When sales and marketing come together, applying their unique skill sets to a common goal, great things can happen. Especially in 2020, with a rapidly evolving marketplace, it’s more important than ever to create a strategic methodology. You can do this with a streamlined sales and marketing process focused on producing more revenue in a shorter period.
One tactic to accomplish this is account-based marketing (ABM). ABM uses targeted marketing campaigns to win over specific B2B (business to business) accounts. ABM has the potential to produce the largest marketing return on investment (ROI) when focused on high-value accounts. Below we’ve outlined what you need to know about ABM. You’ll discover what it is, how it works, and the elements that go into creating and implementing a successful ABM campaign.
What is account-based marketing?
Account-based marketing is a highly individualized, account-specific B2B marketing strategy. You’ll develop this strategy in a coordinated effort by marketing and sales working as allies. First, identify the best high-value accounts to target, then develop a customized strategy for each account. This continues down to the level of key influencers and decision-makers in the sales cycle.
Why use ABM?
Marketing campaigns are typically targeted to a market segment or subsegment. Some are designed to have a broad reach aimed at capturing a large number of leads which must then progress through marketing and sales funnels.
Account-based marketing is hyper-focused on a set of carefully selected high-value accounts. It is used to land new accounts as well as expand business with existing clients. It can also be a key component of a startup marketing plan as well as programs developed by mature companies. ABM forgoes the time and effort to narrow down a large bucket of leads into qualified prospects by honing in on qualified clients. It also helps focus internal resources and budgets on activities most likely to generate revenue and improve ROI.
Benefits of ABM
As mentioned, account-based marketing offers an opportunity to generate more revenue and ROI in a shorter period. Below are the key elements of ABM.
- Personalized Marketing Approach – Capturing the attention of sophisticated B2B customers isn’t always straightforward. For example, if their business targets a niche within a certain market segment, your umbrella messaging to that market may not resonate with them, so they ignore it. To overcome this and other challenges, ABM tailors outreach and content at the account level as well as to key decision makers and influencers within the account.
- Sales and Marketing Alignment – With ABM, sales and marketing are allies working toward a common goal via a shared strategy and outcome. This can result in greater resource efficiency and overall efficacy.
- Shorter Sales Cycles – An internal team of motivated, cross-functional stakeholders can generate awareness, capture an account’s attention, engage key decision makers, and ultimately convert them into customers. The result is a shorter than average sales cycle.
- Clearer and Improved ROI – 84 % of businesses using ABM report that it results in a higher ROI than more generalized marketing programs, according to a survey from the Information Technology Services. An account-centric approach makes revenue attribution and the ability to identify direct costs, and thus measuring ROI, easier. Equally important, ABM streamlines the sales and marketing process compared to traditional lead generation. It can also remove unqualified prospects up front, enabling resources to focus time and energy on accounts most likely to convert.
- Better Allocation of Resources – Leads from broad brush marketing campaigns require time and effort to qualify, groom, and advance through a sales funnel. ABM accounts are targeted before a campaign is launched, so resources are laser-focused on exactly what is required to convert and generate revenue.
Disadvantages of ABM
While ABM may sound like a marketing panacea, there are pitfalls to consider. We’ve outlined a few of these below.
- Expensive – It requires more time and resources to create highly personalized, account-level programs versus a traditional one-size-fits-all marketing campaign. Account-based marketing is better suited for larger companies that can devote enough resources to make it a winning solution. If you need to limit spending on an ABM campaign due to budget concerns, consider putting it on hold until the necessary resources are available.
- ABM Narrows the Pool of Target Customers – Small or medium-sized companies interested in making a bigger splash in the market and in gaining more customers may wish to target a broader audience.
- Failure to Align on the Right Target Accounts – This gets back to allocating enough time and resources upfront to determine which accounts to target, and developing and executing a sustainable strategy for each one. Short cuts at the outset of an ABM campaign can lead to failure.
- Lack of Accurate Shared Data – We all know the saying “garbage in, garbage out.” Accurate B2B data and intelligence are required to choose the right target accounts. to customize content and messaging, and to select the most efficient channels.
- Unrealistic Expectations – During a time when sales and marketing teams are pushed to generate more revenue more quickly with improved ROI, it’s tempting to over-promise and hopes you might get lucky. Instead, set realistic expectations and achievable goals.
Account-based marketing examples
The good news is that ABM can be applied to multiple marketing channels, creating multiple touch points within an account.
- Events – Successful events identify targeted accounts and their key stakeholders and decision-makers. Then you can create event messaging and promotions around their interests as well as their shared corporate interests.
- Webinars – Relevant webinars are a great way to engage clients, share more content, and generate awareness and sales. They enable you to present personalized, high-value offers to different influencers and decision makers. They also help you gauge the level of interest and the probability of conversion. Additionally, a well-designed webinar gives your targets the ability to download assets such as white papers, case studies, and guides.
