Over the past few months I’ve published a series of articles about why most organizations aren’t nearly as data-driven as they think they are. It turns out that for many B2B companies there are often valuable insights on your go to market strategy locked away in your CRM.
In this final instalment we’ll pull everything together. We’ll talk about what we learned from speaking with our clients through the product development process of DueDil DataWorks, and how you can build a more efficient go to market approach using information you already have.
A dose of our own medicine
The original inspiration for what is now DueDil DataWorks came from a conversation last year with the Director of Sales Ops at one of our clients. Over the following quarters we built the product, iterated based on feedback and successfully launched in early Q3 of this year. As we preached the word of a data-driven go to market strategy though, there was something that wasn’t quite ringing true. In our enthusiasm helping our clients solve their issues around their CRM we had neglected our own.
The difference between VCs and execution
One of our investors, Chris Tottman from Notion Capital, said something in a board meeting once that stuck with me: “VCs like BIG markets, execution likes small markets.” Anyone who has raised money from a VC will be familiar with the Total Addressable Market (TAM) slide. It’s usually some representation of an unimaginable amount of money, usually in the many billions, that hardly anyone is bothering to go after. In rare cases this is true. This is the BIG market.
More often, however, the truth is more complicated. Even if there are a huge number of potential customers willing to spend lots of money with you, they’re not all willing to spend the same amount, and acquiring them can be expensive. Sorting those that are worthwhile from those that aren't isn't easy. Our clients needed a way to zero in on the most valuable prospects and acquire them without overspending. As we went through the product development process for DataWorks, it was clear we needed the same thing.
Killing me softly…
The original idea behind DataWorks was simple: take all of the data trapped in a CRM, run it through DataWorks to clean and dedupe it, enrich the newly cleaned information with insights from The DueDil Business Information Graph (B.I.G.) and replace the tired, old CRM data with this new treasure trove of information. From there, all kinds of interesting customer profiles, trends and go to market insights would be a snap to bring to the surface. Simples.
Our first run in with reality came when one of our clients in the beta asked to run 66,000 records through DataWorks. Aside from the number of records being larger than what we expected, there was all kinds of horribleness buried in that file: foreign companies, sole traders, complicated group structures and not just one duplicate record, but sometimes as many as a dozen! DataWorks at the start could never have anticipated just how bad things could get out in the real world. When we looked at our own CRM, however, we found much the same thing. The more clients we worked with in the beta the more we realized the depressing truth that what we were seeing was pretty par for the course.
Keywords as the key
It took some time before we got to our ‘aha’ moment with DataWorks. That’s because solving all of the speed and performance issues enriching a large, messy CRM was just the start. Pulling out the insights was more complicated than we originally thought as well. Once we had cleaned, deduped and enriched our client’s CRM (and eventually our own), we realized that highlighting Ideal Customer Profiles (ICP) from the standard information was still too difficult. Most people will be familiar with how outdated Standard Industry Classification (SIC) codes are for any kind of business intelligence, particularly when roughly 1 in 5 businesses is classified as ‘other.’
We already knew how important it was to understand the true nature of a business for things like onboarding and commercial underwriting. What we didn’t fully understand at the beginning of the DataWorks journey was just how important it would be for formulating a bulletproof go to market strategy as well. This is where our proprietary dataset of more than 36,000 industry keywords came in. Every day we scrape the web to extract and tag the activities of more than 40m companies. This allows us and our clients to pinpoint the exact business activities of their best customers -- whether they’re cider makers or fintech companies. Keywords proved to be the missing ingredient to helping us and our clients find that small but valuable segment of the market we now refer to as the Strategic Addressable Market (SAM).
SAM I am
Having run the gauntlet with DataWorks we now fully understood the benefits of identifying our Strategic Addressable Market and “executing small.” In our case, our SAM clients demonstrated win rates, Average Order Values (AOV), retention and lifetime value metrics that were 2x - 10x our average clients'. The fact that the number of prospects in the SAM was about 1/10 of those in our Total Addressable Market (TAM) was more than made up for by the value these clients represented and the benefits we got from a more focused and efficient go to market strategy.
Hyper-segmentation is the name of the game
Earlier this month we hosted our final DueDil Unplugged event of 2019. We were lucky enough to get a great panel together, including Simon Cureton from Funding Options, Kate Eslam from Gartner and Nik Haidar from Validis. One of the recurring themes from that event was that in the new SME economy, “hyper-segmentation” is no longer optional. Through the DataWorks beta and our own experience we saw the internal business reasons for turning our CRM into a strategic go to market asset. What Simon, Kate and Nik discussed, however, are the factors out in the market that are making a detailed understanding of prospect segments a necessity.
The consumerization of enterprise means that SMEs are no longer willing to accept a one size fits all proposition. A digital experience that is tailored requires you to know something about the business you’re hoping to gain as a customer, and going to market efficiently means you need insight into these hyper-segemented cross-sections of your prospect universe. Here’s a summary of how you can build a more efficient and focused go to market strategy that leverages the information you already have buried in your CRM, turning it from a liability into a strategic asset:
- Get your house in order -- whether it’s with DataWorks or a more traditional managed service, proper CRM hygiene is an important first step. Remove duplicates, update outdated information and get a clean view of your existing prospect universe.
- Enrich your view -- find a way to bring new insights into your CRM such as relationships between companies in the group structure, shared directors and shareholders and companies that trade from the same address. All of these insights will help you to learn more about the prospects you want to acquire as customers.
- Hyper-segment and zero in on your Strategic Addressable Market (SAM) -- once you understand what your best customers look like, find a way to quickly hyper-segment your prospect universe to identify every other company in the market you don’t yet know about. Information such as granular business level activity, financial characteristics and location are helpful here.
We went on a longer and more rewarding journey with DataWorks than we originally anticipated, but the lessons we learned along the way helped us get to a more focused and efficient go to market strategy for ourselves and our clients. Our experience through the beta program also reinforced what we were seeing and hearing in the market. Hyper-segmentation in the SME economy of the next decade is no longer optional. Refining our Total Addressable Market (TAM) into our Strategic Addressable Market (SAM) made clear the meaning of Chris’s quote, and at the end of the day it’s execution rather than VC slideware that wins.
Before you go…
If you’re interested in learning more about how you can use DueDil and DueDil DataWorks to build a more focused and efficient go to market strategy we’d love to hear from you. Even if you’re not but you have something to share about your own path to executional excellence and would like to speak at an upcoming DueDil Unplugged event in 2020, please get in touch on LinkedIn.