Account-based marketing (ABM) is a strategic approach that focuses on targeting and engaging specific accounts rather than individual leads. This approach has become increasingly popular in recent years, as it allows businesses to tailor their marketing efforts to their most valuable accounts and achieve higher conversion rates. However, to truly gauge the effectiveness of your ABM strategy, it's important to track key performance indicators (KPIs).
In this article, we'll explore the most important ABM KPIs that businesses should track to ensure their efforts are paying off.
Conversion rate
Conversion rate is the percentage of visitors to your website or landing page who take a desired action.
For example, if you want visitors to make a purchase, the conversion rate is the percentage of visitors who actually make a purchase. In the context of account-based marketing, conversion rate is an important KPI because it can help you understand how effective your efforts are at converting target accounts into paying customers. By tracking conversion rate over time, you can see if your ABM strategy is improving or if there are areas that need to be optimized.
Customer lifetime value (CLV) is a measure of the total value that a customer brings to a business over their lifetime. It's an important KPI to track because it helps businesses understand the long-term value of their customers and make informed decisions about how to allocate resources. To calculate CLV, businesses typically consider factors such as the average purchase value, the number of purchases made over a set period of time, and the average customer lifespan.
In the context of account-based marketing, CLV is an important KPI to track because it can help businesses understand which accounts are the most valuable and allocate their marketing efforts accordingly. By focusing on high CLV accounts, businesses can potentially increase their overall revenue and profitability.
Cost per lead
Cost per lead (CPL) is a measure of how much it costs to generate a lead through marketing efforts. It's calculated by dividing the total cost of a marketing campaign by the number of leads generated.
For example, if a campaign costs $1,000 and generates 100 leads, the CPL is $10. In the context of account-based marketing, CPL is an important KPI to track because it can help businesses understand the efficiency of their marketing efforts. By tracking CPL over time, businesses can see if they are getting more leads for the same amount of money, or if they need to adjust their strategy to reduce costs. By keeping CPL low, businesses can maximize their return on investment and allocate their resources more effectively.
Cost per opportunity
Cost per opportunity (CPO) is a measure of how much it costs to generate an opportunity (i.e., a qualified lead that is ready to be passed along to sales) through marketing efforts. It's calculated by dividing the total cost of a marketing campaign by the number of opportunities generated.
For example, if a campaign costs $1,000 and generates 10 opportunities, the CPO is $100. In the context of account-based marketing, CPO is an important KPI to track because it can help businesses understand the efficiency of their marketing efforts at different stages of the sales funnel. By tracking CPO over time, businesses can see if they are generating more opportunities for the same amount of money, or if they need to adjust their strategy to reduce costs. By keeping CPO low, businesses can maximize their return on investment and allocate their resources more effectively.
Cost per customer acquisition
Cost per customer acquisition (CPA) is a measure of how much it costs to acquire a new customer through marketing efforts. It's calculated by dividing the total cost of a marketing campaign by the number of new customers acquired.
For example, if a campaign costs $1,000 and generates 10 new customers, the CPA is $100. In the context of account-based marketing, CPA is an important KPI to track because it can help businesses understand the efficiency of their marketing efforts at driving customer acquisition. By tracking CPA over time, businesses can see if they are acquiring new customers for the same amount of money, or if they need to adjust their strategy to reduce costs. By keeping CPA low, businesses can maximize their return on investment and allocate their resources more effectively.
Return on investment
ROI is a measure of the profitability of an investment or project. It's calculated by dividing the net benefit (i.e., the gain from the investment minus the cost of the investment) by the cost of the investment.
For example, if an investment costs $1,000 and generates a net benefit of $1,500, the ROI is 50%. ROI is an important KPI to track because it can help businesses understand the efficiency of their investments. In the context of account-based marketing, ROI is an important KPI to track because it can help businesses understand the profitability of their marketing efforts. By tracking ROI over time, businesses can see if their marketing investments are paying off and adjust their strategy accordingly. By maximizing ROI, businesses can allocate their resources more effectively and increase their overall profitability.
Number of active accounts
The number of active accounts is the total number of accounts that are currently engaged with a business. In the context of account-based marketing, tracking the number of active accounts is important because it can help businesses understand the effectiveness of their efforts at engaging target accounts. By tracking the number of active accounts over time, businesses can see if they are successfully building relationships with their target accounts and if their ABM strategy is working.
Additionally, by tracking the number of active accounts, businesses can identify any potential issues that may be causing accounts to become inactive and take steps to address them.
Number of new accounts acquired
The number of new accounts acquired is the total number of new accounts that have been acquired over a specific period of time. In the context of account-based marketing, tracking the number of new accounts acquired is important because it can help businesses understand the effectiveness of their efforts at acquiring new accounts. By tracking the number of new accounts acquired over time, businesses can see if their ABM strategy is working and if they are successfully acquiring new accounts.
Additionally, by tracking the number of new accounts acquired, businesses can identify any potential issues that may be preventing them from acquiring new accounts and take steps to address them.
Engagement rate
Engagement rate is a measure of the level of engagement that an audience has with a business's content or messaging. It's typically calculated as a percentage and is based on the number of interactions (e.g., likes, comments, shares) divided by the total number of followers or subscribers. In the context of account-based marketing, engagement rate is an important KPI to track because it can help businesses understand the effectiveness of their content at engaging target accounts. By tracking engagement rate over time, businesses can see if their content is resonating with their target accounts and if their ABM strategy is working.
Additionally, by tracking engagement rate, businesses can identify any potential issues that may be causing their content to underperform and take steps to address them.
Lead-to-customer ratio
The lead-to-customer ratio is the number of leads that are converted into customers over a specific period of time. It's typically calculated as a percentage by dividing the number of leads that are converted into customers by the total number of leads. In the context of account-based marketing, the lead-to-customer ratio is an important KPI to track because it can help businesses understand the effectiveness of their efforts at converting leads into customers. By tracking the lead-to-customer ratio over time, businesses can see if their ABM strategy is working and if they are successfully converting leads into customers.
Additionally, by tracking the lead-to-customer ratio, businesses can identify any potential issues that may be preventing them from converting leads into customers and take steps to address them.
Final thoughts
ABM is a strategic approach that focuses on targeting and engaging specific accounts rather than individual leads. In order to gauge the effectiveness of their ABM strategy, it's important for businesses to track KPIs. Some of the most important ABM KPIs include conversion rate, customer lifetime value, cost per lead, cost per opportunity, cost per customer acquisition, return on investment, number of active accounts, number of new accounts acquired, engagement rate, and lead-to-customer ratio.
By tracking these KPIs over time, businesses can see if their ABM strategy is paying off and identify any areas that may need optimization.
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