Introduction
Account-based marketing is a great example of how unique, data-empowered marketing stractegies have evolved over time. They have radically transformed the way businesses woo their clients today.
In-depth information about prospects helps marketers focus only on accounts that closely match the ICP (Ideal Customer Profile). With account-based marketing, businesses rapidly find prospects that match their ICP. That results in higher conversion, shorter sales cycles, and better ROI, among other things.
What is ABM?
Account-based marketing (ABM) is a B2B marketing strategy that leverages data-backed insights to focus on specific accounts that are potentially more valuable.
ABM requires your sales and marketing teams to jointly develop targeted content. This is achieved by closely understanding the attributes of each account. Next, your teams will create personalized buying experiences by using these attributes. Research shows it creates better engagement with key stakeholders in each of the accounts.
This strategy is in sharp contrast to traditional marketing where you use a broad-brush approach and send out more generic marketing communications. There, resources are allocated to the entire market in general, unlike ABM which allocates resources to specific accounts.
And if you’re wondering why B2B should focus on ABM, here’s what you need to know: The 7 key benefits of Account-Based Marketing.
Types of ABM
Marketers can execute one of the three types of ABM.
1. One-to-one ABM, aka Strategic ABM
This is the most strategic type of ABM.
You target no more than three or four high-value accounts. Then you develop a detailed understanding of the challenges and requirements of each prospect. Next, you craft tailored, thought-leadership content where you highlight your specific value propositions as key differentiators.
Finally, you begin building strong relationships with key stakeholders.
KPIs: Short-term KPIs centering around relationships and differentiation
Best suited to: Organizations that clearly differentiate their offerings and leverage resources to target high-value prospects.
Pro tip: One-to-one ABM requires both discipline and resources. Your systems should be fully ABM-ready before you see results.
2. One-to-few ABM, aka ABM Lite
ABM lite handles small clusters of prospects that share some common challenges. On the average, you’ll see 4 to 7 accounts per cluster.
Your teams will create content that’s common for the entire cluster. Not everything that reaches the prospect is super-personalized, but you get things out the door faster.
Your investment-per-account is slightly lower. And your team members divide their time across different accounts.
KPIs: Visible opportunities in the short- to medium-term future and pipeline management
Best suited to: Companies that serve markets with several moderate-sized prospects
Pro tip: Often, your organization will find a particular prospect was much bigger than your estimate. You want to be nimble enough to transfer them to your one-to-one ABM teams.
3. One-to-many ABM, aka Programmatic ABM
One-to-many ABM grew organically from traditional marketing. Instead of just focusing on lead generation in huge numbers, ABM improves your targeting with automation.
This model relies heavily on technology for better, speedier analysis without going into every single detail.
KPIs: Lead generation is the most important metric in the early stages. Next, you look at engagement of social content and blog posts.
Best suited to: Organizations that target plenty of prospects. Be prepared to manage sales teams that each handle a large number of prospects, though.
Pro tip: In programmatic ABM, there’s this golden common ground between accurately filtered inbound leads and cold-mail generated outbound leads. The closer your sales and marketing teams work to this golden common ground, better the results.
Are these three types of ABM mutually exclusive?
If you mean whether an organization uses only one type of account-based marketing approach, no.
Organizations may execute one or more types of ABM simultaneously. For instance, in a certain geography they may be using the programmatic, one-to-many ABM while in another they may be successfully executing the strategic, one-to-one ABM.
Also, as prospect potential grows or diminishes, your organization may switch them to a different ABM. A huge enterprise whose foreseeable needs are reduced due to change in business priorities, for instance, could move from your one-to-one ABM radar to elsewhere.
Components of ABM
ABM works, but not overnight. You will need to have certain specialized components in place to ramp up your revenue and drive growth with ABM.
Here is a brief summary of the 9 key components of account-based marketing. Each of the components can be categorized as Analytical, Organizational, or Contextual.
