How to Build a Business Case for ABM

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Copyright © 2022 Demandbase
How to Build a Business
Case for ABM Featuring
Forrester & Union Bank
Guest Speaker Bob Peterson, VP, Principal Analyst, Forrester,
James Meono, Director, Digital Marketing at Union Bank,
Jackie Palmer, Demandbase VP of Product Marketing

Demandbase Webinar – September, 2022
Bob Peterson
VP, Principal Analyst
@ Forrester Research, Inc. All rights reserved.

What We’ll Cover Today
• Key Findings from State of ABM 2022 Global Survey
• Components of an ABM Budget
• Building a Business Case For ABM: Considerations

State of ABM 2022
Key trends driving ABM investment
4

ABM Goals
The top 3 goals are generating
new pipeline and leads, and
acquiring new logos 0% 5% 10% 15% 20%
Other (please specify):
Improve customer loyalty.
Enter new geographic markets.
Improve customer retention.
Penetrate new vertical markets.
Increase deal size through solution bundling.
Increase penetration of a specific offering.
Increase win rate for must-win opportunities.
Improve sales and marketing alignment
Grow existing accounts through cross- sell…
Accelerate pipeline velocity.
Generate new leads for sales.
Acquire net-new logos
Generate new pipeline.
Series1
Analyst note: Forrester advises ABM clients not to focus on
leads as a goal for ABM.
Question: Please select your top ABM priorities (up to three)?

ABM Budgets
ABM budgets are down a little as
a result of smaller firms
embarking on pilots, but not as
much as we would expect 0% 5% 10% 15% 20% 25% 30% 35%
< $100,000
$100,000 – $250,000
$250,000 – $500,000
$500,000 – $1 million
$1 million – $2 million
> $2 million
Question: What is your ABM budget in $ (excluding headcount)
Analyst note: The average ABM budget has gone down
around 16% from 2020 to $590k excluding headcount, as
a result of high numbers of small firms being in pilot mode.
A typical ABM pilot is around $150k-$250k.

ABM Challenges
Four out of the top 5 challenges
in ABM remain unchanged since
2020 (despite the changing
firmagraphic of companies doing
ABM)
0% 2% 4% 6% 8% 10% 12% 14%
Inability to demonstrate value
Inability to scale
Inability to customize content for ABM accounts
Lack of a dedicated ABM leader
Lack of sales buy-in
Continuous changes to targeted account list
Organizational changes impacting ABM strategy
Technology limitations/integration challenges
Lack of account and contact insights
Insufficient budget
Question: What are your top ABM Challenges? (Select up to 3)
Only the top 10 challenges are displayed
Analyst note: Despite ABM being an insight-led initiative, a
lack of account and contact insights features on the top 5
challenges for the first time. New practitioners are advised
not to try to save costs by cutting back on account insights

ABM Tactics
Display advertising has
overtaken content creation and
customization; telemarketing and
direct fall out of favor
Question: How is your ABM program execution budget broken out?
Analyst note: Display advertising has gone from the 3rd
most popular tactic to the most popular, largely due to
budget shifts in the pandemic.
0% 5% 10% 15% 20% 25% 30%
Other
Telemarketing or prospecting
3rd party projects (e.g. non-retainer agency
projects)
Direct (e.g. direct mail, gifts, 3D mailers)
Insights (e.g. contact data, account profiling,
intent)
Events (both virtual and in-person events)
Content creation and customization
Display media/advertising

Components of an ABM Budget
Investment categories to account for when building the business case
9

How ABM budget
is allocated
Outsourced services
(retainer based)
Program
execution costs
Personnel costs
(including T&E)
Technology
and tools
23%
33%
26%
18%

Programs
• Events
• Content
Customization
• Media
• Prospecting
• Direct Mail
Budget Components of ABM
ABM budgets must consider three areas to ensure all components are incorporated.
Personnel
• Hiring/Recruiting
• Full Cost to
Employ
• Training
• Team
Management
Infrastructure
• Insights
• Personalization
• Demand-side Platform
• MAP/SFA
• Predictive
• Intent

Building a Business Case for ABM
Strategies for illustrating ABM impact
1

The Returns Component The Costs Component
• MROI
• Net New Customer
Acquisition
• Average Deal Size
• Deal Close Rates
• Conversion Rates
• Deal Velocity
• Customer Health
• Retention
• Customer Lifetime Value
• Personnel Expense
• Infrastructure/
• Technologies
• Marketing Programs
Expense
ABM Business Case Considerations

