Cross-Channel AdvertisingSales Intelligence
Demand Generation: Everything About the New Trend in B2B Marketing
Tim Rath1/6/2023
In this article, you will learn what Demand Generation is, where it differs from Lead Generation, and why everyone in B2B marketing is now focusing on "demand generation".
Table of contents
- What is Demand Generation? The basics
- Why is Demand Generation important?
- What does the Demand-Gen Funnel look like?
- What does this mean for practice? You already know that a different strategy is called for depending on the funnel stage. Now, you will learn what such strategies can look like and which ones work best.
- Of course, there are also a lot of helpful tools for Demand Gen. OMR Reviews helps you find those that suit you and your needs best.
- In summary, Demand Generation is nothing completely new. What is new is that companies are now "waking up" and realizing how important it is to continuously win new target groups and to pick up people where they are right now - even if they don't yet know that they need to be picked up.
Just another buzzword or a consistent marketing tactic? Demand Generation is currently an absolute trend in the marketing bubble. Too many marketers in recent years have been fully focused on collecting as many leads as possible - and are now realizing that this is no longer working and they've lost sight of something important: Without generating new demand in the market, traditional lead generation is not endlessly scalable. Also, people are less and less willing to exchange their contact details for E-Books, whitepapers & Co.
This article takes a closer look at the subject of Demand Generation and clears up some uncertainties. Our guest author Tim Rath from YOYABA explains what Demand Generation actually is, how Demand-Gen and Lead-Gen differ and what matters if you want to use the marketing tactic for your business. In addition, we will show you some helpful tools and software on OMR Reviews that will assist you.
What is Demand Generation? The basics
The term "Demand Generation" has been appearing in various marketing blogs for several years now, but is still not uniformly defined. Simply translated into German, it means "Generation of Demand." In fact, Demand Generation (or Demand-Gen) involves much more than just briefly generating demand for any products.
Demand Generation is an umbrella term for a whole range of marketing activities, with which you build a long-term relationship between your brand and (potential) customers, generate attention and stir interest - always with the aim of making more money in the long run.
Sounds simple? But it's not. The goal of Demand Generation is not to figure out who is already interested in your product and to persuade these people to buy (that's Lead-Generation). You want to spark interest in people who know nothing about you and your products - or haven't even realized yet that they have a problem your product can solve. You want to convince these people so much about your solutions that they voluntarily come to you as prospective customers.
In essence, Demand Generation describes what marketers should always have been doing, but often haven't: provide enlightenment that generates demand and fills the sales pipeline with high-quality leads.
Demand Generation vs. Lead Generation
As we have already indicated: Demand-Gen aims to win more people for your brand and your products in the long term. Once interest is aroused, you need to ensure that potential customers become customers and spend money with you. Your aim is to push them further down the funnel (more on this later), in the case of B2B SaaS products for example closer to or even up to subscription.
This is exactly where Lead-Generation (also called Lead-Gen) usually starts. A lead is a person who has signaled "Yes, I'm interested!" by voluntarily providing data, such as an e-mail address when signing up for newsletters. With this data, your sales team harvests the so-called "Low-Hanging-Fruits", thus tapping into the existing or previously generated demand.
In traditional Lead-Generation marketing, you bring the sales colleagues into play as early as possible, quickly making contact with the leads (e.g., right after a whitepaper download) and trying to persuade them to make a purchase. With Demand-Generation marketing, on the other hand, you shift the point of contact backwards. You create a passive demand for your products or services by assisting potential buyers' research process with high-quality, freely available content - without actively intervening or hell-bent on collecting contact data. Thus, you unobtrusively create demand via content, potential customers come to you voluntarily and you only have to "encourage" them to make the final purchase decision (Demand-Capturing).
The main difference between Demand-Gen and Lead-Gen therefore lies also in the focus. You need short-term leads to make money. There are not an infinite number of leads in the market that are ready to pull out their wallets. Therefore, you need to start long-term even earlier in the Customer Journey and win new prospects who become new leads and - you can probably guess what's coming - can spend even more money with you.
Demand Generation and Lead Generation are therefore not two separate marketing approaches, but rather two stages in the interaction of marketing and sales, building on each other - and cannot do without each other in the long run. In Demand-Generation Marketing, traditional Lead-Generation finds a new place in a slightly modified form - as Demand Capturing further down the funnel.
Demand-Generation vs. Lead-Generation
Why is Demand Generation important?
The question of why you need Demand Gen can be relatively easily answered: Because people need to know about and be interested in your offering before they can buy it. Today, (potential) buyers are increasingly unwilling to register for content and give out their contact details. The trend is rather towards consuming as much information as possible "ungated" before making a purchase. The reason: negative experiences. Decision-makers no longer want to be contacted and pushed into a sales conversation they are not ready for, just because they have downloaded a single whitepaper.
Instead, the most important touchpoints and decisions are increasingly taking place in "Dark-Social" - i.e. where they cannot be tracked, for example via podcasts, LinkedIn posts, exchanges in (Slack) communities or in personal coffee chats. And also in social ads (e.g. on LinkedIn), which are not optimized for conversion, but for engagement. Members of a buying center exchange information with other experts and prefer to compare offers based on freely available information. They become aware of a company through content that they consume and like on LinkedIn, for example, Google it, and then end up on the website via a search ad. At first glance, it seems that the most important touchpoint was the paid Google ads - but in fact it was the free, organic LinkedIn content.
