Is Account Based Marketing just the latest buzzword for what has existed for decades or is it worth attention? That’s a reasonable question. In our opinion, there is a problem with definitions and to be fair some unjustified hype.
In this beginners guide, we try to cut through the noise and outline the basics of Account Based Marketing. What it is and what it is not.
We start with a short history lesson as it helps give an overall perspective of where ABM fits within the marketing mix. We then take a look at the ABM process, its potential benefits and risks without diving too far into the detail.
What Does ABM Stand For
The acronym ABM stands for Account Based Marketing. It is a term used in Business to Business (B2B) marketing. As the name suggests it is an approach focussed on marketing to a select number of key customers.
The purpose of ABM is to engage the decision makers and influencers in selected key accounts. It attempts to satisfy the information needs of those who can affect a purchasing decision at each stage of the sales process.
If there are more than a few key accounts the complexity of the process can soon escalate. Many accounts, each with several key decision makers and many potential touch-points results in a significant amount of data.
Personalisation is key so the mass of data must be interpreted and acted upon. The ABM process often relies heavily on digital marketing techniques and automation.
Two of the major players in marketing automation platforms (more on that below) define ABM as follows:
Hubspot : Account based marketing is a focussed growth strategy in which marketing and sales collaborate to create personalised buying experiences for a mutually identified set of high value accounts.
Marketo : B2B strategy that concentrates sales and marketing resources on a clearly defined set of target accounts within a target market and employs personalised campaigns designed to resonate with each account.
ITSMA One of the first organisations to focus on Account Based Marketing states ABM is ‘Treating individual accounts as markets in their own right.’
ABM is a focus on key accounts. It is satisfying the information needs of key individuals within those accounts at various stages in the sales process. It is about marketing and sales working together to deliver business opportunities.
A Short History Of ABM
It is claimed the term Account Based Marketing was first used by ITSMA in 2004 but its origins go back to at least the mid-1980s. B2B organisations have long focussed on key accounts.
Key account selling is the process of focussing sales effort on key accounts and the key decision makers within those accounts. There is nothing new there.
Key account management is the process of building close relationships with key accounts once some initial relationship is established. Again nothing new.
Account based marketing builds on the concept of key account selling. From the late 1990s into the early 2000s, the relationship between buyer and seller changed. A new approach was needed and the rise of the world wide web delivered new opportunities. As the buyer took a step back from the seller ABM was proposed as a tool to close the gap.
At its most basic level Account based marketing is focussing marketing effort on key customers and the decision making teams within those customers. What has changed over time is the relationship with customers and how their needs are serviced.
Account Based Marketing Benefits
Some claim Account Based Marketing improves return on resources employed. That is probably true but making accurate comparisons can be difficult.
Others claim ABM improves long term customer success and reduces churn but at this point, definitions start to blur. Surely that depends on key account managers and their support teams not account based marketers.
In summary, the benefits of Account Based Marketing are:
- It improves sales closure rates.
- It improves marketing alignment with sales.
- It minimises wasted sales and marketing resources.
- It improves the supplier’s reputation.
- It reduces friction between seller and buyer.
Before diving in and starting an Account Based Marketing process it is important to try to quantify each potential benefit. Do the potential returns justify the resources required to support an ABM process?
The Account Based Marketing Process
For an Account Based Marketing process to work, it needs support from the very top of the organisation. Crucially, it needs patience.
It is important to find the right individual to lead the process. They need both the skills and the attitude to see a long term process through to completion.
Taking a step back from ABM for a second let’s take the example of a hunter. They can be an analogy for our sales and marketing team.
One approach our hunter might take is to blast away with a shotgun in the general direction of where he thinks the prey could be. He might hit something but if he doesn’t get lucky after the first few volleys the prey will be gone (if it was ever there in the first place).
Alternatively, he could take the snipers approach. He could take time to research when and where the prey will be, position himself and wait. If he is really smart he could ask colleagues to gently persuade the prey to move in his direction.
When the boss asks the hunter what he has been up to all week our trigger happy friend can point to the expended shotgun cartridges. They can point to a shredded part of the forest. If they have been really lucky they can point to some downed prey. It all shows activity and weak management tends to believe (wrongly we suggest) activity equates to results.
When the sniper heads back to the office it is more difficult to demonstrate their efforts. It will take time for their strategy to start to pay off. When the results do start to come through they will almost certainly be more consistent (and lower cost) but the sniper needs time to show the benefits of their approach.
If higher management is committed to at least a trial of ABM over an agreed period then a typical account based marketing process is as follows:
- Set goals.
- Identify the key obstacles to success.
- Align marketing and sales.
- Build a solid strategy.
- Market segmentation.
- Define what is a target account.
- Create a list of target accounts.
- Research those target accounts.
- Develop a marketing strategy (and content strategy).
- Measure and Analyse.
- Revise and Repeat.
Thirty key accounts with only eight identified contacts in each gives 240 key contacts to track. To understand and process interactions with each of those contacts requires a level of automation.
Content, in all its forms, that specifically matches the needs of the target is the fuel for the process. Typically a CRM will be needed and a content management system to track what is delivered and to whom. Content distribution tools (including social media) will be required and a range of analysis tools to track performance. Digital marketing tools (SEO, PPC, Email, social etc) will be needed either as stand-alone items or integrated into a larger platform.
Several platforms integrate much of the above including Hubspot, Marketo, and Engagio. Most platforms deliver a useful service but it is important to ensure technology does not become the problem. Costs can spiral and more time can be spent fixing technology problems than dealing with customer and market issues.
Most platforms started life as inbound marketing tools and morphed (to a point) into ABM tools. It is important to understand the difference between inbound marketing and ABM and not to let the tool dictate the process.
Common Account Based Marketing Problems
Account based marketing is certainly not the best way forward for all B2B organisations. It only tends to fit certain markets, with a specific set of supplier/customer dynamics.
The main problems with ABM tend to fall into three categories:
- Support and planning
Without a clear understanding of what ABM is (and what it is not) its goals and a plan, it is destined to fail. To have any chance of success strong leadership is required and unflinching medium to long term support from higher management.
Sales and marketing must both buy into the benefits of ABM. A mutually supportive, frictionless, sales and marketing relationship is crucial to success. Poor targeting of key accounts and trying to do too much too soon can be an issue. The resources required to produce and customise the content required should not be underestimated.
Perhaps the biggest potential problem is the marketing stack required to deliver any ABM process at scale. Account based marketing should be about ‘treating individual accounts as markets in their own right.’ It should be about satisfying specific information needs. It should be really understanding the customer and their challenges.
Without care and attention, the marketing stack can distance a supplier from the customer. It can cause data blindness. There is an obvious potential conflict between personalisation and scale.
So to conclude by returning to definitions. What is account based marketing? Fundamentally, it is a method to generate awareness in identified key accounts. It is a process designed to guide the key decision makers within a target customer along the path to a sale.
ABM can deliver significant benefits to an organisation but it is not the right way forward for all. It moves away from the traditional (wasteful) shotgun approach to B2B marketing but it does take time to deliver.
In a short post, it is only possible to cover the basics of Account Based Marketing. To install and deliver an ABM process takes time, resources and expertise. It also requires strong leadership and a single-minded approach.
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