Account-based marketing (ABM) strategies have been around for years; the term was first coined in 2004 by the Information Technology Services Marketing Association (ITSMA). It’s mainly used for B2B marketing and has a proven track record of driving targeted results and optimizing marketing efforts.
ABM is a powerful advertising and go-to-market (GTM) tactic that uses deep customization to create a personalization strategy targeted at specific accounts and key decision-makers. Despite its name, it combines the efforts of multiple teams, ranging from marketing and sales, to operations and customer success, and stretches across both inbound and outbound tactics.
Like any other strategy, tracking account-based marketing metrics is crucial to understanding your campaigns' effectiveness across all departments involved in any marketing or GTM process.
ABM Metrics
1. Total Addressable Market
2. Number of ABM Target Accounts
3. Engagement of Target Accounts
4. Account Penetration Rate
5. Progression Rate of Target Account
6. Sales Velocity
7. Conversion Rates
8. Revenue per Converted Account
9. Customer Lifetime Value
10. Churn Rate
11. Customer Acquisition Cost
12. Account Expansion
12 Top Metrics for Successful ABM Campaigns
Here, we explore 12 key account-based analytics, from target engagement to acquisition costs and customer lifetime value, that drive ABM success.
1. Total Addressable Market
The total addressable market (TAM) is the overall revenue opportunity available in the market (ie, market demand). This is an early-stage calculation, as it gives you an idea of how large your specific market is and how much potential profit there is to gain.
While it doesn’t necessarily mean that you’ll realize all of that profit, knowing the total addressable market gives you a base from which to set goals and objectives. Once you know how much you stand to make and how many accounts you could theoretically acquire, you can begin to set KPIs for your marketing and sales teams.
How it’s measured:
- Calculate the total number of potential customers
- Multiply that amount by your annual average contract value
To set better sales and marketing KPIs, take your TAM calculation deeper by identifying SAM (serviceable available market), which is the portion of your TAM that you can reasonably target based on factors like your location and business model.
Then, calculate your SOM (serviceable obtainable market), which presents a realistic snapshot of what’s possible in the near future based on where you sit in the market. It’s especially helpful for setting your sales goals.
2. Number of ABM Target Accounts
Marketing can, at times, be “feast or famine.” That is if you don’t balance your pipeline and sales cycle of incoming business with existing customers. You’ll always need to work on acquiring more key accounts, but it’s just as important to filter out those that are no longer relevant to your business.
This is where customer segmentation helps you refine your target list by grouping accounts based on factors like firmographics, for example, company size or industry, needs-based criteria, or even decision-making roles. In turn, you can focus your ABM efforts on high-potential accounts to optimize your resources and maximize your ROI.
ABM can be an expensive tactic if you waste resources on target accounts that won’t be lucrative for your business. That’s why keeping track of your ABM targets is important, so you don’t end up with a list that’s too long to manage, too short to be profitable, or too costly to acquire.
To measure the number of accounts to target with ABM, you need to balance the:
- Expected deal sizes
- Length of the sales cycle
- Available sales resources
- Engagement level with current targets
3. Engagement of Target Accounts
Keeping target accounts engaged is mission-critical. It’s also one of the most essential ABM metrics to track. Knowing how engaged your target accounts are is a measure of how accurate your ideal customer profile (ICP) is and how successful your marketing material is.
If your customers aren’t engaged, then it’s time to reassess.
Userled provides an advanced solution that provides rich insights into engagement levels for your target accounts. We also enable you to create customized content to increase engagement with collateral such as:
- Content libraries
- Personalized landing pages
- Personalized outreach
- Inbound web personalization
- Personalized ads
Plus, you’re equipped to iterate on your collateral, in line with the insights that emerge, to boost customer engagement even further.
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4. Account Penetration Rate
ABM campaigns should track the account penetration rate to understand how successful your engagement and relationship-building efforts are. If the percentage is low, it might mean a few things.
- Firstly, it could signal that the quality of your target accounts isn’t up to scratch. In other words, you’re not reaching the decision-makers within an organization.
- Secondly, it might be a sign that your marketing content isn’t performing as well as it should.
- Finally, it may be that your ICP isn’t accurate, and you need to revisit it.
Here’s how to measure the penetration rate:
- Take the total number of target accounts
- Divide this by the number of engaged accounts
- Multiple that by 100, and you’ll get your account penetration rate
5. Progression Rate of Target Account
We recommend tracking this account-based marketing metric to understand how effectively target accounts move through the sales process. That is, how high-value accounts progress across stages of the ABM funnel, starting with engagement and ending with conversion.
By tracking this metric, you’ll see how far along the sales process most accounts get. Your sales team can identify which portions of your sales cycle need to be optimized or reassessed and which parts are working well.
How to measure the progression rate:
- Track the percentage of accounts that advance from one stage of the sales funnel to the next over a specific period.
6. Sales Velocity
Also known as pipeline velocity, sales velocity measures how fast target accounts move down the sales funnel. The lower the velocity, the greater the indicator of friction or a blocker in the funnel that you need to address. Otherwise, you risk losing customers that you could have converted.
