What is Demand Generation?

Dáire Summerville18 October 2023
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You've set sail with your business, and you know there's a treasure trove of potential customers out there. But how do you reach them in a vast, digital sea teeming with competitors? The answer lies in demand generation, a strategy that not only sets the course but also charts the path for your brand's success.

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Demand generation is a marketing strategy that builds awareness of and interest in your company's products and services. Typically, educational content is a large part of this approach.

Today we’re covering key topics for successful demand generation, starting with how it’s different from lead generation. Then, we’ll dive into:

  • Creating targeted content your ideal customers want to read

  • Marketing this content across multiple channels

  • Measuring your effectiveness

By the end of this article, you’ll know how to use demand generation in your sales and marketing efforts. This will help you build your brand awareness to get more leads and sales. But before we get ahead of ourselves, let’s start with a definition of what demand generation is.

Defining demand generation

Demand generation is the process of creating attention for and interest in your brand. This can include a variety of marketing activities like content, webinars, events, ads, and more. The goal is to introduce potential customers to your brand so you can later nurture them into leads and turn them into customers.

Demand generation is the top of the B2B marketing funnel where you cast a wide net—the first step in the journey towards converting prospects into loyal customers.

Demand generation vs. lead generation

Demand generation is different from lead generation and other marketing strategies. Lead generation is the process of building desire for your product in your target audience. It focuses on getting contact information for your leads, nurturing those leads, and converting them into customers.

“B2B demand generation is like the friendly handshake that introduces your business to the world. Lead generation is the one-to-one meeting that follows.”

Daire Summerville, Director of Growth & Product Marketing @Dealfront 

In today's GDPR-compliant world, demand generation isn’t just about casting a wide net. It's about doing it the right way and respecting data privacy, while reaching your target audience effectively. Then you nurture that demand and guide it through the marketing funnel until it comes out as a loyal customer. This is key to building a winning marketing strategy that brings the European market to your doorstep.

Let’s take a look at the components of demand generation to see how this works in practice.

The components of demand generation

You can boil down successful demand generation to four essential parts: 

  1. Target audience

  2. Content creation

  3. Multi-channel marketing

  4. Lead nurturing

Identifying your target audience

Defining your ICP is the foundation of effective demand generation. Your ICP is a detailed description of your ideal customer—who would benefit most from your products and services. Without a well-defined ICP, you’re likely to waste time and money trying to build interest in your company—in an audience that doesn’t want or need what you offer. 

With a well-defined ICP, you can create targeted, efficient marketing campaigns. Steps to building your ICP include:

  • Market Research: Conduct in-depth research to understand your industry and market dynamics.

  • Customer Segmentation: Identify common characteristics among your current customers.

  • Client Analysis: Examine your most profitable and satisfied clients to pinpoint shared traits.

  • Firmographic Criteria: Consider factors like company size, industry, location, and revenue.

  • Technographic Data: Assess the technology stack your ideal clients use.

  • Pain Points: Identify the challenges your product or service solves for them.

  • Competitive Landscape: Evaluate who your competitors are targeting and where gaps exist.

  • List Building: Use compliant B2B data to build lists of companies that match your ICP and get contact information for key decision-makers.

Next, you’ll want to create detailed buyer personas, the individual decision makers within your target companies. Buyer personas breathe life into your ICP.

For example, let’s say you're selling B2B software solutions in Europe. Your ICP might consist of mid-sized European companies in the logistics sector. But within these companies, you'll encounter various roles, such as IT managers, CTOs, or procurement officers. Each of these personas has unique pain points, motivations, and challenges.

Create detailed buyer personas for these roles to tailor your marketing messages, content, and strategies to resonate with them on a personal level. Follow these steps to build your buyer personas:

9 steps to build your buyer personas

Content creation and marketing strategy

Valuable, relevant content makes your target audience feel that you thoroughly understand their pain points and what they need. This is why 56% of marketers say targeted content is the most essential strategic element of a successful lead nurturing program.

Create content that speaks directly to their pain points in clear, accessible language. For example, what if your buyer persona is a tech recruiter who has to spend hours every day wading through resumes and weeding out unqualified candidates? You could create content that discusses how to use artificial intelligence (AI) and automation in the recruitment process, including chatbot interviews.

Once you've crafted compelling content, the next step is distribution. Your distribution strategy should align with where your target audience spends their time online.

Multi-channel marketing

One thing that sets successful B2B marketing strategies apart is an omnichannel approach. The cohesive orchestration of these channels creates a consistent and seamless customer journey. An omnichannel strategy recognizes that your audience may interact with your brand through various touchpoints. And provides a unified and coherent experience across all of them.

Some ideas for distribution channels include:

Common Distribution Channels

One thing that sets successful B2B marketing strategies apart is an omnichannel approach. The cohesive orchestration of these channels creates a consistent and seamless customer journey. An omnichannel strategy recognizes that your audience may interact with your brand through various touchpoints. And provides a unified and coherent experience across all of them.

Lead nurturing

To nurture leads, prioritize personalized communication, active listening, and consistently delivering value to your audience. One powerful tool for nurturing these relationships is marketing automation. It enables businesses to streamline and personalize their interactions with leads at scale.

With marketing automation, you can send targeted emails, provide relevant content, and track lead behavior to tailor your messaging. This saves time and ensures that your leads receive the right message at the right time, making the most of your demand-generation strategies.

