Demand generation, although it’s been around for years, has gained significant traction as a B2B marketing strategy recently. It is a shift away from well-known lead generation tactics, and a focus on creating genuine demand for sales teams, rather than handing them leads that aren’t ready to buy. This guide will provide you with a comprehensive overview of B2B demand generation as a strategy, including its key elements, steps to develop a strategy, measuring success, and overcoming challenges. Let’s dive in.
Understanding the concept of B2B demand generation
Before we delve into the specifics, let’s first define what B2B demand generation is all about. B2B demand generation refers to the process of creating awareness and interest in a product or service among prospects, ultimately converting them into leads that are ready to buy.
Wait, that sounds like it’s just good marketing, right?
The difference is that there is an acceptance that the vast majority of your market aren’t ready to buy (up to 95%!)1, and you can’t force them to be ready. Demand generation, therefore, is an approach that’s much more aligned with sales teams, focuses on quality over quantity, and looks to push genuine demand into your sales funnel (hence the name!).
There are three fundamental components of demand generation:
- Demand creation: Using your whole marketing ecosystem to stay in front of your prospects, by providing useful information around their pain points, or making them realise they have a pain in the first place – creating future demand for your solution.
- Demand capture: Using organic and paid search channels to be visible for highly relevant, high intent searches – capturing the demand of those in-market now.
- Demand conversion: Now a prospect is on your website, ensuring you have a streamlined journey for them to convert and become a lead.
Demand generation is a crucial component of B2B marketing as it fuels the sales pipeline and directly impacts revenue generation. It goes beyond traditional marketing tactics and focuses on building long-term relationships with prospects, nurturing them throughout their buyer journey.
But let’s take a closer look at the intricacies of B2B demand generation and explore how it can benefit businesses in the ever-evolving landscape of digital marketing.
Steps to develop a B2B demand generation strategy
Now you understand the mindset change for the concept of demand generation, let’s walk through the steps to develop and execute your B2B demand generation strategy.
Setting clear objectives
Start by clearly defining your objectives. Demand generation requires business-wide buy-in. In a world of rising MQL targets, demand generation focuses on quality over quantity.
This often means MQLs, while important to track, shouldn’t be the core KPI that you’re measured by. MQLs as a core KPI often leads to high volume, lower quality leads. Instead, consider revenue-focused KPIs such as pipeline. This allows better alignment with sales and ensures you’re being measured by lead quality rather than lead quantity.
Furthermore, having clear shared objectives also ensures that your entire team is aligned and working towards a common goal. It provides a sense of direction and purpose, enabling everyone to focus their efforts on activities that contribute to the overall success and growth of the business.
Developing a comprehensive buyer persona
Once you have set your objectives, develop detailed buyer personas based on market research. These personas will help you tailor your messaging, content, and campaigns to resonate with your target audience. Consider factors such as demographics, job titles, pain points, motivations, and preferred communication channels.
Creating buyer personas allows you to gain a deeper understanding of your target audience. It helps you identify their needs, challenges, and preferences, which in turn enables you to craft personalised and relevant marketing messages. By speaking directly to your audience’s pain points and aspirations, you can establish a stronger connection and build trust with your potential customers.
Pro tip: Get on sales calls. Hearing your audience’s challenges first-hand is invaluable, and also gives you insights on how sales sell your solution and objection handle. This enables you to have laser-focused personas, and ultimately messaging that resonates with your audience.
Creating compelling content
Content is the backbone of any successful demand generation strategy. By creating and sharing valuable, relevant, and informative content, businesses can attract and engage their target audience.
But what makes content compelling? It’s all about addressing your audience’s pain points, providing solutions, and showcasing your expertise. Whether it’s in the form of articles, whitepapers, case studies, or videos, your content should aim to educate, inspire, and entertain your audience.
At a minimum, your content should cover:
- Your target personas pains and how to solve them
- Thought leadership from experts in your business
- Content that talks about your category as a whole (including solution comparisons)
- Your value proposition and the macro benefits you deliver
- Solution propositions and specific benefits for your target personas
- Results you’ve delivered for customers
Implementing a multi-channel approach
Demand generation is most effective when implemented across multiple channels. Consistency across channels and a cohesive message will increase brand recall. When your audience encounters your brand across different platforms, they should be able to recognise your brand identity and associate it with the value you provide. This consistency builds trust and credibility, making it more likely for your audience to engage with your content and take the desired actions.
Although not an exhaustive list (and there are definitely B2B demand generation tactics outside of digital to consider), think about these focus areas that are tied to the demand generation fundamentals that were covered earlier:
- Articles with SEO in mind targeted at pains your audience are feeling
- Regular cadence of webinars or live events that engage your target audience
- Using organic social media to promote content and push the opinions of your thought leaders
- Email marketing promoting useful content, testimonials, customer wins, product marketing
- Paid social that targets your ICP and promotes useful content, propositions, testimonials
- Articles with SEO in mind targeted at the types of solutions your audience are searching for
- Paid search that targets highly relevant, high intent keywords
- Regular website hygiene checks and fixes
- Ensuring your website has all the information you would take someone through in a sales process
- Regular conversion rate optimisation audits and establishing clear paths to conversion
- Setting up sales intelligence reports in your CRM/analytics platform
Sales and marketing alignment
Demand generation is reliant on a close relationship between sales and marketing. It works best when both teams are going after the same ICP lists and complimenting each other’s efforts.
