Prof. S. Shyam Prasad PhD
Introduction
Market is dynamic and marketing is hyper dynamic so to say. As management students and particularly for marketing students, it is incumbent on them to know the latest trends in marketing. This blog is written with the intention of keeping them abreast with the current developments in the field of marketing. However, all the developments cannot be covered in a single blog; I have chosen to acquaint them with Account Based Marketing (ABM) in this write up; This is to be followed up with Activity-based Marketing and Drip Marketing articles.
Account Based Marketing
Account based marketing (ABM) also known as key account marketing is a marketing strategy with increased focus on a customer[1]. Account based marketing is “more targeted and personalized versus spray and pray, where you’re just trying to capture anyone in your net”, Meagen Eisenberg, CMO, MongoDB. ABM uses personalized campaigns and bulk of our energy and resources are concentrated on best-fit accounts that have high potential for our business. The entire campaign is based on the messages on the specific needs of the account. First we will discuss how ABM is executed and second we will see what are the advantages of this strategy.
The starting point of ABM is to identify the best-fit companies or the best companies (with high potential) to do business with. Hence the first step would be to create a list of ideal customer profile (ICP). Presently, with the help of technology and manual research one can identify accounts that we want to target and prepare a list of them. The accounts figuring in the list are called as target accounts. We may now say that target accounts are companies that we want to turn into customers. One should keep in mind that ICP is a description of the account (company) that’s a perfect fit for our firm and it is not the profile of an individual buyer or end user. However, the people in those businesses who make the purchase decisions are important to our business; they are called prospects.
Since all the target accounts may not be of equal importance, accounts tiering is done and usually 3-tiered system is adopted. In this system, Tier 1 accounts are perfect ICP fits, Tier 2 accounts are strong ICP fits but have a lower lifetime value and Tier 3 accounts fit most, but not all, ICP criteria. They’re worth pursuing but typically not worth investing significant resources to win their business (Ward, 2017) .
Following are the core steps of developing an ABM strategy (Golden, 2018) .
1: Identify high-value accounts
One of the shortest definitions of marketing is “meeting (customers’) needs profitably” (Kotler, Keller, Koshy, & Jha, 2013) . Logically, the identifying the customers is the basis for successful marketing. At the cost of repetition, customers are organizations here and not people. This should not be confused with process of developing personas.
High-value accounts can be obtained in few different ways and the easiest is to examine the present customers to identify the ones that fit the definition of an ideal customer. An ideal customer is a customer
that would get significant value from your offering, and provide significant value to your business in return (Trieu, 2018) . An ideal customer would be best-fit companies or the companies with high potential to do business with. The profile of an ideal customer will change as business evolves. However, some basic characteristics of an ideal customer would be:
that would get significant value from your offering, and provide significant value to your business in return
- High lifetime value
- Low customer support needs
- Low cost of acquisition
- Become brand advocates
- Provide referrals
The trick is identify the target accounts collaboratively with marketing and sales as data from both areas are important and required.
2: Map individuals to accounts
The next step is to develop an organization-level personas. Again, it is not the personas for individual people though it is good to have them.
“Individual contacts are important, but in the context of the entire account. In other words, you need to connect the concerns and needs of each person on the buying committee back to the strategic objective of their company. Your main goal when engaging each stakeholder is to help drive consensus for a purchase decision” (Golden, 2018) .
By account personas we mean elements like the company structure and people who are the critical to us, especially the decision-makers and influencers.
3: Define and create targeted campaigns
Having decided on target accounts and individuals, we turn our attention to develop personalized campaigns designed to be of their interest. But one should keep in mind that ABM strategy is more on acquiring a new business as our customer and is less focused on individual personas. Hence, the contents should be focused on the deals that one would like to make with the company. However, for an ABM programme to succeed, it is important to nurture relationships too.
4: Pinpoint optimal channels
No matter how good the contents are, they are of no use unless they reach the target people. It is important to figure out which channels they use most to do research and chose those channels to deliver the contents. The channels may vary over industry or even over time.
5: Develop a strategic playbook
This step in built-in to clarify roles and responsibilities of the people as to who does what and when; particularly the collaboration between marketing and sales. There should be clear understanding as to who will engage contacts within the accounts and drive marketing.