Analytical components are data-driven. Number crunching and meaningful, actionable insights form the core.
Organizational components are driven by human interaction, which can make things a little complex. A fine balance of freedom and discipline is essential.
Contextual components circle around communications and messaging channels. They constitute what the stakeholders at the prospect’s end see and engage with.
1. Data-backed insights
Component category: ANALYTICAL
Function: Nearly everything in account-based marketing hinges on your data so analytics play a critical role in how well your ABM pans out.
And it’s not just a one-off. You’ll be interacting with the prospect repeatedly, and every interaction produces fresh information, so those insights will never be static. Your analytic tools should be dynamic enough to capture, process, and build upon each new piece of information.
2. Sales and marketing alignment
Component category: ORGANIZATIONAL
ABM requires close collaboration and alignment between sales and marketing teams.
Instead of operating in silos, both teams work together to define account-specific strategies, set goals, and execute targeted camp
Function: Aligning sales and marketing teams has a deep impact on how well you will be able to execute your ABM.
It has two aspects. The first is agreeing upon the KPIs. Both teams should be looking at identical KPIs all through the journey.
The second is consistency. As engagement across accounts unfolds, it’s easy for this alignment to weaken. The trick is to not lose sight of the fact that at the end of the day, both teams are working towards the same organizational goals.
3. System to qualify accounts
Component category: ANALYTICAL
One of the fundamental elements of ABM is the careful selection of target accounts. Instead of focusing on a broad audience.
ABM identifies and prioritizes key accounts that align with your ideal customer profile.
Function: Which of the three types of ABM approaches you take depends on how you’ve processed the data you’ve collected. A thorough system to understand prospects would give you key insights like potential ticket size or how long the sales cycle is likely going to be.
If you don’t have a reliable system to qualify, score, and segment accounts, you’ll work way below ideal efficiency levels.
4. ICP usage and identifying stakeholders
Component category: ANALYTICAL
Function: The Ideal Customer Profile (ICP) tells you clearly what kind of prospects will benefit the most from whatever you’re trying to sell. Based on how you’ve read the analytics, you will know the extent to which the prospect aligns with the ICP.
Your salespeople need to do their homework on the prospect’s stakeholders. The VP Finance of an enterprise uses criteria that are different from the ones a freshly founded startup does. Approaching both with the same cost-benefit analysis could be disastrous.
5. Cultural shift
Component category: ORGANIZATIONAL
Function: ABM-mature organizations exhibit a different work culture, which is not the same as that in organizations relying on old-style cold calling.
For instance, your sales teams will have to develop the patience that goes with nurturing. Marketing teams will need to put in more efforts extracting data and then making sense of them. An external expert would be a great help for this.
6. Strategic, calibrated content
Component category: CONTEXTUAL
ABM emphasizes the importance of personalized communication. Once you have identified your target accounts, it’s crucial to craft messaging and content that resonate with each account’s decision-makers and influencers.
Function: It’s pretty common for organizations using ABM to serve dramatically different content to accounts, thanks for specialized tools (check this). The old spray and pray approach has to give way to personalized content. Also, this content will keep changing and evolving as the account graduates down the sales cycle.
Provided you have collected the right insights, your content will remain tuned to the needs of your prospects. They will keep nodding as they consume your content, “Yes! That’s exactly what I battle with all day!”
7. Branding and brand advocacy
Component category: ORGANIZATIONAL
ABM focuses on delivering highly relevant and tailored campaigns to target accounts.
Function: Just as you score and qualify prospects, the prospects score you too. They will pore closely at the differentiators and begin making up their minds – one more reason you should constantly be working on building clear differentiators.
Good branding can turn tables in a favorable manner. The same stakeholders you were finding so difficult to convince yesterday can become your staunch supporters tomorrow. You’ll have your brand advocates rooting for you at the prospect organization.
