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January 2, 2023

What is Demand Generation?

Fostering growth and achieving business targets isn't simply about having an exceptional product or service. It necessitates a thorough understanding and efficient implementation of demand generation strategies.

What is Demand Generation? 

Demand generation is a data-driven marketing program leveraging the inbound methodology to drive awareness and interest throughout the entire buyer and customer lifecycle.

A true demand generation strategy accounts for every touchpoint in the buyer’s journey — all the way from anonymous visitor to delighted customer and throughout the customer’s lifetime. It leverages data to align your marketing and sales teams, track marketing's contribution to revenue and, most importantly, drive growth for your organization.

Demand Generation vs Lead Generation

In the realm of digital marketing, demand generation and lead generation are often used interchangeably. However, these are two distinct concepts, each with unique roles and strategic implications in the broader marketing landscape.

Demand Generation: Awakening Interest

As discussed earlier, demand generation is a holistic, strategic process aimed at arousing interest in your company's products or services. It encompasses a range of tactics, including content marketing, SEO, email marketing, PPC advertising, and  social media marketing, all designed to make your target audience aware of what you offer and build a desire for it.

Demand generation focuses on forming long-term relationships with potential customers. By nurturing these relationships through valuable and engaging content, businesses can build a solid foundation of trust and brand loyalty.

Demand generation strategies are typically broad and aim to reach a large audience. They also focus on educating potential customers about the product or service, explaining its benefits, and how it can solve their problems.

Lead Generation: Transforming Interest into Action

On the other hand, lead generation is the process of identifying and cultivating potential customers for a business's products or services. It involves capturing the interest of potential customers, often through a form of 'opt-in' action, such as filling out a form on a landing page, subscribing to a newsletter, or downloading an eBook.

Unlike demand generation, which primarily focuses on creating awareness and interest, lead generation is about conversion. It's about transforming this interest into actionable leads that can be followed up by sales teams. In essence, lead generation is the next step after demand generation.

The Interplay Between Demand Generation and Lead Generation

While demand generation and lead generation are distinct concepts, they are closely intertwined and complement each other in the broader marketing strategy.

Demand generation lays the groundwork, creating awareness and interest in your offerings. Once this interest is aroused, lead generation comes into play, capturing this interest and converting it into actionable leads. Together, they form a synergistic relationship that drives business growth.

Download the Essential Guide to Demand Generation to learn the essentials of  deploying this powerful strategy within your business.

Demand Generation Fundamentals

Since demand generation programs encompass every single touchpoint (from building awareness through customer retention), they can be broken down into four manageable parts: brand awareness, inbound marketing, sales enablement, and customer retention, with revenue performance as the result of all functions operating like a well-oiled machine.

Click through the table of contents below to jump to a relevant section! 

  1. Brand Awareness
  2. Inbound Marketing
  3. Sales Enablement
  4. Customer Retention
  5. Revenue Performance
  6. 5 Tenets of a Successful DG Program

Brand Awareness

To generate demand, people have to know who you are. The first step is to develop brand awareness, the extent to which contacts and customers are able to recollect and recognize your brand.

Your brand is effectively the sum total of all your customer touchpoints, and as such, it helps your business differentiate itself from competitors. Building your brand identity in order to drive affinity and recognition across your audience is vital to facilitate the recollection of your company and offering.

1. Proper identification of buyer personas

To facilitate recall, you need to first know who the people are you’re trying to reach. Without properly identifying and outlining your buyer personas, you won’t be able to reach your potential customers where they are, making this stage of the process vital to your success.

demand generationTo identify your buyer personas, start by looking at your existing customer data to see who is buying from you. Conduct surveys or interviews to gain further insights into their needs and pain points. Use this intel to create detailed buyer personas that capture your target customers' demographics, interests, behaviors, and goals.

2. Establishing thought leadership

Maintaining thought leadership will help to position you as an authority in your space. When people think about your industry or the problem you solve, they are more apt to think of you if you’ve established thought leadership. 

