How to know whether adopting an ABM approach is right for your organization
The definition of ABM is deceptively simple—marketing based on target accounts rather than casting a wide net—but there’s a lot of complexity within the deeper meaning of this unique method of achieving business goals. Account-based marketing is a strategic approach to B2B marketing that focuses on building relationships with a select group of high-value accounts. It’s most effective when it’s part of a unified and focused growth strategy in which marketing and sales teams collaborate to craft personalized buying experiences supported by customized touchpoints that are strategically positioned across the buyer journey.
In keeping with the 80/20 Rule, also called the Pareto Principle or the Law of the Vital Few, the vast majority of profitable B2B marketing engagements are with a few crucial accounts. Identifying and evaluating these key accounts has become a basic requirement for designing lasting relationships that grow revenue. More and more businesses are moving away from an approach centered on the sales and marketing funnel to the more concentrated ABM method, which has established itself as capable of advancing multiple marketing and sales priorities.
Starter questions to answer as you explore ABM
How do you know if ABM is a good fit for you? It’s not the best approach for all B2B organizations. Here are some questions to keep in mind as you explore it as a potential option:
- Does your business have a limited addressable market? Some industries, segments and buyer personas are not a fit for ABM. More on this below.
- Does your company have relatively few target accounts? Less than a dozen targets usually make for a good ABM fit, although there is variation by company size and industry.
- Does your business fit the 80/20 Rule? If 20% of your accounts generate most of the revenue, then ABM is likely a good fit.
- Are your deal sizes typically large? For example, deals in the range of $1M justify investment in ABM, which is all about prioritizing account quality over quantity.
- Does your business maintain an active martech (marcom) stack that’s built around an effective Customer Relationship Management (CRM) system? If not, you should look into building out your CRM before pursuing ABM.
- Is your company tracking marketing leads with a sales team? ABM works best when a marketing team collaborates closely with a sales team, preferably using the same data and CRM.
These are just a few upfront ABM considerations. This blog takes a deep dive designed to help you find out if it’s a good fit for your business.
How does ABM differ from traditional B2B marketing?
Conventional digital marketing focuses more on generating leads and driving web traffic whereas ABM is about creating personalized experiences for the people who make up your target accounts, touchpoints designed to educate, inspire and move them through the buyer’s journey to ultimately becoming long-term, high-value customers.
Here’s a quick breakdown of the primary ways account-based marketing differs from traditional B2B marketing:
Individual account focus – Most B2B marketing employs the shotgun approach, blasting features and benefits of the products or services out to as many people as possible without regard to specific pain points and priorities. Cutting-edge ABM ditches the wide net, opting for a laser-like focus on individual accounts with messaging that addresses what the people at the target companies say they care about.
One reason the account-focused approach is working is that the pools of decision-makers are growing to include decision-influencers who have somewhat varying priorities, making it more vital than ever to reach the right people with the right message at the right time. For example, to complete a B2B purchase in 2018, businesses required the approval of an estimated 6.8 stakeholders, an increase from an average of 5.4 stakeholders in 2014 (Harvard Business Review).
What’s more, these gradually expanding groups say they want less contact with sales professionals. 43% of B2B buyers would prefer a buying experience free of any direct interactions with sales representatives. By generation, 29% of Baby Boomers and 54% of Millennials prefer buying without sales rep involvement (Harvard Business Review). This big change from one generation to the next is a marker of a very strong trend away from direct contact with sales professionals during the buyer journey, meaning you have fewer overall opportunities to convey your message. If they don’t address the company’s needs, your content won’t connect. An account-focused approach performs better in this kind of low-contact environment.
Personalization – Personalization across campaigns creates a more relevant and engaging brand interaction for buyers who work at your target accounts. Delivery entails targeted email campaigns, landing pages built on segmentation and other customizable materials. Regular B2B marketing campaigns, on the other hand, typically tout the company’s offerings and differentiators, which don’t speak to anyone’s particular priorities.
