An Account-Based Marketing strategy can be an extremely effective tool in today's market. With all the technology and data available to marketers these days, it's no wonder that ABM programs are becoming more and more popular. But before you embark on an ABM journey of your own, what do you need to know? And what should expect from your efforts?
In this edition of the Solving for B° Podcast Marketing Copywriter, Jared Haube; Brand Strategist, Leslie Rainwater; and Chairman of BrandExtract, Jonathan Fisher discuss the latest trends in ABM and offer tips to make your ABM program a successful one.
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*This transcript has been edited and formatted for readability.
What is ABM?
Chris: In today's episode, we're discussing Account-Based Marketing. We'll talk about when should companies should use an ABM strategy and what they need to ensure a successful ABM campaign.
For those who may not be familiar with ABM, can you guys give us a high-level definition of ABM?
Jared: Essentially, account-based marketing prioritizes the accounts that are most relevant to your business. B2B marketers employ ABM to pinpoint and target the accounts that matter most to their organization.
The goals of an ABM strategy focus on attracting and engaging prospects at scale, converting them into customers, and measuring progress before, after and throughout.
Jonathan: Simply put, ABM is sort of the opposite of mass marketing. I like to think of it as a rifle approach versus the shotgun approach.
Chris:When does it make sense to use ABM instead of a mass marketing approach?
Jonathan: ABM starts with data research. It makes sense when you have the ability to identify candidates and prospects that you're looking for, based on a variety of variables: their size, age, life cycle, etc. Through data mining of your CRM system, list acquisition and segmentation work, profiling and persona building, ABM can make great sense to work from a much more targeted list of prospects.
Advantages of an ABM Program
Chris: What are the advantages of an ABM program?
Jared:It prioritizes the most relevant accounts of your business. But on top of that, it brings the adage “quality over quantity” to mind.
You orient your marketing spend to the most promising business opportunities.
You mitigate the age-old gap between marketing and sales by establishing alignments.
And you're able to tie your marketing initiatives back to tangible revenue figures and drive the growth strategy.
Chris:You mentioned the alignment of sales and marketing. Can any of you elaborate on that a little more?
Leslie:That’s an age-old battle. Sales doesn't know what Marketing's doing, and Marketing doesn't always get the information from Sales. This is pretty natural due to the way organizations run.
But this is a very structured method that helps align a path forward that requires participation from both. Everybody is on board in their different phases, and you can track the results. As a result, there's that positive cycle that goes back, and it aligns everybody better.
Jonathan: When you're talking about Sales and Marketing, I like the analogy “Marketing leads the horse to water, Sales make him drink.” But with ABM, you don't have that definition. It's not just lead them in and then hand them over. Instead, with ABM, you have a constant back and forth of touches between Sales and Marketing in the process.
Leslie: And it's not as loose of a process. It's very structured, so people have the ammunition and tools they need and a schedule to go by so that everybody is on the same page.
Jonathan: You asked about the advantages… Because it's not as loose and it's a back and forth kind of process, it forces accountability between the groups to work together. That allows tracking that you often don't get when sales teams don't use CRM systems, for example.
Jared:Think about the context of efficiency with regards to ABM. Imagine having Sales and Marketing focusing on the same list. That alone means there is a very accountable and structured approach to business opportunities that are real and matter to the corporate strategy.
Chris:It sounds like an ABM program is more easily trackable; you can get a better sense of what works and what doesn't, and kind of keep your finger on the pulse of that effort. Is that fair to say?
Jared:Yes. The and the objectives need to be SMART:
As an example, in the context of measurements, growing amounts of revenue from specific segments as a goal, or acquiring business away from your market competition. Those are real, measurable foundations on which an ABM strategy can deliver and progress the organization's growth strategy.
Jonathan:ABM can be so targeted that it's literally a custom program per client when you're talking about large accounts. So you can engineer a program specifically to penetrate a single client.
Now, obviously, that client would have to be worth it. These are sizable whales of opportunities, but going after large accounts is one of the main characteristics of ABM.
Chris: Going after one account allows you to put more thought behind your message and to tailor the message. I think that's the value.
Leslie:And when you're able to tailor it like that, it also helps you control how much you spend and where you spend it. So you are not only stepping away from a broad approach; you also have more time, effort and money to focus on emplopying quality approaches, building the content you need and doing the right research for those specific people that you're going after.
Chris: Right, it's not that spray and pray approach.
