B2B Account Based Marketing Agency

Sales funnel vs ABM funnel: The key differences

Sales funnel vs ABM funnel

When you picture the marketing or sales funnel, does it typically look like a triangle with the point at the bottom?

The traditional funnel is generally represented by filling it (the wide opening at the top) with as many leads as possible, and it whittles down to a small opening at the bottom. What comes out the bottom are a few good deals. 

What if this version of the funnel was not the only one?

What if we turned it upside down, filling the top of it (now the small opening) with less but specifically identified accounts that would be targeted as future customers? Instead of random leads (which is common in the demand generation funnel), now we’re talking about named accounts here. And as the accounts move through the funnel, they are becoming more qualified and more likely to become a closed deal and a larger deal size at the bottom of the funnel (wide opening) because the accounts are better targeted in this upside-down funnel. (Read about how this would accelerate your B2B pipeline here.)

The funnel differences

The concept of a “funnel” is not new. It is used in many cases, particularly with demand generation. The funnel concept is essentially a way to think about the process of moving customers from left to right through various conversion points along the buying journey (or sales process) where conversion happens when a potential customer passes to the next stages in the funnel until they are secured as an account or a client. Funnels are also an approach to managing customer relationships (not CRM as technology but CRM as a prospect moves all the way through the funnel).

The funnel concept applies to virtually every given B2B organization. Even if you’re not necessarily practicing demand generation, you still have a funnel. You are still moving accounts or leads through that funnel. There is always some sort of concept of how your organization engages and moves your potential customers through the decision-making processes to become a customer. Even when retaining existing customers, generating repeat business, or referral business, the funnel concept applies – they’re just starting from a position further in the funnel, to begin with.

ABM Funnel vs Sales Funnel

In B2B marketing, funnels closely link marketing to sales, and therefore, are paramount in both demand generation and Account-Based Marketing (ABM). However, the ABM funnel, unlike the traditional demand generation funnel, is upside down and focuses on accounts instead of leads as is the case with demand generation.  That’s because only 25% of leads are legitimate and should advance to sales according to Gleanster Research.

ABM focuses on identified accounts that will drive revenue, then expand contacts and engagement within each account as you move down the stages. Accounts, not leads, are the name of the game. Since revenue comes from closed deals with accounts, the objective is essentially account acquisition and account expansion. And that’s the biggest difference between the sales funnel and ABM funnel.

Furthermore, in the traditional funnel, metrics revolve around conversions starting with advertising, then progressing through the CRM. For example, X number of leads from a paid ad generates X number of impressions that convert at a certain rate and at a certain cost per lead. Once that lead gets to the sales team typically via an organization’s CRM, there are more conversion points such as how many of those leads progress to subsequent “stages” before hopefully becoming a closed deal. In the ABM funnel, this conversion process becomes shorter and more predictable.

Why is the ABM funnel important? 

The ABM funnel deeply relies on the collaboration of the marketing and sales team (which we emphasize so much throughout our blog) as the named accounts are collectively decided on. In ABM, the target accounts are your target market, and everything you do revolves around moving this target market through the funnel before it’s handed off to the sales team to close the deal.

B2B sales and marketing alignment

Why does ABM really matter? 

It’s in the name! ABM is about new account acquisition and account expansion. You expand your funnel as you move through the ABM process, accelerating pipeline velocity and activating sales. With ABM, marketing and sales teams have aligned objectives, owning the funnel stages together, and ultimately contributing to higher business objectives such as revenue growth.

ABM isn’t difficult, it’s just different.

There are three broad approaches to measuring a successful ABM approach:

First, is naturally the account relationship itself, as measured by the creation and expansion of relationships within accounts. 

The second measurements are campaign outcomes and progression toward pipeline contribution. What types of outcomes are you seeing with the multi-tactic campaign(s) that you’re running at those accounts? Are you progressing in some way toward the actual or likelihood of pipeline growth? 

The third measurement is the overall ABM initiative. What is your full return inclusive of your marketing and sales investment?

What’s the bottom line? ABM isn’t difficult, it’s just different. Measurements are geared around the accounts, and marketing teams aren’t used to operating this way. But sales teams are! (Check out Sales reps vs ABM: who generates more revenues?

So work on aligning your sales and marketing teams around common metrics to get the best out of ABM. And eventually, your marketing and sales teams will start seeing things differently, too.

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