, the biggest hurdle to making this adjustment is it's a big cultural change. I think a lot of firms underestimate that every party involved has to give up something.
Judy Sparks: The before and after might look like this. There might be a sales team that is accustomed to going to all the same trade shows every year, playing in all the same golf tournaments every year, taking the same clients out to the same dinners every year. So after a while, there's some diminishing return there, because you're spending money on the same people over and over again and waiting for them to buy. At what point do you say, "I really need to reallocate my funds elsewhere?"
Judy Sparks: One of the big hesitations that the C-suite has in adopting account-based marketing is where do I find the extra budget that is going to be required in order to do things that will support this account-based marketing effort? Because these are things that typical design and construction firms haven't budgeted for. What we tell our customers is you already are spending the money. It's really a reallocation of funds.
Judy Sparks: The sales teams that get onboard with this are usually the ones that are able to give up some of the things that they are accustomed to spending money on and reallocating those funds to marketing causes. We have a national general contractor who started ABM this year for the first time and they took $40,000 out of their local Atlanta sales budget and allocated it to ABM to raise visibility in a very important sector that they do a lot of business in to be able to grow market share. They spend those monies on things like content offers, and videos, and digital advertising, retargeting ads, to get their name out there. Because their biggest deficit is the salesperson that was banging on the door one door at a time just couldn't get the coverage and speed of market that an ABM strategy would afford.
Judy Sparks: So in one digital campaign, they ended up getting thousands of impressions and hundreds of click throughs on their video directly with a buy-in audience within a very specific sector. That same money in the previous years was used on three golf tournaments and a couple of trade shows. By far the return has been much greater, because now they are entering those trade shows and those things that they are still doing that they didn't cut out with a very high level of visibility and the engagement in the sales efforts are bringing more business than the previous way. Does that make sense?
Katie Cash: I think that does make sense. I think really what we've seen with some of our clients that have embraced this new idea is they've gone from flipping an RFP over the cubicle from sales to marketing as we've got marketing watching these campaign dashboards through technology tools and through automation tools, where they can say, "Hey, sales team. Here are some hot leads," and the sales team is like super excited about it cause they're not cold calling anymore. They have some data, they understand where some of the pain points might be, where the points of interest certainly are, and they're able to, like you mentioned, kind of expedite those conversations. Ultimately the sales team is being measured by their ability to drive revenue growth. Right? And so certainly they would love this partnership, and we have seen it be highly, highly successful once everybody kind of gets in alignment and understands that everybody's given up a little bit of everything but it's all for the greater good.
Judy Sparks: My favorite part is the C-suite understands what they're buying. A lot of times sales and marketing is put in that one line.
Katie Cash: Overhead?
Judy Sparks: Called overhead. It's a large number. That isn't usually in our industry include the man hours that seller doers or doer sellers are putting into the game. Again, the cost of client acquisition is enormous and I really encourage for the C-suite leadership in the AEC industry to start taking a closer look at how you're not just your dollars, but your your dimes and nickels and pennies are spent. Because reallocated in an account-based marketing platform, you can get a lot better return for every dime, nickel, and penny you spend.
Katie Cash: Well, and also opportunity costs. There's that too.
Judy Sparks: Exactly. Bandwidth is a big issue. If you're spending your time taking out the wrong client, then who are you not taking out that now your competitors are spending time with? I think that that is a real struggle, is trying to have enough hours in the day, even if you are already working a 12 to 15 hour day, to reach everybody that you need to reach.
Katie Cash: Yeah. As we sit here today, this is a highly competitive marketplace as we sit here in the US today, and needing to have time to focus on doing things that are going to make the biggest impact right now. Because as you mentioned, a lot of our design and construction professionals are seller doers or doer sellers, and so they're not fully focused on sales all the time, so when they do, they need to use that time wisely.
Judy Sparks: Another reason why ABM makes a lot of sense, a lot of your professional service firms, especially in the architecture and engineering realm, they don't have dedicated salespeople that are commonly found in the GC world. And so if you're a seller doer, you're a doer seller, and you have a lot of billable responsibilities. When you finally find time to do something that looks like business development, it would be really super helpful for your marketing team to be able to come to you and say, "Here's an owner that's has clicked on and downloaded our content offer on sustainable design 12 times. And here's this information. You ought to probably give him a call." I think that most seller doers would much rather pick up the phone or send an email to somebody that has already shown interest in them and be able to start the conversation with, "It appears that you've recently visited our website. It looks like you might be interested in this, this, and this. Do you have time for a cup of coffee, or I'd love to come see you and tell you more, or do you have time for a phone call?"
Judy Sparks: I think that that is a lot easier than, "Hi, my name is and I work for this firm, and you may or may not have ever heard of us, but we're interested in doing design work for you." I think that just the idea of a cold call for most professionals is just horrific. They'd rather do anything than make a cold call.
Katie Cash: Well, they do do anything. Let's just call a spade a spade there. What I'm hearing from you is account-based marketing is really great for any kind of firm in the design and construction space. You may be selling engineering services, architectural services, maybe you're selling sustainability consulting even, but there's an application for account-based marketing for you. You could be a large firm, a small firm, you could have multiple geographies that you are trying to service, but there's a way that you can approach your sales and marketing efforts maybe with a little bit more thought, and strategy, and proactive approach through this kind of filter. Is that safe to assume?
Judy Sparks: Absolutely. I think that what's happening in our industry is marketing is just getting a whole lot more strategic. A lot of that it has to do with technology. The technology that is available to us today just simply wasn't there five years ago, so now there's just no excuse. There are so many automation tools. If you have a marketing team that is manually doing anything, you probably need to pause and ask is there an easier way, a way to scale this faster and cheaper than we're doing now?
Katie Cash: Yeah, I think so, too. As we wrap up today's conversation, you and I could talk about account-based marketing I think all day, because it is something we're very passionate about and we know that our C-suite clients are really getting eager about it. But a lot of our clients, as we're going into the fourth quarter of 2019, they're starting to plan for 2020. So, what advice would you give the principals and the executives out there at design and construction firms as they look at their 2020 budgets, their strategic planning, when it comes to considering whether or not account-based marketing is right for them at this point in time?
Judy Sparks: It's a pretty loaded question. I have a lot of advice I'd like to give, but the one piece of advice that I give most often is to let your sales and marketing people do their jobs. What I mean by that is a lot of times principals, they back off the accountability train. They feel like they have to dictate the business strategy or tell their marketing or sales teams how to go about their go to market strategy. What I would tell principals is set your financial goals, set your business goals, and then turn around, and hold your sales and marketing teams accountable, and make them develop and own their plans.
Judy Sparks: If you find that they are not enabled to do that, a lot of times principals feel that they are unable to do that because sometimes they don't have a technical background. What I find is some of the best ideas come from people who have been formally trained in marketing. If they understand what the business premise is and they understand what the business goals are, at least allow them to bring their expertise to the table and show you how they plan to meet your goals and which distribution channels make the most sense and how much it's going to cost. I think that oftentimes principals are surprised at what their sales and marketing teams can do if given the responsibility and if they're held accountable.
Katie Cash: Well that is a wrap today, folks, for our episode regarding account-based marketing and what it is. If you have enjoyed today's discussion and you are interested in how firms across the design and construction space have implemented ABM as a business strategy, make sure you tune in next week where I will be sitting down with JLL discussing how they have rolled out account-based marketing across the Americas as they've continued to strengthen and focus their sales and marketing efforts. You won't want to miss it. Have a great week.
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