What is account-based marketing?
ABM is a strategy used by B2B companies to target specific accounts they want to become clients. It’s a process of identifying the right customers and then crafting a targeted marketing message that speaks to the needs of that account.
The goal of ABM is to increase revenue at every stage of the sales funnel. It can also involve creating marketing messages that allow you to upsell and cross-sell to your existing accounts.
Why is account-based marketing effective?
When you use account-based marketing, you’re not spending all your marketing budget on generating thousands of leads who may never become customers. It’s a much more strategic approach that helps you find customers aligned with your mission.
ABM is effective for these reasons:
1. Higher contract value
When you target specific accounts, you can choose those with large budgets. Ideally, you want to attract customers with high ACV (annual contract value) and LTV (lifetime value).
Spending all your time, money, and energy on attracting dozens of low-value customers is counterproductive when you could go out there and market to targeted accounts.
The Pareto Principle in business suggests that 80% of your revenue comes from 20% of your clients. Targeting accounts that will bring you the most revenue can hugely impact your growth.
2. Better retention
When you target customers who are a perfect fit for your product, they will be easier to retain. If your cold outreach strategy only focuses on accounts you know will benefit from your product, you’ll reduce churn. Delighted customers will give you the opportunity for growth without marketing to new prospects.
3. Better customer experience
If a lead comes into contact with your brand across different channels, the experience can be confusing, with inconsistent messaging and calls to action. When you take a targeted approach to customer outreach, you can align your messaging and provide a smooth, effortless journey to sign up.
4. You can reach all decision makers
When you contact an account directly, you can present to all key stakeholders who will make the final purchase decisions. This improves your customer journey and can help you close sales more efficiently; you don’t need to pass through a chain of gatekeepers.
5. Improved ROI
Investment in ABM consistently outperforms other marketing strategies. Research shows that companies using ABM generate as much as 208% more revenue than those that don’t. When you focus your resources on a few targeted accounts more likely to close sales, you waste less marketing budget and less time.
6. Higher conversion rates
Instead of cold calling every person that could be a fit for your customer profile, a more targeted approach means you can have more fruitful conversations. If your targeted account was exposed to your message before your sales team calls them, there’s a higher chance they will convert.
How to approach account-based marketing
Before you start crafting your messaging, you need to decide which market segment to target. How will you personalize your outreach to speak to your target accounts?
Using the Team framework, you can break down the system of account-based marketing into four steps:
A more detailed version of this framework:
- Deciding which accounts to target
- Researching those accounts (their pain points, how your solution can solve them, why they are such an excellent fit for your business)
- Scripting a marketing message that will speak directly to your chosen accounts
- Decide which channel you will use to deliver your messaging
- Analyze the performance of your campaign and deciding where to tweak the messaging
Which channels can you use for ABM?
The channels you’ll use in ABM may differ from a standard marketing campaign because you’ve researched the accounts and know the best place to approach them.
Events are a great way to close deals with prospective accounts, as you can meet key stakeholders and provide a personalized pitch.
Content – reach your target accounts by offering them solutions to their problems. When they search for answers, make sure your blog posts, videos, and podcasts are the ones that offer the information. Providing valuable resources to your potential accounts will help build trust with your prospects and show your expertise.
Direct mail is another common way to reach prospects, it makes you stand out amongst an ocean of emails. You can personalize the message and provide value with free advice on solving the client’s pain point.
Webinars are a growing acquisition channel; in the last two years, there’s been a 300% growth rate in companies using webinars to get new clients. You can create webinars with your target accounts in mind and educate them in a way that convinces them they need to become your customer.
Personalized web pages are a way to convert your targeted accounts. When they land on your page, they need to see a personalized message that tells them why they should be your customer.
Paid Advertising, if you have the budget for it, is an easy way to get targeted accounts’ eyes on your website. Instead of creating a broad audience to serve your ads to, target your ads to specific companies and execs that you want to convert.
Email and direct messages are simple ways to get your message in front of the right people. But don’t alienate your prospects with a generic message that could be for anyone. Crafting careful, personalized messages that speak to the problem you aim to solve is the way to get noticed.
Need some help crafting your ABM strategy? Get in touch with one of our mentors with expertise in account-based marketing.