Why is account based marketing (ABM) so hot today? More and more companies have reached the epiphany that while B2B marketing still has its place for B2C-style branding and awareness, demand generation should be uniquely B2B. And they’re changing everything from their organizational philosophies to the technology they use to accommodate the shift.
Consider SheerID. Like many companies in recent years, SheerID found itself executing a B2B marketing strategy that wasn’t very B2B-ish. SheerID, which helps corporate clients such as Spotify, Foot Locker and the PGA Tour instantly verify consumers’ eligibility for special offers, adopted digital programs aimed at reaching as many people as possible within organizations and generating as many leads and contacts as it could. That’s the sort of elaborate fishing expedition more closely associated with B2C than B2B.
“There was a consensus in the industry that B2B was becoming similar to B2C,” Simon Spencer, SheerID’s director of marketing operations, told me recently. “But we realized that way wasn’t a perfect fit for our business.”
Now, SheerID has transitioned to a different approach. Instead of focusing exclusively on driving leads with acquisition marketing programs, the company now targets its ideal prospects, and engages with the collective group of people who make or influence purchasing decisions, based on their role and stage in the buying cycle. Leads are still good but leads from their target accounts are golden.
SheerID is not alone in the move to ABM.
Much of the move towards ABM has to do with a significant change within companies to what Harvard Business Review calls the “consensus sale.” While sales reps used to seek out and build a relationship with the one executive who could single-handedly approve a deal, decision-making authority today tends to lie with groups of people, all of whom have different roles.
The average B2B decision-making group now includes 5.4 buyers, according to research by CEB. These may include executives, line-of-business managers, technical leaders, procurement team members and other stakeholders. Each may play a different role or represent a variety of teams and locations. They are likely to have different needs, perspectives, evaluation criteria and priorities, perhaps even competing ones.
The old way of converting one individual doesn’t work in this environment. Rather than obsessing over leads and contacts, ABM requires that sales and marketing work together to decide on the accounts they want to add or grow. When a deal closes, it’s with an account, not an individual contact. So ABM is not about de-emphasizing leads, it’s about understanding each lead’s context and the importance of the company that the lead represents, and discovering and addressing the additional players in the mix. After all, you might close a deal with an account but you market to and build relationships with individuals.
A successful ABM strategy requires a very clear go-to-market strategy and well-understood profile of an ideal customer—one that has a good experience with your product and a healthy lifetime value. Choosing which accounts to focus on is a critical element of ABM. It’s marketing’s responsibility to help pinpoint the range of influencers and decision-makers, and then market to each according to their persona. This enables sales to then surround an account with precision.
That’s not always as easy it sounds. The massive emphasis on demand generation and lead acquisition in recent years has come at the expense of other core aspects of marketing a brand. Somewhere along the way, many marketing organizations stopped asking fundamental questions: Which segment of the market should we target? What is the problem that we solve for our customers? Which customers are most profitable? Who exactly are the people making or influencing the purchasing decisions? What’s the best way to reach them?
To a large extent, putting the “B” back in “B2B” means going back to marketing basics while applying the latest technology to help execute an ABM strategy.
Gartner had a good description of how the process should work: “Account-based marketing builds on a foundation of robust data collection and analysis, the use of predictive analytics to identify expansion opportunities from within an existing customer base, and the creation of segments and relevant content based on life cycle journeys. It marries these elements with automation that enables marketers to deliver advertising and personalized Web experiences targeted for specific accounts.”
The latest technology provides what’s essentially a command center orchestrating the multi-channel engagement with accounts. For example, companies can automatically zero in on companies that match their ideal customer profile, create account-based campaigns to improve engagement across broad buying teams and use segmentation to manage communications.
It’s also important for companies to understand that, as with any major philosophical shift, ABM requires some cultural change. For ABM to work, marketing and sales must have a clear set of expectations. Doing ABM right requires a ton of education within the company and holding people accountable to a new set of metrics and success criteria.
It’s also important to note that ABM isn’t in fact intended to displace other programs and processes; it is simply another tool in the chest. It’s to companies’ advantage to deploy ABM alongside other programs, to compare and contrast the returns on various approaches, and to reallocate budget accordingly (particularly if ABM proves more productive than anything else the company is running).
But B2B marketers should be very excited about ABM because it marks a pendulum swing from the over-B2C-ization of the discipline back to what they got into the business for in the first place – market effectively to businesses. B2C-style techniques still have their place for getting target customers to develop a crush on your brand, but ABM is the way forward to win over the range of buyers in today’s complex environment.