Jared:Technology plays an important role in the facilitation of an ABM strategy, as well. It gives marketers the ability to scale, reaching hundreds or even thousands of accounts while delivering a personalized, engaging experience. And that is not something marketers had 15 or 20 years ago.
It has come such a long way that we're now able to draw in more target accounts, increase website engagement and equip the sales team with better-qualified leads. Jonathan mentioned platforms like CRMs. You can also think about content syndication systems. Technology does play an important role underpinning all the key points we've covered thus far.
Challenges of an ABM Program
Chris:We've talked a bit about the advantages of an ABM system, but what are some of the challenges?
Jared: From an alignment perspective, because the marketing and sales relationship is very important in an ABM context, there can be initial pushback for Sales over concern of a reduction in qualified leads through their pipelines when it comes to trying to present an ABM strategy.
Another one is that sales team that won't be inclined to provide their target account list or collaborate with a marketing team to create one. These are two initial challenges that you can face.
Jonathan: I just ran across that issue with a $100 million company in talking with their communications team. Their sales team doesn't want to play nice, which is mind-numbing to hear. But we see it constantly.
If you're a CEO or a CMO and you've dealt with that frustration, implementing an ABM program -- while it may be a challenge -- is an opportunity to get that integration that you've been looking for and haven't been able to drive forward.
Chris:You just need to get buy-in from all parties involved. I think the apprehension from Sales may come from the idea that they don't know what's going on. It might feel like it's threatening their job security. But really, what ABM tries to do is to empower the sales team and give them more qualified leads.
Jonathan:You want to improve their win ratio. You want to drive leads that are more qualified, maybe in the later stages in the qualification process for them. You want to support them through the sales cycle instead of just handing it off and hoping they close the deal and don’t forget about it.
We've actually seen that happen. We drove 1,500 leads to a sales department once, and they forgot about them. They told us they were following up on them, but we later found out they weren't.
Another time, we were working with a company once and their consulting team was squatting on all the leads because they were at capacity, and they couldn't do any more work. Yet, the CEO was sitting there screaming that they were expecting 300% growth. And the operations team was like, "Forget it, we're not putting any more in this pipeline."
Those are some of the challenges that you can run into with this process. But there is also data and the quality of data.
Leslie:That is absolutely key to this whole program: finding those people that you want to touch and then figuring a strategy to go forward. A key to that, first, is to communicate with the sales folks and get that alignment so you can get their list and the things they're working on, and make sure they're using their technology correctly.
In the research phase, it's really important to get a good data researcher to help you build that list. And then, you want to keep building it organically. It is not a good idea to simply purchase a list. If you do that, you will not get exactly what you need because there's a scientific approach to it.
Jonathan:You'll have to scrub the list as you go, and you can run some testing along the way, help continue to filter the list down. But if you don't have really good research and you're not getting the proper inputs on the front end, you might be measuring the wrong things.
For example, you might be basing your decisions on the size of sales that an organization does as a target, “They're a $100 million or $1 billion company, they're obviously a target for us.” But you may find that the sales reporting is often inaccurate by these companies that collect sales data. And a better metric might be looking at the employee headcount as a truer indicator of a target for you.
Understanding those subtleties is a big part of the process. And you must get those right or you might end up marketing to the wrong people, with the wrong message even.
Jared:We've discussed Sales, but sometimes it's not just Marketing and Sales which get involved and have a key role to play in developing an ABM strategy.
You also need to consider the finance department and the operations department because Operations can help with facilitating the tech side of ABM, which is crucial for effectiveness. And the finance department, when it comes to budget allocation and financial decision making, also plays a role in the ABM picture.
Key Components of a Good ABM Program
Chris:What are the key components of a good ABM program? Is there anything that's key to a good, successful ABM program?
Jonathan:Segmentation. I think people see this list as a singular product, and it's not. There needs to be a segmentation process. You can look at things by life cycle, for example, “Where are these people in their purchase decision process?” Or, if they're within your own customer segmentation, “They've bought from us in the past, what did they buy in the past? How long ago did they buy? Is what they bought aged out?”
So thinking about your list as sort of a single set product, I think, is often a mistake that people make. “Oh, well we've built the target list, all targets are now equal.” That's not the case. Understanding how to do the segmentation off the list, once you build it up, is a key component of this process.
Jared: Creating your list and marketing to it is only one part of the equation. Segmentation is very important for delivering relevant messaging to each segment in a timely manner. And the segments you've defined also need to have separate objectives that your marketing team can create initiatives to support.
