4 Common Areas of Growth in Account-Based Marketing
June 23, 2021 •Mason Cosby
Regardless of if you just ran your first account-based marketing (ABM) campaign or if you have been running ABM for years, every good marketer wants to identify the areas of potential improvement.
This is your guide to the four most common areas that need improvement in your account-based marketing efforts.
Measuring What Matters
Before you can know what to improve, you need to know where you stand today. If you haven’t measured the metrics that matter, you need to start there. Most marketers will have the ability to measure their ABM efforts through the right tech stack.
If you aren’t currently measuring or reporting your ABM efforts through a sustainable, scalable, and systematic approach, the two blogs below will help.
Start by addressing your technology. Our blog What Technology is Essential for Effective Account-Based Marketing will walk you through the technology you should implement to create sustainable growth with ABM.
Once you have the right technology to measure your campaigns, you should start to understand what metrics matter. Our blog How to Measure your Success with Account-Based Marketing will help you understand what metrics you should measure.
Identifying the Levers You Can Pull
When we start to look at these areas of growth, have the perspective that there are potential levers you can pull that will improve your growth over time. When it comes to most things in business, there are rarely silver bullets that will eliminate the issues you’re having in a week.
The areas outlined below will allow you to improve the growth of your business over a period of time. You can expect that these areas of growth will start to improve over a 3 to 6 month period.
If your business needs revenue immediately, start sending emails to your database pitching them to buy your product. Create some kind of limited-time offer that will prompt sales to happen now.
Is it the best way to do marketing and the most effective way to improve your customer relationships? Absolutely not.
Is it a near-guaranteed way to generate short-term revenue that will give you the breathing room to live another day and determine long-term and sustainable growth? Yes.
Lastly, these levers should all be viewed through the lens of your company’s mission. If you provide small business owners with affordable software to run their business, dramatically increasing your price or starting to target enterprise-level business won’t align with your company mission.
Your Average Deal Size/The Accounts You Target
When it comes to the most direct lever you can pull to improve your growth, it’s your average deal size. The larger your average deal size, the better your long-term project revenue goals.
As you look at your average deal size, there are likely numerous factors that play into what creates the deal itself. To identify the area you can most easily improve, list out the factors that generate your deals.
These factors could include the length of the agreement, the product’s price, the number of additional features or services, or countless other factors. Your business is unique, and you know what factors contribute to your deal size.
Once you have every factor in front of you, there could be one factor that you identify as a small change that could have massive impacts.
In the video example above, we identified that the deal size for Terminoso is made up of the product’s price per month, the number of locations that use the product, and the length of the agreement.
Unless Terminoso can come up with a new complementary product or add-on feature, they won’t be able to increase their price. In the example video, we also saw that their average customer stays with them for 10 years, so the length of their contracts isn’t the issue.
So for Terminoso, the easiest way to improve their average deal size would be to target slightly larger companies. If they targeted accounts with one more location, they would see an increase in annual revenue of over $100,000 per customer.
Again, your business is unique. Once you have laid out the factors that contribute to the size of your agreements, you will be able to identify what potential factors will result in long-term increased revenue potential.
Your Onboarding Process
Some may find this potential factor an odd consideration when looking at improving your ABM efforts. Onboarding doesn’t have anything to do with marketing and sales, right?
Most B2B companies sell a complex product that solves a complex problem. As a result, these same B2B companies have a complex onboarding process that ends up as a high touch and high engagement experience. As a result of these complex onboarding processes, one of two things can occur.
- Your onboarding process becomes the bottleneck that prohibits sales from bringing on new customers.
- Sales doesn’t consider the complex onboarding process and signs a new customer when the onboarding team is already overwhelmed by onboarding new customers. As a result, every customer in the onboarding process has a bad initial experience as a customer, which leads to shorter customer retention and negative sentiment from a previous customer.
If you don’t have a complex onboarding process, you likely aren’t experiencing a bottleneck and should look at another way to improve your overall growth.
If your sales team can outsell your customer onboarding process, you have a few viable options.
- Audit Your Onboarding Process- Look at your onboarding process and ensure that each step is needed. What you may find are some steps of the onboarding process are simply more discovery questions that are covered in your sales process. Additionally, there could be steps that simply don’t need the customer’s involvement but have traditionally been completed over a customer call.
By auditing your onboarding process, you will ensure that each step has an express purpose and that you eliminate any steps that only add friction. By removing unnecessary steps, you will increase your overall bandwidth with your onboarding process and can start onboarding more customers.
- Automate Parts of your Onboarding Process- No matter how complex your onboarding process and product could be, there are likely a few aspects that could be automated through videos or in-depth how-to guides.
One of the common arguments against automation is that you create a less personalized experience. Though you will have a less personalized experience, your customers likely won’t mind. You prioritize their success by eliminating potential bottlenecks and empowering them to move the process forward by providing them with the information they need to find success.
- Increase your Price- If you can’t remove or automate steps of your onboarding process, you should increase your prices.
It’s simple economics. Price is based on supply and demand. You have a demand that’s larger than your current supply. By increasing your prices, you will decrease your demand to meet your current supply.
