Declan Mulkeen (strategicabm) - So today I'm joined by Keith Pranghofer, who's Director of Account-based Marketing and Strategic Accounts at Microsoft. Keith, thanks so much for joining us today.
Keith Pranghofer (Microsoft) – Thanks for having me, Declan, happy to be here.
Declan (strategicabm) – Fantastic, so let's kick off. Keith, you've been on a long journey at Microsoft. I think about 16 years in total, if your LinkedIn profile serves me right. That journey has encompassed Customer Marketing, Field Marketing, Customer Advocacy, and now for the last six years or so, Account-based Marketing. Can you tell me what's been the greatest change that you've witnessed in Marketing over all those years?
Keith (Microsoft) – Yeah, I mean so many. I mean, just so many that we all see, but for me I think the biggest change that I've seen is this pivot to really need to be customer and client obsessed. And this isn't just about ABM, but it's all functions of Marketing. Whether you're in product Marketing, or Customer Marketing, PR, or Research. This shift to really go deep and understand your client or your customer has really grown.
For me, it's been driven by, how do you compete in the market, right? And how do you address rapid change that's going on? If you don't understand your client or customer, you can't respond. And then arguably, it's more important not just to capture revenue today, and share of wallet, but how do you capture share of perception or voice.
Declan (strategicabm) – Yeah.
Keith (Microsoft) – And so understanding your client customer, being really obsessed around it, I think has been the biggest change that I've seen from a Marketing perspective.
Declan (strategicabm) – So this whole kind of approach of Client-centric Marketing and building that kind of community with your clients.
Keith (Microsoft) – Yeah, spot on. A lot of the conversation today revolves around, hey, what approach might you use? A lot of it is on the technology that we leverage today, but I think fundamentally those are all pieces that have driven change. The client-centric programs. I think you hit it spot on, is for me what I've seen the biggest change in 15 years.
Declan (strategicabm) – And that's interesting actually, because I remember I interviewed at the very beginning of this podcast a couple of years ago, Bev Burgess, who actually coined the term ABM back in 2003. And she was telling me that she was at a lunch or a dinner with some Marketers from Accenture and Unisys, and they had invented a term and a methodology called Client-centric Marketing.
And so that was the genesis of her building the methodology, coining the term Account-based Marketing. So it's interesting, your positioning around what you've seen in the change, obviously it comes back to what she saw 20 years ago now.
Keith (Microsoft) – Yeah, I mean, it really has. Bev, like you mentioned, has been, not only coined it, but then the work that Accenture, and I think it was Infosys you said, right? The work there, and so much of that bleeding from, it's interesting where it came from where it's evolved, those are really services-based organizations, right? They're not product based. They're in the business of consulting services, and how then bringing that, and how it's landed now in product.
And I would say even in some cases, you start to see it from a consumer perspective. To me, that's really an interesting evolution as well, of where it originated. I think people coming into Marketing practice today, it's the big tech product companies that are pushing a lot of the Account-based work. And I think oftentimes we look at them as being the marque, right?
I can say being at Microsoft, it's great to have that and have the brand name. And you name any of the large technology companies that are driving ABM, and so you think, oh, they must’ve originated and started this, but it didn't, it came from these businesses that had to be client obsessed because they were, at the end of the day, their product were the people that had to go do the work. So you had to be relationship based.
Declan (strategicabm) – Yeah, and I think also, Keith, they were companies and they continue to be companies that have to explore incredibly deeply those companies, their clients, know the market, know the landscape, know the competitors better than their customers to be able to advise them about what the future looks like, right.
So that's the perfect fit for ABM, if you think about it. 'Cause obviously the value that the insights bring, the value that all that kind of the data brings to the conversation, right?
Keith (Microsoft) – Yep.
Declan (strategicabm) – So let's just move on then, talking about your career a little bit more around ABM. I think that one of the first kind of campaigns that you were running at Microsoft were focused around deal velocity of existing customers. Could you tell us a little bit more about that?
Keith (Microsoft) – Yeah, certainly, and so, yeah, my first days in ABM and at Microsoft were in our Consulting Services business. So it kind of ties back to the story I was talking about from a services angle.
