Cloud Co-Sell for ISVs: Part 2 - Account Mapping Best Practices

Introduction

This article is a the second part of the series “cloud co-sell for ISVs” focusing on the most common activity in joint-GTM for ISV-CSP partnerships - account mapping.? No matter what the joint-GTM activity, the end result is almost always account mapping.? There are differing opinions on the most effective approach to account mapping and I’ve taken an opinionated point-of-view.? Please share your thoughts in the comment section below!

Background: incremental revenue growth is the outcome to work backwards from

The goal of joint-GTM is to achieve commercial outcomes more effectively: time-to-value (speed), customer acquisition cost (CAC), total value (revenue), etc..? The simplest way to think about this is the incremental revenue growth framework, which frames partnerships as a way to better achieve revenue growth.?

First, let’s think about this from the cloud service provider (CSP) perspective.? Let’s assume the CSP is Acme Cloud with a current run rate of $1B per year.

1. Cloud revenue is utility revenue (e.g., consumption of first party Acme Cloud services).? There is variability by customer by month (since it’s pay for what you use), however at an aggregate level, the spend has a reliable baseline.??
2. Each year, the Acme Cloud GTM org sets incremental revenue growth targets.? For this year, Acme expects to grow 20% or $20B.? While the total goal is $120B, in this model, the focus is on the $20B of absolute growth.??
3. Of the $20B in growth, Acme Cloud estimates the impact of partnerships and projects that 25% of growth will come from ISV co-selling, or $5B in annualized run rate.? ISVs drive both direct consumption themselves (SaaS deployed on Acme Cloud drives Acme native services consumed by the ISV) and first-party services the customer deploys (e.g, when the customer uses the ISV solution as SaaS, they also consume additional Acme Cloud services like compute, storage, analytics).
4. Acme Cloud then assumes that 3x pipeline coverage will be required, or $15B in ISV co-sell pipeline.? Targets are then cascaded by region, customer segment, and by ISV (for top ISVs).? Core roles like Global Partner Managers (PDMs), ISV Overlay Sales, and Partner Marketing take on targets mapping corresponding where in the funnel they focus.

In this model, the focus is on growth.? ISV partners are “door openers” for Greenfield customers (a Greenfield customer is a customer with little to no cloud consumption), which represent the majority of cloud customers. ISVs accelerate time-to-value for existing customers by helping them build cloud foundations / landing zones (security, networking, cloud operations), modernize their application development (DevOps, observability), transform their data strategy (data and analytics, AI/ML), and deliver digital transformation (line-of-business applications, industry vertical).

The ISV perspective

For ISVs, the mental model is similar - partnering with a CSP drives incremental revenue growth, through new customer acquisition, existing customer expansion, and pipeline acceleration.? Let’s pretend for a moment, we work for Kane Software, a CICD (continuous integration, continuous delivery / deployment) platform.? Kane Software has a run rate of $100M with 25% annual growth expected this year (considering historic churn, premium SKU upsell, new product lines, organic growth).? Our sales goal this year is $125M with $25M of incremental revenue growth.??

Of the $25M incremental revenue growth, we believe:

• $4M will be from net-new logo acquisition
• $9M will be from existing customer purchasing more licenses of existing products
• $3M will be from existing customers purchasing additional products
• $6M will be from customers purchasing premium SKUs
• $3M will be from selling services and support offerings to new and existing customers

Many ISVs immediately focus on net new logo acquisition with the expectation that CSPs will source net new business for them.? ? To drive accountability towards this,? ISV Alliance Directors (who manage the overall cloud GTM relationship) are frequently compensated on “cloud provider sourced” wins.? Unfortunately, while well intended, CSP sourced wins can take 9-12+ months to achieve, with upfront work and results (at a territory level) needed first.? An individual cloud seller will bring you into their accounts you’re not in yet, but only once they understand your solution better, know how customers use your solution, and have seen a win together.? I’ve heard some refer to this as “give to get”, however I think it’s a more practical lens of needing to sell twice in co-selling - first to the cloud seller and second to the joint customer.

