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While account-based marketing (ABM) has become an important topic for modern marketers, many organizations are just getting started. To create a high-performing ABM organization, it’s critical to build a strong foundation to support this new way of thinking.
Jon Miller, CEO and co-founder of Engagio, joined Sam Melnick and me for Creating the Foundation for Account-Based Marketing. This was the third webinar in our #RunMarketing series. Read the recap below to learn three key areas of an ABM foundation, plus the “Big 5” metrics to remember.
Fishing with Nets Versus Spears
Maybe one reason why sales and marketing haven’t always gotten along is their view of accounts versus people. Salespeople never talk about how many leads they’ve closed – they talk about how many accounts they’ve won.
On the other hand, marketing sits in a people-centric world. Much of their job is on the “Do” side of marketing, executing customer-facing campaigns. Many of those demand generation efforts are like fishing with a net. As long as enough total fish are swimming into the net, it doesn’t matter what kind of fish are being caught.
To grow, many companies are embracing ABM and targeting specific customers or accounts. In other words, fishing with spears.
With this shift to highly targeted marketing, the strategic aspect of marketing – the “Run” portion – becomes more important. To understand if your ABM strategy is effective, you need insights about which strategies are resonating and which investments are paying off for your target accounts. And that information can only be understood if marketers focus both on planning, investment and measurement – sometimes called the “back office” of marketing – hand-in-hand with the “Do” side of marketing.
Without this foundational focus on marketing performance management, it’s otherwise challenging for marketers to achieve success – especially with ABM.
Planning for ABM
Beyond what you’re going to do, an ABM plan includes what you expect to happen. Consider the following:
- Scale — How big is the effort? Are you using ABM to complement existing demand generation efforts, or replace them entirely? The answer will depend on your organization and your business.
- Scope — Are you starting with a small pilot? If it goes well, how will you scale it up?
- Strategy — Where is your focus? Is the plan to add new clients or expand existing customer business?
As you develop your plan, ABM requires sales and marketing to be more aligned and more collaborative than we’ve seen before. For more details about the three different styles of account-based marketing, watch the webinar recording.
Thinking About Investments for the Long-Term
Everyone wants to talk about ROI. Often we see too much attention on the “R” (return). If you don’t control and understand your investments (the “I”), you’ll never get to ROI.
With ABM, investments requires a shift in thinking to a long-term horizon. According to Implisit, prospected accounts take 1.7 times longer to convert.
There are also different kinds of spend categories. ABM is a more people-intensive activity, so more investments might be going to headcount versus programs. You might also see different investments in outbound efforts like direct mail or private field events. ABM also traditionally requires spending money to learn insights and get data about target accounts.
“Big 5” ABM Metrics
When it comes to measurement, you need to have a target you’re aiming for. That’s why setting targets upfront is so important in planning. You can’t measure if you don’t know what success looks like.
Traditional demand quantity-based metrics don’t quantify results in ABM. You need metrics and insights that show how deals are being influenced over long periods of time.
These are the “big 5” metrics to use:
- Coverage — Do you have the right data and contacts for each of the key people in your key accounts? How well are you adding newly engaged people?
- Awareness — Do people at the target accounts spend any time with you at all? In other words, do they have any awareness?
- Engagement — Are the right people at the right accounts spending time with you? Is that trend going up or down over time?
- Program Reach — As David Ogilvy said, “Don’t count the people you reach; reach the people that count.” Are your marketing programs reaching the target accounts?
- Program Impact — How are ABM activities improving the sales outcomes you care about?
Remember, achieving success with ABM requires a strong foundation of planning, investments and measurement.
When you’re embarking on a path for ABM or any other marketing activity, don’t jump directly into the execution or ”Do” portion. Start with the foundation – the “Run” side of marketing. Build your plan, determine what your investments you’ll make, and decide what measurements and insights you want to gain. As marketers, we have to merge the “Run” and “Do” parts of our work to be successful.
Learn more about how to #RunMarketing. Get recaps of the other webinars in our series: Executing the CMO’s Vision: Turning Marketing Dreams into Business Impact and The Missing Link in Becoming Customer-Centric: Connecting Marketing’s Back Office.