Data utilization – The old ways of B2B marketing too often relied on intuition, conjecture and even bias. As a more modern practice, account-based marketing uses data to identify and profile optimal target accounts, along with measuring the performances of campaigns.
Collaboration between marketing and sales – Traditional B2B marketing was usually conducted separately from sales, in silos, whether the two groups talked or not. As an adaption to the changing business environment, today’s ABM works through synergistic collaboration between marketing and sales, ensuring that marketing campaigns are aligned with sales goals.
When these differences are strategically exploited throughout a campaign, account-based marketing can be much more productive than old-fashioned, shotgun-blasted umbrella messaging. B2B marketers who adopt ABM strategies can speed up and shorten purchasing engagements by proactively anticipating buyers’ needs and offering solutions to their pain points.
Why is account-based marketing important?
Overall business goals should be the drivers of all marketing and sales initiatives. If your organization’s goals would be advanced by improving marketing ROI, forging longer account relationships, increasing brand awareness and improving sales performance, then ABM is a strategy your team should consider. Let’s take a closer look at why it’s a good option for many B2B companies.
Proven benefits of account-based marketing
Increased ROI: Recent studies have reconfirmed that well-executed ABM can lead to significant jumps in ROI. For example, a 2023 study by Demand Gen Report found that companies that implemented account-based marketing for the first time enjoyed a juicy 160% increase in ROI. In a 2022 study, Demand Gen Report found that 76% of B2B marketers who use ABM saw a higher ROI than those who didn’t. The same study found that 60% of ABM marketers gained 10% or more in revenue. Also last year, 87% of B2B marketers reported to ITSMA that their ABM tactics earned a higher ROI than all other activities.
Improved lead quality: Account-based marketing can empower you to improve the quality of your leads by focusing on only the most likely prospects. This focus saves time and money over the long haul. In a 2019 survey of marketing professionals, MarketingProfs found that 82% of respondents using ABM said it has helped to get better leads and 78% said it has helped to increase the conversion rates of those leads. HubSpot survey respondents said the top two tactics are researching accounts and identifying target contacts.
Stronger customer relationships, faster sales cycles and better sales performance: Account-based marketing paves a path to more profitable customer relationships by providing decision-makers with personalized attention and support. Done right, this can lead to repeat business and referrals. In a 2020 study, Aberdeen Group found that ABM programs can lead to a 20% increase in customer satisfaction while boosting customer retention rates. Account-based marketing campaigns can improve sales performance by providing sales teams with targeted, qualified leads and by positioning them with detailed prospect information to close deals more quickly. Sellers always benefit from a clear understanding of their target accounts and the best ways to reach them.
Account-based marketing can shorten sales cycles by building those relationships with your target accounts early on. This can lead to faster deals and more closed business. Aberdeen Group also found that ABM programs can lead to a 30% decrease in sales cycle length and a 25% increase in win rates. The researchers also reported that account-focused programs can improve lead conversion rates and customer lifetime value.
Marketing and sales alignment: Capitalizing on certain benefits unlocks other cascading positive results. Data-driven collaboration, shared goals and effective communication are the keys to running ABM campaigns that advance the goals of the whole business. Marketing and sales teams get their best results when both are working with high-quality customer data, but this can be a tall order. Salesforce reports that 31% of B2B marketers say getting a unified view of customer data is a challenge.
Brand awareness: Account-based marketing helps potential buyers discover your brand. Marketo reports that campaigns can increase brand awareness by up to 50%. ABM campaigns can increase brand awareness by placing your branded content where your target audience will come across it. For example, a sponsored article in a publication read by many of your idea buyers positions your company as a thought leader in your industry. Such tactics can also lead to increased website traffic and social media engagement. According to a report by ITSMA and Demandbase’s ABM Leadership Alliance, 84% of B2B marketers who use ABM say it has improved brand awareness.
