Businesses that want to establish lasting trust and sustainable scale invest in demand generation. This is an integrated, data-driven tactic used to induce interest and build brand recognition. Demand generation has a future-focused perspective that sees marketers and sales representatives cooperate to attract attention for a brand within a respective industry. The out-market consists of about 95% of potential buyers who do not know about the product or service offered. Yet, many businesses make the mistake of competing for the 5% in-market customers who are aware of the product. Demand generation pushes businesses to look beyond the saturated market limitations and leverage the larger, less saturated, out-market’s interests. Instead of fighting over the 5%, businesses can target new customers with unique touchpoints. This approach to generating demand lays the foundation for future lead generation. Continue reading to discover how to use demand generation as a key to scale faster and make a return on investment. Reaching the out-market is vital for companies looking to sustain growth and competitiveness. The following points will help businesses create an action strategy to attract customers while simultaneously measuring progress through relevant performance indicators.
The Demand Generation Strategy In Action
Create and Understand the Ideal Customer Profile
Any demand generation strategy begins by clearly defining the ideal customer. A customer profile specifies the businesses or potential customers suitable for the product or service offered. At this stage, the strategy involves documenting who the target buyers are and their buying intent. A defined buyer profile gives marketers and sales representatives direction on which relevant leads to follow in the future. Identifying the ideal customer sets the stage for successful lead generation down the line, as it reduces inefficiencies and promotes higher conversion rates. A clear picture of the buyer ensures an effective use of resources during sales and cohesive messaging during marketing.
Some considerations when documenting the ideal customer are:
Highlighting who the best buyers are within the industry, including company titles and sizes.
Addressing buyer difficulties and how the business (or product) can solve them.
Clarifying the message and how it aligns with the ideal buyer.
Detailing the marketing channels that potential customers are likely to use to access brand information, including business blogs and social media.
Emphasizing the reasons why future customers would choose this specific product and business over competitor products.
Establish Trust With Future Buyers
It may sound counterintuitive to start building confidence with buyers that do not exist yet, but planning ahead is how businesses win. Establishing trust with future buyers involves consistent brand exposure and engagement. When valuable content is repeatedly shared with potential customers, it creates an environment of familiarity. Buyers begin to trust the product or service before purchasing it simply because of the association.
Another way to facilitate trust is to offer non-sales-driven content that gives value to audiences. For example, Grammarly has a basic or free package offer that allows ideal buyers to use the service before committing to a subscription. A function like Grammarly’s helps the business establish trust and cement its position as a worthwhile tool for work. Confidence-building ensures ideal customers become aware of the product, making them more likely to buy in.
Consistently Share Content
Advertising the product consistently maintains the pre-established trust. It also reaches out-of-market buyers who may not have previously known about the business. Marketers can distribute content through many channels, including paid adverts and newsletters. Similarly, the sales team can use fewer distribution channels, such as emails, calls, and texts, to spread the message. The account-based marketing method is another way to share content. It focuses on creating campaigns that prioritize the ideal buyer, which is effective in demand generation. Account-based marketing is known to improve relationships between customers and businesses by 74% and increase brand credibility by a further 84%. The success of account-based campaigns depends on a company’s ability to have sales and marketing teams collaborate. Each sales and marketing member should work toward satisfying shared revenue targets and leveraging the buyer profile to win the attention of high-priority accounts. With the demand generation strategy in motion, businesses should have measures in place to indicate progress and performance.
Demand Generation Performance Indicators
The key performance indicators for demand generation measure how well the objectives to incite interest and build trust have been carried out. Metrics used to measure demand generation performance are listed under the following headings.
Leads and qualification
Marketing qualified leads is a performance indicator that conveys the interest potential customers show through their actions, such as downloading newsletters and the time spent browsing the website.
Sales-qualified leads and sales-accepted leads are crucial for tracking demand generation efforts.
Acquisition expenses
Cost per lead measures the amount spent in the process of creating product awareness.
Cost per acquisition refers to everything in cost per lead, including extra expenses used to convert initial interest into customer loyalty.
Lifetime value
Customer lifetime value is a metric that reflects the total revenue generated from each customer for the time they demonstrate brand loyalty. The buyer-business relationship is valuable and hugely influences profitability.
Investment returns
Return on investment is used to measure the generated net profit or loss percentages from marketing activities.
Cost per acquisition assesses the costs incurred with each acquisition. It processes expenses from marketing, sales, and other departments where costs are incurred.
Pipeline and Participation
The number of activations is a metric that tracks initial customer interest in a product or service. It includes tracking how often potential buyers have clicked on promotional links, created accounts, or engaged with content at all.
Conversion rates per channel emphasize the percentage of leads converted to paying customers.
Performance from sales
The average deal size indicates the value of each sale, generally considering revenue made from one transaction at a time.
Revenue underpinnings
Total revenue contribution is an indicator businesses use to examine different revenue sources, so managers are aware of which channels to invest more in down the line.
Final Takeaways
Businesses can leverage demand generation to attract customer interest in the products or services on offer. To get the best results from this strategy, it is crucial to develop a plan that prioritizes the ideal customer profile. A business that knows its target market and the needs thereof sets itself up for success. It is also central to demand generation to establish trust with future customers through consistent communication and creating a baseline for connection. With the demand generation performance indicators at the forefront, businesses can track revenue, sales, and marketing performance, as well as the total growth contribution of the strategy.
