8 Key Metrics to Measure Success for Your ABM Strategy

1. Total available market

Total available market (TAM) helps your key stakeholders better understand your business and product potential. Establishing TAM helps your business understand every potential customer for your solution in a given segment, which is defined by the industries your business fits into. 

TAM gives you a reference point to answer key questions that can define the goals of your ABM strategy, such as:

• What is my current market share? What percentage am I expected to earn for incremental, moderate or aggressive growth targets?
• How much of my total addressable market is in my current dataset? Do I need to source more ABM accounts to dig into a segment?
• How many accounts would we need to engage through ABM to deliver sufficient leads to sales?

Assessing TAM from a sales perspective ultimately helps you validate your revenue goals by showing how much of the market is available, how many deals you would need to grow your market share at your average deal size and how much pipeline you would need to build.

2. Ideal customer profile

3. Accounts in-market

In-market accounts usually demonstrate some kind of activity or intent to purchase. Targeting in-market accounts based on intent data provides higher conversion rates or sales qualification lead (SQL) rates with benefits including increased content engagement and reduced acquisition costs.

From the sales perspective, knowing which accounts are in-market saves time for sales reps, which you can measure through activity trackers, CRM platforms, and direct sales feedback. Targeting in-market accounts can measure lift in the overall pipeline and improve win rates for your business.

4. Conversion rate (win rate)

Tracking closed/lost rates can be just as valuable as tracking closed/won rates for monitoring opportunities especially when it comes to developing your ABM strategy. The win rate is an important ABM metric to track because it measures how many marketing-generated leads become sales-qualified leads (SQLs), and how many of those convert into customers. By tracking the win rate, you can show how your ABM strategy efficiently generates leads that eventually lead to closed won deals and help your business reach revenue goals. 

ABM strategies can be highly effective for closing more deals by supplying the right content at the right time to progress buyers through the sales cycle.

5. Sales velocity

Over time, sales and marketing must work together to increase velocity through the funnel by educating and engaging the entire buying committee. This should speed the process along for reps because it’s not the first time a lead has engaged with the brand.

• For marketing velocity, a data aggregation tool can provide readouts on the B2B marketing funnel velocity across products and channels.
• For sales velocity, various tools can measure this and most CRMs have a built-in capability to track it.

For sales teams, time is the most valuable commodity. Using ABM campaigns to help reps save time will accelerate your sales velocity by more frequently delivering informed, in-market prospects. With ABM metrics, it’s important to measure activity, time to close, and overall success per rep to determine the sales velocity of your team.

6. Churn rate 

Intent data and competitive intel help identify companies at risk for churn as they’re approaching renewal cycles. Many B2B marketers and client services teams struggle to reestablish a connection with accounts that have already decided to go another direction. Early intervention doesn’t necessarily help you win every renewal, but it can facilitate the conversation with clients prior to making the switch.

Likewise, reducing churn may not be a focus of every sales team, but sourcing competitive intent signals can help you find buyers matching your ICP who might find long-term value in your solution. This can also be used to arm your sales teams with talk tracks for competitive scenarios if you know prospects or clients are typically researching certain competitors.

7. Customer acquisition cost

One of the biggest struggles for B2B marketers is measuring ROI for marketing spend on ABM campaigns and communications with vendors to justify customer acquisition cost (CAC). CAC is a vital ABM metric as you run highly targeted campaigns that lead to less budget spent on low-quality leads. You can make a case that, for the same marketing spend, your intent-driven marketing campaigns generate better leads and therefore more revenue.

8. Customer lifetime value

Forecasting changes to your customer lifetime value (CLV) can be challenging, particularly when you’re pioneering a new software category or just launching ABM for acquisition. By focusing your ABM campaigns on the customers who are the best fit for your products, they’ll stay with you longer and spend more year over year.

There are a couple of formulas to calculate CLV, depending on if you want to pull out the costs that it took you to acquire the customer, and it may differ by industry, geo, or segment. Historical opportunity data is a great starting place for calculating CLV.

Measure ROI for ABM and intent data

Measuring ROI and other success metrics is crucial for executing a successful ABM strategy. By having a clear understanding of these KPIs, you’ll be able to justify spending and prove marketing’s value to your organization. Tracking these metrics will help you measure ABM success for your pipeline development, marketing campaigns, and sales outreach.

Michael Kotchish

Michael Kotchish is the director of global business development at Gartner Digital Markets. Michael leads multiple sales teams and is responsible for training representatives and managers on lead qualification, discovery, deal management and closing activities. Connect with Michael on LinkedIn.