Key Considerations for Your Account-Based Marketing Strategies
Account Based Marketing (ABM) has for years been touted as one of the best marketing strategies to employ in B2B high tech organizations. According to ITSMA, 28% of marketing teams’ annual budget is dedicated to ABM, and approximately 50% of all ABM programs are in the “expanding” or “embedded” stage.
All of this sounds fantastic, but most of us in marketing know ABM takes a village to implement. In fact, the more targeted, the harder it is to sustain. So, it begs the question, is a 1-2-1 approach to ABM truly a goal that most marketing organizations should have?
What is Account Based Marketing (ABM)?
In simple terms, Account Based Marketing (ABM) is a strategic marketing approach to target a set number of accounts with messaging, content and tactics specifically tailored to them. As I mentioned above, companies usually attempt to take a 1-2-1 approach, for larger accounts. For example, if you want to target a company like IBM, you’d create messaging specifically for your audience at IBM. All your marketing and sales activities would be aligned and tailored toward IBM. This type of personalization can be very effective. 89% of marketers see a positive ROI when they use personalization in their campaigns. Most often when we talk about ABM, we’re thinking of this 1-2-1 method. In fact, some teams mistakenly believe that this is the only way to do ABM, but this approach isn’t always realistic for every marketing organization. It can be extremely time-consuming, requires a high number of resources and budget, and at times even risky if you put all your eggs in the wrong basket. I think we need to get out of the mindset that the best way to do ABM is the 1-2-1 approach.
What are the three types of ABM?
ITSMA does a good job at describing the different account-based approaches that companies have developed, and breaks them down into three types:
1. Strategic ABM (1-2-1 accounts)
2. ABM Lite (1-2-Few accounts)
3. Programmatic ABM (1-2-Many accounts)
Strategic ABM, which mostly targets a handful of existing key accounts, has the potential of providing the highest ROI. In Strategic ABM, organizations mainly target existing customers. Highly customized programs are created to encourage customers to expand and increase opportunities within the account. Strategic ABM is mostly driven by sales, with limited involvement from marketing. The tactics for this type of ABM include one-to-one meetings, social media outreach, appointment settings, account-specific thought leadership and private events.
According to ITSMA, ABM Light differs from Strategic ABM in that it targets a higher number of accounts, usually around 20+. Still, ABM Light targets approximately 56% of existing accounts. In this model, marketing’s role is still limited but can be helpful in setting up one-to-one meetings, sending direct mail, creating custom collaterals, and using intent tools for specific keywords.
But it is in the Programmatic ABM that marketing can be the most beneficial. In this 1-2-Many model, marketing teams leverage technologies to tailor campaigns for specific named accounts at scale. This is the model that as a marketing professional, I find the most appealing and effective. There are no limits to the number of accounts you can target and you’re able to run a full-on marketing campaign. If you have a good product and a need in the market, aligning marketing and sales towards a common goal has the potential to generate solid pipeline and opportunities.
What’s so great about the 1-2-Many ABM process?
The 1-2-Many ABM strategy is closely related to the segmentation process that marketing teams have done for years before the term ABM ever became a thing. One of the best presentations on segmentations comes from Malcolm Gladwell’s Ted Talk, “Choice, Happiness and Spaghetti Sauce.” When people are asked which type of coffee they like, Gladwell says, the universal answer is “a dark, rich, hearty roast.” But if you served them that brew, it receives a score of 60 on a scale of 0 to 100. If you broke the population down into groups, and made coffee for each of these individual groups, the score would go up from 60 to 78. As Gladwell says, “The difference between coffee at 60 and coffee at 70 is the difference between coffee that makes you wince and coffee that makes you deliriously happy.”Though Gladwell’s examples in this specific talk are about food companies, the same concept applies to B2B technologies. According to Optimove, “When a group of customers is segmented and targeted by many smaller campaigns, the accumulated uplift is much greater than that of “spray and pray” campaigns. How higher? Try 33% in Customer Lifetime Value.
”I’d argue that marketing does best when targeting a large volume of accounts. Why? Because conversion rates are low. This doesn’t mean that you want to take a horizontal “spray and pray” approach, but rather to understand that there is a balance between how targeted your marketing team can get, and how effective it can be at the same time. The strength of marketing comes from reaching an audience across a variety of channels—from social media and ads to content marketing, webinars, virtual events, direct mail campaigns, field events and so on. I’d argue that it isn’t about the size of your account list but rather how well the accounts are researched and how granularly they fit into specific pattern or criteria. Maybe you’re looking for managed service providers who offer security as a service, or you’re looking for Electrical Coops that are expanding into the broadband market. Each of these types of accounts is in their own cluster and would require different marketing strategies and tactics.
Final thought…
No matter which ABM approach you take, your target list is your biggest asset. As an ABM vendor once told me about the poor quality of the account list she receives: “Junk in, junk out.” If your account list doesn’t meet the targeting criteria, and is lacking in quality, no ABM model will be effective. Prospect and customer research is the backbone of the most successful ABM campaigns. So, take the time to understand—really understand—your Ideal Customer Profile (ICP). Know your accounts and buyers inside and out, and remember that without this hard work, you might as well not even get started.