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How to use account-based marketing to improve customer lifetime value

November 18, 2023 | Jimit Mehta

Are you looking to improve customer lifetime value and drive more revenue for your business? Account-based marketing (ABM) may be the solution you've been seeking. ABM is a targeted marketing approach that focuses on high-value accounts and aligns sales and marketing efforts to deliver personalized messages to those accounts. By prioritizing the needs and wants of your target accounts, ABM helps you build stronger relationships with your customers and drive long-term success. In this article, we'll explore how you can use ABM to improve customer lifetime value and grow your business.

Understanding customer lifetime value and its importance

CLV is a measure of the total value that a customer brings to a business over the course of their relationship with the company. It is calculated by taking into account the amount of money a customer spends with a business, as well as the length of time they remain a customer. CLV is an important metric for companies because it helps them understand the profitability of their customer base and identify opportunities for growth. By understanding CLV, companies can allocate resources towards retaining and expanding relationships with their most valuable customers, ultimately leading to increased revenue and profitability.

In the context of account-based marketing, understanding CLV is crucial because it helps companies identify which accounts are worth targeting and how to tailor their marketing efforts to those accounts in order to drive long-term value.

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Identifying target accounts for ABM

Identifying target accounts for ABM is the process of selecting the specific accounts that a business will focus its ABM efforts on. This is typically done by identifying accounts that are most likely to bring the greatest value to the business over the long term. To identify target accounts, companies can use a variety of criteria, such as the size of the account, the potential for future growth, the account's fit with the business's products or services, and the likelihood that the account will remain a customer for a long period of time.

Once target accounts have been identified, companies can use various tactics to reach and engage those accounts, such as personalized messaging, targeted content, and account-specific marketing campaigns. By focusing their efforts on a select group of high-value accounts, companies can more effectively build relationships and drive long-term value.

Developing personalized messaging for target accounts

Developing personalized messaging for target accounts is an important aspect of ABM. Personalized messaging involves creating marketing content and messaging that is tailored to the specific needs and wants of an individual account, rather than using a one-size-fits-all approach. This can include things like custom landing pages, personalized emails, and targeted social media ads.

Personalized messaging is effective because it speaks directly to the unique needs of the target account and shows that the business is attentive to their specific requirements. By delivering personalized messages, companies can better engage their target accounts and build stronger, more meaningful relationships. Additionally, personalized messaging can help increase conversion rates, as it is more likely to resonate with the recipient and motivate them to take action. In the context of improving customer lifetime value, personalized messaging can help companies retain and expand their relationships with high-value accounts, ultimately driving long-term value for the business.

Aligning sales and marketing efforts for ABM

Aligning sales and marketing efforts for ABM is the process of ensuring that both teams are working towards a common goal of driving value for target accounts. This involves coordinating strategies, sharing resources and information, and ensuring that the right messages are being delivered to the right accounts at the right time.

By aligning sales and marketing efforts, companies can better tailor their approach to the needs of their target accounts and deliver a seamless customer experience. This can involve things like having the sales team provide insights and feedback to the marketing team on the needs and pain points of specific accounts, or having the marketing team provide the sales team with account-specific content and messaging to use during sales conversations. By working together, both teams can deliver a more targeted and personalized experience for the target accounts, ultimately helping to improve customer lifetime value.

Measuring and analyzing the impact of ABM on customer lifetime value

Measuring and analyzing the impact of ABM on CLV involves tracking key metrics and using that data to understand the effectiveness of the ABM campaign. This can help companies understand which aspects of their ABM efforts are driving the most value and where they can make improvements.

There are several key metrics that companies can use to measure the impact of ABM on CLV, including:

  1. Customer retention rate: This measures the percentage of customers that continue to do business with the company over a certain period of time.

  2. Average order value: This measures the average amount of money that a customer spends per order.

  3. Customer acquisition cost: This measures the amount of money that a business spends to acquire a new customer.

  4. CLV: This measures the total value that a customer brings to a business over the course of their relationship with the company.

By tracking and analyzing these metrics, companies can understand the impact of their ABM efforts on CLV and make adjustments as needed to drive long-term value.

Strategies for maintaining and increasing customer lifetime value through ABM

There are several strategies that companies can use to maintain and increase CLV through ABM. These strategies include:

  1. Continuously gather and use customer data: By collecting data on customer behavior and preferences, companies can better understand their target accounts and tailor their ABM efforts to meet the needs of those accounts.

  2. Deliver personalized experiences: Personalized experiences that are tailored to the needs and wants of individual customers can help companies build stronger relationships and drive long-term value.

  3. Nurture relationships: Building and nurturing long-term relationships with customers is key to maintaining and increasing CLV. This can involve things like regularly checking in with customers, offering additional products or services, and providing excellent customer service.

  4. Upsell and cross-sell: Offering additional products or services to existing customers can help companies increase CLV by driving additional revenue from those customers.

  5. Continuously optimize and improve: By regularly analyzing and adjusting their ABM efforts based on data and customer feedback, companies can continuously optimize and improve their approach to drive long-term value.

Best practices for implementing an ABM campaign

There are several best practices that companies can follow when implementing an ABM campaign:

  1. Clearly define your target accounts: Identify the specific accounts that you want to target with your ABM efforts and make sure that everyone on the team is clear on who those accounts are.

  2. Align sales and marketing efforts: Ensure that both the sales and marketing teams are working towards a common goal and that there is good communication and coordination between the two teams.

  3. Create personalized messaging: Develop customized messaging and content that is tailored to the specific needs and wants of your target accounts.

  4. Use multiple channels: Utilize a variety of channels, such as email, social media, and events, to reach and engage your target accounts.

  5. Measure and analyze results: Track key metrics and analyze the results of your ABM efforts to understand what is and is not working and make adjustments as needed.

  6. Continuously optimize and improve: Regularly review and optimize your ABM efforts based on data and customer feedback to drive continuous improvement and increase effectiveness.

Over to you

ABM is a targeted marketing approach that focuses on high-value accounts and delivers personalized messages to those accounts. By aligning sales and marketing efforts and delivering personalized experiences, ABM helps companies build stronger relationships with their target accounts and drive long-term value. In order to use ABM effectively to improve customer lifetime value, companies should clearly define their target accounts, create personalized messaging, use multiple channels to reach those accounts, measure and analyze the results of their ABM efforts, and continuously optimize and improve their approach.

By following these best practices, companies can effectively use ABM to increase customer lifetime value and drive long-term success.

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