So there were places where we had existing relationships, and then we were constantly getting new projects coming into the pipeline, right. You always had these feeder deals, is what we would call it, but they were often small deals, and it goes back to if you want to grow your book of business from a services perspective, you have to understand your clients, their needs, and where they're going in the market, to get these bigger deals.
And so what we realized is that there was really an opportunity to apply ABM to help drive velocity against those smaller deals, but also how do we grow their size? So this whole concept of how do you, we called it, land and expand? And we used ABM, and we did it by really looking at in these earlier days building out propensity models.
So we didn't have all the AI and machine learning at the time, but we would build out these propensity models that would help us look at where can we go win deals, and then how do we expand them by proposing value-add services or the next logical services? So we used a lot of data early on to build out these models.
And then the big part for us, particularly in the services business, was that deep connection with the Sales leads, and then also for us solution architects, the people actually delivering on the client. And so we worked a lot with them to actually map out content, subject matter experts, reference customers, throughout a sales stage.
I wouldn't say it was a buyer journey by any stretch of the imagination, but it was really map to sales stage. How do we want to leverage not just content messaging, but our people, to really go help us win the business. And then figuring out from a Microsoft perspective, being in a product based company, how do we leverage the broader GTM capabilities at Microsoft?
So it was the channels that you may have to reach customers and surround them with a message. And that approach was really helpful for us. I mean, I think the results that we saw in our first year and a half or so, we were growing deal sizes about 50% compared to those where we weren't using this ABM approach, but more so, our win rate was three times higher.
So that approach of looking at the customer, using data and modeling, partnering with Sales, and then understanding, all right, at least at a high level, what does that journey look like? And mapping out content and resources that'll help move that deal through the pipeline ended up being really impactful.
So that was my first foray into ABM, and it was mostly all a Sales enablement motion. It wasn't supported by broad Marketing, advertising. Social media wasn't really out there at that time, so it was really directly working with Sales to make it happen.
Declan (strategicabm) – And obviously, the interesting thing there, Keith, obviously is we all know that ABM doesn't really work without Sales. So ironically, you were doing the Sales part of it as opposed to the whole kind of Marketing part of it, right?
Keith (Microsoft) – Yeah, I mean, it really was. In fact, I would say the team that I was leading at the time, and then the Field Marketers that we had, oftentimes we thought ourselves as more of Business Development roles than Marketers.
Declan (strategicabm) – Yeah.
Keith (Microsoft) – And it was a great mindset to have, right. How do I think about the business versus how do I think about Marketing? If I think about the business first, and then what's the Marketing tactics we need to apply? It was just a really good mindset for us to have and to relate with Sales.
Declan (strategicabm) – Yeah. It's fantastic. And so if we move on from there, from those early kind of ABM days, I think you built a function which you called the Strategic Account-based Engagement function. What was that evolution and what did that look like?
Keith (Microsoft) – Yeah, so this was a really amazing experience that I had the opportunity to be a part of. And both from the pilot stages, and then going on to help lead the program. But it was a much different approach, where this was looking at, from a Microsoft perspective, our customer holistically.
So it wasn't just our services business, or single product, it was really looking at our customer holistically. What are we trying to achieve, and really, how are we trying to build partnerships with our top key accounts? So in this case, we were looking at 36 of our largest accounts. And how do we engage with them to be market makers, right? How are we going to market with them, was this north star we were trying to move towards.
So in this case, it was really thinking from an ABM perspective, more of a one-to-one approach. And that was our model, of one Marketer covering five accounts, which was still a lot.
Declan (strategicabm) – Yeah.
Keith (Microsoft) – It's the model still today. It's still a lot when you're trying to go this deep, but so that was a very different approach of not so much on velocity and trying to drive win rate, but how do we build successful partnerships? Where we know revenue will come, we know advocacy will come, we know share of wallet will come, and we'll win and we'll be able to compete. So a very different mindset and outcomes we were trying to drive towards versus the early days, of let's look at deals in the pipeline, how do we drive velocity against them?
Declan (strategicabm) – It's much more focused on deepening those relationships, learning more about the customer, and obviously being in partnership really with the customer would be fair to say, right?
