Account-Based Marketing (ABM) made its debut in the early 2000s. It was a marketing tactic designed to engage and convert high-value prospects into a customer.
Today you find that many businesses are using ABM to leverage their marketing efforts to close more opportunities and upsell to existing customers.
Survey data reveals that around 90% of marketers claim the ROI from an ABM approach is more significant than traditional marketing methods. Despite this, without proper planning, you can waste money on ABM strategies that don’t work.
In this article, we will address the following questions.
What is Account-Based Marketing (ABM)?
Account-based marketing (ABM) is a marketing strategy designed to focus sales and marketing resources in the business-to-business (B2B) space.
Instead of creating broad-reaching marketing strategies, ABM targets accounts within a defined market to increase ROI.
It’s a strategic approach that used highly targeted sales and marketing messages to win new business.
In complex B2B sales, rarely a single individual makes the final decision. Usually, the decision-making process combines the thoughts of primary decision-makers, end-users, and influencers.
The goal of ABM is to identify those individuals who are actively researching products and services with intent.
Armed with this information, sales and marketing messages can then be customized to engage with these individuals.
Previously an ABM approach was very time-consuming and expensive, with many components needing to be managed manually.
With the advent of marketing automation technology along with customer relationship management (CRM) software, the process has become more manageable.
Technology allows marketers to personalize marketing messages to meet the potential client’s specific needs.
Marketers can target accounts that have been pre-qualified that translates into sales revenue more often.
The overarching objective of ABM is to identify and target high-quality prospects over generating a large volume of leads. Effectively it turns the sales funnel on its head.
Although ABM is not a new concept, its resurgence is due to a changing landscape and the emergence of technology-based solutions.
You can no longer shove a promotion in front of prospects and expect them to buy. Buyers today are far more sophisticated and want the marketer to meet them exactly where they are on their path to purchase.
How Account-Based Marketing Works?
ABM begins with developing an ideal customer profile (ICP) which is similar to developing a buyer persona and aligning the target company with the buyer’s journey.
The main difference between an ICP and buyer persona is that within an account, you may find competing objectives and conflicting opinions in regards to the desired solution.
This is noted in the ICP to understand your prospect and influencers at a deeper level. This requires exhaustive research of the individuals of a target prospect account.
You can waste money and time taking a shotgun approach to marketing. With ABM, time and money are spent identifying key individuals within a potentially high-value target account.
Data is then mined to identify relevant individuals to determine who the decision-makers are, along with key influencers.
Using data sources, information is extracted by companies who specialize in data mining to provide the names and email addresses of target individuals within a specific account.
The next step is to identify which communication channels will be used to deliver personalized messages that address the target prospects’ needs, challenges, and opportunities.
Once the messages and sales efforts are deployed, the strategy is monitored to make any necessary adjustments if needed. Evaluating the effectiveness of the sales and marketing efforts in real-time leads to a greater ROI.
Why do Companies Keep Failing With ABM Strategies?
ABM is widely misunderstood. ABM doesn’t replace traditional marketing methods; it should complement traditional marketing and Content Marketing efforts.
Historically marketing takes a top-down approach, attract, nurture and close. ABM takes the opposite approach, identify, engage, land, and expand.
An ABM strategy doesn’t work with every prospect. Companies that focus on higher volume and lower value deals are better suited to a more traditional inbound approach to marketing.
An ABM strategy should be reserved for complex sales dealing with high-value prospects only. If you use an ABM strategy for every single prospect, the likelihood of the risk and reward ratio will drop off dramatically.
When meeting with prospects face to face, an experienced salesperson knows how to read buying signals.
However, this is far more difficult in the age of Digital Marketing. Marketers must monitor the online behavior of their prospects through search engine queries, content downloads, and repeat website visits.
Taking an ABM approach to marketing only works if you have the financial backing and support from sales and marketing leaders within your company.
If they don’t see the potential for a healthy return on investment (ROI), they are unlikely to support your efforts. It’s critical you enlist their buy-in from the get-go, not just by providing the budget; they need to be involved at every step of the process.
You don’t want to go through the machinations of setting up an ABM strategy only to find out later there is no budget or time to implement the strategy.
It’s important to also involve other functions within the organization such as customer support teams, sales teams, finance, and above all, members of the senior executive team.
Remember to include the information technology team, who have the responsibility of ensuring CRM systems and other supporting technology are easily integrated across the enterprise.
Without company-wide support, you reduce the probability of seeing an increase in ABM ROI.
For ABM to work effectively, it requires a large amount of data. Data is usually captured through an IP address and third-party cookies.
Company-to-contact IP address matching requires the services of a third-party who specializes in data mining. It’s important to find a data resource that offers a high degree of accuracy.
Failing to choose a data provider carefully might not support your ABM marketing efforts.
An ABM approach only works when you identify prospects who are ready to buy now.
Choosing a data provider should not be based on volume; it should be based on quality guaranteeing 95% email contact validity.
If your target companies are enterprise-level businesses, using a data provider with a large percentage of validated small business emails won’t work for you.
