Sunday, November 27, 2016

Solving the Real-World Challenges of ABM

A few years ago, the noted behavioral economist and best-selling author Dan Ariely described big data in a rather memorable way. He said, "Big data is like teenage sex:  everyone talks about it, nobody really knows how to do it, everyone thinks everyone else is doing it, so everyone claims they are doing it."

With a few minor tweaks, Ariely's description of big data can be applied to account-based marketing:

  • ABM has been one of the hottest topics in the B2B marketing and sales world for the past couple of years. Virtually all B2B marketers are aware of ABM, and the odds are that most are thinking, if not actually talking, about it.
  • Most B2B companies are just beginning to learn how to do ABM. In the 2016 State of Account Based Marketing Study by SiriusDecisions, 42% of survey respondents said they had been using ABM for less than six months.
  • A large and growing number of B2B marketers claim they are doing (or planning to do) ABM. In a survey last fall by Demand Metric, 71% of respondents said they are using ABM, testing ABM, or interested in adopting ABM.
The allure of account-based marketing is easy to understand. According to research by ITSMA, most B2B marketers believe that ABM produces a higher ROI that any other approach to marketing. Users of ABM claim that it provides several important benefits. In the Demand Metric survey mentioned earlier, a majority of ABM users said that it produces increased engagement with target accounts (83%), better sales/marketing alignment (69%), better qualified prospects (66%), more pipeline opportunities (55%), and increased conversion rates (55%).

There's a great deal of hype surrounding account-based marketing, and much of it is justified. However, the hype also tends to obscure or minimize some of the real-world challenges associated with doing ABM well. Successful account-based marketing requires a sound strategy, sufficient financial resources, the right mix of human skills, appropriate technology tools, a high level of cross-functional teamwork, and a long-term commitment.

Beginning in January, I'll be devoting several posts here to the challenging - and often under-appreciated - issues that can make or break an ABM program. In these posts, I'll discuss how to select and prioritize ABM target accounts, how to identify what resources you'll need to build and sustain a successful ABM effort, how to develop the insights regarding target accounts that are required for effective ABM, and how to create the level of customized/personalized content that's needed for ABM success.

These discussions aren't designed to dissuade anyone from adopting ABM. On the contrary, my goal is to provide insights that will help companies become ABM success stories.

Illustration courtesy of Rob Lee via Flickr CC.

Sunday, November 20, 2016

The Most Effective Personalization is Invisible

Delivering outstanding experiences to existing and potential customers has become the prime strategic objective for most B2B and B2C marketers. In the 2016 Digital Trends Quarterly Intelligence Briefing by Econsultancy (in association with Adobe), surveyed marketers identified optimizing the customer experience as their most exciting opportunity.

Most marketers now recognize that the ability to personalize marketing messages and other marketing content is an essential requirement for providing great customer experiences. The authors of a 2016 report by the Economist Intelligence Unit (EIU) used a quotation from Kristin Limkau, the CMO of JPMorgan Chase, to highlight the importance that marketers place on personalization:  "Achieving personalisation at scale is the biggest and most important challenge for us to get right."

But despite the recent focus on personalized marketing, it's clear that marketers have more work to do to make it truly effective. Research has shown that many customers aren't particularly impressed by the personalization efforts they encounter. For example:

  • In a survey by Adobe, 71% of consumers said they like receiving personalized offers, but 20% reported that offers are not done well, and another 20% said that personalization efforts are too intrusive.
  • In other research by EIU, 70% of survey respondents said that many of the personalized messages they receive are annoying because the attempts at personalization are superficial, and 63% said marketing messages that use their name are so common that they have grown numb to the practice. In addition, only 22% of the respondents said that personalized offers are more likely to meet their needs than mass market offers.
Clearly, most of us want companies to provide personalized messages and content, but many of us are becoming more concerned about our privacy, and we feel that some personalization efforts are just plain creepy. When CEB recently asked a panel of nearly 400 consumers how "online ads that use details about what I have done" make them feel, almost three-quarters (73%) of the responses were negative, and almost half (49%) used synonyms for "creepy."

To avoid the "creepy" element and make personalized messages and content more engaging and effective, marketers must keep one critical principle in mind:  The most effective personalization is usually invisible. By invisible, I mean that the personalization is undetectable by the customer or prospect.

Since the early days of personalized marketing, the most common way to personalize a marketing message has been to include specific facts about the recipient in the message. Some examples would be the recipient's name, her job title, company affiliation, or information about a recent purchase. I call this practice explicit or overt personalization.

It's as if we marketers believe that the effectiveness of personalization comes from telling the customer or prospect what we know about him or her. There may have been some truth to this belief several years ago when personalization was still novel, but today, most types of overt personalization are ineffective at best, and can actually be seen as "creepy" by customers or prospects.

What our customers and prospects really want are offers, messages, and content that are relevant to their interests and needs - in other words, something that is useful or valuable. So, we marketers need to stop telling our customers and prospects what we know about them and start using that knowledge to craft marketing content that provides them real value and utility.

Image courtesy of Lisa Lowan via Flickr CC.