ABM Produces Strong Results: Metrics to Drive the Business Case
99%
said account
engagement was higher
for ABM accounts
Average lift
was 20%
Improved
Win Rate
80%
said win rate was higher
for ABM accounts
Average lift
was 13%
Higher
Deal Size
73%
said average deal
size was higher in
ABM accounts
Average lift
was 21%
Improved
ROI
91%
said ABM accounts had
higher ROI than the
control group
Average lift was
just over 10%
Source: SiriusDecisions 2019 State of Account-Based Marketing Study
Higher
Engagement

Pilot
Design
How do I design a
program given the
goal and
resources?
The ABM Brain Must Make Constant Calculations
As an ABM effort moves from immaturity to maturity, regular analysis of costs and benefits must be
done, sometimes with imperfect information.
Post-Pilot
Scale
What do I need to
ask for to scale, and
do the pilot results
support that ask?
Continuous
Optimization
How can I be more
predictive with my
expected revenue
outcomes?
Limited information Lots of information
Cost/Benefit Analysis

Pareto Theory Can Help Inform Pilot Design
The starting point for ABM design is understanding the accounts that are expected to contribute the
lion’s share of revenue.
Economics Lesson 1
Pareto Theory
(aka “the 80/20 rule”)
80% of the output
comes from 20% of the
input. In ABM, 20% of
accounts might produce
80% of the revenue.
The Situation:
Your CMO has asked
you to scope and design
the ABM pilot, including
specifying what
resources will be
needed

Use an ABM Charter to Wireframe Expected Cost/Benefit
The ABM charter provides an easy way to wireframe the proposal and validate what success
should look like with the executive sponsor.
Opportunity Statement
Our top 100 accounts represent 75% of our
revenues — $300M. Each typically spends $2M-$4M
with us in a year, but there is significant growth
potential if the accounts were more fully penetrated.
To this end, sales’ goal is to grow the portfolio by
10% in 2021 – an extra $30M in revenue.
ABM Scope and Objective
Run ABM pilot targeting 50 of the top 100 accounts
(before scaling to all 100) in three industry verticals.
Target marketing contribution of $7.5M.
Draft Budget
Investment of $400K (excluding people) to include:
• $150K — tech and media spend
• $100K — content
• $25K — account insights
• $100K — other execution costs (events, tele, etc.)
• $25K — other/contingency
Milestones
• End Feb.: preparation, education, account
selection complete
• March: planning, content audit/development,
vendor selections
• April: dev – execution and measurement
• Dec.: post-pilot evaluation and scale
Key Activities
• Internal communications and education
• Define SLAs with sales
• Vendor sourcing
• Predictive modeling to determine highest-
propensity accounts for products A and B
• Insights gathering/account profiling/intent
• Customize content and tactics for priority
industries
• Account targeted media spend
• Sales enablement materials
• Closing tactics
Key Stakeholders
• Exec sponsor (sales) – Brendan Clarke
• Exec sponsor (marketing) – Jared Goring
• ABM project lead – Heather Ash
• Head of marketing ops – Julian Moore
• Head of sales ops – Andrew Long
• 3x account managers (10 accounts each)
• Portfolio industry marketing lead – Christine
McDonald
• Head of demand gen – Ashley Brown
• Content lead – Beth Davies
Risk/Dependencies
1. Account managers support/buy-in
2. Account list stability
3. Technology integration
4. Skills/hiring delays rollout
Charter Owner
Heather Ash, updated Jan. 2020

Opportunity Statement
Our top 100 accounts represent 75% of our revenues
— $300M. Each typically spends $2M-$4M with us in
a year, but there is significant growth potential if the
accounts were more fully penetrated. To this end,
sales’ goal is to grow the portfolio by 10% in 2021 –
an extra $30M in revenue.
ABM Scope and Objective
Run ABM pilot targeting 50 of the top 100 accounts
(before scaling to all 100) in three industry verticals.
Target marketing contribution of $7.5M.
Draft Budget
Investment of $400K (excluding people) to include:
• $150K – tech and media spend
• $100K – content
• $25K – account insights
• $100K – other execution costs (events, tele, etc.)
• $25K – other/contingency

To Scale Up Post-Pilot, You Must Pass the “Butterfly Test”
Account-based marketers must be able to answer pointed questions about whether the accounts
would have succeeded without ABM if they are to justify resources to scale.
Economics Lesson 2
The Butterfly
Effect
Where a small change in
initial conditions may have
a disproportionate effect
on later state (helps to
answer ABM’s sourced vs.
influenced question)
The Situation:
You are in a post-pilot
review meeting with the
CRO and need to justify
the resources needed to
scale up.

