Traditional marketing tactics are not always effective in reaching target accounts, which is why many businesses have started to adopt account-based marketing strategies (ABM). This is a strategic B2B approach that helps companies focus their resources and efforts on high-value accounts.
In this article, we’ll take a look at the typical ROI for ABM, the benefits and challenges of the ABM approach, and the tools that you can use to achieve success in your own account-based marketing efforts. Stay tuned!
Benefits of Account-Based Marketing
Before diving into the typical ROI for ABM efforts, it’s good to understand what benefits account-based marketing brings when executed successfully. Let’s outline and review the key advantages.
Increased Revenue
You can increase chances of closing deals and generating revenue when you target high-value accounts with personalized messaging and content. ABM can help you identify key decision-makers within the account and tailor your messaging to their specific needs and pain points. This type of precise targeting is much more likely to receive a response, and as such, it typically generates more revenue.
Personalized Engagement
ABM allows you to personalize your interactions with prospects and customers, and personalization is a known tool for greater customer engagement and stronger relationships.
The essence of personalization is to understand the core needs and desires of the target audience. Then you can create targeted messaging and content that resonates with them. This approach can help you establish trust and build long-term relationships with your customers.
Improved Sales and Marketing Alignment
ABM requires close collaboration between sales and marketing teams, which can improve alignment between different departments in your company. For example, marketing and sales teams can work together to identify high-value accounts and develop targeted messaging.
In this way, sales and marketing teams can better understand each other’s priorities and goals. The result is more effective communication between teams and better responses from marketing campaigns.
Key Takeaways
Account-based marketing is a targeted approach to digital marketing that focuses on high-value accounts
One of the main benefits of ABM is the improved marketing alignment between different teams such as sales and marketing teams
B2B marketers’ challenges can be overcome with specific ABM tactics such as identifying target accounts, creating personalized campaigns, and measuring ROI that can be overcome with specific tools
The Challenges of Account-Based Marketing
Naturally, no marketing strategy is perfect, and while strategic ABM offers many benefits, it’s worth mentioning that there are some challenges that come with it. The following are the most common challenges that companies face when attempting to implement an account-based marketing strategy.
Account Selection
Choosing the correct accounts to target can be a time-consuming challenge. Identifying high-value accounts is important, but ensuring that they are a good fit for your business is crucial at this point. You may also encounter challenges in gathering relevant data on these accounts, which can impact your ability to create personalized campaigns.
When planning which accounts to target, consider factors such as company size, industry, and buying behavior.
Data Management
ABM requires a lot of data to be effective, which can be a challenge to collect and manage. You need to ensure that your data is accurate, up-to-date, and organized. In order to achieve this, there are many tools available at your disposal. You may want to invest in a tool like Datameer to help you visualize the collected information.
Resource Allocation
ABM typically requires a larger investment of time, money, and resources. Small businesses can struggle to find success when executing an account-based marketing strategy. You need to ensure that you have the right team, resources, and tools in place to effectively manage your ABM initiative.
What is the Typical Account-Based Marketing ROI?
Now that we have discussed the benefits of ABM and the challenges that come with it, let’s take a closer look at what the typical ROI is. The ROI of your ABM campaigns will depend on several factors, such as your industry, your target accounts, and the effectiveness of your campaigns. Applying ABM campaigns produce greater ROI than many other B2B marketing strategies. Let’s find out some account-based marketing benchmarks.
ROI growth with ABM
ABM Leadership Alliance mentioned that companies that implement account-based marketing see a 171% increase in average contract value. Additionally, Act-On reported that 80% of marketers said that ABM outperforms every other marketing investment.
Moreover, 60% of companies that implement ABM report a revenue increase of at least 10%, and 19% of them report a 30% increase in ROI.
These are optimistic statistics, but it’s important to recognize that ABM is a long-term strategy. Unlike traditional marketing tactics, which are typically designed to generate quick leads, ABM is focused on building strong relationships with key accounts over time. This means that the ROI of your ABM initiative might not be immediately apparent, but can grow and compound over time as you continue to nurture these relationships.
Account-Based Marketing Statistics Across Industries
Account-based marketing has become an increasingly popular strategy across various industries, including technology, financial services, and healthcare. Here’s a breakdown of the typical ROI for each of the mentioned industries.
Let’s take a closer look at the typical ROI for Account-Based Marketing efforts in different industries.
Technology Industry
Yeager Marketing points out that account-based marketing strategies generate greater ROI for B2B tech companies when compared to traditional B2B marketing methods. The reports show a 208% revenue increase for businesses that implemented ABM. Among the main benefits of ABM in the technology industry is the ability to personalize communications, and create better alignment between marketing and sales teams.
Financial Services Industry
In the financial services industry, MarketTailor mentions the example of JP Morgan Chase using ABM to target specific accounts, helping to increase their close rate by up to 30% and boost revenue by 10%. Overall, many case studies demonstrate the potential for a well-designed ABM campaign to facilitate growth and a larger ROI for financial services companies.
