If you’re just digging your feet into ABM and looking for pointers on how to build a successful account-based strategy, then How to ABM Like a Boss is the definitive blog series for you. No need to read through a stack of posts from a dozen bloggers. This is it. It’s like reading an eBook but in an easier and more digestible way. ABM like a boss!
Seventy-two percent of companies surveyed increased their ABM budget, according to a study from the ITSMA and ABM Leadership Alliance. And in our recent report, The 2020 ABM Market Research Study, ABM practitioners note they’ve increased their ABM budgets by forty percent year over year (from twenty percent in 2019 to twenty-eight percent in 2020). The rapid success of ABM is clearly driving demand for increased investment.
But even for advanced companies, getting budget for ABM isn’t easy. In fact, in our study, getting budget was the number two challenge they faced.
How should a B2B marketing leader think about budgeting for ABM? What kind of budget does ABM require?
We know this is a common challenge for many B2B marketing leaders, so the team here at Demandbase has put together this brief resource unpacking this critical question.
Let’s break it down.
According to SiriusDecisions’ 2019 State of Account-Based Marketing Study, today’s average ABM budget is around $350,000. (This does not include headcount costs). Seventy percent of organizations expect this number to rise.
But if you’re just starting out with ABM, not every company has an extra $350,000. In that same study, SiriusDecisions found that for pilot programs, the budget is lower, averaging about $200,000.
However, there are companies on the high-end that have mature ABM programs and are only doing enterprise deals. Those companies have budgets in millions for ABM. That said, the number of companies that can make this kind of investment is minimal.
You can spend your budget in programs, people, tools, or agencies. So the natural next question is: How much are organizations spending on each area of ABM?
In the same SiriusDecisions study, they found, on average, almost half (forty-nine percent) of an organization’s overall ABM budget is spent on program development and execution costs, with display media spend, events, and content representing the top three spend areas.
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ABM is a team sport. Don’t go it alone.
We know Sales and Marketing alignment is a major component of ABM, so consider splitting the bill. Sharing the cost of an Account-Based Marketing tool with Sales re-frames the purchase as a Sales enablement process, not only a Marketing initiative.
At Demandbase, we’ve seen Sales and Marketing teams effectively partner together to invest in Sales enablement tools like account insights and sales intelligence, which can help both Marketing and Sales build and iterate on their target account lists and deliver meaningful information about their key contacts.
Perhaps you have some funds allocated for innovation? Make a pitch for sharing some of that budget to fund ABM technology.
Also, going in as a unified front can help you obtain an ABM-specific budget directive early in the process. You’re more likely to get high-level buy-in for ABM implementation if both Sales and Marketing are on the same page.
One thing organizations don’t realize is that building an effective ABM program doesn’t always require a larger budget. You can succeed by using your current tech stack more wisely.
You can look at areas of your budget that are currently allocated to other initiatives and incorporate account-level enhancements to those projects. You can also reallocate budget to ABM is by taking it away from any budget spend that isn’t generating leads, opportunities, or revenue.
That’s why being able to measure and attribute ROI is imperative for any modern marketer.
The first step to moving budget around starts with taking an honest look at your current marketing performance.
You’ll need to make a list of all your marketing programs and tactics to answer the following questions:
ABM offers an opportunity to get more out of your existing marketing budget dollars by spending less time, resources, and effort filling the funnel with prospects that aren’t associated with any target account.
For example, many ABM experts recommend reallocating existing lead-based line items to your ABM strategy. For example, if you’re sending your Marketing dollars on list purchases and programmatic ads, you may want to think about redistributing those resources on ABM programs instead.
Let’s take a look at how some programs you’re probably already running (and their designated budgets) will change with ABM:
Advertising – Before ABM, your ads were untargeted. After ABM, you focus your ad campaigns toward a specific set of accounts.
Content syndication – Before ABM, you focused on lead volume with low conversion rates. After ABM, your costs decrease as you see higher conversion rates from target accounts.
Direct mail – Before ABM, you had a broad-based approach with lower-value offers. After ABM, you’re running high-value offers to your target accounts.
Website and digital experiences – Before ABM, there was only one digital experience for everyone. After ABM, you’re creating personalized experiences for target accounts.