Why You Shouldn’t Give up on ABM?
ABM should not be a replacement for traditional demand-driven marketing.
Ideally, it should be used as a complimentary marketing strategy alongside other marketing approaches.
Rather than feeling like you must pick as a side, traditional vs. ABM, think of both as being complementary to each other. Both have a place in an overarching marketing plan because they serve different marketing needs.
What holds marketers back from implementing a robust ABM strategy is that they haven’t yet leveraged the tools needed to support ABM.
Relying purely on email, the web, CRM, and social media alone won’t maximize your results.
Looking ahead, marketers need to look at specific ABM platforms, marketing attribution software, analytics, and reporting in conjunction with intent and direct mail.
The research report conducted by ITSMA and the ABM Leadership Alliance states that 70% of marketers are using email, their website, CRM, and social media to drive their ABM programs.
Between 40%-60% are using analytics, events, marketing automation, and direct mail as well as account insights to drive their ABM strategies.
Only 25% of marketers are using ABM platforms, attribution software for reports, content management systems, and sales automation to drive their ABM initiatives.
It’s expected that the top planned investments for 2021 will include an ABM platform, attribution and reporting, intent, direct mail, content syndication, events, and third-party data as a way to increase their ROI.
This tells us that you will receive a greater ROI on all ABM strategies with a little investment in technology.
Keep in mind, ABM is a strategy, not technology. It uses technology to record and track data and enable a more effective ABM strategy.
No ABM strategy will work effectively unless the results are measured. As you ease your way into ABM, look for areas of improvement with reports generated through your CRM.
How Does ABM Drive Revenue?
There are three approaches to ABM, the first being a strategic approach encompassing tens of accounts. This approach allows you to create and execute highly customize marketing campaigns for individual accounts.
The second approach is scaled to creating and executing hundreds of accounts—this approach tailors lightly customized programs into segments based on similar issues and needs.
Lastly, a traditional approach targeting thousands of accounts using technology to tailor marketing campaigns by combining targeting, personalization, and analytics.
For years, sales teams have been sifting through the leads generated from a traditional marketing approach only to find a handful of qualified leads ready to buy.
Because ABM is focused on identifying high-value accounts, it allows precious resources to be used more effectively.
When marketing campaigns are optimized for a special target account, it naturally allows you to increase ABM ROI.
This is because marketing efforts are personalized and geared specifically to target businesses and identifies exactly where the potential customer is on their path to purchase.
When marketing efforts are personalized, the target audience is more likely to engage.
When content is specifically geared to their business needs, problems, and opportunities, and it meets them on their journey, buyers will naturally respond more positively.
With higher levels of engagement, naturally, this leads to a higher closing rate driving revenue.
ABM makes it easier for sales and marketing teams to track results because the focus is narrower.
It’s easier to control data output when measuring the data of a smaller set of accounts. Because the data collection is more detailed, these insights allow you to make adjustments as you go in real-time.
An ABM approach requires sales and marketing teams to be aligned. When you put your brand in front of the right people who are ready to buy now, you spend less money for better results.
You gain greater insight into the effectiveness of emails, advertisements, websites, and events.
When the sales and marketing teams are aligned, they not only generate higher revenues, the ensuing results lead to an increase in average deal size.
Going Beyond: How to Continue to Increase ABM ROI?
Survey reports that companies allocate on average 27% of their marketing budget to ABM tactics.
This is because the ROI from an ABM approach sits anywhere between 26% — 50% higher than traditional marketing initiatives.
Apart from the obvious monetary value, respondents to their survey also report the strengthening of relationships within their accounts.
This report suggests that ABM will continue to deliver results in 2021 and beyond. It is expected that ABM will continue to strengthen the breadth and depth of the relationship, grow revenue within accounts, grow their pipeline along with brand equity and awareness.
Most companies are able to increase ABM ROI with more targeted results than any other marketing initiative.
Firstly you must identify a list of target accounts. Looking at your existing customer data will help you narrow down the customers you want to continue to do business with in the future.
Secondly, conduct your research to include the market, company, people, and relationships.
Thirdly is to identify the key decision-makers and influencers. This is the biggest challenge of all.
The next step is to create relevant content so that your target accounts will engage with your content. Lastly, ensure you have the right tools and technology to increase ABM ROI.
2020 saw a year of digital acceleration which opens up a huge opportunity for marketers to embrace new technologies to support their ABM initiatives. Marketers are more open to ABM to drive strategic growth through digital transformations.
The combination of speed and collaboration is the answer to constant disruption, which is essential to increase ABM ROI.
ABM works best when ROI is documented, not just increased revenues, documenting outcomes for relationships and reputation as well.
Account insight is the core principle that drives an ABM approach to marketing. By investing in data and analytics to inform account selection, you can greatly increase ABM ROI.
Rethinking ABM to embrace the next opportunity with Rock Content will see a combination of deepening account insights and strengthening sales collaborations. Get to know our ABM solutions by talking to an expert today!