You want your target accounts to move as quickly as possible through the sales funnel so you can generate profit and move more businesses through. This also lets you focus your resources on further optimization rather than fixing problem areas.
This is how to calculate sales velocity:
- Measure the number of sales-qualified leads (SQLs) in the pipeline
- Multiply this by the average deal size
- Multiple by the overall win rate
- Divide by the length of the sales cycle in days
With scalable personalization and powerful sales insights that help you engage your key accounts, Userled enables you to grow your sales pipeline (by over 27%), speed up your sales cycle and increase your average deal size.
7. Conversions Rates
Conversion rates tell you the percentage of closed-won accounts versus how many target accounts your marketing and sales teams engaged overall.
It’s no secret that ABM campaigns can be more expensive than traditional marketing strategies. This is due to increased costs around personalized content creation, advanced technology, and dedicated outreach efforts.
However, despite these costs, ABM campaigns often deliver a higher conversion rate and a better total pipeline return on investment (ROI) as they follow more precise targeting.
Tracking conversions will also tell you how effective your ABM campaign is and allow you to optimize it.
Here’s the method for calculating conversions:
- Take the total number of accounts converted
- Divide by the total number of target accounts engaged
- Multiple this by 100 to get the conversion rate
8. Revenue per Converted Account
Tracking this means measuring the average deal size (AVD) of a converted account. It’s usually looked at monthly or quarterly and gives your business an understanding of how much customers are willing to pay for your products or services. This, in turn, helps you price your offerings at an optimal figure that satisfies clients and brings in profit for you.
Knowing this will also later help you calculate customer lifetime value (CLV), which is vital in understanding the total ROI of your ABM campaign investments.
Calculate revenue per converted account by:
- Taking the total value of the deals won
- Dividing this figure by the total number of deals won
- This will give you your ADV
9. Customer Lifetime Value
CLV is the measure of the total revenue a customer is expected to generate during their relationship with your company. A higher CLV indicates a more valuable customer. Once you know who this ideal customer is, you can optimize your customer acquisition and retention strategies accordingly.
Measuring CLV is crucial for ABM success because it influences decisions across finance, sales, and marketing teams. It guides how much budget to allocate for acquiring new customers and how to invest in retaining existing ones, impacting overall organizational strategy.
How to measure CLV:
- Take the average monthly recurring revenue of the account
- Multiply this by the average duration it remains with your business
10. Churn Rate
This is the rate at which your company loses customers. It’s a vital metric to monitor as it tells you whether or not your products or services satisfy clients.
Your sales and marketing teams may be hitting targets and gaining ABM business, but that’s no good if your offering isn’t up to standard and customers leave soon after joining you.
This affects ABM campaigns because a high churn rate damages your relationships with clients, and ABM is about nurturing those relationships to build a lasting and fruitful partnership. These are some top tactics that we use at Userled to address this:
- Involve customers in your roadmap by asking for product feedback
- Have a dedicated customer success or account manager
- Set a shared Slack Channel for more instant communication
- Have dedicated training sessions
- Set biweekly or monthly customer calls
- Involve customers in your product roadmap
- Develop key integrations to increase your user experience
Measure churn rate by:
- Looking at the number of customers you lost
- Dividing that by how many customers you had at the beginning of the period
- Multiply this by a hundred; the result is the churn rate
11. Customer Acquisition Cost
This metric tells you how much you spend on acquiring customers. It’s important because it helps you figure out whether you’re profitable.
By comparing this figure to the CLV, you can see whether you spent more or less money on gaining the customer than the profit you make from them. You lose money if you spend more on acquisition than you make. If you spend less, you’re profitable.
Businesses usually consider CAC within a specific time frame, like a quarter or a financial year.
Follow these steps to calculate CAC:
- Calculate the cost of sales and marketing
- Divide it by how many new customers you acquired
- Do this over a set period of time
12. Account Expansion
One way to expand your accounts is to upsell. Upselling involves encouraging customers to purchase additional or more expensive products and services, which increases their overall value to your company.
This strategy is essential for ABM success, as effective upselling can boost profitability through recurring revenue or higher ticket sales. It can also strengthen customer relationships as increased buy-in signals trust in your brand.
Regardless of the account's initial value, upselling can transform lower-value customers into high-value ones over time. Not only does this support broader business objectives by boosting revenue and reducing churn, but it also improves Customer Lifetime Value (CLV) and Average Deal Value (ADV).
To work out account expansion:
- Divide the revenue generated from upselling by the cost of your ABM efforts
Userled’s Solution for ABM Success
Looking for a way to maximize your personalization strategy with minimal effort? Userled equips your marketing team with the tools to nurture, convert, and expand relationships with your target accounts.
With Userled, you can easily create personalized landing pages, ads, and inbound content, perform outreach, and access a content library for your ABM strategies. Once your campaign is live, track key metrics such as CAC, sales velocity, CLV, and revenue per converted account to measure performance and optimize results.
Try Userled’s free ABM tools today. You can start building your personalized assets and when you’re ready, book a demo with our team.
Author
Generated £1.3M pipeline by focusing on UTM parameters personalisation.
Generated £1.3M pipeline by focusing on UTM parameters personalisation.
