In recent years, marketing has transitioned away from mass communication strategies and focused more on targeted, personalised forms of communication. A similar shift has occurred in B2B demand generation, with companies targeting accounts at the individual level with personalised, relevant strategies. This approach is known as account based marketing.
In competitive industries, providers understand that prospects do not pay attention to general messages that do not apply. Instead, you need to develop a deep awareness of the interests and behaviours of accounts based on industry, job title, and other firmographic and intent data. This approach has taken such hold in B2B marketing, that a recent Demand Gen Report highlighted that ABM knowledge and skills are among the most important for contemporary CMOs to possess.
In fact, a Sirius Decisions study found that 92 percent of respondents believed Account Based Marketing was a “must” for B2B companies.
Why Account Based Marketing?
Account-based marketing produces numerous direct and indirect benefits for both your organisation and for clients. Empowered by high-quality data and demand generation systems, businesses get a much clearer picture of how accounts behave in response to business problems. This heightened awareness improves your ability to deliver effective messages through the right channels to the right people across a number of job functions involved in the decision-making process.
The following are some of the more critical benefits of an account based marketing approach:
Marketing and Sales Alignment
Getting marketing and sales teams to collaborate is a major challenge in demand generation. With an account based marketing approach, though, this alignment seems to occur much more naturally and more often. The Sirius Decisions study also found, for instance, that 60 percent of respondents had marketing and sales functions that were “somewhat” or “tightly” aligned. This is a significant improvement over the 2015 study, where only 34 percent reported the same. Functional alignment improves end-to-end communication throughout your opportunity pipeline.
Better Prospecting Efficiency
By targeting at the account level, you eliminate much of the waste in preparing and delivering general promotional campaigns that have a low response rate. Instead, you invest more time up front to identify and profile the ideal prospects. And your marketing budget goes more efficiently into message strategies and channels that reach the intended targets. Especially when there are large buying committees in organisations comprised of different job functions.
Because of more efficient demand generation, you eliminate wasted resources that are a cost drain for B2B companies. Shortening the sales cycle is another common way that account-based marketers save money. Because you have a better sense of your target and their needs and can monitor their pre-call behaviours, the conversations move more rapidly with your sales team. Your reps are more equipped to ask the right questions early and to work with the prospect to navigate toward the ideal solution.
Higher Response Rates
When you remove a lot of the disinterested or unqualified prospects from the mix, you achieve a higher response rate on your marketing investment. Therefore, the time your sales reps put into calls with qualified prospects is more fruitful than in traditional mass marketing systems. Additionally, executives see better results and are more apt to invest more in your marketing and sales strategies.
Larger Average Deal Size
Concentrating your efforts on the most qualified prospects increases your potential to land more major deals. You build a more in-depth picture of the scope of the business problems your targeted prospects face. You get to know them by their job functions, roles, and responsibilities, and gain genuine insight into the challenges they face. This awareness allows you to build more thorough solutions that address their full gamut of needs. It is more convenient and economical for a buyer to work with one provider that can assist with all problems using one solution suite.
None of these other benefits matters much if you do not see improvements to the bottom line. Fortunately, because of the improved targeting and budget efficiency, a lot of data support increased revenue from account based marketing. Sirius Decisions reported that companies using account based marketing, that had marketing and sales alignment, increased revenue by 24 percent more than peers in the recent three-year period. Also, profits climbed 27 percent faster for these organisations.
More Satisfied Clients and Long-Term Relationships
By targeting the most qualified prospects with the right solutions, you end up with more satisfied customers and longer relationships. In some cases, a one-time sale to someone when the need is not ideally required can have a detrimental effect. We’ve all had deals that have not worked out as well as we had hoped. And this can lead to upset, frustration and negative word-of-mouth in the marketplace. Instead, with an effective account based marketing strategy, you meet the needs of the most qualified prospects, satisfy them, generate repeat purchases and referrals, and increase revenue as the relationship evolves.
A More Cohesive System
By adopting account based marketing, you set the stage to utilise one software-based system that integrates all facets of your demand generation, nurturing, closing and relationship management processes. This seamless connection ensures that your targeting, follow-up, cross-channel engagement and account management is in sync in a personalised way with each account. In many cases, companies collaborate with an expert partner to facilitate such a cohesive and high-functioning ABM system.
Improved Tracking and Modification
Account based marketing gives you much greater control over your activities across all channels with all customer types. Leveraging a cohesive system and an excellent database software program, you can track responses to communication strategies by prospect type across all channels. As you find out what works well (and what does not work well), you can modify your targets or promotional strategies to reach your prospects. This continued tracking of results and program modification furthers your ability to achieve other economical advantages already outlined.
What Does the Data Say?
In addition to the data demonstrating the progression toward more account based marketing in B2B, a number of studies show that companies that have embraced it are achieving success. You can also glean insights from data about marketer’s reactions to ABM and which strategies appear most successful. Companies put their money where their commitments are. And for those committed to account based marketing, the technology and services are the costs.
Sirius Decisions reported that
- 58 percent of companies planned to invest in these areas to support account based marketing in 2016
- more that 70 percent of B2B providers have staff dedicated to carrying out ABM,
- with 41 percent indicating they already have a full system in place
- another 58 are currently testing account based marketing.
Despite the overwhelming interest and shift toward account-based marketing, it is still a relatively new phenomenon. Only 20 percent of companies with full programs in place have had them for more than a year. Thus, if your business is a bit late to the party, there is still plenty of time to get up and running.
Account based marketing is not a fad. It is here to stay. The data on customer retention, revenue and profits clearly show that it works financially. You reduce much of the waste of more traditional, less-personalised methods of promotion, and replace them with more focused strategies that optimise ROI. You also achieve greater levels of customer satisfaction, which prompts increasing revenue from repeat purchases and referrals. As you look to get started, spend time planning for what success means to your business.
Consider the importance of bringing on an expert service provider with account based marketing expertise that can help you build the right infrastructure and systems from the beginning. Doing so helps you optimise your resource allocation to ABM and achieve the best results.