Joint-GTM with CSPs impacts incremental revenue growth in three broad ways:

1. Build-with: Increased combined solution “stickiness” which drives customer adoption and retention through “build with” activities.? This is a combination of your software solution (likely deployed as SaaS), the cloud services your solution directly drives, and the cloud services your solution influences in the customer tenant, within the context of a broader customer problem being solved.??
2. Market-with: Increased pipeline sufficiency (“top of funnel”) through programmatic marketing, events (virtual and in-person), and demand generation activities (call downs, email campaigns, account based marketing, social media selling).? The incremental demand generated is measured by sales qualified leads.
3. Sell-with: Existing customer expansion (up-sell, cross-sell) and net lew logo acquisition through joint account development activities.? The output of sell-with (or “co-selling”) is sales outcomes (increased revenue per customer, increased deal closure rate, shortened deal cycle, increased win rate).?

We will dive deeper into each of these areas over the course of future articles.? What I’ve observed is that no matter what the joint-GTM activity is, inevitably it will result in two sales teams working together on a joint opportunity, facilitated by account mapping.? Each ISV has unique dynamics related to their specific solution, their end user, their purchasing journey, the industries they compete in, etc., so there isn’t one playbook for all ISVs.? Generally speaking however, there are approaches which tend to have a higher probability of success, which is where I recommend you focus.

Examples of high probability of success activities include:

• Up-sell and cross-sell within an existing customer (e.g., “we have deployments in the retail and investment areas of a banking customer; we need help expanding into the wealth management department”)
• Mid to late stage opportunities where you have a clear ask of the CSP sales team (e.g., “we have an active and productive dialogue at the Director level, but need an introduction to a senior IT stakeholder in the CIO team”)
• Customer profiles which match prior wins, where you have referenceable wins you can share with the CSP seller
• Highly targeted account mapping (waves of 25-50 accounts) meeting the criteria above

Examples of low probability of success include:

• Leads and early-stage opportunities which don’t meet most of BANT-C (budget, authority, need, timeline, competition) qualifications and where you don’t have a named customer point-of-contact with an active ongoing dialogue
• Expanding into a new industry vertical or use case with minimal examples of previous wins / success?
• Engaging CSP account teams with unclear or impractical asks (e.g. “position our solution over our competitor”, versus respecting customer choice)
• High-volume generic account mapping, mapping out hundreds to thousands of accounts using Salesforce/CRM output and comparing account overlap

All of these approaches can drive incremental revenue growth but you are less likely to have success with low probability of success approaches.? For example, I supported a partner where the only opportunities they brought to the cloud provider I worked at were accounts they had struggled to gain traction with for the past 12-18+ months.? Ultimately, these were customers where their solution had challenging “product market fit” and “customer willingness to pay” blockers and the CSP seller providing a decision maker introduction or sharing account intelligence wasn’t going to alter the trajectory of these deals.? Furthermore, the ISV eroded trust with these CSP sellers who were now reluctant to engage with this specific ISV in the future.

Background: account mapping is the most effective, but least scalable joint-GTM activity

In my taxonomy of core joint-GTM activities, there are four key streams of activities: 1/thought leadership and awareness, 2/lead generation, 3/field activation, and 4/joint account development (presented in alignment to the typical sales funnel). Almost all "up-funnel" activities will eventually result in account mapping, to bring the CSP and ISV account teams together to jointly engage the customer.?

The challenge with account mapping is that it is both one of the most impactful activity, while also one of the least scalable.? It’s one of the most impactful activities because the account teams which each serve the same customer have the best intelligence, customer stakeholder relationships, and access to customer decision makers.? Account mapping is also one of the least scalable activities because the there is a finite number of CSP sellers and each can only support ~5-10 concurrent co-sell opportunities.??

CSP sellers:

1. Almost always cover multiple customer accounts, varying by the spend, complexity, and strategic importance of the customer(2).
2. Have multiple competing priorities - including selling hundreds of native (micro) cloud services, selling first party software solutions, supporting customer migrations, driving multi-year spend agreement conversations.?
3. Can only support a limited number of partner co-sell engagements.? Most only have the bandwidth to support ~5-10 concurrent partner engagements and receive many more requests than they can support (the most popular customer accounts can receive 100+ partner requests).??
4. Value the trust they’ve built with customers above all else.? Everytime a CSP seller introduces or endorses a partner solution there is an element of risk for them.? Consequently, CSP sellers prefer qualified opportunities with evidence the ISV has been successful with customers similar to theirs.

