What Happens When Your ABM Strategy Isn’t Working?
Account-Based Marketing (ABM) isn’t a silver bullet for success. Not everyone is on the ABM hype train and others have been burned by unsuccessful ABM implementations. While success is high—according to a 2017 report by the ITSMA and ABM Leadership Alliance, 87% of companies say ABM delivers higher ROI than other types of marketing—there are marketers who aren’t seeing success with their ABM strategy.
If you’re one of those companies that is frustrated by a lack of success or if you just want to find out how to have more success with ABM, what can you do?
Now before you panic, it’s critical that you’re correctly defining success, and a lot of that comes down to measurement. For marketers that are newer to ABM, there are a few common measurement mistakes that can mislead how you understand your performance.
Lead Volume. If you are in the demand gen mindset, it might be disconcerting to see that lead volume is down or flat. With demand gen, you’re used to seeing that number increase. What’s happening?
Lead volume is not proof that ABM isn’t working. ABM is about high quality engagement, and while that may mean fewer leads, you’d expect higher conversion rates down the funnel.
Conversion Rates. “OK, so I’m generating fewer leads — why are my funnel conversion rates still low?” Before you throw your ABM strategy out, check to see how you’re calculating your conversion rates. Are you measuring individuals or accounts? A single account may comprise dozens of people (leads), but can only convert to one opportunity.
Let’s say you have 10 accounts with 10 contacts in each for a total of 100 contacts that convert into five opportunities. If you’re using your old funnel conversion rate formula (5 opps divided by 100 contacts), you’d get a conversion rate of 5%, which is low. However, your real conversion rate is 50% (5 opps from 10 possible accounts).
Deal Volume. You may also see that your deal volume isn’t skyrocketing. What good is a marketing strategy if it’s not bringing in more deals? That’s close. The real question is whether your marketing strategy is bringing in more revenue. ABM should lead to bigger deals, as well as more upsells and expansions, rather than just a high volume of small deals.
Essentially, ABM should lead to more revenue. If you read those three measurement misconceptions and thought to yourself, “Yep, I’m doing everything right! Why isn’t ABM working?” here are three steps you can take.
1) Evaluate your account grading system
One of the first steps in implementing an ABM strategy is to identify your universe of target accounts. Within that universe, most organizations break it down even further, from A-D or 1-4, with A-grade accounts or 1s being the very best fits.
If you’re not seeing success, once you’ve gone through a sales cycle or two with your ABM programs, evaluate your grading system. Are your A-grade accounts closing at a higher rate, with greater velocity, and generating more revenue than the other accounts? That’s where you’re spending the most and it’s also where your sales team is spending the most energy. If you’re not getting the most value from efforts targeted at A accounts, use your new data and rethink your grading formula. Make sure you and your sales team are actually spending the most resources on your highest value accounts.
On a related note, if you found early success and it seems to be fading, it may be time to refresh your target account list. Depending on the size of your team and the size of your account list, it may be possible that you’ve exhausted your current target account list. If you’ve spent the last month or two really focusing on engaging a subset of your A accounts, switch things up and focus on another subset for a little while.
Like all marketing execution, the way to improve is to test. Test different offers, different levels of personalization (e.g. persona-specific emails vs. handwritten notes), and channels. Every test, whether a success or a failure will help you learn about your audience and what resonates.
At Bizible, we ran a successful account-based direct mail campaign last year that helped set a lot of meetings that turned into pipeline and eventually revenue. However, when we dug deeper into the data, we found that it wasn’t successful with CMOs and larger accounts, so we went back to the drawing board and developed new offers specifically for those audiences. Early indications are that they are generating greater engagement.
Test, measure, analyze, repeat!
3) Be Patient, But…
Nobody likes to hear this, but it’s as true in ABM as it is in many other aspects of life: be patient. According to the same report mentioned earlier, business results improve with experience. Those who have done ABM for two or more years are more than twice as likely to report significantly higher ROI compared to traditional marketing initiatives than those who are new to ABM (55% vs. 23%).
Implementing a new strategy and getting marketers to adopt a new mindset doesn’t happen overnight. For organizations with long sales cycles, it’s even more important to practice patience before making a final verdict, as bottom-line data can take a long time to see.
So what can you show to colleagues who are starting to lose faith and can’t wait for that revenue data? Two great proof points are benchmark data (e.g. 55% of those doing ABM for 2+ years report significantly higher ROI) and indicator metrics to make the argument on behalf of patience with ABM. These include account coverage (number of known contacts within an account), account penetration (number of engaged contacts within an account), opportunities, and pipeline.
Unlike the misleading metrics that we discussed earlier, all of these indicators are account-centric and tell you the real health of your ABM strategy. If these metrics look healthy, chances are you’re on a good path to revenue, the metric that truly matters.