To establish thought leadership, share your expertise and insights through blog posts, social media updates, webinars, and other content formats. Make sure your content is high-quality, well-researched, and valuable to your target audience. Having your team leaders participate as speakers in events like INBOUND will also boost your brand's reputation.

3. Leveraging a strong social media presence

In the same vein as thought leadership, maintaining a strong social media presence is integral to brand recall. Leveraging social media is one of the easiest ways to communicate your brand. Individuals begin to associate what you post about with your brand. It also allows you to showcase your company culture and ideals in a succinct and authentic way. 

4. Maintaining public relations management

Maintaining a mutually beneficial relationship between the public and your organization is vital to developing good brand awareness. For example, consider creating a crisis management plan to handle negative press and ensure your brand reputation remains intact no matter what occurs internally or externally.

5. Creating a go-to-market strategy

Your go-to-market strategy can be thought of as a hypothesis, with demand generation being the first experiment. Ultimately, you don’t know exactly what your market will demand from your offering or how quickly people will adopt your brand, but you can use your initial understanding and research on potential customers to get started.

From there, you can use your demand generation efforts to inform your brand and product strategy moving forward — better aligning your brand and offering with buyer needs and positioning them for enhanced recall in the future.

Inbound Marketing

Many believe the misconception that demand generation and inbound marketing are one in the same. But they're not. Demand generation is a function; you want to generate demand for your product or service. Meanwhile, inbound marketing is the method by which you can carry out that function. If you believe in educating your customer base and guiding them through the funnel with valuable content and offers, inbound marketing can help you do that.

Inbound marketing tactics work not only to convert visitors into leads and nurture leads into customers but also to generate demand for your product or service. After all, inbound is all about enabling consumers to identify and solve for their challenges with the help of your organization.

1. Blogging and SEO

To educate your visitors and begin to guide them down your funnel, you must be able to attract them to your website. Writing blogs about the topics your contacts care about and optimizing that content for search is a great way to organically draw visitors to your site. 

Here is a step that's impactful no matter if you're only starting to develop your brand's blog or start seeing a dip in performance of your content: on a quarterly basis, identify high-intent, low-competition keywords relevant to your target audience and include them in your blog titles and throughout the content. 

2. Paid advertising

Paid advertising can include targeted ad campaigns on both paid search and paid social channels. While it is often associated with inbound marketing, paid advertising can be executed with an inbound approach. Like blogging and SEO, it attracts visitors to your site by focusing on the keywords you know your buyers will be searching for. Unlike the organic channels, this method allows you to target specific high-intent keywords and use retargeting to show ads to people who have already interacted with your website or content, increasing the likelihood of conversion.

3. Gated content

Gated content consists of e-books, guides, white papers, videos or any other content that is worth downloading because it provides high value to your visitors and leads. These materials are vital because they allow you to continue educating contacts through the buying process. By gating content, you're offering value in exchange for contact information; Use this information to nurture leads through the funnel and convert them into customers.

You can also implement lead magnets, such as free trials or consultations, to entice leads to convert into customers. No matter the offer you're gating, be sure to follow up with leads who have downloaded your gated content with email nurturing campaigns to keep them engaged and move them further down the funnel.

4. Lead generation

You’re not going to be able to sell to anyone without first generating leads. Ultimately, your sales team needs someone to follow up with. A lead is an individual that has voluntarily given you their information, providing candidates for you to nurture into marketing qualified leads (MQLs) and sales-qualified leads (SQLs). Besides filling out forms on gated content offers, you can also capture contacts’ information through chatbots, giving you another lead generation channel. 

traditional lead generation approachBy implementing tactics like lead scoring, you can prioritize leads based on their level of engagement and likelihood to convert, enabling your sales team to focus on the most qualified leads. You can use tech like HubSpot's progressive profiling to gather more information about your leads over time and use that data to further personalize your marketing efforts.

5. Chatbots and conversational marketing

Chatbots are another channel to engage with prospects and customers who are visiting your website. From lead generation to qualification, and customer support, chatbots both automated and live provide website visitors with the ability to answer their questions in real time with minimal effort.

