What percentage of leads generated by your marketing efforts turn into customers?
“Lead generation has been a success criterion for marketers for some time, but what we don’t hear about is that less than 1% of those leads become customers,” said Sangram Vajre, CMO of Terminus and early Account-Based Marketing pioneer, in a recent conversation about Account-Based Marketing.
If you’ve ever thought, “If I generate more leads, then our revenues will grow,” you share the mindset of many marketers in the B2B space. In theory, the philosophy is sound: pour leads into the top of the funnel and eventually sales will come out of the bottom. In reality, sales reps ignore 50 percent of marketing leads, making it difficult for marketers to reliably benchmark lead conversion KPIs.
So, what happens? More often than not, it’s the “leaky bucket” syndrome, due to a misalignment of sales and marketing— silo’d technology, poor communication, inconsistent messaging, and lack of process integration.
Does this sound familiar?
Marketer: “What accounts are you working on? We’d like to help you close them.”
Salesperson: “I’m already engaging with the prospect. Thanks, but no thanks. I’d prefer if you didn’t interfere with my sales process.”
If your job as a marketer is to provide your salespeople with new leads as well as “air cover” to keep your brand top of mind for prospects, this can be an incredibly frustrating conversation.
Account-based sales have been around for decades: a salesperson is given a list of accounts and is tasked with generating interest throughout an organization. With an average of 5.6 people needed to sign off on any given purchase, it’s an exhaustive, hands-on process. This often requires several 1:1 meetings with key stakeholders, dozens of emails, multiple calls, online and in-person demos, and occasional ‘wining and dining.’ It’s a high-cost, high maintenance process bound to a single salesperson’s efforts. And in the meantime, while your salesperson is meeting with an organization’s CMO, its CTO could be learning about your competitor’s product.
Enter Account-Based Marketing: “A strategic approach that coordinates personalized marketing and sales efforts to open doors and deepen engagement at specific accounts,” as described by Marketo co-founder Jon Miller.
The emergence of Account-Based Marketing (ABM) technology has facilitated alignment of sales and marketing efforts across the organization. The first benefit of ABM is that it engages key stakeholders in net new accounts, accounts already in the funnel, and existing customers. Vajre refers to this as the “Yellow Pages.” Your sales department knows which companies fit the ‘sweet spot’ and, once you have that list of companies — as well as relevant purchase decision-makers — your marketing team can start to build the customer personas within those select companies. This enables your sales and marketing teams to understand which channels are best to reach prospects on their terms, making the overall process less interruptive and more meaningful.
“Don’t count the people you reach, reach the people that count.” — David Ogilvy
Another benefit of ABM is the ability to create specific content, offers, and messages that are delivered through relevant channels to each stakeholder involved in the purchase-decision process within an account. Marketing guru and The Futures Company’s Executive Chairman J. Walker Smith recently shared his sentiments with us on why ABM works: It focuses on building the right relationships through consistent messaging.
“Every company is in the business of solving a problem. ABM helps with this because it gives you the chance to build relationships with clients. Relationship selling comes down to two things: One, figure out what the client thinks their problem is; and, two, try to tell your client what their actual problem is,” Smith said.
This approach guides prospective as well as current clients to the decision stage. Walker referred to it as, “gaining the authority to guide the writing of the RFP.”
Not only are experts touting the benefits of ABM, but business results also show the impact of effective ABM:
1. B2B organizations with tightly aligned sales and marketing achieved 24% faster 3-year revenue growth and 27% faster 3-year profit growth.
2. 80% of marketers surveyed by ITSMA reported that their ABM initiatives gave them the greatest ROI.
3. 91% of those marketers report being “tightly” or “somewhat or moderately” aligned with sales.
4. 84% of marketers say they find significant benefits to retaining and expanding existing client relationships through ABM.
5. 90% of marketers viewed ABM as a must-have.
“Don’t just generate leads; instead, focus on what drives the bottom line.” — Sangram Vajre, CMO, Terminus
These stats reveal the impact of ABM and what it can do for the bottom-line, but what’s most important is to ensure that it’s the right approach for your organization. Here’s how: 6 Critical Things to Consider Before Chasing Bright Shiny Objects [Inc. article].
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Photo Credit: Fishing With Spears: All About Account-Based Marketing