The Marketer’s Dilemma
The “new normal” of business of reduced resources / “do-more-with-less” began as a result of the global economic downturn in 2008 and has not let up. The new normal applies to the profession of marketing as well. The numbers of customers grow as do demands from Sales: more leads, better conversion rates, more activity. At the same, however, Marketing has fewer people and lower budgets. And if your company is like most, a relatively small number of customers account for the majority of revenue and profit (the infamous “80-20 rule”). So what is a Marketer to do?
One answer – but by no means the only – is Account Based Marketing (”ABM” for short). I define ABM as a set of marketing tactics and programs targeting a market of one, usually an existing customer (but sometimes a prospect) that has strategic value for your organization and / or you believe will buy from you in the near term. Essentially, it’s marketing for a single company instead of the masses or a market segment. It’s white glove, customized, and high touch. It is reserved for your best customers and / or those accounts that you want to enter your top tier. ABM demonstrates to your clients that you are making a significant investment to establish a true partnership; a relationship of trust versus a vendor-seller.
But ABM is more than signaling commitment and touchy-feely relationship building; the business benefits of ABM are clear. According to a recent Sirius Decisions report, structured ABM programs deliver more than 200% increase in contribution to sales pipeline; a 30% improvement in customer health scores; more than 33% increase in Web traffic from targeted accounts. And according to Gartner Research Director Todd Berkowitz, ABM “…can increase revenue by as much as 20% by taking a programmatic approach to marketing to existing customers.” So net-net: more sales; better customer engagement; deeper relationships.
There are many flavors of ABM programs in terms of size / scale / objectives. I was part of a failed launch of one program, and am currently running a reasonably successful one (recently awarded Sirius decisions “Program of the Year” Award (shameless plug). Between my personal experience and having spoken with marketing peers both from within and outside SAP (my current employer) about ABM, I have compiled what I believe is a foundation necessary for building a successful ABM program.
- Strong partnership within Sales
For ABM to be successful, the Account Executive needs to engage with the ABM practitioners. This means that they think of the ABM practitioner as a strategic partner; as a core part of his / her account team; and brings them in early and often to the account planning process. Any hint that Sales does not view Marketing as a strategic partner (i.e. “I need an event next week” or “please order some pens I can give to my customer,”), run screaming! That Account is not right for ABM, no matter the revenue targets.
- Customer champions
Sales buy-in is not enough. To ensure success, you need “Champions” at the account itself; individuals with whom the ABM practitioners works closely. The “Champion” is usually Senior Manager or Director level and helps in the following ways: 1) disseminate and support the content and programs directed at their own company; 2) provide feedback on that company’s needs and requirements from you and the account team. For example, do they need education on how to optimize an existing investment; or do they want information about a product or service; or do they require a physical event (e.g. an “Innovation Day” or “Workshop” to bring their own teams together to collaborate on how your company’s solutions address their business challenges; 3) be a sounding board and partner for ideas for how to enhance the partnership further. Without an engaged Champion, even the best ABM program will not be successful.
- Dedicated marketing resources (people and money)
While it may seem obvious, especially given the “new normal,” a successful ABM program requires some amount of dedicated resource and focus. Without it, the program will move too slowly, and won’t have the desired impact. How much of an investment depends on the company and the goals and scope of the program. Account coverage (e.g. 5 accounts vs 75) and type of coverage (full white glove vs. largely content-driven, digital engagement) will determine whether 1 or 2 or 7 people or more are needed. In my experience, people are more important than actual dollars or EUROs for ABM. Why? Because many ABM tactics are low / no-cost, such as webcasts, newsletters, collaboration tools, and existing content that can be re-tooled. True, money is required for high-touch or highly specialized activities, and these should be part of most ABM programs. But marketing can make a significant impact without spending gobbles of money (yes, I said it…I hope my boss isn’t reading this).
- An “engine” that delivers relevant, timely content
We’ve been hearing “Content is King” for years. And it’s true: it is at the heart of most marketing activities. What is the message; what is the value proposition; what is the content that we want to share with a customer or prospect that will get them to read, to engage, to say yes! Tell me more, or show me, or where do I sign up? At most large companies, there is no shortage of content. The trick is in knowing where it is, what content is relevant for whom, at what stage of the buyers’ journey, and how to package it in compelling ways. Someone needs to think about content and create a scalable model for content creation, curation, and syndication specially for the ABM use case. In my experience, this won’t happen on its own. And when it does, it takes far too much effort.
- Passionate, capable marketers who believe in ABM
This might seem obvious, but it’s critical. Marketers who view ABM as a task on top of their “day job” are not who you want to manage your ABM program and / or support your top accounts. I have found that the most effective ABM practitioners are those marketers that realize that ABM offers them a unique opportunity to work with amazing customers and to have a direct impact to revenue. Furthermore, ABM allows – demands! – that Marketers leverage the full spectrum of the marketing value chain – from awareness / consideration through to demand creation / acceleration. In the B2B world of highly specialized marketing role and functions, ABM presents truly unique professional opportunities. Help your Marketers realize this advantage, and you will unleash their innate passion and skills.
ABM is not a panacea and needs to be carefully scoped. But done right, it is a proven model for delivering value to both customers and to your top line.
I look forward to your feedback.
Jeff Winter, ABM believer