Keith (Microsoft) – Yeah, and I think that's the key part. Our North Star was how are we doing this in partnership with the customer? And to me, that is Nirvana for ABM. Is where you are building your campaigns and what you're trying to do with your advocates and the customer. Talk about being relevant and being able to resonate.
If you're doing it with your advocates in that account, you're going to have the right message, you're going to get access to the right people, and you're going to be able to deliver experiences from inside the walls, I guess you could say, rather than being outside. So it's an amazing place to be.
It's also a hard place to be, right. You all of a sudden have a whole nother stakeholder and building your campaigns and your motion who is the direct customer. So you got Sales now from your own company, you have your own team, you have Leadership. And now you're bringing in pretty much those same types of stakeholders from the customer side, so it gets more complex.
Declan (strategicabm) – Yeah, so it's almost like going back to our, probably you studied the same as me, the whole kind of key account management days, and the whole kind of diamond versus the bow tie, and those kind of models. So you're literally bringing both parts of your organization together with your client, right?
Keith (Microsoft) – Yep, yeah. Yeah. It goes back to even that conversation about the importance of Sales and engaging with Sales on that side. You have to do that as well. Not only do you have to have the trust of the customer to build that relationship, you have to have a strong relationship with Sales. They have to trust you with a lot to allow you to engage directly with that customer, and really set you free to go do what you think is going to drive the best business impact.
Declan (strategicabm) – Yeah, well, I think we'll talk about Sales a little bit later. So you mentioned the word partnership several times there, and obviously what's interesting from your journey there at Microsoft, you've now moved into a new role where you're actually developing your channel partners, I believe is the latest role that you now have at Microsoft. Tell us a little bit about that. Kind of the role, what kind of partners you're working with, and perhaps what have you found different to working with partners as opposed to working directly with customers?
Keith (Microsoft) – Yeah, so I'm just three months into this new role. So I'm learning, learning a lot on that front. But the role's focused around how do we develop, in this case, partnerships with partners. But, well, how we look at it is long term partnerships that are going to really help us be able to grow our business over the long term.
The partner ecosystem is so important from a technology perspective, for how we're going to go, well, sell into new accounts, but go deeper. And so I have the opportunity to work with ISV partners, so that is the focus of the partners that I'm working with.
And it's both in terms of when we're trying to sign larger partnerships agreements, it's both in the pursuit phase, where we're working with the ISV to envision what could be possible for this partnership, what would a go to market look like with that ISV? And then working through the process of the Sales teams internally to close that partnership, and then move into a go-to-market design execution.
And then ultimately we hope to expand and renew, that partnership keeps renewing as we go through time. And while it's ISVs, the really interesting thing, and I think it's also what's making it for me, makes it kind of challenging and different, is there's a lot of diversity even amongst ISVs.
There's the large established ISVs that are in the Fortune 100, right. But then we're also working with niche industry solution providers, or high tech startups, that they may be very small organizations, but the amount of influence that they have on the markets, right, from their solutions. Or the importance of their solutions in driving in customers business, for us drive a lot of revenue from our cloud businesses.
And so that's a very interesting space of when we often would think of working with large customers, it's a lot, or the revenue as we sized which customers we might pick to engage from an ABM perspective. We're obviously looking at, usually it was both revenue, but you're starting to look at how large is that customer, how many employees do they have?
In this case, and working with partners, the partner may be actually very small. Several hundred employees, but the revenue that they could potentially drive through that partnership for Microsoft could be just as much as one of our large customers.
So it's a very different dynamic, to have to say, all right, how do I work with this small organization that's going to have a very much smaller Marketing team as well, and partner with them, and then drive these significant revenue numbers that we want to achieve together? Mindset very different, in terms of thinking about scale and the number of people that you might work with, and the revenue outcome that you could still potentially drive.
Declan (strategicabm) – So let's just dig down into that a little bit more for a second, in terms of, you mentioned obviously, 'cause I know you're a big fan of ITSMA, and Bev Burgess and all those kind of learning and methodology. In terms of the work that you're doing with the partners, are you also applying the different types of ABM program to them in terms of One-to-few, One-to-one, One-to-many, or do you have a different approach?
