ABM IS PRODUCING significant returns for early adopters in both retention and lifetime value, according to ABM: State Of The Market, a research report from TOPO, commissioned by the ABM Leadership Alliance.
The research findings are based on phone interviews with 50 marketing executives at organizations in various stages of ABM maturity.
In addition, companies that have implemented ABM have seen a lift in average annual contract value of 171%.
“The number one reason [for that increase in results] is targeting,” said Craig Rosenberg, Co-founder and Chief Analyst at TOPO. “In ABM, organizations are deliberately choosing to allocate resources to driving demand from the most desirable accounts based on deal size and deal velocity.”
The research revealed that ABM is swiftly becoming a powerful retention tactic for some B2B marketers. In the relatively short history of technology-driven account-based marketing, marketers have typically targeted prospects in order to drive net-new business. However, many marketers indicated they are using it to deepen and expand relationships with existing high-value customers, the study found. It’s particularly true of large organizations with $500 million-plus in sales, which are more inclined to focus on deepening existing customer relationships. More than half (58%) of their focus is on customers, while just over a third (35%) of their focus is on prospects.
“Strategically, ABM is about lifetime value (LTV),” Rosenberg said. “Tactically, customer expansion campaigns are often the most successful. One of the core tenets of an account-based strategy is personalization and customization. There is no better way to customize than to create content and offers about that particular account.”
“Strategically, ABM is about lifetime value. Tactically, customer expansion campaigns are often the most successful.” Craig Rosenberg, TOPO
Rosenberg cited one client example. “One organization we looked at was focused on growing LTV,” he said. “They took accounts that were happy and had the highest potential account revenue. Marketing created campaign materials about their successful use case. All the account-based marketing (ads, personalization, etc.) was about the use case. SDRs were pursuing prospects to talk about the use case. How can prospects at an account turn down a story about themselves?”
Newer ABM practitioners — defined as those that are in the inception phase of ABM — are also focused on current customers, according to the research. Sixty percent of them place their focus on customers, while 32% said their focus is on prospects. The remaining 8% focus on partners.
In order to track ABM program success, 28% of marketers cited driving pipeline as their key measure — more than any other metric. For respondents running more mature programs, account coverage, deal size, deal velocity and lifetime value were cited as the most common success measures.