Tl;dr - Predictable machinery sales result from an increasingly complex coordinated framework of marketing and sales tactics. Companies often try to select approaches in an either/or comparison like "inbound vs ABM." But success is built on a broad, carefully engineered combination of methods. Let's look at how they relate and how companies can begin to implement ABM for capital equipment sales.
Complementary Sales Approaches for Your Entire Market
Most machinery builders generate ≈75% of their revenue from repeat orders. That creates business risks and reduces revenue. It largely codifies into strategy a defense of current customers and minimal success in penetrating entrenched incumbants.
That's worked traditionally, albeit accentuating the cyclical nature of capital equipment sales. But as buyer behaviors change and competitors become savvier, it's becoming problematic. Companies must market and sell to their entire target market.
That means they need an improved revenue growth framework, one that considers every function of revenue growth from strategy and marketing to technology and sales. Of course, that's precisely what companies do on the production side of their business, through process engineering and rigor. And it's at the core of my Overall Revenue Effectiveness™ revenue growth framework.
Companies need to think of their market as a Venn diagram. The circles will include current repeat customers, lost customers, target accounts, affiliates of current customers (e.g. other branches/plants), and ICP (ideal customer profile) matching accounts. There should also be circles representing new segments as new technology and partnerships open up new opportunities.
Account-Based Marketing and Target Account Sales
Visualizing that diagram, you realize there are accounts where you have strong relationships and no business - maybe you've worked on many projects you've never won. You have other accounts that have never thought of you and many in between.
There will be a large number - likely thousands - and they'll be prioritized differently depending on firmographic factors, competitive relationships, and other details.
The way you'll sell them will be different. In some cases, you'll have team selling and top-to-top engagement. In others, one of your reps will cultivate a relationship with an engineer who's moved from one customer company to another target company. Some you'll ignore, while others will be selected for deliberate, patient targeting with the attainable goal of a first meeting in some months.
You can't actively work on all of them simultaneously.
That introduces another Venn diagram - this one of sales and marketing approaches. Some accounts will be active with pending projects and intense, frequent sales activity. Others will be aspirational with occasional outreach. A few will be high-priority targets with focused sales activity, and many will be occasionally touched. There will also be a large group that is known but not active.
To reach this diverse group of prospects, your revenue growth effort must include a combination of outbound prospecting, opportunity sales, inbound marketing, and target account sales and marketing.
Thus the need for marketing and sales integration. The two functions must work collaboratively to deliver the best effort for each type of account and each sales situation. That's the key to boosting the efficiency and effectiveness of sales.
And that's where the concept of ABM comes in.
Many machinery companies have very casual target account lists. They're normally prepared in a rush when a sales manager inquires. There's not a lot of research or rationale in many cases, and the accounts, therefore, aren't subject to a deliberate omnichannel outreach.
ABM, in contrast, carefully identifies targets based on measurable attributes which match a company's most successful prospect profile. That list is targeted for complex and sophisticated coordinated marketing and sales efforts. These are often long-term and involve carefully orchestrated plays. Sometimes there is even specific content created for each account. It is an advanced manufacturing marketing technique.
ABM is gaining traction as buying teams expand, buying journeys lengthen, and the complexity of sales increases. It's a coordinated approach.
Inbound vs ABM
But you'll only use ABM for perhaps a few hundred companies. With a few hundred more the subject of active sales, that leaves thousands that are likely untouched.
That's where marketing needs to step up using a variety of tools, including digital, content, and inbound marketing. So when you compare inbound vs ABM, it's really a false choice. They're both necessary, and they're complimentary.
Inbound helps companies find you when they are searching for a solution but not actively engaged with your sales team. A lead gives your inbound sales team an opportunity to engage. ABM helps to penetrate important accounts by leveraging the coordinated strengths of marketing and sales.
So inbound vs ABM isn't an either/or, as it's sometimes cast. It's an AND.
How to Incorporate ABM Into a Capital Equipment Revenue Growth Framework
Both inbound and ABM are well suited to capital equipment sales. They're complementary approaches recognizing the broad range of prospect awareness and activity. The ORE revenue growth framework incorporates various techniques to support all approaches simultaneously.
ABM can be particularly challenging, however, because it's built on integrating marketing and sales in a way that is uncomfortable for many machine companies.
It involves coordinated planning, content creation, measurement/KPIs/accountability, training and coaching to optimize the effectiveness of sales, team selling, buying team research, and other tactics which traditional target account sales often omit.
It's so complex, in fact, that it often requires specialized account-based marketing software to manage the effort across hundreds of companies, marketing and sales disciplines, and extended periods of time.
Incorporating ABM (or even inbound marketing and team selling) into capital equipment sales requires a mind shift. Often the assumed roles of marketing and sales are ossified, and mindsets must be changed.
Success is built on a commitment to recognize the various types of prospects and the various combinations of marketing and sales that are appropriate for targeting each. It creates a complex matrix of execution with which some traditional machinery sales teams will be uncomfortable.
Underlying the required changes is a fundamental reassessment of the roles and resource requirements of marketing and sales in support of integrating the functions.
Integrating Marketing and Sales for ABM Success
When 70% of buying journeys happen before active engagement between prospect and sales, marketing plays an increasingly important sales role. Further, large buying teams and long sales cycles require marketing support in content and tools to support the effectiveness of sales.
These requirements are not reflected in the org charts and budgets of many mid-size machinery companies. Often, "marketing" is one or two folks coordinating trade shows and trade journal ads, and sales is a group of 20-50 with a couple of layers of management and a significant budget.
While top industrial companies often allocate ≈5% of revenue to marketing, even an increase of 1-2% will support the addition of some people, tools, and outsource resources.
But that's not enough.
Management must cultivate and require a collaborative, integrated function of peers between the departments. So much of revenue growth today, particularly ABM, requires an active side-by-side effort of marketing and sales. Integrating the functions is critical to success.
First Steps to Improve Target Account Sales Results with ABM
My ORE framework provides a detailed roadmap for building the full range of marketing and sales capabilities in your company. This diagnostic will help you measure where you currently stand and identify priorities for focus.
There are some basic steps that companies can undertake easily to begin their journey toward improved target account sales using an ABM approach.
Define your ICP
Everyone on your team should understand the parameters that determine how closely a prospect matches your ideal customer profile. That will be based on various firmographic factors like size, location, industry, ownership, etc. This is a fundamental factor in targeting and lead scoring.
Refine & Emphasize Your Sales Process
Complex, long-term, coordinated efforts between marketing and sales require well-defined and carefully engineered processes. This includes the sales process which is often very casually discussed among veteran capital equipment sales teams. Plays need to be reinforced with CRM questions, coached, rehearsed with roleplays, and constantly discussed among the full team using consistent language.
The coordinated effort to simultaneously reach five or seven members of a typical 12-person buying team is complex. it will require relationship mapping, planning, and engagement at various levels in the company across various departments. CRM and account-based marketing software will be tools in the tech stack to support the effort.
Testing Sales Skills & Training
Mediocre salespeople won't succeed in complex ABM plays. Of course, they won't consistently succeed in most sales situations. And by definition, the majority of salespeople are average. To staff your team with a group of 2nd & 3rd standard deviation talent, you need to use tools that specifically measure sales skills with a high degree of predictive validity. Then you need to consistently train them to improve.
Inbound and ABM Are Tools to be Combined
The bottom line is that inbound vs ABM is a false syllogism. It's not either/or. Both are important to revenue growth success - along with other approaches and tactics. They are elements of an increasingly complex revenue growth framework that's necessary if companies are to predictably grow machinery sales.