8. Channel efficiency
Component category: CONTEXTUAL
Function: Devising channel-specific messages for your prospects begins with serious questions. Like, where do your prospects get information from, who or what influences them most, or on what channels do they spend their time.
Based on the insights you have collected, you’ll proceed to multichannel nurturing. And your marketing teams will devise content for each stage – when to educate, when to nudge, when to encourage your prospect to take action, and more.
9. Measurement of processes and outcomes
Component category: ANALYTICAL
ABM emphasizes the importance of measurement and continuous optimization.
Function: It’s like coming full circle – you start your ABM by looking at data on how you can proceed. And at the end, you look at data on how well you have done. Because you have been combining your sales and marketing teams, you want to look at certain KPIs closely. For example, ABM wants you to win big-ticket clients – were you successful? Or, did your approach reduce the sales cycle?
There’s no point shying away from asking pointed questions, because some answers could be a revelation of sorts. In order to have continued success, you‘ll need continued evaluation and course-correction. And that begins by looking at your score card at the right times.
10. Multi-channel engagement
Component category: CONTEXTUAL
Function: ABM recognizes the need for a multi-channel approach to engage with target accounts effectively.
It involves leveraging various communication channels such as email, social media, direct mail, events, and personalized content
What are the essential KPIs of ABM ?
When it comes to measuring the success of Account-Based Marketing (ABM) strategies, Key Performance Indicators (KPIs) play a vital role.
KPIs provide valuable insights into the effectiveness of ABM efforts and help align marketing and sales teams to achieve common goals.
Types of ABM KPIs:
- Account engagement
- Account conversion
- Pipeline velocity
- Customer velocity
- Revenue generation
Let us learn about these KPIs in some more detail:
1. Account engagement
This KPI measures the level of interaction and engagement with target accounts.
Account engagement KPIs provide insights into the effectiveness of your ABM content and campaigns in capturing the attention of target accounts.
2. Account conversion
Account conversion KPIs track the progress of target accounts through the sales funnel.
Tracking account conversion rates helps identify the most successful strategies for converting high-value accounts.
3. Pipeline Velocity:
Pipeline velocity KPIs assess the speed at which target accounts move through the sales pipeline. They measure the average time it takes for an account to progress from one stage to another, providing insights into the efficiency of your ABM sales process.
By monitoring pipeline velocity, you can identify bottlenecks and areas for improvement to accelerate deal closures.
4. Customer lifetime value (CLV)
CLV measures the total value a customer brings to your business over their entire relationship with your company.
This KPI helps evaluate the long-term revenue potential of target accounts and the success of ABM strategies in nurturing customer relationships. By tracking CLV, you can identify high-value accounts and allocate resources effectively.
5. Revenue generation
Revenue generation KPIs focus on the financial impact of ABM efforts. They measure the amount of revenue generated from target accounts and the return on investment (ROI) of ABM campaigns.
By analyzing revenue generation metrics, you can determine the effectiveness of your ABM strategies in driving tangible business outcomes.
These are just a few essential KPIs in ABM that provide insights into different aspects of your account-based marketing initiatives.
If you want to know more detail about these KPIs, this is what you need: Account Based Marketing KPIs: Effectiveness in measuring ABM success.
ABM and inbound marketing
To smart marketers, the differences between account-based marketing vs. inbound marketing are actually a synergy in diversity.
Inbound marketing prepares the background to attract prospects, using content that they deeply care about. There’s a lot of emphasis on SEO. Later, many of these prospects grow into high-quality leads, because that’s the solution they were looking for.
With ABM, you allocate sales and marketing resources in order to create a special experience for would-be customers. It hinges on the quality of data and how well this data is transformed into insights. These insights help you figure out the unique requirements and challenges of each account. Next, your teams create unique strategies for each account and execute them.
ABM and inbound marketing can work in tandem. You can use inbound marketing to get the attention of prospects. And after that, ABM can take over to engage and nurture them.
