B2B companies are rushing to transform their current sales and marketing approach to an Account-based Marketing (ABM) approach before the next financial crisis. Learn what ABM is, how it can boost your chances in a tough marketplace and where to get started.
It’s hard not to notice that the financial markets are in turmoil these days, bringing back some nasty memories from a decade or so ago. And with a hard Brexit looking likely in Europe, we all need to take significant steps to prepare for the worst.
Perhaps, in fact, by the time you read this blog post the next market crash will already have happened. In any case, it seems inevitable that a crisis will occur sooner rather than later. So, what can you do right now to strengthen your revenue-generating machine before all hell breaks loose?
Invest now to weather the storm
One strategy to mitigate the effects on your company is to invest in some changes before the usual cost-cutting rounds begin – i.e., while funding for a revenue machine transformation are still available.
The best-performing, most revenue-focused companies have already made wide-reaching changes that every mid-sized or large B2B company will eventually have to make. They’ve invested in a relatively new, but fundamentally customer-centric approach to sales and marketing: Account-based Marketing (ABM). So, their revenue-generating machines are in great shape – and ready to grab even more market share from competitors who have been slower to prepare for tough times.
Briefly defined, ABM is a strategy in which the marketing and sales teams work closely together to focus on a list of specified customers and prospects. As ABM platform developer Engagio’s CEO, Jon Miller, puts it, it’s similar to the difference between fishing with a net (you’re never sure what you’ll catch and most of it is undesirable) and fishing with a spear (you know which accounts are best for your business and you are focused on winning them).
ABM has been shown to deliver significantly higher return on investment for every dollar spent on sales and marketing, making it a must-have for winning in highly competitive marketplaces like the IT industry. Now, ABM is being adopted more widely with, perhaps not surprisingly, US-based B2B companies leading the way.
Apple, Oracle and Fujitsu, for example, are some of these first-movers. While many companies are only now discovering Account-based Marketing, these companies have been moving along the ABM track for a few years.
Have you heard about ABM?
If you haven’t heard of ABM before or don’t know much about it, you’re definitely not alone. Most B2B marketers have been too busy working to build their strategies around an earlier approach, “inbound marketing”, to focus on what is coming next.
However, because so many companies have been pouring resources and attention into inbound marketing activities, there’s now a huge amount of noise out there. All of those messages are fighting a sea of content for the fleeting attention of largely millennial influencers and decision-makers.
If you continue down this path, your company will not be in a strong position for success when the going gets tough.
Is inbound marketing on its last legs?
Dead end sign to signify that the usefulness of inbound marketing is coming to an end
The reality of inbound marketing is that only around 1 in every 100 leads actually turns into business. There are all sorts of reasons for this, which will be dissected in a later post, but the bottom line is that a lot of resources are being wasted on marketing efforts to attain leads that deliver little or no value to the company!
You see, inbound marketing approaches usually reflect the short-sighted principle that Marketing’s job is well done when a marketing-qualified lead has been passed to the sales team.
At that point, Sales is expected to get out there and try to turn that lead into a deal. Marketing then sits back, pleased with the number of clicks and views amassed in their back-office systems.
That’s not a fair statement, of course, as Marketing often goes a step or two further, but it does reflect what we often hear from salespeople. With Sales having greater power than Marketing in most B2B companies, the opinions of salespeople are not to be taken lightly!
“Don’t count the people you reach. Reach the people that count.”
Legendary ad man, David Ogilvy
So unfortunately, inbound marketing is limping toward the end of its reign as the best way to conduct modern marketing. It still has a place in the marketing mix, but it can no longer claim to be the answer to the question of how best to support the company’s revenue goals.
In short, it is an outdated strategy that won’t let you beat your competitors or even keep up with them.
Much more than marketing
To tell it like it is, ABM is the compelling next wave to ride. It’s a fundamental business transformation you will have to make. But what is it that makes it so compelling?
Despite its name, ABM isn’t really a marketing-only initiative. Instead, it’s a results-focused strategy that brings Sales and Marketing together as a team to focus on the same goals, the real goals, like making sales efforts more efficient, speeding up sales cycles, increasing deal sizes and boosting buyers’ propensity to buy. And it requires a business decision to re-focus efforts on a targeted list of highly desirable accounts that would be or already are a great fit for your company.
Beyond saving your company effort and resources, ABM provides a core of benefits dubbed the “3 R’s” by B2B research and best practices firm ITSMA:
- Reputation: Brand perception, awareness and knowledge of your company’s brand will increase among targeted accounts. So, you are more likely to be on the short list of your targeted accounts when it’s time to make an investment in your category.
- Relationships: The number and quality of relationships your company has across accounts will increase tremendously, making your company the one everyone agrees is a good choice. It’s a customer lifetime value perspective.
- Revenue: When your efforts are focused on the accounts that really matter, the deals are bigger and the customer is more likely to buy again.
I could keep explaining many more interesting things about ABM (it’s a big topic!), but for now, let me make a simple statement: If you’re a B2B company that sells high-value products or services with a long sales cycle involving more than four influencers or decision-makers in each account, you will have to make a transition to ABM.
When you do it, of course, is up to you – but the sooner you start, the better you will be able to handle the crisis we all know will eventually arrive.
Where to start
If you’re interested in staying ahead of the game, but don’t know how to start, don’t start like this: You hear about ABM, read some online content about the topic, get some internal buy-in, install some ABM software tools and try to get things going.
That is, quite frankly, a recipe for disaster. An ABM transformation is exactly that, a transformation. It is a process that requires careful, informed planning – preferably facilitated by someone who has done it before and whose competencies span both sales and marketing.
Consider it an insurance policy – after all, this is one of the most significant changes you’ll make to the business and its performance potential over the next few years!
Every pilot needs a co-pilot
a pilot and his co-pilot to depict how you need both to fly a plane
Once the planning is done and management, sales and marketing have truly aligned around a clear ABM strategy, you should get started by running an ABM pilot program in a smaller part of your business – a region, a specific vertical or simply an isolated group of high-priority accounts.
Communications agencies like cylindr are excellent co-pilots to help you conduct the planning and alignment phases and to set up your ABM pilot program.
Such teams specialize in tailoring ABM strategies that align with your company’s goals, and they can help you set up the necessary mechanics and metrics, too.
All aboard the ABM train
Tough times may be ahead, but that doesn’t mean your company’s long-term goals need to suffer. Thinking and acting strategically now is a sound investment that not only helps when the next financial crisis hits, but which strengthens your business foundation for the long run, too.
Now it’s up to you: When are you ready for your ABM transformation?