For the last several years, marketing experts have been driven by metrics that provide them with insight into their consumer market. The overarching idea is to ensure that their products and services stand out against competitors using several avenues of communication and reach.
Today, account-based marketing has become a crucial element for marketers in the B2B software ecosystem, allowing them to utilize improved marketing efforts that can help to track day-to-day marketing activities through lead and funnel conversion.
As the digital space grows, more competitors come online and the marketplace changes, account-based marketing strategies become a more innovative method to teach impact and support marketing initiatives.
What are account-based marketing efforts?
Account Based Marketing (ABM) has demanded experts and professionals to strategize differently than before. The idea of ABM is to acquire consumer data that can be attributed to communications strategies, helping organizations achieve their marketing objectives.
A foolproof ABM strategy will help to focus on revenue, company market share, consumer buying power, and the rate of retention.
Instead of utilizing ABM strategies to acquire new clients, marketers have found that account-based strategies can help them identify specific problems in accounts, build their current relationships, and improve marketplace connections.
With ABM strategies evolving, today we can group them into two types:
Acquisition metrics
An acquisition metric will help to measure a system or standard for acquiring new clients, customers, and accounts. By providing clients with a valuable asset, it’s possible to center measurement around potential client growth over time.
Expansion metrics
Another crucial metric used by marketers is the expansion of monthly recurring revenue (MRR). Using MRR in the marketing strategy will help teams better understand where recurring revenue or regular additional revenue is being generated from their existing accounts.
With expansion metrics, businesses can up-sell products to existing customers, such as upgrading their plans. Additionally, it’s also possible to cross-sell products and services to current clients.
How to measure the effectiveness of account-based marketing efforts
Measuring the effectiveness of account-based marketing efforts requires account-based metrics, and by understanding these methods, marketers will have a clearer idea of where they can improve their efforts to grow relationships and boost MRR.
Total target account reach
One of the foundational metrics to use to see whether ABM efforts have been effective is total target account reach. This allows marketers to see whether their marketing campaigns and content have reached their targeted accounts or audience.
Typically, marketers will check if their accounts have at least one or more levels of interaction. Through this measurement, it’s then possible to adapt campaigns that can create more influence that can optimally improve conversion rates. An ABM strategy won’t necessarily grow leads, but measuring total target account reach helps how campaigns can be optimized for increased visibility and interaction.
Market availability
Market availability or total available market (TAM) is a way for marketing teams to measure and define their AMB strategy within the existing marketplace.
The total available market seeks to answer some key questions that can help to define ABM goals throughout the campaign.
With this measurement, marketers can calculate the percentage of their current market share and how they can earn from increasing their influence by adjusting their target range. Additionally, marketers can use their analysis to determine how much their current accounts are being reached, and if they will need to increase their ABM accounts to generate better returns.
Total available market is an effective model that measures existing accounts and builds new channels to help increase ABM engagement that can help deliver leads to deliver increased sales.
Conversion rate
Another key measurement is by monitoring the conversion rate or win rate. The win rate will reveal whether an account-based marketing strategy is creating more marketplace leads, and how much of these are converted into sales-qualified leads (SQLs).
Understanding how marketing efforts can generate more SQLs and ultimately increase customers gives marketers the edge to improve their existing ABM strategies, but also how to efficiently generate better leads that can eventually turn into paying customers and align with business revenue goals.
Understanding win rates is not only about seeing how leads turn into new customers, but also about how to build a winning ABM strategy that consists of the right consent that will help initiate customer engagement and boost the total number of buyers throughout the sales cycle.
Total sales velocity
Boosting revenue and growing business exposure is perhaps the biggest objective ABM strategies hold, and for many companies, their marketing campaigns should help to convert leads into sales.
If an ABM strategy works effectively, marketers will often see a shorter sales cycle, as high-quality leads are generated and enter different phases of the sales cycle.
With total sales velocity, marketers can measure how well their high-quality leads perform within the marketing pipeline and how fast these leads generate more qualified leads.
The aim is to have a higher pipeline velocity, as this would mean that campaign leads are more effective and helps to shorten the sales cycle. Through this more customers can enter the different sales stages, but marketers have more control over how their ABM strategies operate throughout these different stages.
Amount of average cross-sell and upsell deals
Cross-selling and upselling products and services to both existing and new clients is an expansion metric that determines client relationships and how ABM strategies are influencing the relationship between the business and the client.
An increased number of cross-sells and upsell deals are factors that determine existing client retention. Creating new products or services, and including them in current offers leaves businesses with an opportunity to upsell these new products to their current list of accounts. Including upgraded or new products, would leave businesses with an opportunity to increase the total number of orders, boost sales, and ultimately help reach company revenue goals.
Measuring the average size of cross-sell and upsell deals puts marketing teams in a better position to understand how their current ABM strategies are working to not only incorporate existing clients but also retain new clients along the sales funnel.
Retention rate
While an increased number of new sales through quality leads are beneficial for both the business and ABM strategy, it would be a lost cause if new customers do not become repeat clients.
Marketers do not only value their existing client base, but also a market share that they have yet been able to influence or convert into paying clients. These new market segments are what enable marketing teams to build an ABM strategy that will turn new paying clients into permanent paying customers.
Calculating the retention rate of an ABM strategy marketers would divide the total number of current customers by the number of repeat customers.
While the equation looks pretty simple in theory, in practice it requires marketers to have a firm understanding of the current customers, and how new clients have been converted by their ABM efforts.
Customer lifetime value
Understanding how customer lifetime value (CLV) changes throughout ongoing market trends and consumer behavior can be a challenge when launching new products, services, or an ABM strategy for acquisition.
Directing campaign efforts towards customers that align with current ABM strategies can measure which available products and services are a good fit for clients and how to convert them for long-term increased sales.
Measuring the return on investment (ROI) can help to execute a more successful ABM campaign that will see better customer retention and conversion. By justifying budget expenditure through KPIs, marketing teams can measure ABM efforts successfully, and help develop campaigns that can improve marketplace outreach, ultimately leading to increased sales.
Final thoughts
While these efforts can help to track the overall success of account-based marketing campaigns, marketing teams will have a clearer idea of who their current clients are, how to direct efforts towards these segments, and what improvements are needed to help boost customer outreach.
Additionally, these efforts will present new opportunities within existing ABM strategies, ensuring that marketing efforts will help establish stronger customer-business relationships. On top of this, instead of solely retaining and converting new clients, efforts should be directed to improving cross-selling and upselling of new products and services within the current sales cycle.
Having more foolproof data and customer analysis provides a clearer picture of how companies can adjust their key performance indicators, but also align their marketing campaigns not only at their current accounts but to newer segments of the marketplace.
