ABM/ABX

How to Segment Your Accounts By Potential Value for Pro-Level ABX

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September 28, 2021

5 mins read

How to Segment Your Accounts By Potential Value for Pro Level ABX

How to Segment Your Accounts By Potential Value for Pro-Level ABX

A key mistake many companies make when embarking on an account-based strategy is treating all their target accounts the same. A better approach is to recognize there are different styles of Account-Based Experience (ABX) — ranging from truly one-on-one conversations with the largest accounts to technology-driven account-based programs with thousands of lower-value targets — and then to segment your accounts accordingly based on the potential value of the account.

We see these styles of ABX across our clients:

  1. One-to-One: Delivers highly customized experiences for a very limited number of valuable accounts.
  2. One-to-Few: Focuses on small groups or clusters of accounts with similar business imperatives.
  3. One-to-Many: Uses technology to find accounts, personalize interactions to individuals within those accounts, and measure results by account.
  4. Targeted Demand Generation: A broad style that bypasses personalization to drive even more scale.

One-to-One ABX

This highly customized style of ABX directly engages strategic target accounts with the highest revenue potential—generally at least $2 million a year and up. (Note: The data in this post come from the ITSMA and ABM Leadership Alliance ABM Benchmark Studies, primarily 2020.)

Often, this approach is focused on expanding and deepening relationships with existing customers. (Typically 80 percent of these accounts will be current customers.)

Accounts in this style of ABX get completely bespoke marketing. Your playbook is:

  • Deep research: Map out each buying center to understand areas of revenue potential (whitespace). Build out the buyer’s organization chart to ascertain the contacts you know and where you need to build relationships. Research key business priorities and publish detailed account dossiers integrated with Sales account plans. Consider internal chat groups or forums for each account.
  • Personalized content: Create customized marketing content, value propositions, and messaging. (One company we surveyed even hires an agency to come up with specific branding for each of these top accounts.)
  • Dedicated programs: Drive executive briefings, innovation days, high-end experiences, and other marketing activities just for that one account.
  • 1:1 attention: Involve the entire organization, from the CEO down, to create executive engagement and personal meetings.

This level of customization requires significant investment; companies typically invest $36,000 to $50,000 a year in marketing programs to reach each of these accounts, and it’s not uncommon to see one ABX marketer covering just a handful (e.g., about five) One-to-One accounts.

But the investment is worth it for these high-value customers. When ITSMA says “ABM delivers more ROI than any other form of marketing,” One-to-One ABX is what it’s referring to.

One-to-Few

The One-to-Few style is a more scalable approach for accounts that are valuable but don’t warrant top-tier investment—usually in the $250,000 to $2,000,000 annual potential range. It also works well for a temporary focus on specific segments.

Instead of completely bespoke marketing, this approach focuses on micro-segments of accounts with similar characteristics and business imperatives, e.g., Credit Card Payment Processors. This style is used equally for new business (51 percent) and for expanding existing accounts (49 percent).

The median number of total One-to-Few accounts per company is 50 (mean 177), with each micro-segment typically containing 5 to 15 accounts.

Companies apply deep research to the cluster and modest levels of personalization to each account, investing between $3,000 to $15,000 per account per year.

One dedicated ABX marketer can cover up to five or six clusters in this style. The most common tactics used in One-to-Few include one-on-one meetings, executive engagement, email marketing, custom thought leadership, and in-person or virtual roadshows/events.

Since these accounts are often smaller, mapping out individual buying centers may not be as challenging. But you still want to spend time making sure you have quality data at the account level, as well as for each person and key persona in the organization—and you’ll want a process to keep those insights fresh, at least annually. 

One-to-Many

The One-to-Many style uses technology to drive broad programs with light personalization and customization.

Each account is generally less than $250,000 revenue per year, and a company can have hundreds at any given time—the median number is 500 accounts, and the average is a whopping 6,221 (though we suspect that companies with very large lists are using targeted demand generation for most of the accounts and are using segments/triggers to rotate their focus on a subset).

Companies invest a few hundred to a few thousand dollars per account per year, and on average, 72 percent of One-to-Many accounts are new accounts; the remaining 28 percent are existing customers.

While all styles of ABM can benefit from the use of technology, the One-to-Many style benefits most by using it to drive scale and optimize measurement. Under this style of ABM, the most common tactics are virtual and in-person events, account advertising (including social), one-on-one meetings, and content syndication.

Targeted demand generation 

While there is no hard line between One-to-Many and targeted demand generation, the main difference is the level of personalization each marketing strategy uses. Both strategies use tactics such as email, advertising, events, and direct mail, but in One-to-Many, each account gets some personalization, while there is little to no personalization in targeted demand generation – at least until an account becomes marketing qualified. This makes targeted demand gen scalable up to thousands or even tens of thousands of accounts.

Which style is best? There is no best style of ABX. The right style is the one that matches your situation, the value of your accounts, and your deal sizes. Some companies will use just one style; others may use all of them. The most effective programs use segmentation and triggers such as MQAs to move accounts temporarily into different styles as appropriate.

For further details on these approach styles and how to run effective tiering and segmentation strategies for each, take a look at The Clear & Complete Guide to Account-Based Experience (ABX), starting on page 36, or you can also watch the full interview below (and share with those you are trying to help understand how to segment like a pro) . 

 

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Jon Miller

Chief Marketing Officer (CMO), Demandbase

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