The growing value of marketing to accounts holistically
Here are some more interesting statistics that illustrate the rapid rise of ABM as a B2B practice:
- The most common metric used to track success is revenue won (HubSpot).
- 70% of companies report using ABM (HubSpot).
- 64% of ABM strategies have been launched in the past five years (Salesforce).
- 71% of the companies surveyed intend to increase their investment in ABM across their key markets in 2023, up 13% year on year (ITSMA).
- 28% of B2B marketers polled stated that ABM was their top priority (ITSMA).
- ABM can help close deals 33% faster (Terminus).
- 26% of companies using it are only loosely practicing it by including non-ABM initiatives (Forrester).
Cultivating cross-channel ABM experiences
Practicing the art and science of account-based marketing at a high level allows marketers to curate customer experience initiatives in collaboration with other teams throughout the business, including sales, service and ecommerce. As with any complex B2B undertaking, tracking performance is vital. Cross-functional metrics can combine to paint a telling picture of the customer experience.
The latest research clearly shows us that B2B customers not only want but expect cohesive engagements that speak to their priorities, whether they’re interacting with a marketer or a sales professional, underscoring the need for alignment and insight sharing. The best ABM software programs and platforms can provide a consistent, start-to-finish buying experience.
The problem is that most marketers are not equipped with the multifaceted, interconnected and data-fueled ABM strategies and software needed to deliver consistent, relevant experiences to customers regardless of which company department or messaging channel the customers are interacting with.
Business buyers often report feeling like they’re communicating with separate organizations, not one company. Sharing unified customer data between business units can go a long way in addressing this inconsistency issue. The best ABM software makes such data sharing feasible.
Caveats and drawbacks associated with ABM
If you’re considering account-based marketing, there are a few things you should know upfront and keep in mind as you proceed:
It’s not a one-size-fits-all solution. All businesses are unique, so what works for one may not succeed for another. It’s vital to shape your program based on your specific needs and capabilities.
It’s resource intensive. This is not a cheap marketing strategy, but it can be cost-effective when you win big with it. Setting up a killer ABM program takes a lot of time, money and resources. If you’re a small business with a limited budget, it may not be the best use of your financial and personnel resources.
It’s not a quick fix. ABM is a long-term marketing strategy. It takes time to build relationships with your target accounts and generate results. This is a big drawback for businesses that need to see fast results.
It can be difficult to measure the outcomes. Precisely measuring the ROI of programs can be hard because ABM is a long-term, holistic strategy that involves many touchpoints across channels. It can take time to see results and not all successes are correctly attributed to campaigns, particularly when customers don’t buy directly through a campaign touchpoint.
It can be difficult to scale up. Scaling up to a large number of accounts is often challenging, primarily because ABM uses a personal touch with each account. High cost also contributes to the difficulty of upscaling programs.
Depending on the software platform used, martech integration and data management can also be challenging, but not with the leading applications, which turn this trouble spot into an area of strength. If your organization is equipped to work around the drawbacks, ABM can be a transformative B2B marketing strategy. Before investing too much time or any money, be sure to weigh the pros and cons carefully.
Now that you’re familiar with the basics of ABM, let’s take a closer look at how it delivers value so you can determine whether it’s a good fit.
How do you know if ABM is right for your company?
Companies that implement data-driven ABM are the ones earning the most loyal customers and business growth, but not all companies can pull it off. Effective programs are built on a foundation of knowledge with the aim of acquiring repeat business from loyal accounts. When it comes to building long-term relationships, knowing if your customer’s main pain point centers on supply chain issues, labor costs or both gives you a decisive edge over competing marketers who are simply touting their company’s features and benefits.
How does your team determine which accounts to classify as high-value and which among those to pursue with ABM? Creating ideal customer profiles (ICPs) for the accounts you want to target helps you answer this question while providing the building blocks for a new framework. Ideal customer profiles and target account lists are core marketing knowledge vehicles that are foundational to ABM. An ICP is a fictional representation of your perfect buyer. It includes basic information about the company, such as industry, size and location, as well as details at the role level, including pain points and organizational goals, although B2B ICPs typically focus more on the company and its priorities than the individual leadership roles.