Keith (Microsoft) – Yeah, well, we're testing right now, I would say. I'm trying to figure out what is the right way to engage, and it's a little bit of all of it. So we're taking approach right now, where we are doing as we're engaging with the ISVs, with our partners, a One-to-one approach with a handful so that we can learn, right? How should we go build these partnerships? What type of relationship development do we need to secure and win those partnerships with the ISV?
And that's a very much a One-to-one, but we are building it with the mindset of, we have to do this at a One-to-few, and even get to a One-to-many. 'Cause our partner ecosystem is so huge, tens of thousands of partners. And so we're testing and learning this One-to-one fashion, but very much thinking it in the mindset of how are we going to harvest this and be able to scale this type of motion in a One-to-few or One-to-many model, but also in a fashion where we are never going to have the number of people that we probably need, from in our case a partner Marketing role, to go engage at that level.
So it's going to be an interesting dynamic, and it's also one where you're not going to scale this. It's so relationship based that we're not getting to scale this through Marketing technology most likely, right. It's still going to be so relationship based. So there's a lot of nuances that I'm learning, and we're trying to figure out, but we are trying to apply the methodologies, and just trying to learn what makes sense and what doesn't.
Declan (strategicabm) – Yeah, that's interesting actually, Keith. 'Cause what you just said there reminds me of a previous guest on "Let's talk ABM" - Elise Miller, who's Head of ABM for EMEA at ServiceNow. Which I'm guessing would be a company that you know very, very well?
And what they've been doing there is something around trying to build an ABM ecosystem. Because they said exactly the same thing as you said. You can't scale ABM in terms of the number of bodies that you would need to deliver it to the number of clients that you would like to deliver it to. So how can you actually push ABM out to the entire organization so more people actually do ABM outside of Marketing? Which I thought was a really interesting approach.
Keith (Microsoft) – Yeah. You really do have to figure out how do you enable other people to go do it? And so to that, it just makes me think one of the things that we really do rely on is the Relationship Managers at a partner level to help them build their strategy in terms of how they want to engage the partner, and then what does that go-to-market plan look like?
So that's one of the things that we're thinking about as we're driving our program, is how are we going to enable our Relationship Managers for those partners to go do some of the work that traditionally you would think a Marketer should go do, right? And that is that's one of the things we have to think through, is how do we build that model?
I think both the tools to do it, and the methodology, but also then there's going to be training that's going to be needed. And haven't even got to thinking about how we would do that, but that's probably the other part of it. Is how do you train somebody to not just understand what the tools, and methodologies and approaches might be, but how do you best apply it based off of the partner that you're working with, and what's going to work for their business model?
Declan (strategicabm) – Yeah, and would that have something to do with perhaps building an ABM Center of Excellence, or something similar?
Keith (Microsoft) – Gosh, I don't know. I would go a route to go. I've seen so much value and I think, going back to ServiceNow and what Gemma Davies has built there in terms of their Center of Excellence, which is amazing. And where I sit, I am actually in the subsidiary, so I'm just focused around the US.
And so one of the things, a little bit of a side topic, but the value of having a Center of Excellence to be able to activate different markets is so, so important. And that's one of those things that I never have had as a ABM Marketer at Microsoft. And the work that we do is that type of Center of Excellence.
But there's so much value in that, and roadmap potentially, it's something we look to go do, but right now it's let's just learn and figure out what we think we need to do just to kind of win in the short term.
Declan (strategicabm) – Yeah, well, maybe add it to your list, Keith, for 2023, or 2024, I'm not sure.
Keith (Microsoft) – There we go. Maybe 2024.
Declan (strategicabm) – Yeah, so you mentioned earlier about Sales. I thought it's a good time to ask you that question really. That a lot of people that I talk to around ABM say that ABM cannot exist without Sales, and without that Sales and Marketing alignment. And obviously trying to get Marketing and Sales to work together can sometimes be a challenge. What kind of tips would you share with the audience about how to get that alignment?
Keith (Microsoft) – Yeah, God, I think alignment with Sales comes from... Probably the most important thing is understanding outcomes that the seller needs to drive, right? They are going to be very different outcomes that they need to drive and achieve just to be successful.
