What is account-based marketing and does it work?

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Jul 1, 2022 / by
What is account-based marketing and does it work?

Account-based marketing is a marketing term that often gets bandied around without a proper explanation and as a result, it is sometimes misunderstood by marketers and business owners alike. Part of the problem is that it still means different things to different people.

Without a solid definition, many businesses can’t decide whether or not it’s right for them. Here, we’ll shed a little light on not only what account-based marketing is, but whether or not it might be right for your business.

According to ITSMA, around 85% of marketers have found that account-based marketing delivers higher ROI than any other marketing approach. With such potential returns, there is a great deal to be mined from this approach and more marketers are discovering this for themselves, with 41% of B2B marketers planning to increase spending in the sector.

But before we delve into whether or not you should be joining them, let’s start with the basics.

What is account-based marketing?

Account-based marketing is a strategic, coordinated B2B sales and marketing approach, which treats a single account (or group of accounts) as a market of one. Activities will be planned with each individual stakeholder with the aim of claiming and keeping that specific account. What you’re effectively doing with this approach is treating individual accounts as their own markets.

ITSMA defines the term as “A structured approach to developing and implementing highly-customised marketing campaigns to markets of one that involves taking a close look at key business issues facing the target, mapping them to individuals, and tailoring campaigns to address those issues.”

A common analogy used by many marketers when trying to describe the term is that you are casting aside the fishing net in favour of a rod and going after one specific big fish (landing a whale). This means it’s a more heavily tailored and specific marketing practice that has often been used by big businesses to identify, catch and maintain high-value accounts or prospects by appealing to their specific wants and needs.

Types of account-based marketing

1:1

The most popular tactic in the UK, 1:1, as the name suggests, is perhaps the ‘purest’ form of account-based marketing as it refers to marketers putting more resources into individual accounts. Direct mail is a popular method of 1:1 account-based marketing. B2B online security firm Rapid7 recently sent a classic “View-Master” to a select number of targeted accounts to promote the launch of one of their new products and they experienced fantastic ROI.

Rapid7 EVP of Global Marketing, Allison MacLeod, said of this tactic: “We got a lot of great responses, not only from what it did to help open doors for reps, but even just from a social perspective, from people saying – if you’re going to send me something, send me something cool.”

1:Few

An approach perhaps better suited for developing businesses that can’t afford to take the risks of putting all of their eggs in one basket so early on, the 1:few approach spreads the bets somewhat between more accounts. This means targeting specific clusters of accounts with a common denominator.

This tends to be the gateway into accounts based marketing for marketers looking to test the waters before jumping in with both feet. The obvious drawback, when compared to a 1:1 approach, is that, as the net is wider, the strategy is rarely as focused and the campaigns rarely have quite as strong an impact on the target.

1:Many

An even more modern approach that uses technology to target accounts programmatically, 1:many is used most commonly in the US and is the approach perhaps more commonly aligned with traditional marketing as it targets hundreds or even thousands of accounts. This, however, is spreading yourself quite thinly compared to the other two approaches, which might not be an ideal approach for niche or high-value markets.

The vast majority of 1:many account-based marketing is done online. One interesting example of the approach working wonders for customer registration centres on product experience management company Salsify. They organised a roadshow-type event in New York in partnership with Google and Johnson & Johnson.

VP of Marketing at Salsify, Aaron Doherty explains: “We have a target list of accounts to focus on. We reached out to them early with a marketing message, hit them with display, targeted display, targeted emails, and then had the sales team come in and in do 2 hours of sales effort. The goal was to register 60 people and we registered 82 people.”

Is it right for my business?

There’s a common misconception that account-based marketing is exclusively a “big business” technique, but it’s not as daunting as you might expect to get it to work for smaller, developing companies. Indeed, whilst big companies are using it successfully, that success is now filtering down to the wider market and SMEs. In essence, it’s no more complex than narrowing the focus from a group of customers (a segment) to a single customer or a small group of closely related customers.

Remember that each business and each market will play to different crowds and will require different approaches, so you should always examine your circumstances before acting.

Conclusion

Customer experience is more important than ever before when it comes to brand differentiation.

The customers of today don’t want to be treated like just another phone number or email address, they expect a more personal approach and this is particularly true of B2B businesses.

Account-based marketing won’t be an approach that works for everyone. However, if you have absorbed the above and feel that account-based marketing makes sense for your business model and sales/marketing cycles, there is monumental potential there if you’re willing to put in the effort. Because sometimes, the bigger fish are worth fighting for.