Defining your ICP focuses marketing and sales efforts on the accounts most likely to buy from you. Making a list of accounts to target is a natural next step that begins with listing companies that buy offerings like yours and ranking them using criteria such as revenue potential, industry, company size and fit with the ICP.
Both marketing and sales teams should be involved in these key discovery conversations. Crafting ICPs and target account lists gives you the knowledge to determine if ABM is right for your organization while setting you up for potently personalized communication to those ideal customers and target accounts.
Identifying and qualifying your target accounts
As you decide on what you’re looking for in the accounts you would go after if you adopted ABM, consider these qualifying factors:
Show me the financials: Keeping your company’s revenue and overall growth goals in mind, ask how much revenue can be generated from an account and consider if it’s worth targeting. Think of the long-term value.
A scale of an opportunity: Get up close to see if it’s a baby whale or just a big fish that’s done growing. Scalability is a form of salability, after all. A potential account’s business performance can tell you a lot about its target value. How much potential is there to grow the account down the road? Consider upsells, cross sells and future offerings that could help retain and grow the account.
Survival of the rivals: Seeing which customers your competitors are selling to is a best practice for starting your target account list. Knowing about buyers currently in the market for offerings like yours is an excellent way to find similar account opportunities. What products or services are they buying? Use this information to shape your list of target accounts.
These exploratory steps inform most marketing activities, and if you’re considering a new approach, they give you a strong starting position from which to develop and execute on the message personalization and content customization that gives ABM its value. To compete for big accounts run by sophisticated buyers, you must be able to message to the individual purchasing decision makers as if you know them and you must make content that stands out and hits home with them, a tough task in today’s overcrowded information environment. Winning their loyalty requires fulfilling marketing and sales promises, but to get to that point you must win their attention first.
ABM gets you on their radar, makes a good impression, crystalizes your brand and keeps it in their line of sight using data to craft deliverables such as personalized emails, tailored advertising and customized landing pages that speak to their real-world situations.
Mapping a typical ABM journey
Account-based marketing success is measured by tracking key metrics like account engagement, pipeline growth, revenue generated and customer lifetime value. Success depends on taking a strategic approach that’s continuously optimized using key performance indicators (KPIs) to adjust live campaigns and shape future ones.
To crush your entry into the arena, you’ll need strategic models and digital tools to align your teams and transform into a lean, mean ABM machine. You’ll be tracking and continuously reassessing KPIs to connect with and retain high-value accounts and harvest more revenue from them. Here’s a look at other ABM management competencies your team will need to collectively cultivate along your journey:
- ABM software applications and overall martech stack
- Adopting data-centered methods for selecting and evaluating target accounts
- Operationalizing data for target accounts and existing customer accounts
- Expanding and evolving branding in servicing accounts
- Integration of data-informed content, digital campaigns, public relations and sales outreach
- Adopting new KPIs and marketing job functions
- Internal disruptions and misalignment during the transition
- Scope and complexity of overall program and individual campaigns
Tools to check out before committing to Account-based marketing
As ABM has matured, a galaxy of digital ABM tools has proliferated, including facilitation tools along with ABM analysis and reporting tools. With a fundamentally different approach to generating new business, ABM needs to be executed using a different martech tool kit with its own digital platforms.
What are ABM platforms?
ABM platforms are a class of software that marketers use for designing and running programs at scale. Some capabilities include target account selection, campaign planning, engagement tactics and reporting on campaign results. Campaign managers use the information gathered and stored in these platforms to connect with a vetted list of high-priority companies and buying committee members. It works best when marketers work closely with their sales counterparts. For example, marketers partner with sales professionals on tasks like building data-informed ICPs, which they use to craft target audiences and content that leads prospective buyers to find and assess offerings.