Content creation – Before ABM, everyone got the same content. After ABM, your content is focused on key segments.
Sponsored events – Before ABM, you were running lots of events with a small budget for each. After ABM, you run fewer events (more targeted) with more budget for each.
Field marketing – Before ABM, you were running low-touch events across the country. After ABM, you increase high-touch events in key territories.
Webinars and virtual events – Before ABM, you were running educational webinars and virtual events focused on product and thought leadership. After ABM, you’re running more targeted and thoughtful webinars and virtual events.
Selling ABM internally can be tough. One way to advocate for an ABM strategy is to ask for an experimental budget for a limited period of time for a pilot program. This can take some of the risk out of the equation, rather than asking a big budget (often an ambiguous number) to roll out a full ABM program. This way, you’re able to get budget and you’re held accountable (which every single function must be anyway).
It may be easier to get buy-in if you identify your ABM champions within Sales, Marketing, and Operations. These will be the stakeholders that amplify the value of ABM across leadership and grow ABM enthusiasm later on when you build out your ABM team.
Quick reminder, a recent survey by Altera Group found:
It’s equally critical for your team to have all the necessary ABM tools to succeed. Even if you’ve proven some quick wins early in your ABM journey, you’ll need technology to scale. To build an ABM technology stack, start with your gameplan–technology should enable strategy, not serve as a replacement for a lack of strategy.
When requesting budget for a tool like Demandbase, we recommend articulating our capabilities in the context of executing an ABM strategy. With the Demandbase Platform, you can:
IDENTIFY – Create a target account list of companies interested in what you sell based on information that goes way beyond traditional firmographic data. You delve deeper by identifying buying intent signals across the web, so you can find your key prospects before they find you.
ATTRACT – Pinpoint internal stakeholders within target accounts across the Web. Drive interest with personalized messages and advertising that speak to their specific pain points and needs.
ENGAGE – Deliver a truly personalized experience for each visitor on your site—including headlines, site content, visuals, call-to-actions, and downloadable assets.
CONVERT – Help Sales close deals with insights that personalize outreach and maximize the quality of conversations with customers.
We’ve learned a lot about what kinds of ABM budgeting mistakes to avoid.
Jennifer Dimas is currently the CMO at Gigster, but we talked to her when she was VP of Integrated Marketing & Business Operations at Plex., She explained how her team determined where to place investments for maximum impact.
First, she approaches her budget with the same framework used by the company’s CMO, starting with goal-setting and focus. Her objective is to align ABM goals to departmental go-to-market goals, by asking questions such as:
A similar strategy is to integrate the budget for ABM into other pieces of the Marketing budget.
For example, propose that personalization capabilities be integrated into a new website redesign, or use a target account list to help improve an already planned direct mail campaign.
We really like how Dimas also described the need to strike a careful balance between creating and maintaining engagement in the company’s addressable market, and the need to provide more value to the accounts that are already engaged, considering a major technological change to their business.
This type of ABM deal nurturing can be a great way to maintain a relationship with potential buyers and help them move down the funnel.
Here’s a helpful comparison: Dimas spent twenty percent of her budget converting inquiries to qualified prospects with programs such as field events and direct mail pieces. But only eight percent of budget was spent on deals in play, as they ran a blog series and email campaign to help keep pipeline accounts engaged.
No ABM plan is perfect. As Dimas explained, “We’ve been successful in some areas and less in others. The key is to measure and collaborate.” Her team measures success against targets on a weekly basis. They check in with some Sales leaders every two weeks and others monthly.
The key here is that they are never surprising their partners and always open to change. That mindset is critical to fostering collaboration and alignment between Dimas’ team in Marketing and the rest of the organization.
Once you’ve got your budget, you’ll want to get started on building out your ABM team. You may already have your ABM champions in place, but it’s time to start thinking about rallying the rest of the Sales and Marketing troops to focus on ABM performance. For more on establishing an ABM team, stay tuned for my next installment in How to ABM Like a Boss.
Meanwhile, want to dig deeper on ABM budgets? Check out our eBook, How to Find Budget to Fund Your ABM Strategy.