Marketing should regularly talk to sales and get feedback on:
- Quality of leads
- Objections in sales processes
- New job titles that have emerged
- Top pains from sales conversations
- Most effective messages that work
In return, you can surface valuable insights to your sales team such as:
- Known contacts coming back to your site and what content they’re looking at
- Additional leads that have been generated in target accounts – potentially signifying internal discussions
- Top engaged accounts and job titles, and top performing messaging from ad campaigns
Leveraging marketing automation
Marketing automation tools can significantly enhance the efficiency and effectiveness of your demand generation efforts. By automating repetitive tasks like email marketing, lead nurturing, and social media scheduling, you can streamline your processes, save time, and drive consistent engagement with your audience.
Automation can also help in identifying highly engaged contacts in your database, and alerting the relevant salesperson — really the possibilities are endless, you just need to think about what information is valuable for your sales team to have, and how time-sensitive is it?
Measuring the success of your B2B demand generation strategy
As with any marketing strategy, measuring the success of your B2B demand generation efforts is crucial for continuous improvement and optimisation. It allows you to identify what’s working well and what needs adjustment. By tracking key performance indicators (KPIs), you can gain valuable insights into the effectiveness of your tactics and make data-driven decisions to drive better results.
When it comes to measuring the success of your B2B demand generation strategy, there are several KPIs that you should track. Let’s explore some of them in more detail:
Website traffic and engagement:
One of the primary indicators of a successful demand generation strategy is the amount of traffic your website receives. Monitoring the number of website visitors alongside website engagement rates can provide valuable insights into the effectiveness of your tactics.
Analysing user behaviour on your website will help you understand how engaged your visitors are and identify areas for improvement. For instance, if you notice time on page and pages per session decreasing, this could signal your audience targeting or website content needs work.
By monitoring the number of qualified leads generated, you can assess the effectiveness of your demand generation tactics. A successful strategy should consistently deliver a steady flow of qualified leads, indicating that your efforts are resonating with your target audience and driving interest in your products or services.
It’s important to not obsess over volume, without the context of value. That’s why lead volume should always be analysed within the context of their pipeline value.
Pipeline and revenue:
Pipeline, which represents the sum of all potential sales opportunities at various stages of the sales process, provides a forward-looking indicator of business performance. It offers valuable insights into the effectiveness of the demand generation activities in filling the sales funnel with high-quality leads. If pipeline is growing, it is a signal that the demand generation strategy is working.
Monitoring revenue allows companies to evaluate the direct contribution of their demand generation strategies to the top line. It enables them to gauge the return on investment (ROI) of their marketing campaigns, align their strategies with revenue generation goals, and invest more in what works.
Customer Acquisition Cost and Lifetime Value:
Customer Acquisition Cost (CAC) is a crucial KPI in a B2B demand generation strategy as it provides a clear metric for evaluating the efficiency and effectiveness of marketing strategies in converting prospects into paying customers.
A low CAC relative to the customer lifetime value (CLV) indicates a sustainable and profitable business model, enabling companies to allocate resources more effectively and strategise for long-term growth.
Overcoming common challenges in B2B demand generation
Implementing a B2B demand generation strategy comes with its fair share of challenges. Here are a couple of common challenges and how to overcome them:
Less is more can be a difficult pill to swallow for senior leadership. Remember, lead generation has been the go-to strategy since the dawn of time, and if lead volumes aren’t consistently growing, it can make people uncomfortable.
Look to speak in the CEO’s language — they care about revenue, growth and profitability. If you consistently report on marketing KPIs aligned to these areas, it will be easier to demonstrate marketing’s impact on the overall business performance and get buy-in.
While not a challenge unique to demand generation, attribution continues to be a battle for B2B businesses. The honest answer? No single model works. You’ll need to use a combination of first touch, last touch, and self-attributed data to paint a picture of your audience’s buying journeys.
This isn’t made easier by a cookieless marketing landscape2. It further highlights the need for businesses to collect first-party data and ensure that data is accurately stored in their CRM for useful analysis.
Dealing with data quality issues
Accurate and up-to-date data is essential for effective demand generation. Invest in data cleansing processes and tools to ensure the quality and integrity of your data. Regularly update and validate your contact database to avoid wasted efforts and maintain a high degree of relevance in your campaigns.
As mentioned in the previous point, ensuring your attribution data is clean is critical for accurate analysis on the marketing initiatives that are worth investing more in, and which may be worth killing.
In summary: Should you embrace demand generation?
So is demand generation the strategy to adopt in 2024? You can dress it up however you like, but really demand generation is just understanding the way your audience buys and tailoring your marketing to this. It’s customer-centric marketing that’s aligned with your sales team and has shared KPIs.
It’s important to highlight demand generation still works in tandem with a strategy like account-based marketing, it’s not necessarily a choice between one or another.
To summarise, the key points are:
- Only 5% of your market are actively buying, and they’re either in-market, or not
- There is huge potential for future demand in the majority of your market
- You can’t force someone into market, but you can remain visible and relevant for when they are
- Align your marketing efforts with sales, and create a strong relationship with them
- Focus on lead quality over quantity
- Report around revenue-focused KPIs