What is Account-Based Marketing?
Account-based marketing (ABM) is a marketing approach that strategically directs marketing activities to a highly-defined, hyper-targeted audience. Rather than wasting time and resources on unqualified leads, an ABM approach focuses on targeting the highest value clients for your business. In addition to zeroing in on your target audience, it is also essential to drill down your messaging to address your niche audience’s most critical needs.
The History of Account-Based Marketing
Account-based marketing was pioneered by the Information Technology Services Marketing Association (ITSMA) in 2004 as an alternative to the traditional “cast a wide net” marketing approach used by many B2B businesses. According to a 2020 ABM Market Research Study by Demandbase, ABM budgets increased by 40% from 2019 to 2020 with 91% of companies with 1,000 employees having at least a partial ABM strategy in place. The acceleration of account-based marketing among these large companies reflects the confidence they have on their ROI from ABM activities.
Steps to Account-Based Marketing
Here are a few key steps to implementing an account-based marketing approach for your business:
As with any solid marketing plan, your first step should be to dive into the data. Build a detailed customer profile using insights from your own customer data, as well as third-party research. Create a detailed list of contacts that fit your ideal customer profile (ICP). This list should include the names of individuals or companies, along with their emails, phone numbers, addresses, social profiles, websites, and any other contact information you can gather. If exact contacts are unattainable, a tight description using demographic data may be used instead.
2. Tailor your messaging
Now that you have a clear idea of your target audience, the next step is to craft clear messaging that hits right on their needs and interests. The more personalized the proposition, the better! If you’re not sure what your audience’s highest priority pain points are, ask them! Consider sending out surveys or conducting focus groups to ensure your messaging is on point.
3. Set up the right systems
In addition to developing a clear idea of your customer’s persona and pain points, it is just as important to know where they’re “hanging out”. Do you research to identify where your target customer is getting information, inspiration, and communicating with others both online and off.
4. Implement, measure & iterate
Now that your key pieces are in place, it’s time to put them together. Use your contact list for targeted social or display ads, connect and engage with them on social media, and send direct messages to your contacts through email or direct mail. The more ways to get in front of your audience with your message, the better! Once you’ve run your campaign to a large enough data set to glean intelligence, measure the results, tweak the campaign, as needed, and repeat.
The Pros and Cons of Account-Based Marketing
There are benefits and shortfalls to an account-based marketing approach, and the method isn’t necessarily the best for all businesses. Here are the pros and cons of account-based marketing, as well as the types of business types for which ABM may be best suited:
- High ROI: According to ITSMA, account-based marketing delivers the highest return on investment of any strategic B2B marketing approach
- Fewer junk leads: By nature, an account-based marketing approach targets a small, highly specified group of individuals, thus eliminating many low-quality leads that your business has to filter out.
- Cost: Because you’re targeting a narrow list of top accounts, plan on paying more for each lead.
- Time-intensive: Like all good things, it takes time to gather detailed data about your target audience and craft compelling messaging that resonates with them.
What Types of Businesses Should Use ABM?
Every business is unique, so every business’s marketing strategy should be too. Your marketing approach should factor in the unique needs of your target audience, industry, budget, and available resources. That said, there are certain business types and industries that seem to benefit more from an ABM approach than others.
Generally, B2B businesses with higher dollar products and services seem to reap the highest returns from an ABM approach. According to Demandbase, computer software, IT, and marketing and advertising companies lead the pack in ABM adoption. And because of the cost, talent, and time required to implement a successful ABM program, larger companies — those with more than 1,000 employees — have shown the fastest progress with ABM to date.
That doesn’t mean, however, that only software companies with 1,000 employees can benefit from account-based marketing. ABM can be employed by smaller companies in any industry if done correctly. Lack of budget, ability to execute, or tools and technology are reported to be the top three challenges for early-stage programs. Consider a hybrid or pared down ABM strategy to test the waters of this approach for your business or outsourcing the work to an expert.
If you’re interested in utilizing an account-based marketing approach for your business, but don’t have the in-house team to fully implement one, give us a call, and we’d be glad to help!