Sunday, March 26, 2017

Multiple Studies Reveal the Growing Adoption of ABM


Unless you've been very out of touch for the past couple of years, you're well aware that account-based marketing has become one of the hottest topics in the B2B marketing world. The hype surrounding ABM has been almost deafening, and based on the hype, it would be easy to conclude that ABM has already been widely adopted by B2B companies.

It does appear that a growing number of companies have implemented (or are at least piloting/testing) account-based marketing, so I thought it would be worthwhile to share the results of several recent research studies that provide insights regarding ABM adoption.

The 2017 Marketing Benchmark Report - North America by Marketo was based on the results of a Q4 2016 survey of contacts within the Marketo customer base (which includes both B2B and B2C companies). The survey produced 1,363 responses. Although the report doesn't provide detailed demographics for the respondents, it's likely that most were marketing leaders or practitioners. In this survey, 34% of the respondents said they were practicing ABM. Marketo also found that the ABM adoption rate was similar for companies of all sizes.

The 2017 State of B2B Digital Marketing Report by DemandWave was based on a survey of B2B marketers in the United States that was conducted in November and December of 2016. The survey produced 179 responses. In this survey, 37% of the respondents said they had tried or were currently using ABM.

In the 2016 ABM Benchmark Survey by Demand Gen Report, 23% of survey respondents said they had been using ABM "for some time," and another 24% said they had "recently launched" an ABM strategy. Demand Gen Report did not provide a description of the survey methodology or demographics for the survey respondents.

The 2016 State of Account Based Marketing (ABM) Study by SiriusDecisions provides some indirect evidence regarding ABM adoption. This study was based on a survey of 200+ B2B companies. In this research, 71% of respondents said they had staff that is fully or partially dedicated to ABM.

Collectively, these studies indicate that account-based marketing has made significant inroads among B2B companies. It's important to remember, however, that none of these surveys used a random sample of all B2B companies. I suspect that the overall ABM adoption rate is somewhat lower than these studies report. That doesn't mean that the shift to ABM isn't real. It just means that the adoption of ABM is still in its early stages.

Illustration courtesy of ccPixs.com via Flickr CC.

Sunday, March 19, 2017

Have We Really Improved Marketing Productivity?


The recent pace of change in B2B marketing has been nothing short of breathtaking. Over the past 10-15 years, new marketing technologies, channels, and techniques have appeared in rapid succession, and many of these innovations are now in widespread use. B2B marketing automation, content marketing, inbound marketing, and social media marketing are just of few of the technologies and techniques that have changed B2B marketing over the past decade or so.

By all indications, the pace of change is not slowing. During the past couple of years, many B2B companies have adopted account-based marketing, and many have begun using predictive marketing analytics technologies to support ABM and other marketing efforts. And just within the past few months, we've started to hear that machine learning and artificial intelligence will have a major impact on B2B marketing in the near future.

All of these innovations have promised to improve marketing effectiveness and efficiency, and numerous research studies purport to show that they are delivering a wide range of benefits. But have these innovations really improved the bottom-line productivity of B2B marketing? Can we show - in a credible and convincing way - that B2B marketing is more financially productive today than it was 10 or 15 years ago?

Obviously, these questions must be answered on a company-by-company basis. Some B2B marketers may be able to show that their marketing efforts have become significantly more productive over the past several years. But there is evidence suggesting that some aspects of B2B marketing performance haven't improved as much as we might have anticipated.

One indicator of B2B marketing and sales productivity is the efficiency of the demand generation process. Efficiency is usually measured by the percentage of potential buyers or leads who are "converting" from one lead stage to the next.

Many B2B companies use the Demand Waterfall model developed by SiriusDecisions to describe the stages of the lead-to-revenue process, and from time to time, SiriusDecisions publishes "average" and "best-in-class" conversion rates that link to the Demand Waterfall. The following table shows the conversion rates reported by SiriusDecisions for 2008 and 2014:

















What is most striking about this data is that it indicates there was essentially no improvement in conversion rates - particularly the overall lead-to-revenue conversion rate - between 2008 and 2014.

The 2008 conversion rates largely reflect marketing productivity before many of the marketing innovations mentioned above had become widely adopted. But research has shown that by 2014, a significant number of companies were using these technologies and techniques.

Of course, lead conversion rates aren't the only relevant measure of marketing productivity, and there may be a reasonable explanation for the lack of improvement shown in the SiriusDecisions data. For example, the 2014 conversion rates would not have captured the impact of the shift to account-based marketing that's occurred over the past couple of years. Nevertheless, this data should be a wake-up call for B2B marketers.

Senior company leaders are increasingly expecting marketers to demonstrate that their activities and programs are creating economic value for the enterprise and improving enterprise financial performance. Many senior leaders are no longer satisfied with the tactical performance indicators (campaign response rates, content downloads, etc.) that marketers have traditionally used to describe marketing performance. What senior business leaders really want to see is proof that marketing is delivering financial results and that the dollars they are investing in marketing are being spent as efficiently as possible.

