A Pattern for Account Led Growth Relationships

How Customer Relationship Models Affect Growth

This is Part 8 in a blog series on Customer Relationship Marketing.?

The Tale of Two SaaS CEOs

Recently, I spoke to a SaaS company founder who is pursuing a product-led growth strategy. Revenue is slow to build with focus on user adoption, so his question was: when should he bring in the sales reps who can pursue the large enterprise deals? Surely, that would drive revenue faster than through user adoption of a low price point product.?

Separately, I also met with another SaaS CEO driving an account-led growth plan who had revenue concentrated in their top few accounts. His question: user churn of their products was rising due to better, competitive products; so should he bring in growth marketers to fix user adoption, before the large customers churn??

To each of them, bridging across different growth pathways seemed simply a matter of hiring different sales or marketing people. However, there is a tight interplay between how a tech company grows early on and the kind of customer relationship model the company builds. This interplay can either limit or enable growth later on.??

In the next few posts, I explore the common patterns of how companies should audit and build customer relationships for different growth pathways.

Based on its initial growth strategy, each B2B tech company builds a certain type of relationship model to manage their customers.

Once a model is established with the customer, the company uses these mutually agreed upon relationships to set expectations and manage the disruption their tech product brings to a customer’s business.?

So later on, when the company adds on or switches to a different growth pathway, it needs to build new types of relationships and expectations that are organizationally challenging for the company - both within and among its customers.?

Establishing Your CR Model and Auditing CR Equity?

How do the CEOs above assess their current customer relationships? And how do they determine the new relationships needed to bridge to different growth strategies???

Start with a baseline audit of the quality of your inter-firm relationships. This is critical for enterprise focused companies, and may be done at account level. A simple way to do so is map each of these four types of relationships for your company, and for each user and buyer relationship pair, assign a measure of social capital - high, medium or low. Of course, this social capital changes over time. Nonetheless, such an audit of all the customer relationships should reveal the strengths and gaps of a tech company in Customer Relationship Equity.?

With this audit in hand, a company can overlay one of the three growth pathways they are currently following or wish to follow.?

For each growth pathway [product-led, account-led or channel-led], the company needs to invest in different types of customer relationships.?

As an example, let’s look at the relationships needed for account led growth, and the sequence in which they may be built.?

A Pattern: Account Led Growth With High Relationship Scope

Example: Tech co selling to large enterprises with high LTV and a complex tech offering.?

This pattern is common among tech companies with complex offerings pursuing account led growth at large companies.?

Such companies require a high relationship scope because each account offers a high LTV; and typically, the orientation of the relationship is that of an “Expert Consultant” since the tech offering is complex.?

Typically, in such cases, the company’s focus is on relationships with the buyer, and not the user. Buyer is the person who cares about creating business value in the organization through the use of the technology. The company promises to deliver on this value [brand promise] through deployment and use of its technology over time within the account. However, as the tech offering is complex, it triggers significant change in the organization to adopt the technology.?

This poses a relationship challenge: the buyer needs to be persuaded of not just the value of the solution, but also of the necessity of the org and process changes accompanying it. The buyer needs to be persuaded to become a change agent for the technology. The more disruptive the changes to people and process, the more critical it is for the tech company to build high quality relationships with the buyer who needs to help champion or mediate such changes. [more here]

The company needs to build strong relationships with the buyers to help them mediate the org disruption triggered by the deployed technology, as it delivers value.?

These characteristics result in a high touch customer journey for a tech company.? Initially, the company identifies a narrow segment of accounts to break into with targeted awareness. This is to ensure these accounts have a good fit with the complex tech offering. Due to high tech complexity and high org changes the sales effort is high - and needs one-on-one buyer relationships. In such situations, post sales customer support is also high, often needing dedicated account teams to ensure the business value is realized and the org changes sustained.? Over time, the company grows within an account through advocacy of the buyer Champions who promote the successful outcome of the tech offering.?

Start with Relationship Power, Build Depth, Add Reach Later

So, what is the order in which the company needs to build the relationships for such a journey??

First, the company needs to hire executives and sales teams that have or can build access to buyers with relationship power.

These are the buyers who have the power to drive adoption of the technology with the organization. Getting access to such buyers is the first order of the day.?

The second part is to identify the preconceived attitude each buyer has towards the technology offering. This determines how willing they may be to drive organizational adoption of the technology. For instance, if the buyer has a negative attitude to the technology, they are likely to block its adoption. Conversely, a buyer who is convinced of the technology is likely to champion organizational change around the tech offering.?

So, the customer-facing teams need to identify the buyer's power and attitude towards the tech and build relationships such that they can support their Champions and convert or bypass the Blockers.?

Thereafter, the company needs to invest in relationship depth to convince the buyer of its tech offering.

This is achieved through live selling, and where possible in person. Sales teams need to build deep relationships with each buyer to ensure the champions are created and nurtured and blockers converted or bypassed. This is such a critical skill in this pattern that large account sales people maintain relationships with their buyers over decades. Often based on the long standing relationship equity they have, a sales rep can determine better than any market signal whether a certain technology can be sold to a buyer. For the same reason, the hardest skill a new sales rep needs to master at a new account is building relationship depth [social capital]. It is the single biggest investment for account based growth.?

Finally, once an account has champions who advocate for a technology to drive change, the sales team can broaden their relationship reach within the accounts, segments and beyond.

It is easy to audit the reach. Often an account can have multiple buyers or buying centers. In account based growth, advocacy by existing champions to other buyers in the company is the fastest path to growth. Once a few accounts have adopted a technology, similar buyer profiles or personas across multiple accounts can be aggregated to form a target segment [e.g. AI-savvy CIOs”,? “security laggard CFOs”, etc.]. Beyond such target segments, new channels can offer access to more accounts. This can be audited or estimated based on numbers of buyers in each such channel.?

In summary, for account led growth with high relationship scope, a tech company needs to build its customer relationship equity first by accessing buyers who have power to drive change, then by building depth of relationships with such buyers to convert them into champions and finally by expanding reach to similar buyers across new accounts, market segments and channels.??

In the next post, I shall discuss the relationship patterns for Product-Led Growth.?

Key Takeaways

• CEOs of tech companies often wish to add or switch to different growth strategies - account-led, product led or channel led.?
• This is hard because a company’s CR [customer relationship] model is tied to its growth strategy and this needs to change as well.
• For a start, the company should audit its current CR model and identify its current equity.
• For each growth strategy, there is a pattern in which customer relationships need to be scaled.
• As an example: In the pattern for account led growth, a tech company with complex products requires high equity relationships [powerful, deep and multiple] throughout its customer journey.
• These buyer relationships are not just to deliver on the business value but also to mediate org and process changes triggered by the tech.?
• So, a company needs to first access and then build relationships with buyers who have power to advocate for such changes.
• Over time, the company needs to have relationship depth to convert buyers into champions to expand reach into other accounts in the market.?

If you like what you're reading, please subscribe to my newsletter Marketing Patterns

References?

• Marketing Strategy, Palmatier and Sridhar?
• Account Mapping Why It’s Crucial
• Essential Guide to High Touch Customer Success Model