So I think one is coming in with that mindset, of what do they have to achieve, because oftentimes in ABM, depending on your approach, it's a long game, right? And Sales teams and the best Sales people that I've had the opportunity work with know that and that's how they're going to drive their business long term, but they also have end-quarter metrics, and quota that they need to hit, right?
So it's understanding the balance of how they need to think, and then that can help you come into conversations with Sales about, "Hey, what are short term wins that can get us to a long term victory", right? So that's a very important mindset to bring to the table.
The second thing is understanding the customer and client, it goes back to that, right? If you come in being able to bring a perspective on the customers, that salesperson's customers or clients. That shows that not only are you just there to do your job, but you're there to think about the best outcomes and the success of the customer.
Particularly in our Account-based engagement program, is the amount of work that the team did prior to meeting with Sales just to understand the customer and client. That helps you win the heart and mind of that salesperson, to say, "Hey, look, I can trust this person." And you're bringing insights and perspective that maybe they didn't think about, right?
So to me, I think winning Sales, those are the two key things. Understand their core metrics, what they're trying to achieve, and then understand their customer client. You're never going to understand it better than they do, but if you can bring unique perspective and insight on it, that to me I think helps you get the strong foot in the door, and then you can start building that trust and relationship through those short term wins that can drive to long term victory.
Declan (strategicabm) – I think those are two fantastic tips I think people should take on board and have in mind when they're talking to their Sales teams. One thing you were talking about before we did the recording, actually, was you said something which made me laugh. Which was that ABM isn't ABM without the customer. And so that got that kind of made me start thinking a little bit about that, but when you said that what did you mean?
Keith (Microsoft) – It makes me laugh too. And I think maybe it's even in the words. It's an Account-based, right? But it's like, how do we think about the customer on this? Or we talk about Marketing and Account-based Marketing as, oh, this drives the best Sales and Marketing connection. It's like, well, where's the customer in all of that?
And so when I talk about that, it's really about twofold. One is do you deeply understand what the customer's trying to achieve, what their market looks like, and what success looks like for them? And when you do that, you're able to really come in and help reach new buyers, build new revenue streams, both for potentially the customer and obviously for yourself, but you build durable relationships.
And I think that is one of the things, is when you do ABM for just looking at, “Hey, what's revenue that you're going to achieve, right? What's win rate you're going to achieve?” But you don't think about, “hey, are we building the right durable relationships?” You're missing a big opportunity to win markets and win share.
And that to me is pure ABM, it does those things. And it also, the second angle is that idea of how do you actually start to build campaigns that are ABM campaigns that have the customer involved in defining the messaging, defining the execution, right? That really does allow you to do unique things and test new things that you could potentially bring to like clients.
And so that's kind of what I mean by it. And I'll say, we get so caught up in today's world of, how do we scale something so quickly, right. And it's like, oh, we have MarTech now to help us do that stuff. And we quickly lose sight of the end customer when we try to figure out how do we scale it, and potentially have the risk of watering down the message that we want to drive with the customer.
Declan (strategicabm) – Yeah, and I think the interesting point there, Keith, I think is the kind of the rise of all the technology vendors, of all the MarTech vendors, the ABM tech vendors, et cetera. They've done a very good job of Marketing their technology. They've done a very good job of kind of taking a large size of the conversation around ABM.
And I think a lot of people think that ABM is synonymous with technology, but actually that's not the case. And I think you've just said there, the heart of ABM is the customer. And I think if your program loses sight of that, the customer, and thinks about how many more people can we reach, what technology can we use to reach X number of people? You're going to do a disservice to your customers, and I think you're going to probably not do as well as you could do if you were much more focused on a smaller set of accounts.
Keith (Microsoft) – Yeah, I mean, I would agree wholeheartedly. And on the flip side, most of the ABM programs I have had the pleasure of running, we have not had the benefit of having some of these great technology solutions to utilize. And I would have to say, there are days I'm very jealous of seeing what people are able to do.
But I would say when people execute it really well without MarTech, to your point, they have kept the customer at the center, and they're able to do great things and scale it in wonderful ways. I think Marlowe then is like, he's done an amazing job of being able to do that with a small team, and then drive scale, but always keeping the customer at the center of what they were trying to do.