Use chatbots to engage with website visitors in real-time and answer their questions, increasing the likelihood of conversion. Depending on the tool you're using, you can personalize chatbot conversations by using lead information to tailor responses to their needs and interests.

6. Email marketing and lead nurturing

You’re not going to get a contact to go from converting into a lead to becoming a customer without educating them further, especially if your company has a complex sales process or a long sales cycle. By sending your contacts emails with valuable content and other resources, you can nurture them through the funnel. At each stage, you can present the next logical step, helping them progress along their journey. 

lead generation graphicBefore kicking off your nurture, segment your email list based on lead information and behavior to personalize your messaging and increase engagement. Then, use automation to send triggered emails, such as welcome messages, abandoned cart reminders, or other event-based triggers.

7. Website conversion rate optimization

With proper optimization, your website is a powerful way to help your organization capture qualified leads for your product or service. Through Call-To-Action (CTA) strategy and organization, strategic conversion points, clear labels, and visitor-centric navigation you can not only offer value to visitors but nurture prospects as well.

Strategies like A/B testing can help you test different versions of your websitem landing pages, and CTAs to identify the most effective designs and messaging. Check your website analytics to identify areas where visitors are dropping off or experiencing friction, and optimize those conversion points to improve clicks.

Sales Enablement

Marketing and sales alignment is critical to the success of your entire business. Fortunately, sales enablement initiatives driven by a comprehensive demand generation strategy can promote unification across marketing and sales and, in turn, close more business.

The list below features foundational sales enablement methods, tactics and examples that can be executed by your marketing team to close the gap between marketing and sales.

1. Testimonials

A testimonial is like a trust mark. In a testimonial, someone considered to be a peer to your buyers endorses your company, suggesting to your potential customers that they should be confident in your skills and offering. Be sure to actively reach out to satisfied customers and ask them to provide a testimonial, and use them on your website and in your marketing collateral to build credibility.

2. Case studies

Case studies are similar to testimonials, but they provide proof to buyers of the work you’ve done. They also help buyers build trust while offering tangible results for buyers to consider. Make your case studies easily accessible on your website and use them as sales collateral to provide social proof and build trust with potential customers.

3. Battle cards

While testimonials and case studies are customer-facing, battle cards are internal tools. These fact sheets provide information about your product or service, covering elements that could arise during sales calls. These often include comparisons between your product and those of your competitors, allowing sales reps to have peace of mind when discussing your competitive landscape. 

4. Estimate and discount calculators

At the end of the day, conversations with potential customers come down to the amount of value that they can gain from a partnership with you. With that in mind, it’s wise to help your sales team, and the end customer for that matter, visualize an outline of how much value contacts are going to receive by agreeing to a deal. Estimate and discount calculators help with that.

Download the Essential Guide to Demand Generation to learn the essentials of  deploying this powerful strategy within your business.

Customer Retention

While acquiring new business is important, retaining, delighting and evangelizing your existing customers is critical for achieving sustained growth with your demand generation strategy. 

You always want to go above and beyond for your customers, providing them with the ultimate impression of your company and your delivery. By under-promising and over-delivering, you can delight customers at every step of their journey. Of course, providing excellent customer service in this way is just one important method to fuel customer retention. 

1. Execute client marketing initiatives

You should always ensure your clients are aware of any new products or services that are available that could improve their experience. HubSpot is a great example of this. When they recently rolled out their Service Hub software, a tool focused on strengthening customer experience, they sent information out to their existing Marketing Hub and Sales Hub customers, telling them about their new product. Often, companies provide discounts to their existing customers to prompt such purchases. 

Try creating a monthly newsletter that highlights new features, tips and tricks, and success stories. You can also use the newsletter to share industry news and thought leadership content relevant to your personas. This will help you stay top of mind with your clients and showcase your expertise.

2. Use a knowledge base

By leveraging a knowledge base, a technology used to store information about your product (e.g. “how to” and “help” articles), you can help people get more value. It allows you to communicate how customers should effectively use your offering and outlines best practices for different scenarios.

