Account Based Marketing, or ABM, is a hot topic as of late. The idea is that instead of using traditional inbound marketing where you optimize your efforts to get found by people looking for your product or service, you target specific companies that you believe can most benefit and most afford your solution.
You target specific companies instead of waiting for web searchers to find you.
ABM is really a more focused form of outbound marketing–you are in fact reaching out to people that may not know who you are or what you do. The difference is that ABM, when practiced well, is not anonymous. You have to do your homework to personalize your messages and make offers relevant to specific organizations.
According to data from SiriusDecisions, companies using ABM or considering using ABM fall into three generalized buckets around company size.
- 45 percent are less than $100 million in revenue
- 18 percent earn between $101 million and $1 billion
- 36 percent generate more than $1.1 billion
It seems as though the largest and smallest companies are adopting ABM. This makes sense when you think about what drives ABM and when it works best.
Large Teams for Large Companies
First, ABM is common in global companies that work with the world’s largest customers. It’s not unusual, for example, for a company like Cisco Systems (where I used to work) to have a dedicated sales team for a customer like AT&T. It takes a coordinated effort among multiple stakeholders and departments to get a product adopted by a large corporation. These are long sales processes with wheels within wheels, typically spearheaded by an account executive that owns the customer relationship at the highest level.
Small and Focused
For smaller companies, it is often the case that the number of potential buyers for the products is very small in number but large in potential revenue, and that the sales and marketing teams know what businesses to target. Maybe they all attend the same trade shows, read the same publications and websites, and generally know where to invest their marketing budget. Another company I worked for made a laser that is specifically designed to drill holes in fuel injectors. Well, there are just a handful of OEMs in the world that manufacture fuel injectors, so what companies to target was very simple. Finding the right people and getting a foot in the door at these companies was the challenge.
In the middle, you have businesses that are likely to appeal to a wide range of possible buyers in multiple industries. Their products and services are not specialized enough to narrow their target market with a high degree of granularity, so they tend to have a broader outreach and look to get found more than they look to target specific accounts. Also, small companies don’t typically have the sales resources to focus outreach on a few select accounts.
One possible way smaller businesses can use ABM is when their geographical reach is limited. A smaller business may target accounts in a specific region that the company is primed to serve. This can be the case in professional services companies like engineering, construction, legal or financial services. While the Internet makes it possible for just about anyone to work with anyone else in the world, in some businesses the location and the personal relationships play a larger factor in selecting a supplier.
It is also possible to use ABM and inbound marketing at the same time. A search optimized website with calls to action for lead generation, and an automated lead nurturing system can run in the background while a more focused ABM program is implemented around ideal target accounts.
The benefits of ABM are said to be faster sales cycles, better sales/marketing alignment and a streamlined sales process. In some instances, carefully targeting specific customers is likely to be more cost-effective than trying to attract anonymous web searchers. ABM can be very powerful for the right businesses with the right target audiences.