Here’s how account-based marketing (ABM) can help you identify and acquire your next, highest-value customers.
You’re likely familiar with the Pareto Principle, the old 80/20 rule and how it applies to marketing — 80% of your profit comes from 20% of your customers. You also know who those “best” customers are. The metric that illuminates your best customers is customer lifetime value.
But do you know who your next best customers are? Those who will replace your current set of best customers as they “age out” or perhaps join and augment your profitability? I propose that you deploy very specific strategies to identify them and nurture them to their potential, even before they’ve signed their first contract.
The most effective and efficient way is account-based marketing or ABM. It requires resources and it delivers payback. Let’s peel back the layers of what makes an effective ABM strategy, from developing your ICP to deeply personalizing prospect journeys through qualitative research and two-way dialogue.
Understanding ABM
ABM is a targeted, personalized and measurable process focusing on a specific set of high-value customers-to-be by creating and immersing them in a personalized customer experience. It’s a strategy that’s all about acquiring revenue and profit.
Plenty of three-letter acronyms are related to this marketing approach. The ones you need to know right now are:
- ICP, or ideal customer profile: It’s a data picture of your best customers.
- TAM, or total addressable market: Your ICP is likely a small circle inside this ballpark.
- CLV, or customer lifetime value: The metric that means money. How long does the customer relationship last and how profitable has it been? The objective: happier customers that stay longer and buy more.
The uncomfortable truth is that close coordination of marketing and sales (and soon customer success) is required to create and maintain the increasingly personalized customer experience.
Your ICP is ABM’s GPS
Your ICP is a broad-stroke profile of your best customers. This is where separating the wheat from the chaff in your TAM begins. It is the model that ABM prospecting will begin pursuing.
Not every interested prospect is going to turn into a long-term customer. Your TAM has a subset of your ICP. The ICP is the prompt you put in your ABM satellite navigation. There are three levels to a successful ICP:
- The first is in broad strokes: firmographics (vertical, revenue, number of employees, location, etc.). Interestingly, a customer of ours found that by digging a bit here, the percentage of budget allocated to HR was a clear indicator that a company was really in the ICP.
- The second level lays out the preconditions or the reasons they may benefit from becoming a customer (e.g., targeted companies with larger legal departments will benefit from our software).
- The third level takes an educated guess at what titles to target and why (e.g., SME or subject matter expert, a key advisor to the decision-making process).
Personalization, or the ability to personalize, is a key concept within ABM. This ability to personalize depends on the information we gather through analysis and increasingly from two-way communications based on trust.
We may intuit that the SME in a targeted company needs detailed information. We need to learn the specific concerns and use cases to become a differentiator for personalization. We want to focus deeply on these companies and executives.
Levels of personalization within ABM
With only our ICP to keep us warm, the ability to personalize is generally “Dear Santa,” because we really don’t know much more. We can begin to offer more specific content based on assumptions and trying to earn engagement.
We construct a preliminary consideration or buying journey and use content marketing to populate that consideration journey with what folks need to move on to the next step and eventually engage with sales.
The next step is qualitative research to generate specific and in-depth personas. Who are the people making the decisions and what are their personal and professional concerns and information needs?
Then, we engage and have real conversations. We probe and learn and create the customer experience personalized to the company, the customer and the buying team. Let’s not forget that B2B has always been, and always will be, personal.
Now, here’s where marketing and sales have to collaborate and coordinate. to deliver this increasingly personalized experience. They need to share intelligence and collaborate on strategies, tactics and implementation to understand and satisfy the prospects’ drivers and articulate solutions in how they describe their challenges.
As if it wasn’t bad enough that you have to talk to those annoying customers, now marketing has to hold hands, share and collaborate with sales.
The successful integration of marketing and sales is the topic for another day. But I’ll give you three hints:
- Management must walk the talk.
- There must be shared measurements.
- There must be shared compensation.
As we move closer to conversion to customer, you should begin an even deeper immersion in the personalized customer experience by introducing the customer success team.
The end game
I was part of a team doing NPS (Net Promoter Score) research but with a strong qualitative component. Not only do we ask if you would recommend Company A, but we spend most of our time probing why.
I was interviewing the C-suite decision maker of one of the sponsoring company’s best customers. I asked him, what is the most important benefit you receive as a customer?
His answer was short and direct, “Our salesman. He’s part of our team and helps us to solve problems. He knows what we need and goes out and gets it.”
That is where you want to be. That is where ABM can bring you. ABM is a more efficient and productive use of resources and generates the highest ROI of all marketing strategies. Find, invest and create your next, best customers.
The post How to find your next, best customers with ABM appeared first on MarTech.
MarTechAbout the author
International author, lecturer and consultant, Scott has worked with clients in all phases of marketing strategy, research and implementation. He has worked with companies large and small to build profitability, by improving marketing performance, and reengineering the customer experience to boost satisfaction, referral and customer lifetime value. He is proud to be on the B2P team where his contributions include qualitative research and content marketing.
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