- Direct Mail – Customized direct mail can play a substantial role in ABM. One of the most creative ABM direct mail examples that resulted in a huge sale is when a computer and software/vision company sent “burgers” to 100 McDonald’s executives. Each component of a fake Big Mac (sauce, cheese, toppings, bun, burgers) represented one of the company’s strengths and offerings.
- Email Campaigns – Combining personalized emails that boost engagement as part of an ABM campaign can be part of a winning strategy. Start by segmenting accounts based on business needs and interests to create targeted content for the right audience.
- Paid Advertising – Digital advertising via social media, Google Ads, and other channels enables you to reach out to targeted accounts that aren’t part of your network. You can even target key influencers and decisions makers. For example, corporate executives are likely to have LinkedIn accounts. Develop a LinkedIn ad campaign that shares your messaging and value proposition as part of your ABM toolset.
- Programmatic ABM – This form of account-based marketing involves targeting a range of accounts that share common business objectives and traits. Once this is done, develop a strategy and customized content and messaging at a group level. It’s more granular than market or submarket level marketing programs, but less granular than account-level ABM.
- Web Personalization – Consistent, compelling content and personalization across all channels, including your website, is a key ABM component. Develop content designed to boost conversations and engagement for accounts that visit your website.
Account-based marketing vs. inbound marketing: Better together
You may think ABM and inbound marketing are at odds, but they can work well together. ABM focuses on outbound tactics where you start a conversation with an account and then send them personalized messages. Inbound marketing draws customers to you through content marketing, social media, search engine optimization (SEO), and advertising. Paid advertising, for example, is traditionally an inbound marketing tool, but as we touched on earlier, it’s also a successful tool for ABM. So, instead of separating ABM and inbound marketing into silos, look at ways they complement one another and leverage these.
Account-based marketing vs. lead generation: Which is better?
As we’ve highlighted, traditional lead generation uses a broad approach to generate as many leads as possible whereas ABM addresses a select set of high-value accounts. Typically, ABM accounts are known entities and not necessarily new leads whereas lead generation can identify brand new leads. Depending on your product or service mix, you may need both. The key is to have the bandwidth and resources to do both.
How to implement account-based marketing
Don’t underestimate the time, human resources, and budget it takes to design, implement, and manage an ABM program. Understanding the steps will help ensure your estimates are accurate.
- Step 1: Identify High-Value Target Accounts. This can include existing accounts you want to expand, accounts you have previously engaged with, and new accounts. Start your ABM endeavor by developing the criteria you will use to target the right accounts.
- Step 2: Map Individuals to Accounts. Once you have selected the accounts to target, identify key influencers and decision-makers within each account. Then, develop a strategy and content to engage them on both an individual and a group basis.
- Step 3: Define and Develop Targeted Marketing Campaigns. Individualization is a key ABM component. Identify the channels most likely to succeed and why then create customized campaigns and budgets per channel.
- Step 4: Identify and Target Best Marketing Channels. Generally speaking, an effective ABM campaign usually involves a multi-channel strategy. For example, a key decision maker who is rarely in the office probably isn’t the best candidate for direct mail marketing whereas someone likely to be in the office is. LinkedIn Ads and webinars can appeal to both, especially the traveling executive.
- Step 5: Measure, Learn and Test ABM Campaigns. Especially if you are new to ABM, a trial using one or two accounts makes sense. It lets you flesh out and fix potential problems on a smaller scale, and accurately identify the number of resources required and the tracking metrics to use. It can also help marketing and sales learn how to effectively work together to create a successful campaign. As with any kind of marketing program, measuring success (and ROI), learning what went wrong if the campaign doesn’t reach its goals and what went right if it was successful, helps you plan the next one.
Measuring ABM success
As with any marketing program, success is measured in several ways but ultimately it comes down to ROI and revenue generation. In general, the goal of ABM is to shorten the sales cycle and boost revenue with an improved ROI. Metrics that go into your formula should include:
- Average Contract Value. Since ABM targets high-value accounts, the average contract value should be higher than the average value of all accounts.
- Win Rate. Super-focused targeting and account-level customization should result in a higher than average conversion rate.
- Sales Cycle Length. ABM skips a lot of the lead generation and sales cycle process, potentially decreasing the time from the point of first engagement to closing a sale.
- Retention Rate. Sales have always used account-based selling as a strategy, but engaging key decision makers and influencers up front with ABM is likely to result in even stronger client relationships. It also helps you extend your messaging and offerings to clients more quickly, so you can beat your competition to the mark.
- Net Promoter Score. This index, ranging from -100 to 100, measures customers’ willingness to recommend your products or services. ABM aims to develop stronger relationships with various individuals in a client’s organization and create a more enjoyable “buyer journey,” which can increase customer satisfaction and thus lead to a higher net promoter score.