Start building your knowledge base by providing answers to common customer questions. Track engagement on these pages for insights to reduce the number of support tickets your team receives.

3. Employ a ticketing system

Whenever you are working with another company, consumer questions and problems will inevitably arise. A ticket system, a software that compiles all your customer support requests from various channels and helps you manage them, provides a simple means for clients to submit issues, or tickets, to you. From there, you can categorize, catalog and address the issues as quickly as possible, increasing customer satisfaction because people know their voices are heard. 

4. Appreciate your customers

Customer appreciation can include exclusive offers and services along with the events you host for your customers. These small tokens of appreciation can go a long way toward retaining customers and making them feel acknowledged.

5. Generate up-sells and renewals

If you deliver your offering well, you should generate up-sells and renewals, but that doesn’t mean you can just bank on expansion happening. You should have a team devoted to helping customers understand when their renewals are coming up and what products or services are best suited for them. You’ll be able to generate more opportunities that way as people are more likely to take the next step after they’re prompted. 

6. Encourage feedback and make iterations

Demand generation should be a cycle. You market, sell and deliver your offering to individuals and then you interpret how they move through their buyer and customer journeys. Ultimately, you want to determine how you can improve your product and process. If you are thorough and track how people are experiencing your product at every step of the journey, then you can go back to the beginning and make the experience better for the next person.

customer success gaps

7. Leverage Net Promoter Score (NPS)

Net Promoter Score (NPS) measures how likely someone is to recommend your company to others on a 1–10 scale. Using this customer satisfaction metric, you can easily identify how loyal your customers are and divide them into three categories: promoters (9+), passives (7–8), and detractors (0–6). Since it’s a standard tool that’s used across industries, you can compare how you’re doing against your competition or over the entire market. Another benefit is that by identifying customers who are promoters of your brand, you can pinpoint individuals who are good candidates to contribute testimonials and case studies.

Revenue Performance

Whether through the process of net new lead generation or customer expansion, your demand generation strategy is only as effective as the revenue it generates, and the efficiency with which it delivers pipeline. This principle has led to the rapid expansion of revenue operations as a discipline.

Revenue Operations (RevOps) should be accounted for in your demand generation program, either through an in-house RevOps team, a partner, or a combination of in-house and partner services. At its core, RevOps is the process of aligning technologies, stakeholders, and business processes to fuel revenue growth and expansion.

revenue operationsAn effective approach will be multidisciplinary and combine technical and strategic functions, including the following:

  • Implementation and platform setup based on your unique business practices, including  form strategy, lifecycle stage definition, and lead scoring.
  • Technical integration to drive a frictionless experience between systems with clean and unified data throughout.
  • Process and playbook design as well as effective training to align stakeholders behind a process and ensure no revenue opportunities are lost or stalled
  • Reporting and analysis to pinpoint funnel and pipeline gaps. At a minimum, this reporting should represent every lifecycle stage a prospect passes through with your company from the first touch to becoming a customer, with clear visibility into your conversion rates at every stage: visitors to leads, leads to opportunities, and opportunities to customers. Measuring your funnel stages and conversion rates will take place in your CRM and rely heavily on your marketing automation tool as well as your sales team’s manual data entry.

Download the Essential Guide to Demand Generation to learn the essentials of  deploying this powerful strategy within your business.

5 Tenets of a Successful Demand Generation Program

1. Give value before asking for value

You can’t reasonably expect your target audience to take a desired action without making it worth their while. In today’s world, demand generation needs to work harder than simply generating leads to support sales. Through a customer-centric approach, businesses must provide the right information to the right people at the right time in order to help them achieve their desired goals. 

Placing the customer at the center of your demand generation efforts should be your top priority, while getting them to consider your brand as the perfect fit for your needs as a follow-up objective. Before you ask prospective leads for something, make sure you’re first giving them something valuable that they need.

Tips on providing more value:

Consider offering free calculators, templates, or other resources that can help your audience solve problems or complete tasks. People like freebies, and this can establish your brand as a helpful resourc. You can also attend industry events and provide value to attendees by hosting workshops or speaking at panels to drive thought leadership and authority in the industry.