Targeted Account mapping overview

A highly targeted approach to account mapping maximizes your probability of success and best achieves incremental revenue growth outcomes.? I recommend you initially focus on your areas of existing strength and relevance (product maturity, competitive differentiation / segment leadership) and midstage and later pipeline.? Where possible, this should include representation from your Chief Revenue Officer’s top 25 opportunity list.? Bring CSP co-selling to your largest and most strategic opportunities, as these opportunities drive disproportionate incremental revenue growth impact.

Account mapping is comprised of four general phases:

1. Account list creation: ISV creates and shares a list of targeted accounts with key information including: account name; customer point(s) of contact; customer use case; current sales stage; help needed, account notes.? Recommendation is 25-50 accounts per wave.?
2. CSP seller interest confirmed: The CSP partner team reaches out to the CSP seller for each account, via e-mail and chat, and confirms interest in connecting with ISV.??
3. Seller-to-seller introduction call: Introduction call is held to discuss opportunity and joint engagement next steps.? Attendees typically include CSP/ISV sellers and CSP/ISV customer engineers; can also include Specialist Seller or other roles.
4. Joint account development: sellers (including customer engineers) from the CSP and ISV jointly engage the customer.? The partner teams (ISV Alliance Director and CSP Partner Manager) hold (bi)weekly pipeline reviews to review progress and provide additional support as required.??

Upon significant progress / wins, additional opportunities are identified. The CSP seller should always be asked “are there additional customers you cover who would benefit from this ISV solution?”, but only once customer traction has occurred.

The best-case response rate of 65% - 80% can be expected.? There are many reasons a CSP seller may not engage including current commit negotiations with the customer, being new to the role and still ramping up, currently handling an escalation / issue with the customer, etc.? Our goal is to maximize the probability of success (the % of CSP sellers willing to jointly engage).?

To do so, we focus on having the following for each opportunity:

1. A qualified opportunity with an active and ongoing conversation with a named customer contact.?
2. A compelling message to the FSR/CE on what the ISV solution is, what problem it solves, evidence of success with similar customers, and impact to GCP services consumption
3. CSP incentives the opportunity is eligible for
4. A clear ask from the CSP team?
5. An ISV seller / sales engineer who has been previously enabled/coached on how to engage with CSP sellers.

Step 1: Use reverse account mapping to craft a “better together” story for the account mapping campaign.

Reverse account mapping (outlined in Part 1 of this series) is an activity where you interview existing joint customers to understand “in the words of the customer” what the joint better together story is.? Generally, 3-5 joint customers is sufficient.? Focus on a specific customer profile for each reverse account mapping activity, narrowing in on dimensions like company size, geography, industry vertical segment, and stage of cloud adoption.??

An effective “better together” story:

1. Is hyper-focused within a specific use case, industry vertical, or customer segment.? Avoid messaging which is vague and not anchored in customer evidence.
2. Addresses actual joint customers and prospective customer pain points.? It doesn’t extend into adjacent use cases without customer customer examples and data.??
3. Explains how the ISV’s solution is differentiated and unique.? Messaging avoids language which creates the perception that the solution competes with a CSP service.? If in fact, the ISV solution does compete with a CSP service, messaging explains the customer scenarios where the ISV solution is the best fit.

Step 2: create an account list

Create a spreadsheet with a list of targeted accounts with key information including: account name; customer point(s) of contact; customer use case; current sales stage; help needed, account notes (see here for a basic template).? Recommendation is 25-50 accounts per wave, of which at least 15-20 are mid-to-late stage opportunities.? All opportunities should have a named contact at the customer you have an active dialog with and the majority should have at least 3 of the 4 BANT requirements of a qualified opportunity.? Additionally, prioritize solutions are listed on the CSP’s Marketplace as a public offer (for self-service trial, POC, and simple purchases) and private offer (for larger deals with customized pricing).

Step 3: create CSP account team collateral

To get the attention of CSP account teams, lead with CSP partner programs and incentives you participate in, previous wins with CSP customers, and any CSP products your solution is integrated with.? Each CSP will have their own templates for field collateral, so no template is provided here.?

