Most B2B marketers have heard about the benefits of moving to account-based marketing (ABM). So, with apologies for sounding like a prescription drug ad, you may now be asking yourself, “How do I know if ABM is right for me?”
Since many of DealSignal’s customers have already successfully made the transition to ABM, we sat down with the company’s Founder and CEO, Rob Weedn, and asked him about the top use cases he’s seen when working with DealSignal clients.
Q1: Let’s jump right in: what is the #1 use case you see for companies adopting ABM?
Driving growth by expanding their reach to their total audience of accounts and contacts
People are looking to do ABM campaigns for a couple of reasons, but the most prevalent driver we see is a desire for high growth, as well as bigger deals. They’re typically strategic B2B marketers and sales professionals who want to reach their entire market, go after their total audience, and penetrate it fully because they’re in high-growth mode.
However, the problem is—and our customers have uncovered this time and time again working with DealSignal—they’re currently only reaching 10-20% of their total audience. They’re missing 20-30% of the accounts that meet their targeting criteria. They’re missing 70-85% of the contacts in those accounts.
The demand gen teams we work with tend to be proactive; they’ve got high growth targets and need to meet a certain goal—it could be a lead quota, an opportunity quota, it could just be new business—but they need to scale quickly. And when we help them identify the rest of their total audience with precision, they’re typically ready to pull those accounts and contacts into their ABM marketing campaign engine and drive more high quality leads and fuel growth.
And research shows that ABM does foster revenue growth: a study by Demandbase and Demand Metric found that 60% of companies doing ABM for a year reported at least a 10% revenue increase and nearly 20% reported a revenue increase of 30% or more.
Q2: You mentioned that some companies turn to ABM seeking larger deals as a path to growth…how does ABM help?
Driving growth by fully penetrating larger strategic accounts that yield larger average selling prices
Let’s say you’re a small company that’s starting to grow and scale. You’re doing some successful inbound and you’re driving good leads from all over, but they’re only converting to small, one-off opportunities. Each one can take significant internal resources to move through the pipeline and then service. As you look to scale, continuing to do small deals requires a much higher volume of leads at the top of the funnel and a larger number of resources to sell, service, and retain customers. As your product and sales teams mature, it becomes clear that best way to drive linear or exponential growth is to grow revenue per customer and maximize LTV. Account-based marketing is a way to go after the whales. It allows you to land larger initial deals and quickly drive expansion by fully covering the demand centers within larger accounts.
If you look back at [Engagio Founder & CEO] Jon Miller’s early slides pitching ABM it was: let’s go after whales. My interpretation of that was, “Hey, we have a bunch of strategic accounts we need to go after. It could 100, it could be 1,000…and I’ve written about the importance of measuring your TAM before starting ABM…but we need to target larger accounts, get full coverage on the demand centers—influencers and executive buyers, and sell both higher and more broadly into the the large accounts, so that we can get the maximum yield out of each one.”
So if you’re whale hunting, you need a way to define and target the right people. It’s not just marketing to everyone that downloads your stuff. It’s proactively identifying people that meet your ideal customer profile, (ICP) in those accounts so you can personalize your outreach to them.
In this ABM mindset there’s a notion that there are the best target accounts, the best deals for your company, so you need to find the demand centers that you can fully cover to get your deals on the fastest track for the largest amount of money—back to Sales 101. And ABM is helping our customers and other B2B companies increase deal size. In the SiriusDecisions’ 2017 State of ABM Study, 91% of B2B companies doing ABM reported larger deal sizes, and in an ITSMA study, nearly 70% of ABM’ers reported higher annual revenue per account.
Q3: Beyond revenue growth, what’s the second use case for companies moving to ABM?
Visibility into buyer intent and demand centers
It really dovetails with the idea of idea pinpointing your ideal accounts and buyers; the second most common use case we see is that companies are looking at buyer intent.
There are now a number of vendors, some we’ve partnered with, that can identify which accounts are in market for your category of technology or business service. They can identify that there are 100 accounts in market this month or 10 in market this week, and companies are seeing multiple demand centers in these surge reports and heat maps, primarily by location.
When you see that there are 5-10 people in one or two demand centers that show intent—and here’s the tricky thing about ABM solutions and where many break down—you can’t just follow up with the account, you need to reach out to the specific contacts, the people that fit your ICP. You can do ABM advertising, but the old adage is true: “People buy from people”, so people must also sell to people.
Q4: Desire for fast growth, buyer intent…what’s the third reason companies typically move to ABM?
Marketing complementing an account-based sales approach, often using sales automation tools
The third use case is really around an account-based sales (ABS) approach. We see sales teams hiring larger SDR teams and using sales automation solutions like SalesLoft and Outreach to increase their engagement with target accounts and expand their coverage within them.
However, we’ve seen where these programs can break down without marketing involvement. When operating in a silo, sales can be distracted from their focus on selling—when they have to spend their time on data acquisition and quality, systems integration, and building and optimizing messaging, offers, and email templates.
Where we’ve seen these ABM/ABS programs achieve the best results, marketing and sales teams have worked together to: 1) define target accounts (using firmographics to ensure the accounts really fit ICP), 2) acquire and manage the total audience data—including both accounts and contacts (ensuring high quality), 3) manage the integration into their CRM and sales/marketing automation systems (avoiding duplicates and bad data imports), and 4) build content with compelling offers that will drive the highest level of engagement, allow for personalization, and yield better campaign metrics.
Q5: So what does ABM mean in terms of sales and marketing alignment?
No matter which side is driving the move to an account-based approach, alignment between sales and marketing is key, and ABM fosters it. We’ve seen companies eliminate the distinction altogether and move to a “revenue team” model, led by a “Chief Revenue Officer”. And again, this isn’t happening in a vacuum. Earlier we were talking about fast revenue growth being a driver for ABM. According to SiriusDecisions, B2B organizations with tightly aligned sales and marketing achieve 24% faster three-year revenue growth and research from Marketo found that companies are 67% better at closing deals when sales and marketing are in sync.
Q6: In summary, do companies typically have a single use case driving ABM or do you see a combination of factors?
In working with a large number of companies that have moved to ABM, we consistently see these three patterns as their entry point to ABM.
Here’s an example: a company could have worked with sales to develop 2,000 strategic accounts, 100 each across 20 reps. They’ve gone out and marketed to those and they’ve realized—perhaps after doing a TAM analysis with DealSignal—that, holy cow, that’s only 20% of the total target audience and they didn’t even touch their key decision makers and influencers. They’ve missed out on 80% of the audience that fits their ideal customer profile!
We’ve seen marketing intervene at this point, become more proactive and strategic, and say, “Let’s identify all the accounts that meet our ICP and all of the contacts that meet our ideal buyer personas.” Let’s prioritize the ABM campaigns by the most important accounts that are either in-market or the highest priority for sales. Let’s fully engage and penetrate them with targeted, professional, and compelling content.
DealSignal customers that have used our solution to identify their TAM, prioritize their outreach via sales and/or marketing automation, and work in coordination with sales to drive end-to-end campaign follow-through—these customers are showing dramatically better campaign metrics from open rates, CTRs, and conversions to MQL/SQL, to more large opportunities. Candidly, ABM works. And we see most companies starting with one of these three use cases.