Platforms typically reach audiences on channels such as display advertising and retargeting, social media advertising, content syndication, customized landing pages for requesting contact information and emails that are personalized—but not so personal that they raise privacy concerns. Examples of cutting-edge ABM platforms include 6sense RevenueAI, Demandbase One, Terminus Engagement Hub, Dun & Bradstreet, Bombora, TransUnion, Zoominfo MarketingOS, Convertr, Bizible, Triblio and Owler. These platforms are evolving rapidly with the addition of AI and machine learning (ML). For instance, 6sense RevenueAI claims to be the only B2B platform that predicts when accounts hit their buying cycle stages, prompting automated outreach.
A dynamic future for an evolving approach
The future of account-based marketing looks bright and full of change as new technology deepens its impact and continues its dizzying evolutionary pace. Buyer expectations are also evolving. Practitioners on the cutting edge are adapting their ABM to the reality of growing decision-making groups among their existing and target accounts. They’re no longer scoring and nurturing leads based on one or two leaders—instead they’re profiling and messaging to a “buyer cloud” that includes purchasing influencers along with their bosses who make the final calls on which vendor or supplier to choose.
Meanwhile, AI and ML technology is advancing faster than society can adapt to its impacts. Tech-savvy marketers are not waiting. They’re harnessing the new content production capabilities of generative AI like ChatGPT and Google Bard to get a leg up on slower adopters. These same new tools in the hands of anyone interested in experimenting with them, including those with bad intentions, are already escalating the risks posed by fake online content, especially on social media. Gartner predicts that by 2027, 80% of enterprise marketers will have a team function devoted to authenticating their content. To keep up with misinformation and fake user-generated content (UGC) in this brave new world of intractable, high-tech political polarization, marketers must start monitoring their brands’ content to boot agitators and guard the trust they build with their customers. New tech and new roles will be needed to address hordes of inaccurate or defamatory UGC.
Technology is part of this problem’s origins and will be part of how it’s dealt with going forward as well. Companies with martech funding should be expected to gear up. For example, Gartner’s most recent Digital Markets report estimated that almost 70% of B2B businesses would spend more on software in 2023 to create operational efficiencies.
Marketing activities augmented by AI and ML are sure to proliferate because they facilitate data-driven decisions that advance business goals like revenue growth. As their capabilities improve and expand, marketers will use AI and ML apps to better orchestrate content along buyer journeys, including enhanced segmentation and personalization. Quality, consistency and delivery timing will all improve.
Technological advances will allow those on the leading edge to increase revenue while improving cost effectiveness to counter market uncertainty. Bellwethers are already moving to data-driven campaigns with measurable outcomes while automating the lead generation process. More teams will switch their focus to remarketing or retargeting ad campaigns that have enjoyed past success by modifying bids based on tracked behaviors of website visitors, thereby boosting contact form submissions and conversions.
While some things will get easier, managing all the new tech will become a bigger lift as it penetrates hiring and training initiatives. Many companies will need outside help to make the leap forward.
Resources for learning more about Account-based marketing
For a deep dive on data-driven strategy, check out another ABM blog, How to Use Customer Data to Strengthen Your B2B ABM Strategy.
It’s important to note that ABM is not a magic solution. It’s a complex, multilayered strategy that requires careful planning and execution. If you’re uncertain how to design and implement ABM, consider working with a marketing agency specializing in ABM. The Elevation Marketing approach to ABM is streamlined for maximum impact.
We research your business and audience’s unique needs using proven methodologies and cutting-edge martech to generate rich data sets that yield actionable insights. Then we use the knowledge and novel information gained to tailor your ABM strategy. Starting with your priorities, our team of experts in B2B marketing research, strategy, creative, technology, data management and omnichannel campaigns build agile, long-lived ABM programs that can grow with your business.
Whatever your business goals for ABM, our agency has the systems, processes and professionals to turn them into achievements.
If you’re ready to get started, connect with us to receive your free ABM consultation and proposal.