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The Wonderful World of Account-Based Marketing
Before co-founding Terminus, a SaaS platform for account-based marketing, Sangram Vajre led the marketing team at Pardot through its acquisition by ExactTarget and then Salesforce. He’s the author of Account-Based Marketing For Dummies and is the mastermind behind #FlipMyFunnel. Sangram recently sat down with us to elaborate on account-based marketing and tell us what corporate leaders need to do to ensure the success of this approach.
What exactly is account-based marketing, and what industries is it best suited for?
Let’s define account-based marketing once and for all: ABM is focused B2B marketing. That’s it. No fluff. Raw truth. If we can focus all of our attention on accounts that matter and people who care, and engage these people on the channels where they are most active, we are doing account-based marketing. Any industry where one business is selling to another organization, whether it’s technology, manufacturing, gaming, etc., is perfect for account-based marketing. There are multiple people involved in B2B purchase decisions. ABM takes into consideration that each person in the company will want to be sold to in a different way. After all, you don’t sell to a CEO the same way you sell to an administrative assistant.
If a marketing manager or business owner were to say to you, “Account-based marketing sounds neat, but it’s just too much work for my company to do well,” how might you respond?
According to Forrester Research, less than 1% of leads ever become closed revenue. This means that companies who are doing traditional lead-based marketing or demand generation tactics are wasting 99% of their time, energy, and resources on marketing to people who will never pay their company a dime! Not doing account-based marketing, or at least trying one campaign, is leaving money on the table.
Could you give us an example of how account-based marketing transformed a struggling company into a successful market player?
The best example I can think of is our own company, Terminus. We’re less than three years old, but we have grown so quickly by “drinking our own champagne” with account-based marketing. In three years, we’ve grown to 80 employees, served more than 200 customers, and won Best Place to Work in Atlanta this year.
What are some of your favorite account-based marketing technology providers?
We launched the Terminus Account-Based Marketing Cloud which lists more than 35 vendors that all integrate with Salesforce. A comprehensive ABM strategy covers five components: Identify, Expand, Engage, Advocate, and Measure. These software partners are all proven to help progress accounts successfully through each stage of the customer experience.
Other than sales conversions, what metrics are important to measure in determining the effectiveness of an account-based marketing campaign?
It’s important to watch the progression of accounts. This information can be obtained using reporting in your CRM. However your CRM is organized, you want to set progression rules. These progression rules will let you know if accounts are moving from one stage to the next. For example, is an account that came in from a content download progressing to the next stage by scheduling a demo? If you’re running a targeted advertising campaign at qualified accounts who have completed the first discovery call or demo, then your KPI will be how many of those accounts turned into opportunities.
Here are the smaller KPIs to look for:
- Timeline of stage-progression: from the first touch as a prospect, the amount of time it took for the account to become an opportunity
- Engagement in accounts: showing an uptick in the account’s score in your marketing automation system
- Expanded engagement in accounts: more contacts from a targeted account coming to your site, engaging with your content, etc.
How can company leaders help get the necessary “buy-in” from their sales force and marketing personnel during a transition from traditional marketing to account-based marketing processes?
Proving how account-based marketing is transformational to your organization can be done using data. Good data will help give you credibility for making the case for account-based marketing since you will have numbers to support your initiative. You can use the existing data you have from your current lead generation efforts. Using this data from your leads, you can show the amount of money your team spent on marketing as well as the potential return on investment (ROI). Your data demonstrating why your team needs account-based marketing should include the following items.
- Leads generated year-to-date (YTD): The number of leads which marketing generated over the past year, which can be broken down into the number of leads generated monthly or quarterly.
- Revenue from leads generated by marketing: If your company had $1 million in new revenue this year, how much of it came from new leads which marketing brought in? If you have a marketing automation system, a report can be generated showing the lead source tied to revenue.
- Revenue from existing customers: In reviewing your revenue, you can determine how much came from your current client base compared to new leads generated by marketing. You’ll compare year-to-date new revenue against your current annual recurring revenue (ARR).
The goal here is to demonstrate that lead-based marketing is extremely inefficient. The data should show that marketing isn’t focused on the right business metric, which is growing revenue for your company. If your marketing team is focused on creating new leads for sales and those leads do not turn into revenue, then it’s a waste of resources which could have been allocated to other activities. Finish this sentence: “For account-based marketing to ultimately succeed, it’s important for a company’s culture to have…” The entire organization needs to be aligned on the best-fit accounts for your company. Marketing, sales, customer success, engineering, and even HR should understand how your product or service works to help your customers.
What do you foresee for the future of account-based marketing? Do you think it will eventually become the most widely-used marketing approach in the nation?
I believe in the quote that the best way to predict the future is to create it. What I can see as a marketer at heart is the rise of storytelling. How can we get a full story of all the activities an account engaged? We know there is no one “silver bullet” for why a customer made a purchase. So for account-based marketing, this means vendors will have to go from being a point solution, or a cog in the ABM wheel, to being the wheel. Account-based marketing is the future of B2B marketing.