The important point here is that the value of any marketing technology or method must ultimately be judged by whether its use improves marketing productivity. So that's what marketers must be prepared to demonstrate.

Top image courtesy of Kelly Teague via Flickr CC.

Sunday, March 12, 2017

ABM Success Requires "Unnatural" Teamwork


One of the most formidable challenges related to account-based marketing is the need to build and sustain a high level of teamwork among business functions that have historically operated more or less independently. ABM obviously requires a tight alignment between marketing and sales. And when ABM is used to expand relationships with existing customers, the need for alignment will also extend to the customer service/customer success function of a company.

Some ABM experts now speak in terms of account-based everything to make the point that ABM actually encompasses far more than marketing.

Unfortunately, some company leaders don't fully appreciate how much and what kind of teamwork is required for ABM success. For example, most ABM thought leaders and practitioners agree that marketing and sales should jointly:

This level of collaboration is necessary to create a solid foundation for a successful ABM program, but it's really just the starting point. To reap the maximum benefits from ABM, marketing and sales must jointly develop an engagement plan for each target account. This account plan will usually span several weeks to several months, and will likely include marketing and sales activities that must be closely coordinated to produce maximum results. 

In addition, marketing and sales must be ready to make on-the-fly adjustments to their account plan based on actual buyer responses and changing business conditions at each account.

Therefore, successful ABM requires marketing and sales (and in some cases customer service) to work collaboratively on an ongoing basis. This level of coordination is challenging for many companies because it represents a major change in how they have traditionally managed sales leads.

In many B2B companies, the demand generation process involves a series of "hand-offs" from one business function to another. For example, marketing passes leads to business/sales development, which passes leads on to sales. The metaphor often used is a relay race in which each member of the relay team runs for a specified distance and then passes the baton to the next runner. This approach makes it relatively easy to manage demand generation within traditional organizational structures.

The relay race approach has never been the optimum way to manage demand generation, and it won't be effective in an ABM program. To address this challenge, some companies create cross-functional account teams to manage and coordinate the activities relating to their ABM accounts. To use a sports analogy, an ABM account team functions more like a basketball team than a 4 x 100 meter relay team. In an ABM account team, every team member is involved (in one way or another) throughout the entire game, and their roles change on a fluid basis.

The important point here is that successful ABM requires an exceptional level of cross-functional teamwork that isn't "natural" for many companies. Some ABM pundits contend that account-based marketing will create better alignment between marketing and sales, but this just isn't so.

The decision to adopt ABM can be the catalyst for creating better marketing-sales alignment, but ABM won't cause such alignment to magically appear. It's more accurate to say that good alignment between marketing and sales is a necessary prerequisite for successful ABM. Therefore, company leaders must be prepared to create and implement the structures, processes, and culture that are required to make the necessary teamwork a reality.

Illustration courtesy of Katlene Niven via Flickr CC.

Sunday, March 5, 2017

Solving the "Dry Well" Challenge of Content Marketing


Consistently producing content that connects with potential buyers remains one of the greatest challenges facing B2B marketers. The need to make content relevant for individual buyers at every stage of the buying process, to publish content in multiple formats across multiple channels, and to publish new content frequently have combined to strain the creativity and resources of B2B marketers.

In the early stages of a company's content marketing efforts when marketers are focused on "building out" their content library, it's relatively easy to identify good topics for content resources. But after the initial build-out phase is completed, it can become more difficult to identify content topics that are relevant and fresh.

Of course, some topics need to be addressed more than once. It's important, for example, to update your content when the capabilities of your product change, or when new research about a topic becomes available. But sooner or later, many B2B marketers will feel that their well of relevant and meaningful topics has run dry.

To address this challenge, marketers need to think more broadly about the kinds of topics that can be effective in their content marketing program. From a topical perspective, there are four basic types of content (shown in the following diagram).






















Product Content - This is just what it sounds like - content that describes the features and functionality of a product or group of related products. In a 2015 study by LinkedIn, business buyers ranked product info, features, functions as their most preferred type of marketing/sales content.

Product Category Content - This is basically "educational" content that discusses issues or needs that a type of product or service can address. When a provider of account-based marketing software creates content that explains why ABM is a more effective approach to marketing, or describes what capabilities buyers should look for in an ABM solution, that's product category content. Good product category content usually doesn't promote a specific product, but it does "evangelize" the product category.

Most of the marketing content created by B2B companies (excluding pure brand advertising) falls into one of these two categories, and these are the types of content topics that marketers focus on first. This is a valid approach, but these two categories will only provide so many good topics for content resources.

There are, however, two additional types of content that can complement product and product category content, and thus provide a valuable source for good content topics.

