Account-based marketing is no fad: How and why CMOs should commit
Contributor Joe Hyland explains how the benefits of an ABM approach can go well beyond external marketing.
Less is more. It’s such a simple phrase, and yet it holds so much truth.
In the business world, we’ve all experienced how much things improve if we focus on fewer tasks at a time. It makes us better marketers and salespeople — more focused, effective, thoughtful and empathetic toward those we are selling or marketing to.
A lot of jargon is thrown around in sales and marketing. There are even more fads, so much so that it can be hard to keep up. But Account Based Marketing (ABM) is neither jargon nor a fad. It’s an important trend all marketing and sales teams should take note of. It’s based, after all, on the premise that less truly is more.
Why should you move to an ABM approach?
Part of the problem today is that we often operate in silos in business. We get caught up in numbers, quotas, leads and revenue. These benchmarks can create incentives to hoard individual credit and distinguish ourselves, rather than align strategically with others and make larger gains and get bigger wins together. These benchmarks also encourage a quantity-over-quality mindset, because employees are constantly trying to get more leads and more wins. This is to an organization’s collective detriment and hurts its bottom line.
In the past, many marketing and sales teams took a “spray and pray” approach to generating as many leads as possible. It was a volume play. Some organizations could get away with this, simply because their solution was best in class. But now there are too many startups and too many worthy competitors for any organization to take this antiquated approach — a company can’t distinguish themselves just by spamming potential buyers with generalized content.
Furthermore, buyers have access to unprecedented information. Just as a diner would check out Yelp to see a restaurant’s reviews before booking a reservation, a prospect today will do extensive research on potential solutions — often before they even make contact with a salesperson.
In fact, 78 percent of buyers now spend more time researching purchases in an effort to mitigate risks, with many spending up to three months researching vendors anonymously, according to the 2017 B2B Buyers Survey Report by Demand Gen Report. That means they won’t be receptive to vague sales pitches that don’t address their specific pain points.
An ABM approach, if executed correctly, solves these issues. It brings together teams and individuals to focus more deeply on what truly matters: your highest value customers and prospects. And it engages these high-value targets in a manner that’s truly meaningful.
What exactly is ABM?
The core premise behind ABM is that you treat each individual account as its own market — that means you tailor your outreach and go-to-market strategy and make it as customer-centric as possible. At the core of ABM is empathy — you have to truly understand your audience — what their goals and fears are — and you have to constantly put yourself in their shoes.
I even like to imagine what my prospective customers’ personal lives look like. What kind of car do they drive; do they have kids and a family; are they liberal or conservative? What do they do outside of work for fun? You have to truly empathize with them to get inside their heads and be able to effectively market and appeal to them.
The results speak for themselves: 87 percent of companies using ABM report it offers higher ROI than other types of marketing: According to the Information Technology Services Marketing Association, 69 percent see improved annual revenue per account.
But why is that? The Pareto Principle (or 80/20 rule) states that 80 percent of a company’s revenue comes from 20 percent of its customers. This is particularly relevant in the context of ABM. Using this principle makes sense because it emphasizes why focusing and nurturing high-yield customers is so vital to marketers.
ABM programs are most effective for targets with complex, long and sometimes political buying processes. In contrast to lead-based programs requiring engagement with thousands of companies, ABM’s effective audience ranges from dozens to hundreds.
How do you move to ABM?
If it’s too difficult to entirely shift from a lead-based model to an ABM model right away, then do it slowly.
Identify the highest value prospects in your pipeline, and make sure your touch points are tailored to them. If there are certain industries you sell to that you know have more extensive buying cycles, prioritize an ABM approach with them. This gradual rollout may even be advantageous: You’ll learn how and where you need to be personalized throughout your sales funnel, and where you can get away with a more systematic method.
Additionally, I think it’s important to avoid limiting your ABM approach to just marketing and sales. Envision the other ways a personalized, customer-centric mindset can benefit your team. For example, when it comes to managing people, I used to take the same approach for all my direct reports: weekly one-on-one meetings, annual reviews, the potential for bonuses at the end of the fiscal year — you get the idea.
It wasn’t until I started incorporating ABM into my marketing approach that I realized it was a smart way to manage employees as well. I started treating each employee as an individual customer who might value more vacation or educational training over a monetary bonus, for example. Some needed more or less feedback than they received during a weekly one-on-one meeting.
After incorporating the ABM mindset into management, I found my marketing team to be more engaged in their work — and our prospective customers to be more engaged with our outreach as well. And that’s a true win-win for any business.