Sunday, November 13, 2016

If a Prospect Fits, You Must Not Quit

The most critical component of a successful account-based marketing program is focusing your marketing and sales efforts on the right target accounts. Working with the right accounts isn't the only thing you need for success, but it will be impossible to build a successful ABM program if you target the wrong accounts.

Selecting target accounts is obviously an essential step when you are initially implementing ABM, but managing your list of target accounts is an ongoing task. Over time, it's inevitable that you'll need to add companies to, and remove companies from, your target account list. To make these decisions wisely, it's important to remember what makes a company an attractive target for ABM in the first place.

Most ABM practitioners select their target accounts by identifying businesses that resemble their best existing customers, an approach that's commonly called look-alike modeling. Look-alike modeling is usually effective because it will identify companies with the attributes that make them good targets for ABM.

The following diagram depicts the factors that make a prospect organization attractive for account-based marketing. At the most basic level, attractiveness is a function of high value potential and high buying potential. In other words, does the prospect have the potential to become a large and profitable customer for your company, and is there a strong likelihood that the prospect will purchase your product or service?

As the diagram illustrates, high buying potential is a function of two factors - fit and buying interest. The underlying idea of fit is suitability. Does your product or service effectively address a need or a challenge that the prospect is likely to have, and can your company effectively market to, sell to, and serve the prospect?

The second component of high buying potential is buying interest, which refers to whether a prospect has engaged in behaviors that show an inclination to evaluate or purchase the kind of product or service that your company offers. Indicators of buying interest include direct interactions between a prospect and your company, and other behaviors - usually online - that indicate the prospect may be interested in the kind of product or service your company provides.

Fit and buying interest are both important "markers" of high buying potential, but fit is far more important for ABM purposes, and here's why.

At any given moment in time, a large majority of your most attractive prospects - those with high potential value and good fit - will not be involved in an active buying process for the kind of product or service that you offer, and won't score well on buying interest. Therefore, if you put too much emphasis on buying interest when initially selecting your ABM target accounts, you will omit prospects that you should be targeting.

The same principle applies when you're managing your list of target accounts. At any given point in time, many of the companies on your list may not show significant indications of buying interest. That may mean they're not likely to buy in the near-term future, but it doesn't mean that they are unlikely to buy in the longer term. If you remove such companies from your target account list, you'll be abandoning the opportunity to influence the perceptions and preferences of future buyers.

Successful account-based marketing requires long-term thinking and consistency. The objective is to focus your marketing and sales efforts on those prospects that are likely to become large and profitable customers. Identifying prospects with a high level of buying interest can be valuable because it enables you to use a more appropriate mix of marketing and sales tactics. But when high potential value and good fit exist, an apparent lack of immediate buying interest doesn't justify removing an account from your ABM program.

Top illustration courtesy of Jason Taellious via Flickr CC.

Sunday, November 6, 2016

Creating Content that Cultivates Consensus

It's now widely understood that most B2B purchases are made by groups of people. According to CEB, the average B2B buying group now includes 5.4 individuals. SiriusDecisions says that B2B buying groups range in size from 1-2 decision makers to 6-10 or more decision makers, depending on the dollar value of the purchase.

In virtually all cases, these buying groups must reach a consensus before a purchase will be made, and that doesn't come easily or quickly in many cases. Recent research by CEB found that B2B buying groups now typically include diverse stakeholders whose goals and interests can conflict, which can make consensus difficult to reach.

The CEB research also found that while reaching consensus decisions is hard at all stages of the buying process, the greatest challenge is getting consensus on the type of solution to acquire and implement. The second most difficult challenge is reaching a consensus on the definition of the problem that needs to be addressed.

This means that buying groups have the greatest difficulty achieving consensus during the early stages of the buying process, when they are more likely to be performing research on their own and relying on content to help them define their problem and identify possible solutions. Therefore, it's important for B2B marketers to develop content resources that will help buying groups reach a consensus on these essential issues.

Developing content that supports the consensus-building process requires a deep understanding of buyer goals and interests. To lay the foundation for creating consensus-friendly content, you will need to take three steps:

  • First, identify the relevant goals and interests of each member of the buying group.
  • Second, identify which goals and interests are shared by multiple members of the buying group.
  • And finally, identify which goals and interests are in conflict (actually or potentially).
CEB has recently argued that the use of personalized marketing messages and content can actually make it more difficult for buying groups to reach consensus decisions. I don't completely agree with this view, but it is clear that most major content resources, such as white papers, e-books, and longer videos, should contain material that supports the consensus-building process. 

For example, suppose that you are developing a white paper for a specific buyer persona. The overall objective of the paper is to describe the benefits provided by a type of technology solution. In most cases, you'll want the white paper to provide answers to two questions:
  1. How will this type of solution help me [the target persona] achieve my goals and protect my interests?
  2. How will this type of solution help my colleagues in the buying group achieve their goals and protect their interests?
Obviously, the primary focus of the white paper will be on answering Question 1. But if you also address Question 2, you can help your target buyer contribute to the consensus-building process.

Image courtesy of Daniel Orth via Flickr CC.