Using Control Groups in a Dashboard to Prove Value
Showing the performance of the ABM group of accounts in relation to a control group helps answer
the “butterfly question” — would these results have happened without ABM?
ROI per marketing $ spent
A: ABM
B: Control $16.6
$25
1.5x
higher ROI
Average deal size
A: ABM
B: Control $470K
$566K 20% lift
Win rate
A: ABM
B: Control 30.4%
34.3% 13% lift
Performance against target
Revenue
Pipeline 98%
102%
ABM
109%
99%
Control

A Compelling ABM Dashboard Can Help You Tell the Story
PIPELINE
REVENUE
PROGRAM
SPEND
ACCOUNTS
“ABM is extremely effective –the
discipline pays off. I would love to
see us extend this to cover more
accounts.”
– Tom R., VP Sales
Financial Services
6.3
12.3
30.8
40.1
Rev/$ Pipe/$
ABM
Control
ABM Target Attainment Revenue and Pipeline Per
Marketing Dollar Spent
Average Deal Size
PIPELINE
REVENUE
FINANCIAL
SERVICES
AUTO TOTAL
123%
113%
114%
102%
100%
85%
ABM Pipeline and Revenue Account Engagement and Deals
FINANCIAL
SERVICES AUTO TOTAL CONTRO
L
$2,600K
$867K
$1,410K
$360K
$4,010K
$1,225K
$1,230K
$250K
$100K $40K
75 50 125 125
$40K
$60K
$142K
$172K
Control ABM

Scenario Planning Aids Continuous ABM Optimization
It is a fairly common occurrence for marketing budgets to be reviewed partway through the year,
and unaccounted-for budgets to be redistributed.
The Situation:
It’s Q3 and the CFO is
auditing all unspent marketing
budget to assess revenue
impact if it were reallocated to
a strategic growth initiative.
Economics lesson 3
Scenario Analysis
Economists use
scenario-based models
to answer “what if?”
questions and predict
futures in an uncertain
world.

Planning for opportunity types to meet revenue goals
Acquisition
$20M
Retention
$40M
Cross-sell
$25M
Upsell
$15M
Acquisition
57 wins
Retention
114 wins
Cross-sell
71 wins
Upsell
43 wins
Define the total target revenue for a
solution and market
(e.g., $100M of revenue for a talent management
solution in North America)
1
Define the revenue targets for
each of the opportunity types
2
Translate that to the number of
closed/won opportunities required
3
Total revenue $100M

Planning for opportunity types to meet revenue goals
Acquisition Retention Upsell Cross-sell
Example:
engaged
opportunity to
closed/won
conversion rates
3.4% 76.5% 18.0% 5.1%
Engaged
Prioritized
Qualified
Pipeline
Won
Opportunities
Define required volume of
opportunities by type and
stage
4
Pro Tip: Leverage insights
from ABM pilot to illustrate
conversion rate impact of
ABM vs. control group

Takeaways
• Use the ABM Charter to wireframe and iterate the
proposed design, and articulate ABM business case
• Create a control group featuring similar accounts to the
ABM accounts
• Ensure ABM metrics and reporting are robust and that
data is presented in a compelling way
• Don’t assume a completely linear relationship from
pilot to scaled version, either for costs or impact
• Use Revenue Engine Waterfall® modeling to make
predictions about future scenarios

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Why ABM at MUFG/Union Bank?
Supported our
vertical go-to-
market strategy
Different
footprint for
our two brands
(MUFG, Union
Bank)
Relationship
managers had
targeted
company lists
Supported
follow-up for
companies
attending
events

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Internal buy-in for pilot
Educate Sales and
Marketing on ABM
Pilot with a team that is
already heavily invested
into the main CRM system
Make sure that your pilot
team has enough
accounts (ideally a few
hundred)
Sales organizations that
already think in terms of
accounts will view ABM as a
marketing extension into the
digital space
Identify a timeframe for
executing

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Align Marketing and Sales for success
Group company lists
so they can be
reported on by
industry, prospect/
customer, etc.
1
Set expectations
regarding what type
of data will be sent to
Sales as well as the
cadence
2
Align messaging for
ABM with other
ongoing campaigns
(whether they are
high-level branding
or more industry/
product specific)
3
Share account-
specific company
leaders with Sales
early in program to
demonstrate results
4
Refine, refine, refine
5

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How Union Bank scaled after the pilot
Defined
multiple distinct
campaigns
Created
different
audiences
within each
campaign
Moved
companies
from brand to
verticals based
on
engagement
Ran multiple
creatives
within each
campaign
Focused on
brand &
vertical based
creative

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Lessons learned
Ensure pilot metrics are measurable.
Incorporate ABM findings into other digital
channels.
Leverage ABM findings in content strategy
and landing page design.
1
2
3

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Audience Q&A

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Thank you!

How to Build a Business Case for ABM

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