2. Know your audience

You could provide the best software or services that surpass anything else on the market, but if it’s not being marketed to the right audience, you’ll ultimately be disappointed with the leads you generate. Developing effective marketing collateral starts with understanding who your audience is and what drives them to take action. Understanding their pain points and defining how your business solves for them is a critical first step towards identifying your target audience.

To find out who your target audience is — and isn’t — create buyer personas or customer avatars to help you better understand the real people you’re trying to reach. With a strong sense of your buyer personas’ challenges, day-to-day responsibilities, and aspirations, you can more effectively cater content to their particular needs.

3. Create original content

These days, every business is engaging in some form of content marketing. And unless you’re promoting a first-of-its-kind product, odds are you’ll be competing with others to earn your target audience’s attention. Looking to the established players in your space is helpful in knowing the type of content your audience wants, but closely mimicking that same content doesn’t do anything to differentiate your business in the eyes of the consumer. 

The benefits of publishing original, unique content is two-fold. First, it works to set your brand apart from competitors. Find a particular niche or value prop about your company that no one else can offer, and let it shine through in your content. Second, original content can bolster your SEO efforts. Google will push you down the search results if your content closely mirrors existing content or is stuffed to the brim with keywords, so make sure the content you create is uniquely your own.

content strategy

Tips for your content strategy:

Instead of simply creating blog posts, consider creating interactive content like quizzes, assessments, and surveys that engage your audience in a more dynamic way. You can also explore creating different types of content like podcasts, videos, or infographics to diversify your content strategy and stand out from competitors.

Keep in mind, repurpose existing content can be an extremely efficient yet effective strategy. Maximize the value of your existing content by repurposing it into different formats and channels. For example, you can turn a blog post into a podcast episode, a webinar into a video tutorial, or an infographic into a social media post. This allows you to reach new audiences and reinforce your messaging across multiple touchpoints.

4. Listen to your data

Don’t let gut feelings and hunches guide your important decisions. The most effective demand generation strategies are data-driven ones, so look to your Key Performance Indicators (KPIs) to maximize the effectiveness of your funnel. Metrics such as closing percentage, funnel conversion rate, cost-per-acquisition, and lifetime customer value can all shed light on where improvements to your demand generation efforts are needed. With the right data at your fingertips, you can take the guesswork out of demand generation and improve the quality of leads while maximizing ROI in the long run.

Tips on using your data:

Use your marketing automation and CRM tools to track and analyze your KPIs. This can help you identify what's working and what's not, and make data-driven decisions to improve your demand generation efforts. For instance, if your lead conversion rates are low, you might need to revise your messaging or optimize your website's landing pages to better appeal to your audience. 

No matter what tool you use to process, segment, and pull insights from your data, make sure you maintain data integrity and regularly implement data cleaning techniques in your CRM to uphold your source of truth.

5. Test, Test, Test

Speaking of removing the guesswork from demand generation, testing multiple variants can help you optimize content marketing performance and continually improve content quality going forward. Like mentioned earlier, A/B testing is a tried-and-true method for testing different versions of content against one another and seeing which one outperforms the other. In turn, you gain a better understanding of the type of content that strongly resonates with your target audience. 

Whether it’s nailing down the specific wording of a call-to-action, striking the right brand voice, or figuring out the perfect color palette, A/B testing helps you identify what works and what doesn’t. As you continually test over time, you’ll know how to increase user engagement, boost conversion rates, and generate more qualified leads.

Implement Effective Demand Generation

A demand generation program is an essential step toward optimizing your marketing funnel and increasing your lead generation efforts. For a comprehensive look into what it takes to be a demand generation marketer and the tactics, you can start deploying within your organization, download our Essential Guide to Demand Generation.

Demand Generation Guide

This post was originally published June 7, 2018 and has been updated for relevance and accuracy.

Guido Bartolacci

Guido is Head of Product and Growth Strategy for New Breed. He specializes in running in-depth demand generation programs internally while assisting account managers in running them for our clients.


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