Demand Generation is particularly important for B2B companies with complex target groups and products requiring explanation (e.g. Software-as-a-Service), where the customers usually go through a longer customer journey before they actually decide to buy.
Tip: You want to know more precisely how B2B SaaS marketing works and what role Demand Generation plays in it? Take a look at our article "(B2B) SaaS Marketing - everything you need to know about it". In it, we also clear up some marketing buzzwords and explain what key figures are important in B2B SaaS Marketing.
What does the Demand-Gen Funnel look like?
You've probably heard the term "Funnel" once or twice before. There is also a funnel for Demand Generation with different stages, depending on where potential customers are currently in their customer journey.
Different strategies belong to each stage, which accelerate the process and move the prospects further down the funnel, i.e. towards purchase or subscription. Examples include inbound marketing, content marketing, lead nurturing or social media marketing - we'll go into more detail later.
First, let's look at how a Demand-Generation Funnel can be structured. In its simplest form, it is roughly divided into three sections:
- TOFU (Top-of-the-Funnel): This phase is about generating awareness as well as an understanding of the customers' "pain points" and the solutions your company offers.
- MOFU (Middle-of-the-Funnel): Here, the focus is on supporting potential customers with deeper research and considerations, and regularly interacting with prospects. In this way, you stay in the minds of the target group and build trust.
- BOFU (Bottom-of-the-Funnel): At this stage, it's all about turning prospects into customers and inciting action (Demand Capture). For this, an intention to buy must develop in their minds.
Demand-Gen-Funnel in its simplest form: TOFU, MOFU, BOFU
This basic form of the Demand-Gen-Funnel can be applied to almost any company. But: As universal as this three-part funnel is, it is also imprecise. Therefore, it is often further deepened and modified for different industries or types of marketing (e.g. paid vs. organic). The rule is: For organic content, the basic funnel usually works well. However, when it comes to paid media in
B2B-SaaS Marketing, it is worth to get more specific and further break down the Demand-Generation Funnel - into five sections: Create, Capture, Revive, Accelerate and Expand.These five stages describe more accurately what outcome is to be achieved - and thus also provide clues as to what measures should look like that lead to this outcome. This way, you can plan your Demand-Gen activities more purposefully.
Demand-Gen Funnel 5-Stages
The basic principle remains the same, the prospects or customers move down in the funnel. In the top two stages "Create" and "Capture", the base from the three-part funnel is reflected.
In addition, the
five-step Demand-Generation Funnel goes one step further: With the steps "Revive", "Accelerate" and "Expand", it takes into account that the customer journey does not end with the purchase or subscription. Someone who just follows the three-part funnel probably creates demand and does something to convert it into buying decisions (Demand-Capture), but might forget to pick up missed opportunities (Revive) or to maintain relationships with existing customers and increase their sales as well (Expand). These things, however, are also important parts of the Demand-Gen puzzle. Because holistic Demand Generation is
not a linear process. Instead, prospects and customers are constantly jumping back and forth between awareness, interest, intention, and decision. Demand Gen is also relationship management and serves to retain existing customers, excite them for new product features, or reactivate them.Demand Generation in practice - this is how it works
What does this mean for practice? You already know that a different strategy is called for depending on the funnel stage. Now, you will learn what such strategies can look like and which ones work best.
The most important strategies and activities for generating demand Demand Generation is a
complex interplay - of marketing and sales, inbound and outbound, contact building and contact maintenance. Accordingly extensive and diverse are the strategies. We've listed it up for you once gain.Organic: Free content offers, SEO and Social Media
As they say:
Content is king! This is also true in Demand-Gen. Useful, relevant content, which recognizes the needs of the readers and solves real problems, is especially suitable to inspire people for a company, a product or a service.So it could be that a well-placed
video (e.g. on LinkedIn), a podcast or a blog article generates enough attention to attract a reader to the website (Demand Generation), where he or she then finds more information and guides around the product. The interest is aroused, he or she books a webinar or a free demo and thus finally becomes a qualified lead, out of which a subscription or a purchase emerges (Demand-Capture). To get your content noticed, you should definitely do
Search Engine Optimization (SEO), both Onpage and Offpage. What is currently being searched for on the Internet reflects what your target group is concerned about - you can and should use this for yourself. The same applies to Social Media. Stay in touch with the times, network and provide your community with high-quality and authentic content.In total, you position yourselves on various channels as
experts (keyword "Thought Leadership") and build up a basis of trust for further interactions.You can basically use content at any
funnel stage, depending on the specifics of the content. Start rather today than tomorrow with the production of content.Via social media posts, blog articles, infographics, videos, podcasts, landing pages or glossary entries, you create the first touchpoints and make yourself remembered time and again by (potential) customers.
- With checklists, worksheets, webinars, e-mail marketing (e.g. newsletters), templates or e-books, you bring potential customers closer to the conversion (this is already moving in the direction of Demand-Capture).
