Demand Generation – Why You Need It
Note: This article was initially published in July 2022 and updated in September 2023 with details about demand generation and how it differs from demand capture strategies and tactics many startups execute. I suggest re-reading as this subject is too important not to get right in your company.
I’ve observed building technology startups that your company is, at its core, a disruptor. By definition, you are seeking to change how something has been done for years or even decades, usually through the application of new technology.
Given this high level of product design ingenuity, founders are often overly enamored by their product, its outstanding features, and how it can “change the world.”
Afterall, you and the founding team understand every facet of the technology and product design – what it can do better, faster, and cheaper than the alternative. But, comparison marketing is not enough to move a prospect toward a buying decision in today’s sophisticated multi-stake holder B2B buying and sales process.
This is why demand generation marketing must be understood and the tactics executed to perfection.
Startup failures are due to a lack of sales execution – demand capture vs. demand creation.
Today, startup failure is more often attributable to a lack of sales execution than a failure of the product or technology. It’s easier than ever to build a product, and there is hardly any problem known to man without a small number of passionate people working to build technology to address it.
What required a million-dollar investment can now be built over a few months with a small team and an AWS account. This is great for entrepreneurs looking to move fast on an idea, but it makes the market more noisy and crowded than ever.
No demand, no sales, no revenue…
Harvard Business Review states that 42% of the 108 failed startups they analyzed did not survive due to a “lack of demand for the product or service being offered.”
Was there no demand, or did the founders fail to communicate the problem that their product solved clearly enough to the market?
In my observation, the demand was there or could have been built, if only the founders invested in engineering their market messages and executing on them in the same way they invested to build the product or technology.
This is why demand generation must be in your company’s DNA from day one. If you operate with a “build and they will come” mentality, your venture is likely headed to the failed statistic column. Don’t be a statistic when you don’t need to be one!
Demand capture is a set of tactics and messaging frameworks that at their core can be summed up by the mantras, “better, faster, cheaper!”
Most marketing playbooks that are executed today are built on the idea that if we shout loud enough, our ideal customers will one day come knocking on our door wondering where we’ve been and how they can give us money. Though a romantic notion, this is so far from how B2B buying journeys and buyer decisioning works today that it’s laughable.
Demand generation is the fuel that will drive your startup to achieve success in its sales goals. To do this, your marketing efforts should focus on one task – drive business outcomes. Marketing efforts should be measured against their impact on revenue and not on traditional marketing ROI and campaign attribution methods.
The right marketing approach can establish your company as a Category Queen/King by defining a problem and naming the category for your product’s solution. Doing this allows you to dominate the market and will make your product the standard that all others will be measured against. Read about category design here.
Demand Generation – How it is Done
Demand generation involves a series of steps, which, if done correctly, will allow you to capture leads and convert them to buyers consistently. Demand generation is more valuable than lead generation, where the outcome usually includes a name and email address. Here at GrowthStage Marketing, we have distilled this process into a flywheel that explains what we do at each step to help your company’s go-to-market strategy.
For B2B marketing, the focus is to capture the attention of key decision-makers so that they can understand how your product provides the solution they seek. To do this, you must know where your potential customers seek information. Utilizing digital channels, we can establish your presence on multiple digital spaces ranging from search engines to select social media platforms.
This can be done through highly coordinated social pushes and paid traffic on LinkedIn, search engine optimization for your website and content, and paid search ads on Google. Leaky traffic from your website can be retargeted using LinkedIn and other social platforms. You can also send email with triggered and segmented content based on a recipient’s actions. Don’t be spammy, but it’s also alright to be consistent in your communication and outreach.
The goal is to make your company appear as if it’s everywhere so that it will exist in the mind of your potential buyers. Think of your online presence as seeds that will grow into further engagement and in time closed/won business. Remember, a business with no sign is a sign of no business. Be visible!
Buyers will be looking for many possible solutions, and your company is not the only one under consideration. This means that their attention will be divided, and they will probably not understand what you are offering at first glance.
Once you get a buyer’s attention, the aim is to keep their attention by delivering value through the content you publish. Give them helpful content, and they will reward you with more attention.
Your goal is to explain how your product works and how it can solve their needs. Make the buyer feel that you understand their problems by stating the situation clearly and how your product fits the solution they are looking for. It also helps to establish that your startup is a player by leveraging hot topics and trends in the industry in the content you publish.
Formats could be case studies, application guides, ISV/CSP/VAR resources which can all be delivered through different content types such as video, whitepapers, blog posts, podcasts, or audio summaries. People learn through various ways, so why not make your content as accessible as possible to your target audience?
Important note: There is a trend in the market that says publish often to increase your exposure. This may be true in some trendy niches that have a fuse on the interest of the market and it is certainly true in the B2C influencer space where content is throw away based on a strategy of micro engagements which overtime pull a customer into some sales process.
But, if you are publishing empty calorie content that doesn’t help your customer, not only will publishing more of it not work, it will have the opposite impact of degrading your credibility in the market. Do not get caught in the “I must publish 20 times a week trap,” unless you truly have content worthy of each publishing cycle.
Now that you have their attention, it is time to keep them engaged. You now exist in their mind as potential partners, so take this opportunity to urge the reader to go deeper into your product by delivering more helpful content. A regular email push, delivered via drip feed, still works as long as it’s done in an unobtrusive and none salesy way. Online events, webinars, virtual conferences, and podcasts are good methods to maintain engagement.
On the back end, the effectiveness of your engagement efforts should be tracked by metrics that indicate intent, such as views, downloads, opens, and specific actions taken by viewers and consumers of your content.
Here you can get your outbound sales team involved in the process by providing information regarding the specific actions taken by prospects you deem to be “ideal” or a “perfect fit.” You can use tools to drive lead scoring/grading, including Google Analytics, CRM data collection and CDPs, and marketing automation platforms. The important thing is to not lose track of how your efforts are translating into actions that will lead to a purchase.
You’ve given your potential buyer reasons to choose you. Now it’s time to convert. Remember that demand generation is a cradle-to-the-grave activity and does not stop at the sales-qualified lead phase – it should follow through to the purchase order. Demand generation can and should play a role in ensuring success for your customer to increase product usage and allow for future follow-on revenue.
Methods to increase conversion include irresistible time-bound offers such as a sample simulation of an actual life workload pre-configured and ready to run. Keep your potential customer engaged with live chats through your website or other applications, and reduce content gates, but always keep an eye on how each content type performs.
The goal is to make your company omnipresent (be everywhere!), but to not oversaturate any one channel. Distribute your content in different media to increase your share of voice and enhance your brand perception as a Category Leader!
Summing It Up
Success in today’s winner-take-all market means that demand generation must be at the core of your marketing and go-to-market strategy and activities. Every person in the company should embrace this. It will propel your company to dominate the ecosystem and the category you have defined. The road is littered with startups that had good ideas but who failed to execute on the go-to-market and build demand phases. The bottom line is that demand leads to sales and revenue. You are holding your company’s future in your hands, and its success or failure is something you can control if you invest in building demand.