Declan (strategicabm) – Yeah. Marlowe, when he was at FireEye, was one of guests on the podcast. And he was talking about he went to a sales event of the FireEye Sales teams, and they mentioned their top four wins for the quarter. And the top four wins coincided with the top four ABM accounts. So that kind of just shows you that deep connection between Sales and Marketing in an ABM context and really work.
Couple of questions for you, actually, that I know are very close to your heart. How do you use ABM to gain customers for life?
Keith (Microsoft) – Yeah, I love this one. So in our Account-based Engagement program, we had this North Star of our strategy to build such deep relationships with these customers that they would want to go influence the market with us. And so when we approached it from this mindset, you truly put the customer at the center. Their success is your success.
And when we ended up doing this right, you build those internal advocates, right? You have the customer co-creating the messaging, the content, the experiences. And this opens up so many new opportunities, not just to do things that are related to each other's direct business, but how does it tie back to things that could have impact from diversity and collusion, mental health, social responsibility, sustainability.
That is what gains you a customer for life. You are no longer just a solution provider or a vendor, you're a partner on helping them achieve their mission and their values. And ABM can do that when you are able to go in this deep, and you play that long game.
And I tell you, you get customers that engage with you in that way, it opens up the opportunity to start doing some really interesting co-Marketing things. That go influence the market in ways that you will never be able to run as many webinars or put on as many events to influence that number of people.
And so that you can never measure, I mean, we should never, but it's really hard to measure the impact that you can achieve from that, because you're not going to have, here's the number of people that came to my webinar, and here was my click through rate.
But you do that - you win hearts and minds of customers at that level. The word of mouth, I guess you could say, is so much more valuable to you from a Marketing organization than any number of webinars or events than you can run.
Declan (strategicabm) – It's almost, Keith, like the qualitative data is more important than the quantitative data, right?
Keith (Microsoft) – Yeah, I mean, it is, it is without a doubt. Having that be an input to anything you measure in ABM. Yeah. We all get down to numbers and dollars, but that qualitative input, particularly if you can get it at a more and more senior level within an organization, that's gold.
Declan (strategicabm) – Yeah, yeah, absolutely. So let's just finish off with two or three very rapid fire questions. We often talk about ABM as being a journey. And as we mentioned the very beginning of the podcast, you've been on a journey for many years with ABM. What's been your greatest learning in that journey?
Keith (Microsoft) – Be patient with yourself and others. We all are just driven for results, right, and we want to see things scale, we want to see them go faster, but when we approach things more from a growth mindset, and learn from what did work, but more so what didn't work, and accelerate those things that didn't work, we're going to learn and be more effective the next time around than we would ever be.
So out of anything it's, particularly in ABM, be patient and give grace to people. And I think probably the best saying that I could ever remember from a Marketing perspective is somebody told me: "Nobody ever died from a Marketing emergency", right? So be patient, understand that this is a long game. And you do that, you will keep the customer at the center and you'll be successful.
Declan (strategicabm) – That's fantastic experience to share. And in terms of the hardest part of ABM, what would you say the hardest part is?
Keith (Microsoft) – Determining where to invest their finite resources. And it's a long game. You still got to show results. So do I invest in another person? More MarTech solutions? Getting more customers? That's the hardest part. Just trying to balance up those different options, right?
Declan (strategicabm) – Yeah. And the very last question for you, Keith. You get a phone call, it's a Friday evening, your laptop is kind of just closing, when a friend says to you, "Hey, I have to kind of present an ABM strategy on Monday morning to my team. What advice can you give me?" So what's that one piece of advice you give them just before you close your laptop and enjoy a glass of wine, or a beer, or something?
Keith (Microsoft) – Yeah, the one piece of advice is set yourself up for success and your team. And what I mean by that is you're building an ABM program, you want to launch it, start with Customers and Account teams that you know you can be successful with. Do that, and I think the rest follows.
Declan (strategicabm) – I think that's fantastic advice, Keith, to finish off on. Thank you so much for sharing your ABM journey with us today. I wish you and the whole team there at Microsoft every success for the future, and all the very best.
Keith (Microsoft) – Awesome, thank you so much, Declan. This was awesome, appreciate it.
Declan (strategicabm) – Thanks Keith.