Conventional KPIs (as used for demand gen) fail to demonstrate the sustainable impact of ABM to your organisation. A new mix of hard and soft KPI’s are critical to chart the added value at each stage. And it’s these we’ll share and discuss in this article.
When will I see ROI?
Firstly, it’s important to say that it’s easy to oversell ABM – and quite tempting to make big promises in order to get the ball rolling. With demand generation, your stakeholders will be used to fast (though maybe not effective) results, and if you’re changing things up they’ll want reassurances it’ll work and to know when. So how can you pitch it right?
ABM has long sales cycles of 12-18 months, so it’s right to expect the same timeframe for your ROI. However, our global survey of over 300 B2B marketers found that those who have already delivered a return on investment (that’s 41% of you, despite most being only in the early pilot phase) did so within an average of just 9.8 months.
However, that is a global average. The UK takes 13.3 months, over double their US counterparts. This is for numerous reasons – many US ABM practitioners are tech companies, which were the first to adopt ABM and have had more time to refine their techniques. In fact, ABMers in the tech sector hit ROI the quickest at 8.7 months. The US also has a higher number of people applying one-to-many techniques, which while arguably less affective, does deliver quicker results.
Whether you’re looking at a timeframe of 9, 12 or 13 months, any one of those numbers may leave your stakeholders glazing over and losing interest. They want things quicker.
While ABM is a slow burner (for some it’s about fundamentally shifting their processes, making changes at the deepest level) there are many strong results you’ll see before you hit that magic ROI mark.
“It’s the milestones that matter in the early stages. It’s about focusing on the performance on the account and then the results will come. I think ROI is a result of the longevity of that customer relationship. If you’re keeping the customer for longer, you’re selling to them for longer, they become an advocate and bring more customers. That’s what we should be measuring in ABM.”
Your ABM KPI stepping-stones
Our survey shows that the most common measurement of success in ABM is revenue (66%), shortly followed by pipeline in SQLs (65%). Of course, these are essential in charting ABM’s overall success but it’s likely to take time to hit these metrics. In the run up, you need to be looking at the foretellers of revenue, which are centered around engagement, relationships and teamwork.
The model shown, The ABM Value Pyramid, charts the benefits of ABM as you build up to ROI at the top. These are all the things you should be looking for, measuring and sharing.
1. Teamwork
Improved teamwork is the first thing you should see (shown on the first rung of the value pyramid above). As sale and marketing work together on shared goals you’ll start to see more collaboration and greater trust. Despite most ABM practitioners having run their programmes for just six months or less, 54% are already seeing greater alignment between sales and marketing, which is great news for both sides.
The divide between sales and marketing has long been a thorn in the sides of both parties – it’s led to inefficiencies, confusion, delays and lost revenue. Improvement here promises long-term and far-reaching benefits for your company and it’s something that will stretch beyond your ABM programme. You can measure this by the number of meetings sales and marketing have, or feedback scores from one department on another.
2. Understanding
Next you’ll see better understanding, which is the second rung of the pyramid. Once your teams have got a good grip of ABM they can turn their understanding to the customer. They’ll start to know a lot more about which customers represent value to your business and what those customers want from you. They gain a much deeper understanding of specific purchase triggers and how to leverage them.
The quality of your selected accounts and data gives you the best indicator of progress here. However, our survey shows that the depth of account insight is the least commonly used ABM metric (18%). This is surprising given that ABMers cite the need to compile customer insight as their biggest challenge. Make sure you’re measuring and celebrating your progress to show you’re appreciative of the efforts made.
3. Approach
We’re now on the third rung of the pyramid and moving towards harder KPIs.
Improved collaboration between sales and marketing, together with better customer insight and a clear ABM plan will lead to a more refined approach – communication and content that speaks to the customer and really drives results. Essentially, your marketing gets a whole lot better. You can measure this with by looking at engagement with content such as open rates, event attendance or web clicks.
4. Relationship
Now on the fourth rung of the pyramid, we’re firmly into hard KPI territory. At this stage you’ll start to see better customer relationships – customers who engage more readily, who are responsive or actively seeking you out, who are interested in your offerings and confident in your abilities.
You can measure this by the number of sales meetings and pipeline opportunities.
5. Results
Lastly, we see better conversion and retention – i.e. ROI. This is the pinnacle of the ABM pyramid and the place that you and your stakeholders have been eager to get to.
At this point it’s important to re-examine your ABM project – did you see the results you expected? Were there any extras? Did these come faster or sooner than you though, and what can you do to improve that? All of this information will help you form targets for your larger ABM project as you upscale and develop it.