Business Function Content - This type of content addresses issues relating to the job responsibilities of your potential buyers, but which aren't directly related to your company's product or service. For example, suppose that your company offers a sales enablement solution to financial services firms. Your buying group will almost certainly include chief marketing officers and chief sales officers. Once you've developed enough product and product category content, you can create content resources that address more general marketing and sales issues. This type of content could include topics such as:

  • How to win business from millennial investors
  • How financial advisors can use social selling to attract and win new clients
Industry-Related Content - This type of content discusses issues that are related to the industry in which the prospect operates. To continue with my financial services example, the sales enablement provider could create content around topics such as:
  • The impact of "robo-advisors" on traditional financial services firms
  • New (or pending) governmental regulations affecting financial services firms
You may be wondering why you should create content that isn't closely related to your company's product or service. One of the objectives of content marketing is to demonstrate that you understand the issues and challenges that your prospects and potential buyers are facing. Product category content helps you achieve this objective, but so can business function content and industry-related content.

Top illustration courtesy of Paani Program via Flickr CC.

Sunday, February 26, 2017

Does Account-Based Marketing Make Buyer Personas Unnecessary?


Last week, Jason Stewart, the Vice President for Strategic Content at Annuitas, published a great article at LinkedIn titled "What the C-Suite Needs to Know About Account-Based Marketing."

In this article, Jason argues that ABM represents a major step in the right direction for many B2B companies, but he also contends that it falls short of being a comprehensive demand generation strategy. He writes, "ABM is an extraordinarily smart way to make the right tactical decisions when it comes to demand generation, but the elite Account-Based Marketers are still building personas, nurturing every step of the buyer's journey, and know exactly which activities and leads are driving revenue."

I would suggest that Jason's article is particularly on point when it comes to the issue of buyer personas. Most ABM experts say that account-based marketing involves a fundamental shift from "lead-centric" marketing to "account-centric" marketing. But does this mean that ABM diminishes the importance and value of buyer personas? The answer to this question is an emphatic "No," and I'll explain why momentarily. But first, a little historical perspective is in order.

Buyer personas have been a core element of B2B marketing for more than a decade. The origin of buyer personas is usually traced to the practice of creating user personas to help software engineers develop more user-friendly applications. User personas made their appearance in the late 1990's, and we started hearing about buyer personas a few years later.

In the B2B world, buyer personas are intended to help marketing and sales professionals better understand the people who influence business buying decisions, but the importance of this understanding was recognized long before anyone had ever heard of buyer personas. Consider, for example, the following quotation from Organizational Buying Behavior by Frederick E. Webster, Jr. and Yoram Wind published more than four decades ago:

"Although organizational buying is the result of organizational decision making, individual behavior defines this decision-making system. Each person involved in the buying process brings to it a set of needs, goals, habits, past experiences, information, attitudes, and so on which he applies in each specific situation. . .

An efficient and effective marketing strategy for organizational buyers must be aimed at specific individuals who have authority and responsibility for buying decisions, not at some broad conception of the 'organization,' for individuals, not organizations, make organizational buying decisions."

When you implement account-based marketing, the first two steps in the process are to select target accounts and identify the relevant contacts (i.e. buyers) in each target account. The third step in the process is to develop deep insights regarding each account. With ABM, therefore, you will identify the actual buyers, and you will develop deep account insights before you begin your marketing program. Doesn't this knowledge reduce the need for buyer personas?

In reality, buyer personas are still essential for effective ABM because every buyer at each target account will bring his or her individual perspectives to the buying process, and it's still important to have marketing messages and marketing content resources that address those individual buyer perspectives. Today, it is possible to learn more about our actual buyers than in the past, but even "big data" won't consistently reveal the goals, objectives, and motivations of individual buyers.

So, we still need buyer personas to fill those gaps in our understanding. As we interact with actual buyers, we can and should use those interactions to learn more about the specific goals, interests, and perspectives of our buyers. And we should use those insights to fine-tune our marketing messages and content. As we learn more about our actual buyers, we can rely less on buyer personas for insights about those specific buyers. But buyer personas still provide a critical starting point for effective ABM.

Illustration courtesy of Rick B via Flickr.

Sunday, February 19, 2017

How Small and Mid-Size Companies Will Practice Marketing in 2017


Target Marketing magazine recently published the findings of its annual "Media Usage Survey," which was designed to identify marketing spending plans for 2017. The survey was conducted in December 2016 and produced 725 responses from members of the audiences of Target Marketing and subscribers to Total Retail and NonProfit Pro magazines. The researchers suppressed participation by list services firms and creative services/advertising agencies so that all responses would be from marketers.