Defining your ABM leadership group at the early stages is very important. Creating your target accounts with objectives and metrics, consistently communicating with the leadership, marketing and sales teams all play a big role. You don't want to have gaps that end up widening as an ABM strategy progresses and then delays the actual action items when going forward. And evaluating and tailoring the strategy or scaling your various efforts based on organizational needs. Those are the foundations that a lot of us would have to consider when undertaking an ABM strategy.
Leslie:As you're getting into the implementation, once you've segmented your list and you've figured out all these things, you must define the channels you’re going to use to reach them. And you want a mix of them, but you’ve got to figure out how those targets get their information, what are the best ways to deliver it, what are the pieces and how are they all tying together. So it's pulling the orchestra together and then conducting it.
Jonathan:The timing of this program is critical. You don't want to spread things too far apart; you don't want to jam them up too close to each other. So between the channels, that pacing, if you will, is also a critical component to these programs.
Important Steps to Consider
Chris:We’ve talked a little bit about the challenges and the benefits, but I would like to get a little more practical. So if someone is planning on undertaking an ABM program, what are some of the important steps he or she should consider?
Leslie:The first thing is to set your goals and your objectives. Then, define how you’re going to do it, so you have a strategy for how you're going to approach each step, and your time allotted to that.
That's the beginning: knowing what we want to do and what we want to achieve and how we're going to go about it.
Jonathan: The goal should be more than just sales. You can have a wide variety of types of goals. It can range from things like awareness to penetration of a relationship. “We've never been able to get in the door with this company before,” for example. We've seen that before.
It could be to initiate a certain percentage of opportunities with the organization, say, RFPs. Or, it could be to initiate a percentage of deal size, like a larger project versus a smaller project. Or, as we've seen with some of our clients, getting in downstream. They've been able to sell one thing, the tip of the spear, but they haven’t been able to get past that point in their process.
Thinking about goals is important from a very broad perspective, not just total sales, the total number of accounts or the total number of leads. ABM tends to work better when it's more discreet in what it's going after in that process.
Jared: It's also aligning metrics with goals; thinking about how to encourage the appropriate behaviors among everyone that would be involved in facilitating in ABM strategy, supporting open lines of communication, especially regarding all the different teams – Finance, Operations, Marketing, and Sales – and opening the avenue for collaboration. That ties back to an organizational planning approach.
The goals come first, and then you also identify your ABM leadership group. For example, Sales. The expectations around leads and how Sales works would need to be considered. Or Marketing and how the leaders can help draft new benchmarks for measurements and operations, how they'll start thinking about marketing.
Everything comes into play, even, as I mentioned, the finance department: getting on board with them and determining how they spend and financial planning go ahead to get an ABM strategy up and running.
Leslie:You have your goals for how you're going to measure your program, but this is a change management piece. You are changing the culture of your company. You are changing how the people work and bringing people in. And there are ways to do that, but it needs to be very intentional and very purposeful.
It’s about going through that list of stakeholders and figuring out their your role is, why this is important to them, and being able to communicate that and get everybody on board at the beginning. And that's a piece that's often missed but understanding how you manage change is very important.
Jonathan: Most sales organizations that we see don't have defined sales processes or even sales steps. When you talk about change management, the change can be simply aligning that and getting everybody to agree. Even if in the past, the multiple personalities of the various rock star salespeople did it in their own unique way.
But that’s not scalable to an organization. It's limited to that individual. And for these teams to work together, they must understand that change occurs at the base of just creating fundamental agreement on an alignment of how things could work or should work, long before you even get into the implementation of the program itself.
Chris: I think another important part of it is making sure that we're measuring the effectiveness of our ABM effort and allowing that to dictate, or at least inform, future efforts.
Jared:A key start to measurement is to do it prior to starting an ABM initiative, as well as after. When it comes to before, if you can set measurement criteria for your marketing efforts, you'll be much better placed to track growth created from prior marketing initiatives.
Think along the lines of reviewing current conversion rates and web analytics to figuring out the percentage of site visitors that fall into your target account list. That comes before an ABM strategy.
Jonathan: It might be like we talked about, deal size. But it could also be collapsing a sale cycle, for example. We see all the time that sales cycles can often take too long, especially in professional service businesses or large complex businesses. So that's why I said earlier that you must think broadly about the kinds of things that you want to measure in this process, besides just the end game of a single sale.
Jared:And when it comes to measuring post-ABM strategy or activity, you need to think about how your marketing efforts are performing, how you're progressing regarding wider sales and corporate objectives, how you're prioritizing efforts and thus, what variables might need to change.