Inbound Marketing or Account-based Marketing?
Inbound Marketing or Account-based Marketing?
During the past decade, inbound marketing has become one of the leading B2B marketing strategies for demand and lead generation. But while inbound marketing closes in on the middle age, in ”Internet years”, the wrinkles are starting to show. Is account-based marketing (ABM) perhaps a better alternative, at least for some B2B-selling companies? Or should the two strategies converge in order to benefit from one another, thus becoming an unbeatable alternative for B2B marketers.
Inbound marketing has a lot of good things going for it, which is why it’s become so popular. It goes well together with how people research and buy in this day and age: They Google information, share helpful or entertaining content via social media, and look for online reviews – often while being in contact with a sales rep.
A sales rep is also in a psychologically stronger position if he/she approaches, rather than interrupts, the customer’s everyday business with advertisements or cold calls, that most likely will be unwelcome.
An alternative to inbound marketing
Inbound marketing has resulted in more problems the more popular it’s become. Although inbound promises to generate loads of new contacts and potential customers, it can get lonely and frustrating to sit around and wait for the larger companies and their decision-makers and influencers (the ones that manage the really large budgets) to stumble upon your content and reach out to you.
During the past decade a growing alternative approach has emerged, which especially focuses on engaging, accelerating, closing and nurturing the most valuable business customers – account-based marketing.
What is account-based marketing
Many claim the ABM strengthens the cooperation between sales and marketing, more so than inbound marketing, mainly because it involves deep collaborations from day one (it’s desirable in inbound marketing, rarely works). ABM is also fluent in the sales language which focuses more on closing and nurturing deals, than individual leads. In some companies, ABM teams work dedicatedly together with their counterparts in the sales department and process the exact same business clients. Difference is that that the ABM team processes them on a marketing level, while the sales counterpart process them through physical meetings with sales reps.
When the ABM strategy matures within a company, this may also involve other departments besides sales and marketing – customer services and other support functions, partners and even product development. This customer focused strategy, targeted toward the possibilities for highest possible revenue, is often aligned with the company’s strategic goals.
A larger scale B2B buying process always involves a veritable committee of people who makes the decision (including managers, CEO, users, influencers, technical examiners, CFO, purchasers and so on), rather than one single individual. Each individual within this committee have different criteria that motivates their selection of supplier for your product/service – criteria that the sales rep needs to address. This is exhausting and oftentimes sales cycles become a lot longer than expected – or worst case scenario: No deal. With an ABM strategy, you have a better chance – as a team – to succeed.
ABM is also cost effective if it’s done right. More often than not, marketing managers’ budgets are tight, with high-reaching goals, which means that you need to achieve much with less. Focus must always be on potential revenue, and investments should reflect the possibilities to achieve them.
Some ABM practitioners compare this approach to spear fishing, instead of fishing with nets trying to catch anything swimming. This is due to the fact that, in an ABM effort, sales and marketing decide on which target companies to focus on, early in the process and also decide if they should be ”kept warm”, closed or if cross-selling is a possibility. The sales team can be of great help in identifying the most important decision-makers and influencers. Content directed towards these people will now become extremely important in the process of educating the company towards becoming better buyers of your products/services. With ABM, you can make sure that your target companies take part in this content by directing it, exclusively, toward them, which effectively means that all decision-makers, formal or informal, will be affected by it. And you don’t need to wait for them to come looking for you.
ABM is, by definition outbound, not inbound.
One of the greatest challenges in B2B sales with high order values, is to get the attention of C level decision-makers in the targeted companies, that are oftentimes uninterested in information they haven’t specifically asked for. These people are mostly not interested in anything but the results of the company, industry analyses or knowledge and solutions that will bring competitive advantages. Content surrounding these topics will be difficult to ignore (if it’s good enough) – especially if you’re deploying an ABM strategy that lets you inside the offices of your most important clients.
The disadvantages of ABM
Obviously, ABM has its disadvantages too, and they’re often the opposite on the opposite end of the challenges dealt with in inbound marketing. Perhaps the most challenging thing about ABM is that it takes time – just like B2B sales processes. Most customer companies targeted by you will not be ready to buy right now – as opposed to inbound marketing where searches for specific words or terms are interpreted as strong buying signals from companies that will buy in the near future.
ABM is thereby not a short-term marketing campaign. It’s a strategy that you will reap the rewards from, not in days and weeks but in months and years.
Also, ABM works better when targeting large customer companies and large business opportunities. You should never use ABM to close deals with smaller companies or smaller deals. Therefore, ABM is only useful for B2B-selling companies with deals large enough to motivate the invested time and effort required.
On top of this, you also need to create quite a lot of content for a successful ABM effort. The content needs to highlight the challenges of your target customers. This basically means copying the dialogue that your sales reps already have with individuals within these companies during physical meetings to make sure it matches their current position in the sales cycle. Remember that the content should not about you and your solutions, but rather knowledge that matches the information distributed by your sales reps.
Cooperation is key
ABM requires a tight cooperation between sales and marketing when it comes to identifying the customer companies and the individuals within the ”buying committee”. This makes out the foundation for the content needs to be produced or found in previously produced marketing material.
Traditionally, B2B sales reps are skeptical about marketing, which oftentimes means that you start off on a smaller scale; a limited amount of target companies, with dedicated sales rep that support the effort. You then expand the initiative successively, adding similar customers, or customers in similar industries, after seeing that the ABM effort actually works.
At the end of specific sales processes, sales reps can request further support for individual customers. That way you can use ABM in isolated, individual final processes, which increases the chance to close the deal.
ABM analysis differs a lot from that of inbound marketing. In inbound marketing, new leads (conversions) and their contribution to, or connection to, revenue, are measured.
In ABM, the targeted customer companies are known beforehand. And the decision-makers and influencers are previously known or at least identified. In ABM you look at variables such as the number of contacts within the buying organization there is interaction with, how much time they spend on you company (in any way, shape or form) and how often they return to engage more. And, finally, whether you’re accelerating certain sales processes or close more deals within the group of chosen customer companies targeted by the ABM initiative, in comparison those who are not.
Though hard to measure, ABM is considered to ”have the highest return on investment out of all B2B marketing strategies or tactics”, according to ITSMA. ”Period”.
ROI is achieved, perhaps, because ABM is not only a marketing campaign – it is a program that involves the entire company, including C-level. And it helps you grow and/or create revenue from the customer companies that are of noticeable value to you.
So, which is better: Inbound or ABM?
A company with only a few hundred possible customers might only need ABM, but many B2B companies will want to use both. They can use ABM to approach and grow their business with the largest and most valuable customer companies, and inbound to raise interest from thousands of others, less valuable customer companies that they still want to do business with. The choice of activity depends on the recipient and their size, rather than which initiative is the best.