Forty-two percent of the respondents were affiliated with B2B companies, 36% with hybrid B2B/B2C companies, and 22% with B2C companies. Most of the survey respondents worked for small and mid-size companies:

  • 17% were with companies having $51 million or more in annual revenue
  • 22% were with companies having annual revenue of $5 million to $50 million
  • 50% were with companies having less than $5 million in annual revenue
Most of the respondents to the Target Marketing survey reported that their marketing budget for 2017 would the same or higher than in 2016. Thirty-seven percent said their 2017 budget would be higher, and 40% said their budget would stay the same compared to 2016. Only 15% of respondents said their marketing spending would be lower in 2017 than in 2016.

At larger companies, changes in marketing budgets showed greater variation. Fifty-one percent of respondents from companies with annual revenue of more than $50 million reported an increased marketing budget for 2017, while 20% of such respondents said they have a lower marketing budget this year.

Target Marketing also asked survey participants about the allocation of their marketing budget. The top four media categories identified by survey respondents were:
  1. Online marketing - on average, 36% of the total marketing budget
  2. Print (direct mail, magazines, newspapers, circulars, etc.) - 22%
  3. Live events - 19%
  4. Other - 13%
The report's authors noted that print experienced the biggest year-over-year change, falling from 29%  of the total marketing budget in the 2016 edition of the survey.

The survey also asked participants how their spending on specific marketing methods would change in 2017. The following table shows the top six marketing methods slated for spending increases this year:




















Survey respondents reported that email marketing produces the best ROI for both customer acquisition and customer retention purposes. They also said that "Other" marketing methods produced the second strongest ROI for both acquisition and retention, and that direct mail produced the third-best ROI for both purposes.

The survey report did not indicate what marketing methods were included in the "Other" category. Given that these marketing methods command a significant percentage of the total marketing budget and produce strong ROI, it would be nice to know what specific methods the "Other" category encompasses.

Sunday, February 12, 2017

What You Need to Know About Target Accounts for ABM Success


One of the fundamental characteristics of account-based marketing is the use of marketing messages and content that are tailored for specific target accounts. When company leaders adopt an ABM strategy, they make a conscious decision to focus most of their demand generation efforts on a relatively small number of potential customers. In this situation, it's critical to make marketing communications as effective as possible, and the best way to do that is to use customized content resources that are hyper-relevant for each target account.

Many marketers believe that the need to customize marketing content for individual target accounts constitutes one of the biggest challenges associated with ABM. But it reality, the more difficult job is developing the insights about target accounts that are needed to make customized content truly effective. Deep account insights are required to customize content in ways that will resonate with the buyers in target accounts. Without such insights, any customization that's done will be superficial and largely ineffective.

So, what kinds of account insights are needed to develop effective ABM content? In The Clear & Complete Guide to Account Based Marketing, Engagio provides a "laundry list" of the things marketers need to know about:

  • The target account's industry - The competitive structure, key trends, and growth dynamics of the industry in which each target account operates
  • The target account - The account's stated business strategy, its strengths, weaknesses, opportunities, and threats, its financial condition, its major competitors, its buying structure and process, its organizational culture and values, and the presence or absence of any recent buying triggers
  • The buying group - The identity of the members of the relevant buying group, and their priorities and communication preferences
  • Account connections - Any existing relationships or connections between the selling company and the target account and/or the members of the buying group
It should be clear that developing deep account insights is a significant undertaking, and it's a job that must be done primarily by people. Technology can play a role in developing deep account insights by making it easier to gather data about target accounts and perform the other research that's required for insight development. But you still need human creativity and judgment to translate the raw data and information into meaningful insights. Therefore, the ability to scale this component of ABM using technology is somewhat limited.
Many companies have addressed the "insight challenge" by adopting a tiered approach to account-based marketing. The top tier, also known as Strategic ABM, is reserved for those accounts that offer the greatest potential value. In a recent survey by ITSMA, the median number of accounts included in Strategic ABM programs was 10. 
Companies focus most of their insight development work on these Strategic ABM accounts. They develop detailed account profiles, and they update those profiles frequently. This in-depth research enables companies to create and use highly customized marketing content and programs for Strategic ABM accounts.
The second tier of account-based marketing, often called ABM Lite, will include a larger number of accounts that have less potential value than Strategic ABM accounts. Therefore, companies typically perform less in-depth research and build less detailed profiles for their ABM Lite accounts. 
For example, a company may have several ABM Lite accounts that operate in the same industry. In this situation, the company will probably conduct sufficient research to develop detailed insights regarding the relevant industry, but it will gather only basic information about each individual account.
Developing the appropriate level of account insights isn't easy, but it's absolutely essential for ABM success. As Engagio wrote in its ABM Guide, "The entire strategy [ABM] depends on doing your homework and learning as much as you possibly can about target accounts (and key buyers at those accounts) so you can maximize your relevance and resonance within each." (Emphasis in original)

Illustration courtesy of Nico Kaiser via Flickr CC.