- With free demos, vouchers or handbooks, you specifically aim to convert potential customers into subscribers or customers.
- Content types in the marketing funnel
Paid: Performance Marketing (SEA & Social Ads)
Every really good Demand-Gen-Marketing strategy also relies on
cleverly placed ads (SEA and Social Advertising). With this, you can push certain content pieces or landing pages, for example, and make them more visible. You can also use Image-Ads and Video-Ads to be "loud", bring your brand into the minds of people and arouse curiosity.In short:
With targeted Performance-Marketing you push your Content-Marketing. You keep creating touchpoints, set impulses and augment your contacts so to speak (Lead-Nurturing) throughout the entire customer journey.By the way:
Although Demand-Gen follows along the Customer Journey, it would be a misconception to believe that only one person per company runs through the journey. Instead, one person gets assigned to do the research, another one filters in advance and only then does the decision-maker make the choice. In your Demand-Gen activities, you must keep all target groups in mind.3 tips on how to generate more successful demand
Demand Generation can be complicated. Strategies are one thing, experience another. So that you start with a knowledge advantage, here are
three tips for (even) better Demand-Gen Marketing:#1 Create genuine added value
No matter if it's weekly new podcast episodes, videos or social media posts: always make sure that you provide your potential customers with
valuable content.With Demand Generation it is about
problem solving - and who does not address the problems of the target group in the first step or only scratches the surface will hardly achieve that people are interested in the solution that one has in store.Conversely, interest and the likelihood that someone will provide you with the coveted contact information increases if you provide content that is truly useful and tailored to the "pain points" of your target group.
That's why it's crucial that you get to know and understand your target group or buyer persona very well in the first step. Otherwise, it will be hardly possible to address the problems specifically and create added value. In practice, however, so far only a few marketers ever speak to their customers. That should change.
#2 Be unique
Content is essential when it comes to generating demand. The problem: The World Wide Web is full, if not even overcrowded with content. That's why it needs
creative and unique content, that stands out from the crowd instead of going under in it.That means: you should be courageous, not just use the same buzzwords and best practices as everyone else and do something that no one has done before you. Those who only regurgitate what already there, will not remember the people out there.
#3 Testing, testing, testing
We can't say it often enough: Really good marketing (and therefore also Demand Generation) doesn't work without
testingWe marketers believe we know which messages and content our target group needs - but we cannot look into their heads. This always leaves some uncertainty, which can only be dispelled by taking risks and checking with
A/B tests what potential customers really respond to.AB-Testing in marketing
Making it Easier: The Best Tools for Demand-Generation Marketing
Of course, there are also a lot of helpful tools for Demand Gen. OMR Reviews helps you find those that suit you and your needs best.
On the one hand, there are tools that support directly in paid demand generation, so-called
Demand-Side Platforms (DSP). With these, you can automate your digital advertising and manage campaigns more easily. Popular Cross-Channel Advertising Software & Tools include, for example: In addition, there are some
Adform
The Trade Desk
YieldlabSales Intelligence Software & Tools in the marketing world that can make individual activities in the Demand-Generation process life easier for you. These include, but are not limited to: Conclusion: A trend that will stay
LinkedIn Sales Navigator
Albacross
Riverside
HubSpot Marketing Hub
SegmentIn summary, Demand Generation is nothing completely new. What is new is that companies are now "waking up" and realizing how important it is to continuously win new target groups and to pick up people where they are right now - even if they don't yet know that they need to be picked up.
What this means is that there is currently a shift in the B2B marketing world away from pure lead generation towards a
mix of short-term Lead-Gen and long-term Demand Gen. The goal: To tap into existing demand and simultaneously scale the business successfully by getting more and more people excited about your products or services (Demand Generation), thus providing for demand replenishment, and converting more and more prospects into customers (Demand-Capture). In keeping with the motto "If you sow nothing, you will reap nothing," B2B marketing, especially in the SaaS area, will no longer function in the long run without sensible Demand Generation. So it's worth making some adjustments to the marketing strategy if you're not yet betting on Demand Gen.
We know: That's easier said than done. Those who want to scale their business successfully should therefore consider bringing experts on board who practically have the Demand-Generation basics down in their sleep.
Wir wissen: Das ist leichter gesagt als getan. Wer sein Business erfolgreich skalieren möchte, sollte deshalb darüber nachdenken, sich Expert*innen mit ins Boot zu holen, die das Demand-Generation-Einmaleins praktisch im Schlaf beherrschen.
B2B
Author
Tim Rath
Author
Tim Rath
Tim Rath ist absoluter SaaS & Tech-Addict sowie Founder und CEO der YOYABA GmbH, einer Agenturgruppe, die ausgewählte B2B-SaaS-Start-ups und Scale-ups in puncto Demand Generation und Performance-Marketing auf das nächste Level bringt. Gemeinsam mit knapp 40 ambitionierten Talenten skaliert er tagtäglich „Tomorrow's Unicorns“. Er und seine Kolleg*innen verstehen sich dabei nicht als klassische Agentur, sondern als High-Performance-Marketing-Department-as-a-Service.
