There was a time when marketers would target as many potential clients as possible in the hope of converting some of them. Today businesses use a strategy that helps them to focus on select potential clients who have a higher chance of conversion. That strategy is account-based marketing or ABM. When done right, it leads companies to land bigger and more valuable clients, in a shorter period. Todd Berkowitz, Managing Vice President of Tech GTM Marketing, Product, and Sales group at Gartner, Inc., one of the leading global research and advisory firms, helps businesses get their ABM strategies right. In an interview with Digital CMO, he spoke about the evolution of ABM, the trends and technologies that are shaping ABM strategies, and how businesses are dealing with the change.  

Interviewed by Moulishree Srivastava

/ / How has the ABM function evolved over the past few years?

We started to see a pretty significant uptake in ABM in 2016, but it was only 2017 when it really exploded, and it has continued that way into 2018.

It has been around in the larger companies for some time, but it's been sales driven. They would know their largest accounts and drive high touch programs around it. High touch is some sort of physical event like dinner or breakfast, supported by marketing. What's changed over the last few years is that they have scaled it from, say, 50 or 100 accounts, to thousands of accounts. Moreover, there is a greater mix of low touch digital channels. There are still some high touch events for larger accounts, but it is a lot more marketing led now. We have seen more formalized ABM programs being created and expanded by large companies, as well as ABM program offices being developed.

As for smaller companies, it has gone from something they think about, to something they try more on a pilot mode, to something they fully embrace and expand. They have been trying to figure out if it works and learn from past mistakes to fully embrace it. Instead of starting the way the larger companies did, they just started with focusing on new clients.

/ / Why has it become more critical in the current scenario?

As more complex tech purchases are happening, you see more decision makers and influencers in a deal. Closing a deal by targeting just one decision-maker doesn't work very well anymore. So as deals get more complex, more people get involved in the buying process, and the use of ABM allows you to reach all of the relevant people. That has not only helped in winning more deals but also in stopping deals from getting canceled because of priorities. It also can shorten the sales cycle. There is this need to drive ABM because selling realities have become more complex.

/ / What are the technologies/trends driving ABM today?

Given the way the ABM program is constructed, the first thing you have to do is select your accounts. Many of our clients are using technographic data which tells you what technologies are currently installed on the clients' side and intent data which tells you which companies are in the market for particular types of solutions. So if you can focus your efforts on a company that is already looking for a specific solution and has a profile similar to your ideal customer, the chances of winning go up. You have better raw data. Using improved AI-driven models, you can develop more complex algorithms for determining who has a greater propensity to buy, and you can marry that with who is in the market and who has also been engaging with you.

Many companies say data sources are helping them to identify the right individuals and the right kind of personas within accounts to go after. Though there has been far less improvement in this area than anywhere else, it still has gotten better.

On the reporting side, in the metrics, there has been some improvement in the tools that help you match leads to accounts or track engagement at the account level. For example, you have companies like Demandbase, Terminus, Engagio, and Lattice Engine which help you do that.

/ / What are the new opportunities that ABM offers businesses?

If you are going to measure any program that you are running from the marketing perspective, you are going to measure it on how it helps you win more deals, how it helps you win bigger deals, and how it helps you close those deals more quickly. All the other metrics are helpful, but these are the ones that people care the most about. When ABM programs are done right, all those three things can happen. You start to see better performance of any individual marketing channel; you see more people coming to your website and a greater reach in the number of people within the accounts who are engaging with you. And ultimately, you start to see higher conversion rates across marketing and sales.  It results in shorter sales cycles because you are reaching more people and you are getting them involved earlier. Also, often because you are targeting the right accounts, you end up selling more products or services to them. So your deals get bigger in the process.

/ / What are the challenges that companies face in implementing ABM?

There are a lot of them. And this is why it doesn't always work.

In some cases, people go too big, too fast. We always recommend people to start with a pilot, but in many cases, people try to run a large-scale program from the beginning without the experience and understanding of all the pitfalls that can come up. Another big one is not having a complete agreement from not only the sales team but also the executive team. ABM is a very disruptive construct and changes the way you do things. And if you don't have agreement and salespeople don't do what you want them to do, for example, it is not going to work. So in a sense, it is going to get back to pilot.

If you can start small, you can buy some time and go back and improve on how the pilot works and ask for more resources. Another challenge is in selecting the right accounts. If you haven't set guidelines as to whom you are going to target and who are the ones that meet your ideal customer profile, or, for that matter, the industry you are going after, and you just let the sales team pick whatever accounts they want, you may not have either the ideal customer profile or the industry.

