[Published by Mike Scher, January 18, 2016 ] Estimated Reading Time: 4 minutes, 34 seconds
Account Based Marketing (ABM) seems to be the new rage for 2016. A prominent blogger is referring to ABM as the “the new black”, while a Google query for “Account Based Marketing Framework” uncovers a startling quantity of charts and infographics, which attempt to provide a roadmap to success. But, is ABM really the wave of the future or a flashback to the past? Let’s take a closer look, and you can decide.
What’s old is new again
For years, companies have been developing strategies to go after Ideal Client Profile (ICP) accounts. There is a plethora of terms for this: Target Accounts, Tier 1 Accounts, Focus Accounts, etc. Therefore, the idea of targeting specific companies isn’t new. So why all the attention on ABM? It’s all about the ‘M’ – Marketing. Targeting accounts is historically a sales strategy, but now companies realize the importance of bringing Marketing into the picture to drive better results. In reality, ABM is simply the integration of marketing and sales development, resulting in a more synchronized execution. And increased revenue!
VMWare’s shrewd use of AMB
While ABM didn’t ‘technically’ exist at the time, the best marketing + sales integration I have seen was VMware, back in the 2008-2011 time frame. For VMWare, Data Center Consolidation was a big opportunity and they knew that intelligence gathering was key to understanding how to reach their target market. Their research showed that a company, regardless of the technology in place, was unlikely to refresh and invest in their data center more frequently than every 3 years. Why 3 years? Because while technology changes rapidly, no CFO would let their CIO refresh their data center until the investment was sufficiently amortized.
So VMware identified their ideal profile accounts and built a special database with contact info and date of last data center refresh. When an account hit two years past their last refresh, a marketing automation system triggered a synchronized marketing and sales outreach program. Marketing provided air cover while sales used a systematic methodology to drive precise 1:1 messages that resonated throughout the organization.
Based on VMware’s stellar growth and dominance during that time period, I’d say their ABM strategy paid off handsomely!
Technology’s role in ABM
As I said, it’s not that companies haven’t always understood the value of targeting specific accounts—it’s that technology was limiting. That has all changed.
Tracking your prospects’ behavior is the key to marketing automation (which is different than ABM). With a marketing automation campaign, you typically send outbound emails to prospects and their interaction with that email drives the next event. Or you track your website visitors using cookies, and the visitor’s actions trigger an automated marketing campaign tailored to the content most relevant to them. This is a very effective (and efficient) way to provide targeted information to those who show interest in your company. But what if they don’t even know you exist? That’s where ABM comes in.
With ABM, you are focusing on the company as a whole, not the individuals. You determine your target clients and go find them instead of waiting for them to find you. (Genius, right?) One of the primary ABM tactics is to use paid advertisements in major media networks and social sites to target prospects based on the IP addresses of the company. That means you are only paying for leads that come from your target accounts. While the cost per lead may be higher, they will be further nurtured with a very specific campaign and this essentially brings the people you want straight to your doorstep. Same old concept, different method.
So if you are ready to kick off an ABM effort, here are some of the pitfalls to avoid (i.e. learn from our mistakes!):
- Don’t go too broad with account selection at first. Make sure you are very clear on your ideal client profile. Gathering data takes diligence so don’t try to do too many accounts too soon. Master the process and then scale it.
- Don’t continually change your value propositions. Developing your value proposition is the one thing I’ll tell you to ‘overthink’. It’s critical. But don’t be quick to move from one value prop to the next as that is proven to be counterproductive. It takes more repetitions of the message than you think for it to begin to seep in. That is why Nike, McDonalds and Apple very seldom change their tag lines.
- Eliminate guesswork. This is not the time for figuring stuff out on your own. Determining the proper mix of sales development, data gathering and outreach messages is hard to ‘trial and error’. If you don’t know the right frequency and intervals for outreach and follow-up, find an organization (like us at FRONTLINE) who does.
- Don’t overcomplicate. Steve Jobs once said, “Simple can be harder than complex. You have to work hard to get your thinking clean to make it simple. But it’s worth it in the end because once you get there, you can move mountains.” K.I.S.S is the way to go. What are the data elements you need to capture? How easy is that information to obtain? Don’t try to capture too much data, as there is power in simplicity. (With data, more doesn’t always mean better!) In the case of VMware, they kept it real simple and it paid off.
So, now that we’ve examined ABM from all aspects, what do you think? Is it revolutionary or retro? I have my own opinion but I’d love to hear yours! Please email me at email@example.com.