Your Marketing and Sales Process
You likely thought this blog would start with looking at the marketing and sales process. Your ABM strategy, marketing tactics, and how your sales and marketing teams operate will be determined by your average deal size and the onboarding process you have. These two factors will dramatically impact the specific accounts you target and the messaging you use to position your brand.
If you need a larger average deal size, you will need to target larger accounts, which affects the marketing materials you use, and the length of your sales cycles. Enterprise accounts will require more conversations, so your marketing and sales process will need to adjust if you target larger accounts.
Additionally, if you have the bottleneck of an onboarding process, you will need to adjust your messaging to account for how you want to position your company. With a high-touch and highly personalized onboarding process, you can position your company as a more premium service that ensures you have a person to help you every step of the way.
To understand potential areas of growth in your marketing and sales process, lay out each step of your entire marketing and sales process.
You need to understand:
- How many accounts you have been targeting
- What percent of your target accounts are aware of your company
- What percent of your target accounts have engaged with your company
- What percent of your target accounts have shown interest in a sales conversation
- What percent of your target accounts have started the conversation with sales
- What percent of your target accounts engaged in a sales conversation have progressed through each step of the sales process (You should outline each step of your sales process)
- What percent of your target accounts that engaged in your sales process you have closed
If you need an example of what this can look like, view our example video. The goal here is to understand if you have a point in your marketing and sales process where a large percentage of target accounts simply disengage. Once you have identified the stage they disengage, you can start to address why they are disengaging and how you can keep them engaged.
The example video with Terminoso has an onboarding process that limits them to 30 net new customers a year. As a result, their marketing and sales teams should only close between two and three accounts in a given month to not overwhelm their onboarding teams.
Knowing that the marketing and sales team should only close between two and three accounts in a given month, they can start to work backward to understand at each stage of their marketing and sales process what needs to occur to hit their goal of monthly net new key accounts.
As they look at their marketing and sales process, they may identify that they currently lack new conversations with decision-makers of their high-value accounts. As a result, they can see their marketing team needs to create more personalized content to directly connect sales with the decision-makers of a few high-value accounts.
Additionally, marketing can launch a marketing campaign to send targeted ads to the same decision-makers to ensure Terminoso stays front of mind as they are making their decisions.
This exercise of understanding each step your target accounts walk through before they become a new customer will help you to understand and identify the potential areas of growth for your business.
Your Customer Lifetime Value
The last most common potential area of growth for many companies is the average lifetime value of your customers. This potential area of growth is the most difficult to improve because of the nuances associated with customer lifetime value.
To calculate your average customer lifetime value, you multiply your average deal size by the average time a customer stays with your company. If you have already looked at each of the other four areas of potential growth, it’s likely your average customer lifetime value will also increase.
With that said, if you have a short customer lifecycle after you have maximized your deal size, streamlined your onboarding process, and optimized your marketing and sales process, there are a few things you should consider.
- Start Sending Out Net-Promoter Score Surveys- Try to get ahead of any potential lost revenue by knowing who your biggest advocates are, and knowing the customers that are likely to leave. The feedback will help you to understand why an existing customer would potentially leave your company so you can start to address the issues before they leave.
- Interview your customers as they leave your company- Ask them why they are no longer partnering with your business. Ask for genuine and honest feedback stating that you loved working with them and would like to understand how you can improve. Don’t put any blame on them or act defensively. Ensure they have the space to give you feedback without fear of judgment.
- Target Better Fit Customers- For any ABM program to truly succeed, you need to have targeted the best fir customers on the front end. You may have targeted certain accounts to increase your average deal size, but you moved away from your best-fit customers. As a result, your average lifetime value has decreased because you aren’t serving customers as well as possible. It’s better to have a smaller annual deal size with the understanding that the customers will stay for a longer time.
- Identify An Earlier Problem You Can Solve For Your Customers- This concept may sound a bit odd, but you want to help your best-fit customers succeed. When you have a deep understanding of the problems you can solve for your customers, you will likely know what problems they had to overcome before they needed your product or service.
If you know the problems they had to overcome before coming to you, you could create a product or service to address those problems. In doing so, you have created an opportunity to start serving your best-fit customers earlier in their journey. Then the existing product or service you offer becomes a part of how you better serve your existing customers.
- Adjust Your Marketing Strategy- ABM could potentially not be the best B2B marketing strategy for you. Every B2B company will need to implement some level of ABM by the nature that you sell to another business. If you need to sell a high volume of products because you don’t have a product that results in a long-term customer relationship, you may want to transition to an inbound marketing approach.
An inbound marketing approach focuses on creating content appealing to your target audience so you can gather more leads that will turn into sales. With inbound marketing, you will need to take time to ensure you have qualified leads before you pass them onto sales. Since inbound marketing takes a less personalized One-to-One marketing approach, you will have a greater likelihood of gathering the number of deals you need to hit revenue numbers.
Start Growing Smarter
After reading this blog, you know the four most common areas of potential growth for your business. Your business is incredibly nuanced so this blog can’t offer an exhaustive list of potential areas of growth.
If you would like to have an outside perspective help you identify other potential areas of growth, schedule a call today. You will speak with one of our growth consultants to understand your specific growth needs and match you with the right solution.
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