Both the approaches require that you learn about your target prospects and keep improving your understanding. That way, you continue delivering content that’s increasingly relevant and targeted.
ABM vs traditional marketing
To be fair, traditional marketing was perfect for all industries in yesterday’s world. That’s because there was limited data available about your prospects and their challenges.
Today, it’s different. We live in an abundance of data. Sure, some businesses may still find the spray-and-pray approach of traditional marketing suitable. But for many B2B marketers, account-based marketing is the way to go.
At the end of the day, both are marketing approaches. Both try to connect with the right audience. Both use promotional measures to get your organization noticed. However, the similarities end there.
In traditional marketing , you cast your net and wait. You go with promotions and advertisements, and then see who shows interest. After that, you begin understanding and nurturing them. So, like, 10k people see your ads, 200 exhibit interest, 100 travel along your sales funnel, and you finally convert 20.
ABM is rooted in personalized content. You don’t try to reach out to everyone. You use various tools to rummage through piles of data and draw out an ICP. Next, you create tailor-made content and processes to engage the right accounts only. It may appear to be a longer journey, but the strike rate is way higher.
Here’s a quick overview of the principal differences between ABM and traditional marketing:
- Prospect-product fit: In ABM, you only approach and engage those you think are your ideal clients. With traditional marketing, that stage comes much later – you begin by only bringing in more eyeballs
- Alignment: With ABM, the alignment of sales and marketing is both crucial and a prerequisite. In conventional marketing, the marketing teams focus only on bringing a large number of leads, and their alignment with the sales teams is limited.
- Numbers: ABM works with a very small number of prospects. Traditional marketing is nothing if not big numbers.
- Analytics: For ABM, the analytics are long-term and take into account a different set of things. Traditional marketing, on the other hand, looks at more immediate values. For instance, depth of engagement matters to ABM more than it does to traditional marketing.
- Targeting: ABM is analytics-intensive and works on a very well-defined audience only. Traditional marketing is a great deal less focused.
ABM for small business
An important question to ask before committing is whether account-based marketing for small business pays off well.
Firstly, we need to be clear that ABM is not a silver bullet; nothing in business is. For your business to get a good ROI out of ABM, you will need to tick certain boxes. You will need the expertise to sift through lots of data and generate insights. You should be targeting high-ticket prospects. And then, you’ll need the patience to stay on it a bit longer than you do with conventional approaches.
That said, ABM can be a great fit for small businesses too; don’t let experts convince you it’s only for giant multi-billion global enterprises. With a little initiative, small businesses can do just as well. If you are a small business, this is what you’d need:
- Focus: Be sure to stay focused on a few big accounts. Remember, you don’t have to put your full team behind one account.
- Tools: Don’t scrimp on tools. The right tools will not only generate amazing insights but also save you a great deal of your time.
- Timeline: Don’t look at end-of-day sales. ABM is about quality over quantity of leads, so it takes a while.
- Detailing: Be prepared to look at the finer points, because everything will add at the end. Instead of more visible numbers like inquiries generated, look for engagement or impact on your sales funnel.
- Mindset: Spend time building the right mindset and culture in your teams. Invest in training or bringing in an expert who can do it for you.
- Alignment: Make sure your sales and marketing teams are always on the same page. Their alignment is crucial to your ROI.
- Value-creation: Aim to create big value because you’ll be targeting high-value accounts.
Besides, there are challenges involved in ABM that you need to be aware of. Learn what they are and the expert tips from successful B2B marketers on how to overcome them.
Closing remarks
By now, you would’ve figured out that account-based marketing is not just another buzzword, it’s a concrete marketing approach. Like everything else, planning is key. So you want to first look at your product and your priorities, and then draw out a rough plan.
That rough, first plan should be able to tell you how geared you are for ABM. It will help you assess how ready you are and what gaps you need to fill.
And one final tip: you won’t have all the answers. You probably want a marketing consultant who can help you there. So what’s the first thing you’ll do now?
