Cloud Co-Sell for ISVs: Part 2 - Account Mapping Best Practices
Brian Kane
Head of Transformation and Strategy, ISV Partnerships and Google Cloud Marketplace | ex-AWS | ex-Microsoft
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.
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:
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:
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:
Examples of low probability of success include:
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:
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:
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:
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:
领英推荐
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:
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):
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
Slide 2: Customer opportunity slide
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:
3. Ensure the right attendees are on the call, both from your company and the CSP
On the call:
After the call:
Good and bad asks of CSP Sellers
Good asks
Bad asks
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.?
AWS Alliance Lead
1 年Anxiously awaiting Part 3... :)
Author || Founder & Managing Partner Vyver Consulting - Go to Market Strategic Partnerships
1 年Well said Brian! Hopefully this helps alot of ISVs on how to engage CSPs. Everyone thinks CSPs will grow pipe and deals but far from the truth, they are enablers not sources of new pipe. I still think ISVs should focus on the first win with a CSP. Get to know or find that one guy who believes in your product and is a well wisher. Then expand that win and replicate slowly. The heavy lifting is all the ISV. Just my two cents…aim small miss small
Partnerships & Alliances | AI Ecosystem Builder | Ex-Zendesk-Facebook
1 年Thanks for putting this together Brian! Super useful and I really like your insights on the Good and the Bad ways to engage with CSPs.
I help business leaders with Prescriptive Team Building Solutions
1 年Thanks for sharing Brian! I can attest to the quality and viability of your thoughts here! As a partner who has experienced this process, this approach is thoughtful and effective for the long run!
Global ISV Sales GTM Lead at NVIDIA
1 年Brian - you are spot on. We use use this approach every day with our Elastic - Google Cloud GTM with great results, enabling our sellers to have a higher likelihood of success co-selling.