6: Execute your campaigns
With right playbook, executing the campaign is made easy. Campaigns can include an array of tools such as , emails, special events, direct mails, ads, and more. However, care should be taken to ensure messages across the various channels are seamlessly integrated to send the same ideas, views or suggestions.
7: Measure and optimize
Measuring ABM results is a tricky business. This is because both marketing and sales are jointly responsible for ABM in moving the account up the pipeline. Yet, it is important that the results are measured properly. One of the ways to do it is to have the right matrix. Some experts suggested the following (Becker, 2019) :
- Are we growing our list of known individuals within the target account?
- Have there been any changes to the way these accounts are engaging with our brand and its content?
- How much revenue have we generated from these target accounts?
The above steps of ABM may sound imposing and unnerving. But in practice, it is not so and follows simple marketing principles.
Simply said, ABM consists of all marketing activities such as advertising, direct mail, calls, emails, content — all centered around the target accounts that we believe has the highest potential and value. By focusing on the target accounts and engaging them in marketing activities, we move them from a prospect to opportunity and then turn them into customer revenue. The idea of ABM is to increase the efficiency of the marketing activities by taking on the right companies and minimizing wasting our resources.
Now to the advantages of ABM. Account based marketing can help companies to (Wikipedia) :
- Increase account relevance
- Engage earlier and higher with deals
- Align marketing activity with account strategies
- Get the best value out of marketing
- Inspire customers with compelling content
- Identify specific contacts, at specific companies, within a specific market
Few examples of ABM.
1. If you are selling an expensive SaaS product, instead of blindly approaching companies, one might focusing on those accounts who have the highest need and the required budget. The company would be a target account.
2. LinkedIn Account Targeting enables marketers to engage the accounts that matter most to their business by tailoring their LinkedIn Sponsored Content and LinkedIn Sponsored InMail campaigns to a list of top priority accounts, and then layering profile-based targeting, such as job function or seniority, to put their content in front of the right people in a particular organization (Golden, 2018) .
Conclusion
ABM is important in industrial marketing, particularly to organizations with multiple buyers. Account Based Marketi
ng is not a substitute of industry-level marketing. ABM should be used as a supplement, particularly to digital marketing strategy. As now understood, ABM is highly focused marketing strategy; here every individual is treated with tailor made campaign and is treated like one market.
ng is not a substitute of industry-level marketing. ABM should be used as a supplement, particularly to digital marketing strategy. As now understood, ABM is highly focused marketing strategy; here every individual is treated with tailor made campaign and is treated like one market.
Finally, this what Matt Heinz, President, Heinz Marketing has to say about Account Based Marketing, “Account based marketing is simply instead of fishing with nets, we’re fishing with spears’.
Works Cited
1. Becker, B. (2019, October 29). The Ultimate Guide to Account-Based Marketing (ABM). Retrieved 10 29, 2019, from hubspot.com: https://blog.hubspot.com/marketing/account-based-marketing-guide
2. Golden, M. (2018, September 26). What Is Account Based Marketing, Why You Should Adopt It, And How. Retrieved 10 30, 2019, from Linkedin Marketing Solutions Blog: https://business.linkedin.com/marketing-solutions/blog/linkedin-b2b-marketing/2016/what-is-account-based-marketing–10-definitions-from-the-experts
3. Kotler, P., Keller, K. L., Koshy, A., & Jha, M. (2013). Marketing Management (A South Asian Perspective) (14 ed.). New Delhi, India: Dorling Kindresley (India) Pvt. Ltd., licensees of Pearson Education in South Asia.
4. Trieu, J. (2018, September 19). How to Create an Ideal Customer Profile to Generate Leads. Retrieved November 11, 2019, from actionable.me Blog : https://www.actionable.me/blog/sales/how-to-create-an-ideal-customer-profile-to-generate-leads/
5. Ward, S. (2017, August 16). How to Identify & Tier Target Accounts for Account-Based Marketing. Retrieved 10 30, 2019, from Terminus: https://terminus.com/blog/identify-tier-target-accounts-abm-marketing/
6. Wikipedia. (n.d.).