Field collateral (solution briefs) should answer the following questions:

1. Who are you???
2. What is your solution’s use case?? What customer problem do they solve?
3. Who do you sell to? (buyer personas, customer segment(s))
4. Where have you had documented success in the targeted customer segment?
5. How does your solution (in)directly drive customer consumption of GCP services?
6. What is your superpower (what do you do uniquely well)?? This should differentiate you from partners in your space (e.g., cheaper, faster, better, unique capabilities)

Most ISV solutions have applicability to multiple industry verticals and use cases.? I recommend having available collateral (sales and technical briefs) for each core ideal customer profile.? If the ideal customer profile of the account mapping campaign is telehealth companies, there needs to be evidence of your solution’s impact to other telehealth customers (logos, case studies, customer quotes, etc.). If you have no prior experience selling into telehealth, the campaign will produce a low probability of success.???

If your solution is more technical (and your goal is to engage with the CSP customer engineer), focus on white papers, sample architectures, documentation, sample libraries, etc.? Technical collateral should answer the following (without any fluff):

1. What the solution specifically does and doesn’t do
2. Architectural excellence, including scalability, reliability, and performance
3. Your solution roadmap, with emphasis on alignment and integration with CSP services
4. Multiple customer references through whitepapers, blogs, and customer success stories

Step 4: Schedule and hold joint engagement call

Meetings should be short (30 minutes) and content should be concise, compelling, and actionable.? “Time is money” is the most important mantra when engaging sales teams.? We take the approach of focus and relevance because it best serves the customer and also “cuts through noise” for sellers and shifts the cost-benefit analysis into your favor.

Prior to the call:

1. Create two slides to present on the call which includes the following information.? If you need to add additional slides (e.g., architectural diagrams, customer logo slide, etc.) keep it to a minimum.? ISVs who try to present 10+ slides end up spending the entire call presenting slides and little to no time on the actual asks of the CSP account team and next steps.? Attach these slides to the calendar invite to provide as a pre-read (knowing most sellers won’t pre-read).

Slide 1: Overview of ISV solution

• Better together message (developed in part 1)?
• CSP seller incentives / CSP programs your solution is eligible for?
• Links to available materials (landing sites, field collateral, technical documentation)

Slide 2: Customer opportunity slide

• Name of customer
• Names (and links) of similar customers served
• Summary of current engagement (New logo? Existing customer?? Land and expand?? Renewal + upsell?)
• Customer contact(s) currently engaged with
• Specific ask(s) of CSP sales team
• Key account notes / details to include

2. (optional) Coach your seller on how to show up to the call, either through broader enablement on co-selling with CSPs (to be covered in depth in a future article) or a 15 minute prep call.? Key points include:

• Review the “better together slide” slide - emphasizing impact to cloud consumption (CSP services your solution is built on and influences within the customer’s CSP tenant).? Most ISV sellers don’t understand the cloud, how their solution is built on the cloud, or how their application influences a customer’s cloud journey.
• Review the ask to ensure it is clear and realistic (see below for a list of “good asks” and “bad asks”)
• Any additional details to emphasize based on the specific ISV-CSP partnership

3. Ensure the right attendees are on the call, both from your company and the CSP

• Technical solutions (e.g., ISV providing AI models / platform) require customer engineers and AI/ML specialists
• The right sellers when discussing large/strategic customers.? CSP account teams can be 10-20+ sellers for the largest accounts (covering different geographies, subsidiaries/business units, industry segments, etc.).
• Avoid too many attendees as this can eat up ? of the call with introductions and reduce the effectiveness of the call.

On the call:

1. Wait for attendees to join (5 minutes) - assume the call will start 5 minutes late.
2. Introductions (5 minutes) - keep brief (name, title, background at company, experience with customer) and also encourage each participant to mention something fun about them outside of work.? This can build rapport between sellers (e.g., both are members of the same country club).
3. Present/discuss the “better together” slide (5 minutes) - Deliver your rehearsed “better together story”, emphasizing 3 points: 1/incentives and programs your solution is eligible for; 2/what your solution is and how it benefits the customer; 3/how your solution impacts CSP customer consumption.? Generally, the ISV’s Alliance Lead delivers this message, complimented by the CSP counterpart.
4. Present/discuss the customer opportunity slide (10 minutes) - The ISV’s account team presents this slide, clearly explaining the current state of the engagement, the specific customer use case, and the help needed from the CSP team.
5. Next steps and action items (5 minutes) - Act as a timekeeper and ensure at least 5 minutes are left at the end to agree on next steps and action items.? Aim to agree on specific actions, owners, and dates.? If a followup call needs to be scheduled, use this time to compare calendars and get it scheduled.