Lack of a budget can be an issue. ABM doesn't have to cost much money in the beginning if you start small. However, it does take up time, and so there will be an opportunity cost involved. Unrealistic expectations of how long it is going to take to deliver the results don’t help either. For example, if your sales cycle is nine months to a year and you are expecting ABM to result in a major improvement in three months, that doesn't make any sense. It is not a magic pill.

/ / Do you think companies are investing enough in ABM?

I think they are investing enough in the beginning, especially if they are willing to do a pilot. The bigger issue is that they are not ready for it. They haven't got their minds around it. Sometimes they refuse to put money into advertising. You can't just run ABM as an outbound program. It cannot only be phone and email, for example. The whole premise behind ABM is that you are hitting these companies with as many channels as possible. If you call or email someone, they may not reply. Moreover, if you just put an ad out there, they may not click on it. However, if you do an ad and email, phone and direct mail, LinkedIn and every other channel that you can think of, they are more likely to reply to one of those things. You do not care what they do; you want them to engage. Even a small amount of money, say, in LinkedIn advertising, will work. So another reason that ABM fails is people do not invest enough in it. Generally speaking, we see people willing to put money; they are investing. But once in a while, maybe 15-20% of the time, we see people trying to run ABM without the proper investment. They are willing to invest time, but they won't put enough money into doing it.

/ / What are the most popular channels of communication in ABM? How much weight is generally given to mobile & social media?

You have to have a mix of inbound and outbound channels. So on the sales side, it is almost always phone, email and LinkedIn kind of outreach. Then you need an inbound to go with it. I think LinkedIn advertising is probably the most common channel that is used. In some cases, depending upon the market, Facebook and Twitter are used for advertising. So those are the bare minimum. Many companies―particularly those which are large enough and those who have been doing ABM for a while―will add a display advertising platform. That is where things like Demandbase and Terminus come in. These platforms can be effective, but the challenge is that you are buying a software platform, not just spending money on media, so there is a fixed cost associated with it, and you have to be able to justify that.

We usually see a terrific recurrence of using display advertising channels. Retargeting is pretty common too, using display advertising platforms or something like Google remarketing. If you get someone to your site, you want to be able to bring them back. Direct mail, in some instances, works pretty well. You can do it in a more targeted way. For example, you can do it only to people who are not responding.

Regarding social, social advertising and social engagement from the sales perspective are important. However, you can only go so far by having social. If you talk about free social like promoting things on LinkedIn, Twitter and Facebook, that is helpful, but it is not targeted by its very nature. You are just kind of promoting things broadly.

Although mobile is important in some ways, it is not as important. For example, with LinkedIn, a large portion of their engagement happens on a mobile device, but you have to be cognizant of what you are doing regarding your forms. Nobody wants to fill a lot of complex forms on his or her phones, so it requires a kind of change in how you are dealing with form filling from a mobile perspective. I don't think mobile as a channel is that important for B2B.

/ / How is AI changing the ABM function? How well, in your opinion, are businesses coping with this change?

AI is helping people in selecting accounts and the types of personas they want to go after. You choose the wrong account, and ABM wouldn’t work. AI is also working behind the scenes in many ways. A lot of ABM platforms are using AI to look into engagement activities and drive the data points around who is in the market and what technologies they are using. On the reporting side, it can help with how you should change your programs, and how you should potentially personalize for a given account. A lot of recommendations are being driven and will continue to be driven by AI in the future.

Marketers have been using AI for a while now, and they are pretty comfortable from a data perspective and in terms of next best action. A lot of ABM programs are being run at the front-end by sales development representatives. These are generally kids out of university, in their first jobs. They often are doing the marketing and a lot of prospecting. And as AI starts to direct them as to whom to call and what to do, they generally do what they are told because they are young and they do not have a long history of doing things in different ways.

If you think about the sales side, it gets a little challenging when you ask more experienced salespeople to take the recommendations of a machine. You do get some pushback. Now it is certainly getting better, especially because you have systems that are explaining why they are making the recommendations. They are surfacing enough data for salespersons to look at and say this makes sense. Also, if it is just giving them recommendations and not forced upon people, it tends to work better. I would say ABM is a big cultural shift for companies, and AI is only a small part of that.

/ / What are the trends/technologies that you think will drive ABM in the future?

I think you are going to see a lot of continuation of what is already happening today. As people get more experienced with ABM, there will be greater use of personalization at the account level, segment level, and persona level. I think you will start to see more use of video, mostly personalized video, as a call to action. I think we will see more use of AI driving recommendations for the next best action for salespeople and marketers. We will also see continued consolidation of ABM platforms and ABM technologies.

/ / How should businesses gear up for this?

Businesses should continue to keep an eye on the market and look out for new technologies. We see a lot of investment in the space, so they should ask questions of the vendors about their roadmaps and go through their plan for the next year. They should not get too comfortable with whatever they are doing now because things will evolve fairly quickly.