Account Based Marketing (ABM) is the ‘new black’ in B2B. And no wonder, considering that it costs five times more to attract a new customer than to keep an existing one and 91% of marketers that use ABM have indicated a larger deal size, with 25% stating their deal size being over 50% larger. Intuitively, ABM makes sense, yet how much of your company’s marketing budget is spent on chasing new prospects compared to nurturing the existing ones? If you don’t have a clear answer to that simple question, keep reading.
ABM in its simplest form, is a strategy that directs marketing resources towards a specific set of targeted accounts. The motivation? Higher revenues in a shorter time frame. Companies are starting to wake up to it – according to an ITSMA 2018 Benchmark Study, 28% of the entire marketing budget is being allocated towards ABM programs, and 97% of companies are seeing ABM had a somewhat higher or much higher ROI than other marketing initiatives.
As with any other trend, confusion and misunderstandings are an outcome due to the proliferation of technology providers and software vendors that are pushing an agenda largely founded around technology, ‘hyper-automation,’ ‘hyper-targeting,’ ‘hyper-personalization,’ ‘hyper-predictive modelling’ and hyper more.
We are living in a digitalized world and are making our (business) decisions online. This shift in buying behavior has caused a major change in how companies are organized between Marketing and Sales and the responsibilities among the two in larger organizations. Key to succeeding with ABM is creating an alignment between marketing and sales that allow your company to work as a cohesive account team – from the customer experience point of view. Without that alignment, your target accounts will suffer through a fragmented experience as marketing and sales trip over each other, rather than pave the way to effectively engage with key decision makers. Customers prefer not to speak with Sales before they are ready – according to a Serious Decisions study, 67% of the buyer’s journey is now done digitally.
Leveraging existing CRM and 3rd party insights on targeted accounts and key prospects is vital for a relevant experience and being a value adding partner, rather than an automated content distributor. This challenge is highlighted by the fact that more than 35% of companies conducting ABM programs say that getting data reports and results is the top challenge that they are facing, followed by personalizing experiences to each contact at each account. The spread of insights across different teams and departments (sales, marketing, customer experience, product etc.) typically prevents a holistic view of the account and many B2B brands are failing to entangle their customers through ABM, as they end up treating it as another automated marketing campaign and defeating the purpose of ABM; intended to be a strategic approach to long-term growth.
An approach for strategic customer development begins by creating value together withyour key customer, not pushing automated content to them. The end goal is to engage in a mutually rewarding relationship, also defined as Share of Life™. Allocating your digital marketing efforts, and particularly an ABM program, into a Share of Life™ context elevates short term gains into a sustainable long-term growth plan.
To operationalize Share of Life™, companies can leverage the C:R:E:E:D framework to define how to create value in an ABM program. The C:R:E:E:D consists of five interdependent pillars and should not be taken chronologically. The weighting of each pillar is based on the company’s situation and the current relationship with their customers.
Before embarking on an ABM journey, a company needs to map its current level of customer commitments. Commitments come in many forms and include both existing customers and prospects and can be categorized by type, such as intellectual commitments and opt-ins, financial and transactional commitments or strategic partnership commitments. After defining and mapping customer commitments, there is a need to plan how to create mutually beneficial relationships with strategically important commitments. Start by giving something back to customers and prospects who have shown a commitment. This will move relationships from a single commitment to an ongoing commitment. To accomplish this, the company needs to engage in meaningful, relevant communications and interactions that are based on data and insights.
Effective ABM programs leverage digital tools to extract data points and insights from multiple sources, analyzing both small data and big data. While the company typically has pools of data and insights on existing customers, prospect engagement needs to rely on what is available across digital and analogue touchpoints, combined with 3rd party data such as demographic, company size, industry knowledge, thought-leader interests and public news statements etc. There is a need to assess and understand digital behavior, content and topic preferences, etc. so as to serve the right content and relevant communications with a focus on the corresponding content and topic e.g., thought-leadership, case studies, product info, industry and competitor insights etc.
For existing customers, data pools referencing insights about the customer are often fragmented and live across databases within marketing automation, analytics, CRM, the CMS, account management conversations and product usage. Likewise, relevant data and insights often exist across several disconnected teams where this knowledge is siloed. The integration of customer data is integral to the success of ABM and is needed to inform meaningful experiences with customers. When used properly, this knowledge and digital understanding of the customer enables the brand to address fundamental needs and create individualized insights and personalized experiences that empower the customer to do more with their existing solutions.
ABM should not be treated as just another campaign or a temporary program but as a continuous effort that is ‘always on.’ The aim is to build on the trust between the brand and its customers. The program must position the brand as a long-term reliable partner rather than a short-term vendor pushing transactional ‘spam.’ The Reinforcement element differentiates the C:R:E:E:D ABM from a traditional automation initiative, and supports building trust, commitment and mutual value-creation.
The new digital life of customers provides the brand with an opportunity to attain ‘zero degrees of separation’ – an intimacy with the customer - through data and insights. By doing so, companies can understand what is important to the customer. Leveraging such information to inform the ABM program creates digital empowerment, and therefore becomes a virtuous cycle where each iteration results in new opportunities, elevating the brand experience and appreciation. Examples are product usage, IOT data or relying on deep customer insights that allow the brand and its customers to come together and accomplish tasks together. This will lead to product and service co-innovation and strengthening the bonds of brand-with-customer entanglement.
Automated communication alone will not create the sufficient excitement to build a bond that keeps customers coming back. Too many ABM programs automate irrelevant non-meaningful messaging and tactical product-related information in a text-heavy format, which results in low to zero open rates and yawning customers. A study from Demand Gen shows that 91% of B2B buyers would prefer interactive and visual content to traditional static content. Use of sophisticated technology and insights will allow brands to understand how they can authentically add value to what is deemed important in their customers’ professional lives. Providing thought leadership in a compelling format that leverages new ways of interactive communication can provide the needed customer excitement that will forge entanglement — because the brand feels right and does right.
Ultimately, this excitement is the basis for brands to answer whether or not the ABM program actually makes a difference in customers’ professional lives.
The ongoing shift in the customers’ behavior enforces a need for a constant and ongoing development of the ABM program to further deepen the relationship between the brand and their customers. New technology introductions provide opportunities for exciting new ways of communicating, such as using VR and AR for interactive storytelling, or introducing new services and products co-innovated with customers. According to ITSMA 2018 Benchmark Study, 57% of ABM practitioners have co-innovated with their ABM accounts, leading to the development of valuable new solutions for the company. The same report shows that using data and technology for ABM programs is the area least mastered by ABM practitioners.
The success of Account Based Marketing rests on a solid digital strategy. This strategy informs the recalibration of the ‘new vs. existing account’ mind-set and adjustments to the operating model between Marketing and Sales. The C:R:E:E:D framework will help operationalize the program and map out the next steps needed. As the customers decision journeys increasingly are being digitized, a new way of engaging is needed – think positive entangling.
Smart marketers recognize that there will be a distinct “before” and “after” in consumer behavior as a result of the pandemic. You must start now to create the digital tools needed to embed your brand in the customer’s post-COVID life.
Take the time now to identify and understand the new expectations of your customers, and how have their habits and priorities shifted during this time