Healthcare Industry
ABM can also be successfully implemented in healthcare. HISS Media found that account-based marketing is extremely effective for large-scale campaigns within a particular vertical, such as healthcare. Marketing is generally more difficult in the healthcare industry, so the ability to simplify it with ABM and create personalized customer experiences is highly valuable.
It’s important to note that the ROI of ABM can be difficult to measure. Unlike traditional marketing tactics that can generate a high volume of leads, ABM typically targets a smaller number of accounts with a highly personalized approach. This means that the success of your ABM efforts might not be apparent right away.
Let’s take a look at an example that will help you understand why it is more difficult to track ROI in ABM.
Why is it Difficult to Measure Account-Based Marketing ROI?
Imagine you run a software company and you’ve identified a large enterprise account that you’d like to target with an ABM strategy. This account has the potential to generate significant revenue for your business, but it will not be easy and will require a highly personalized approach.
You invest in ABM tactics such as personalized emails, targeted advertising, and customized content to engage with the key stakeholders at this account. Over time, you begin to build strong relationships with these stakeholders and demonstrate the value of your software.
Eventually, the target account becomes a long-term customer and generates significant revenue for your business. While the ROI of your ABM efforts might not have been immediately apparent, the long-term revenue generated from this target account leaves no room for debate – your ABM strategy was a success!
Account-Based Marketing Tools
Implementing an ABM strategy can be challenging, but there are many tools available that can help you with automation, data analysis, specific account targeting, and other features for customer success. Here are some of the most popular ABM tools that you can make use of.
Terminus
Terminus is an account-based marketing platform that allows you to execute ABM campaigns across multiple channels. It provides you with the ability to target and engage with specific accounts, measure the performance of your campaigns, and personalize the customer journey for each target account.
Demandbase
Demandbase is another popular ABM platform that helps B2B companies drive engagement with their target accounts. It provides you with a complete view of each target account and helps you to engage them across multiple channels. Demandbase offers a range of features such as account-based advertising, sales insights, and analytics.
LinkedIn Ads
LinkedIn Ads is another powerful advertising platform that allows you to target specific companies or job titles with your ads. This makes it an excellent tool for ABM campaigns. With LinkedIn Ads, you can create highly targeted campaigns that reach the decision-makers you are looking for.
Bombora
Bombora is a data provider that helps you to identify which accounts are in the market for your products or services. It provides you with intent data that shows you which accounts are researching topics related to your business. This can be useful in targeting accounts with your ABM campaigns and reaching them at the right time.
6Sense
6Sense is an AI-powered account-based orchestration platform that helps to identify your target accounts, engage them across multiple channels, and measure the performance of your campaigns. It uses intent data and predictive analytics to identify accounts that are in the market for specific products or services.
How Much Should You Spend on ABM?
While many companies are starting to adopt ABM, there is often confusion about how much to invest in this marketing approach. The truth is that there is no one-size-fits-all answer to how much you should spend on ABM. The amount you invest will depend on various factors, such as the size of your company, the industry you operate in, and the scope of your ABM strategy.
That being said, there are some general guidelines you can follow to determine how much you should allocate for ABM. Let’s explore these factors in more detail and see how you can determine the appropriate budget for your account-based marketing efforts.
Assess company size
Firstly, it’s important to consider the size of your company. A larger company will have a bigger marketing budget, which means it can afford to invest more in ABM. Smaller companies with limited budgets will need to be more strategic in how they allocate their resources.
Research your industry
Some industries are more competitive than others, which may require a larger investment in ABM to stand out from the crowd. For example, if you operate in the tech industry, you may need to invest more in ABM to capture the attention of key decision-makers. As previously mentioned, the healthcare industry is also difficult to market in, so setting aside a bit more for marketing is a good idea.
Determine your scope
Another factor to consider is the scope of your ABM program. Are you targeting a handful of high-value accounts, or do you have a more comprehensive ABM program in place? The more accounts you are targeting, the more resources you will need to allocate toward your ABM efforts.
One way to approach ABM budgeting is to start with a small budget and gradually increase your investment as you see results. This can help you avoid over-investing in a program that does not deliver the desired ROI. It’s also important to track and measure the results of your ABM campaigns to ensure you are getting the best possible return on your investment.
Recommendation for ABM investing
So, what is the final verdict? When it comes to specific numbers, it’s difficult to give an exact figure for how much you should spend on ABM. However, a general rule of thumb is to allocate around 10-15% of your overall marketing budget toward ABM. This will vary depending on your specific circumstances, but it is a good starting point.
The Bottom Line
So, there you have it! Account-based marketing is a powerful and effective way to reach high-value customers and drive significant ROI for your business. Focus on personalized, targeted campaigns that align with the needs of individual accounts, and you can create strong connections that lead to long-term customer relationships.
To achieve success with ABM, you do need to be prepared to overcome some challenges, such as identifying the right target accounts, using the right ABM tactic, and measuring campaign results. However, with the right tools and strategies in place, you will surely achieve significant ROI and drive growth for your business.