After the call:

1. Confirm CSP account team willingness to support the deal - The CSP Partner Lead follow ups with the CSP account team to confirm interest to move forward.? When account teams decline, get feedback on why as this can lead to adjustments in your positioning in future calls.??
2. Establish a pipeline review process (ISV-CSP) - schedule a (bi)weekly call between the ISV Alliance Director and CSP Partner Lead to review the status of all ongoing co-sell deals, tracking deal stage, deal age, next actions, and any issues to be addressed.?
3. Deal acceleration - When deals are stalled (time kills all deals), additional activities and approaches are taken (e.g., executive escalation, enablement activity, funding/incentive).
4. “Last mile” of procurement - Leverage the CSP’s Marketplace to accelerate the contracting and purchasing of your solution.? In a tightened economic environment, CSP Marketplaces allow customers to tap into their cloud committed spend.??

Good and bad asks of CSP Sellers

Good asks

1. General account intelligence to share account dynamics, even if the CSP cannot directly influence the opportunity.?
2. Introductions to customer decision makers, especially in IT and procurement; account strategy to increase win probability and velocity.?
3. Expansion of ISV footprint into other divisions, subsidiaries, and business units through stakeholder mapping and C-level discussions with customers.
4. Provide technical guidance (CE-led) and credits/discounts to offset costs of proof of concepts and migrations to CSP.?
5. Unblock procurement through the CSP’s Marketplace, through tapping into cloud committed spends and benefits of CSP commit drawdown Marketplaces provide customers.

Bad asks

1. Not having a clear ask at all - A common complaint from CSP account teams is ISVs who don’t bring an ask at all to the introduction call.? These ISVs are viewed as “not co-sell ready” and are quickly moved on from (reminder that CSP sellers receive many requests to partner and have many competing priorities).
2. Sell your solution for you - CSP sellers often get asked by ISVs to drive the customer conversation and opportunity.? The seller of record is your seller.? The CSP account team is there to support, ublock, and accelerate your deal, but not own it.?
3. Cold account introductions - The CSP seller is likely unfamiliar with your solution and wants experience supporting your deal before sourcing you new business for you.? Requests for “fishing” or “prospecting” have a probability of success under 10%.? Hold off on the ask of “what other accounts do you cover that this solution would be a fit for?” until you’ve seen customer traction and/or wins first.
4. Competitive endorsement - CSP sellers consider “doing right by the customer” a core value and respect customer choice.? CSP sellers are generally happy to endorse your solution itself, but not against another ISV.?
5. Confidential customer information - CSP sellers can’t provide you details into the customer’s budget, historic spend, competitive solutions used, or sensitive technical implementation details.? Trust is the currency sellers trade in and such asks will immediately flag the ISV with a red flag.

Conclusion

The ultimate goal of most joint-GTM activities is to connect the customer accounts teams of the CSP and ISV to jointly engage the shared customer, which is accomplished through account mapping.? Account mapping is one of the most impactful activities because the teams closest to the customer working together results in greater customer outcomes.? Most customers are early in their journey to the cloud and will need to purchase 25-30+ net new ISV solutions across 10+ ISV categories to support their cloud journey, in addition to hundreds of existing and legacy applications their IT department oversees.? Customers view the CSP as a trusted advisor to their overall digital transformation journey, including which applications they rehost, replatform, repurchase, refactor, retire, and retain.?

Account mapping is most effective when it works backwards from validated customer impact (through reverse account mapping and your “better together” story developed in Part 1), supported by strong field collateral and customer references.? Account mapping with CSPs should never be high-volume, low-relevance CRM “spreadsheet dumps” (e.g., 100s of accounts) as you lose relevance and focus.? Focusing on quality over quantity is key.? Otherwise the “probability of success” of a CSP account team leaning in and supporting the opportunity is low.??

ISVs who are the most successful in co-selling with CSPs (including the top 5 to 10 ISVs you hear the most about for each CSP) focus on winning with specific CSP sales territories, industry vertical teams, and core use cases.? These ISVs also understand that the goal of “CSP sourced business” comes first by earning trust with individual sellers and asking to be brought into their other accounts once customer traction has been achieved.??

In Part 3, we will explore enablement, including for your sales team, the CSP’s GTM org, the reseller channel, and the customer.?