The Five Act Sales Play for Enterprise Vertical Accounts

This is the second of four posts building out the Five-Act Sales Play model across four sales segments, fleshing out the table we introduced in the initial post. Here we will be focusing on enterprise accounts overlaid with a vertical market segmentation strategy. The idea here is to become the go-to vendor for a specific set of applications for a specific target market segment. This is particularly valuable when you are not the global market leader and need to carve out a space where you can be number one and leverage the ecosystem power such a position entails.

The specific focus here will be on acquiring new logos based on a single use case that targets a problematic business process causing current challenges for virtually everyone in the segment. This is the classic “crossing the chasm” scenario and represents the most proven market development play in all of high tech.

Act 1: Getting Access to the Target Executive

Communication with the target market begins with publishing a provocative point of view about a problematic business process specific to the targeted vertical industry. Specifically, you will call out:

• The negative impact the problem process is creating
• The importance of addressing the problem as soon as possible,
• The inadequacy of current offerings to do so, and
• The reasons why a next-generation offer can succeed where current offers fail.

Broadcast distribution of this message is designed to catch the attention of senior executives who might forward it to their lieutenant responsible for the process in question. Narrowcast communication is targeted specifically at this lieutenant, initially through email, followed up with outbound calls from business development representatives. The goal of these calls is to determine if:

1. The problem process is perceived as vexing to the target account,
2. The contact person is responsible for remediating the situation, and
3. The contact person would take a meeting with an account executive to discuss a potential solution to the problem.

This is a relatively straightforward process that lends itself to scripting and has well defined parameters for qualifying a prospect. In addition, in the hand-off to sales, whatever notes the BDR has taken can prove valuable in creating initial rapport. All in all, this makes use-case-based pipeline generation one of the most efficient and cost-effective forms of marketing communications there is.

Once market development is under way, and your company has a handful of referenceable customers succeeding with your playbook, then a beautiful thing happens. The market segment becomes aware of your solution and begins to circulate the message on its own. You start getting inbound queries that you did not initiate. Ecosystem partners start contacting you about partnering with them. All this reflects a change in state, from being a new entrant, to being the perceived market segment leader.

Act 2: Engaging the Prospect around a Problematic Business Process

Vertical market development is organized around use-case-based sales plays. Specific to Act 2, the key to engaging the prospect is to spend 80% of the time talking about their problem, and only 20% about your solution to it. Specifically, you should never give a solution demo at the first meeting. That would be like going to the doctor for a consultation about a potential health problem and being shown a video of the operation they specialize in. 

Instead, the account executive opens the conversation explaining that, as a vendor, we have seen a number of companies in your industry frustrated by the following problematic business process, and we are working with several to address it. The question for today is, should your company be included? From this point on, ideally the prospect does most of the talking, with the account executive taking notes. Asking informed, probing questions is how AEs can establish they have domain expertise in the use case, and that in turn is what converts a sales call into a conversation with a potentially trusted advisor.

In subsequent Act 2 meetings, the agenda is to dig deeper into the specifics of the problem process as it manifests itself in the prospect’s organization, with a view toward:

1. Scoping the problem,
2. Designing the solution,
3. Ball-parking the cost and time involved, and, working with the prospect,
4. Estimating the business value of implementing the solution.

These will all get fleshed out and formalized in the Acts that follow.

Act 3: Closing the Sale

In a land-and-expand marketplace, the use-case-based sales play is designed to land quickly and to establish the vendor as a trusted advisor with a high-value portfolio that will come into play during the expand portion of the relationship. During this first sale, therefore, you would like to close relatively quickly on the immediate problem, and do so at a premium price, thereby validating both the importance of solving that problem in the near term, and the competitive differentiation of your solution to it. This tees up an account development path that is attractive for both the customer and the vendor.

The economic buyer for the first deal will be the executive out of whose budget the problematic business process is being funded. This is also the person taking the heat from the rest of the executive team for not addressing the problem effectively. Thus, the desired business outcome is crystal clear—Get this thing off my plate!

The key decision-maker will be the process owner whose full-time job is managing the problematic process and the organization that executes it. Unlike the economic buyer, this person may be conflicted, particularly if your solution involves displacing one or more members of the current organization. For that reason, it is important to coordinate the closing with both the process owner and the economic buyer in tandem, to make sure the latter’s compelling reason to buy does not get derailed.

Finally, when it comes to beating out the competition, your competitive advantage is based primarily on your maniacal focus on the target use case. Such a focus results in a “whole product” that is highly differentiated because it maps directly to the problem at hand in a way no general-purpose solution can. This is particularly important to the process owner, who may have to fend off an IT leader who is arguing that the incumbent’s alternative is “good enough.”

Act 4: Enabling the Customer

Because the whole product is your key differentiator, you cannot leave any part of Act 4 to chance. Until such time as you are established as the market segment leader, and the ecosystem rallies around your solution architecture, you must lead the implementation phase. This includes orchestrating partners who contribute to the whole product. There does not need to be a program office. You are simply in charge.

The good news here is that, by its very nature, this play has a restricted scope. You have signed up to fix a broken process, but it is only one process, and there is already an organization in place to address it. True, you have to get that organization to adopt a next-generation solution. Moreover, you have to help them reengineer the process and get the enterprise reoriented to the new approach. But since the process has been widely acknowledged to be broken, there is much less adoption resistance than normal. You just have to make sure that no glitches derail the effort. And there will be glitches, of course, which is another name for lessons to be learned. The point is, you want to be the one who learns these lessons so that you can make your whole product bulletproof. Once you do, competitors will simply avoid this space.

To accomplish this end, you need a small but dedicated team that specializes in this particular use case. As noted earlier, after a handful of successes, the ecosystem will want to get on your bandwagon. At that point, you want this team to package up their learnings and empower third parties to carry the use case forward. This frees you to move on to the next use case, transitioning from the land to the expand portion of the customer journey.

Act 5: Realizing the Value

Act 5 is where you get the big payoff from a use-cased based land-and-expand sales play. Because the problem is so targeted, because it has the attention of upper management, and most importantly, because it has been solved, the customer is typically quite willing to help quantify the return on this investment. This is not a situation where they want to keep things under their hat for competitive advantage. Fixing a broken process does not normally change your competitive positioning. Rather, it frees up resources to spend much more productively elsewhere.

To capitalize on this situation, marketing should seek out opportunities to host panels at events held by the target industry associations. All your target customers will be at these events, and once they hear from their peers that your solution really does work, they want to get the same thing from themselves. 

In parallel, inside the accounts you have already penetrated, you want to take a “bowling alley” approach to expansion. That is, you want to take on adjacent use cases where your first success gains you an entrée to explore where else you can be of help. This effect will be amplified as you gain market segment leader status because, once a partner has invested to become proficient in your technology, they want to leverage that investment across as many opportunities as they can. 

Summing Up

Vertical market development is by far the most reliable way for a B2B vendor to penetrate a new segment and build market power. The challenge for a large enterprise is that, in the short term, it does not move the needle on their top line. As a result, it is hard for them to sustain the focus needed to reach the tipping point where the local ecosystem kicks in and secures their market segment leadership position. For this reason, you see this play run more often by companies with revenues south of $1 billion. But this is a strategic error on the part of the big guys because, no matter how big you are, if there is a chasm in front of you, this is the right way to cross it.

That’s what I think. What do you think?

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Geoffrey Moore | Zone to Win | Geoffrey Moore Twitter | Geoffrey Moore YouTube