Demand generation strategies

Let’s take a look at some of the fundamentals of different B2B demand generation tactics and strategies. You can broadly split demand generation into inbound and outbound strategies, and account-based marketing is a powerful strategy you don’t want to overlook.

Inbound vs. outbound strategies

Outbound vs. Inbound Strategies

An inbound demand generation strategy focuses on creating valuable and relevant content that draws prospects to your brand naturally. It positions your business as a thought leader and addresses the pain points of your target audience through blog posts, ebooks, webinars, and social media. You make your website findable through search engine optimization (SEO) and use content marketing to attract organic traffic and nurture leads through their buying journey.

Inbound is like a magnet, pulling in prospects who are genuinely interested in your offerings.

By contrast, outbound demand generation involves reaching out to potential customers directly. This includes strategies like cold calling, email marketing, and targeted advertising. Outbound is proactive, as it initiates contact with prospects who may not be familiar with your brand. It identifies and pursues potential leads through various outreach methods like personalized emails or social media advertising.

Outbound is like fishing, casting your line into a stream where you know your ideal buyers are.

SEO and SEM in demand generation

Organic demand-generation strategies are non-paid methods like content creation and SEO to naturally attract and engage with an audience. Paid strategies involve allocating a budget for advertising and promotional efforts, including pay-per-click campaigns and sponsored content.

Organic efforts, like compelling content and SEO, lay a strong foundation by naturally attracting interested prospects. Simultaneously, paid strategies, such as targeted advertising, extend your reach to potential clients who may not have discovered your brand otherwise. Ideally, you use both methods simultaneously.

SEO best practices include:

  • Performing thorough keyword research to understand your target audience's search behavior.

  • Creating high-quality, relevant content that aligns with your chosen keywords.

  • Optimizing on-page elements, including title tags, meta descriptions, and headers, with your target keywords.

  • Ensuring your website is mobile-friendly and fast-loading for a better user experience.

  • Building a network of high-quality backlinks from reputable websites in your industry.

  • Update and refresh your content regularly to maintain relevance and improve rankings.

  • Using schema markup to provide search engines with structured data about your content.

  • Focusing on user engagement metrics like bounce rate and pageviews.

  • Staying up-to-date with SEO trends and algorithm updates to adapt your strategy accordingly.

Social media and community building

Using social platforms for demand generation marketing is a low-cost (often free) way to connect with your target audience, share valuable content, and build brand recognition. Use platforms like LinkedIn, Twitter, and Facebook to create a steady stream of organic traffic and engage potential clients.

For example, you can set up an AI chatbot in your social media DMs to nurture leads and ensure you don’t lose any opportunities. Or you can practice social listening, where you monitor social media for mentions of your brand or industry to see what people are talking about. Another idea is sharing your own content on social media, and commenting on content your leads have shared.

Another compelling approach is building online communities to foster engagement. These communities provide a dedicated space for your audience to interact, ask questions, and share insights related to your industry. Platforms like Slack, Reddit, or even a private forum on your website can serve as hubs for meaningful discussions and relationship-building.

Community Building

Cultivating these communities can help establish your brand as a trusted authority and facilitate word-of-mouth referrals.

Account-based marketing

ABM is a highly targeted marketing approach that aligns perfectly with demand generation. Instead of casting a wide net to capture leads, ABM focuses on identifying and nurturing relationships with specific high-value accounts or businesses that are an ideal fit for your product or service.

ABM aligns with demand generation by ensuring that the efforts put into generating demand are concentrated on the most promising prospects. It emphasizes personalization, tailoring content and messaging to resonate with individual accounts. Thus, increasing the chances of conversion. RollsWorks found that 68% of small and medium-sized businesses achieved shorter sales cycles with ABM.

One company's ABM campaign generated a 41% close rate for the company. It accomplished this by serving ads to an account as soon as a sales development representative (SDR) began working that account. Each SDR had a personalized landing page with the SDR's photo and a personal message.

After a prospect visited the landing page, they received matching retargeting ads so the prospect saw the SDR everywhere. Clicking the ad took the prospect to a personalized landing page to book a call. After a call, if a prospect had stalled for 35 days, the company sent them physical direct mail to push them over the finish line.

Now that you have some ideas for demand generation, how do you measure and analyze your campaigns?

Measuring and analyzing your demand generation success

Measuring and analyzing your demand generation campaigns will help you see which are effective and where you need to make improvements. First, you’ll need the right metrics to track.

Key performance indicators (KPIs) for demand generation

Key performance indicators (KPIs) for demand generation are vital in gauging the effectiveness of your B2B marketing efforts. Metrics like marketing qualified leads track the number of prospects showing genuine interest in your offerings.

Sales qualified leads are leads the sales team has qualified as having a high level of interest in your product or service. A sales conversion rate is the percentage of prospects who bought your offer after interacting with the sales pitch.

Other crucial KPIs include cost per acquisition, which evaluates the efficiency of your marketing spend. And customer lifetime value, assessing the long-term value generated from demand generation efforts.

The role of marketing analytics tools

Marketing teams can use tools like Google Analytics, customer relationship management (CRM) systems, and marketing automation platforms to get greater returns from their campaigns.

Google Analytics provides valuable insights into website traffic, user behavior, and conversion rates. Marketers can use this data to identify high-performing content, understand audience demographics, and refine their digital marketing efforts accordingly.

CRM systems allow teams to manage customer relationships effectively. They provide a centralized database of customer information, enabling personalized communication and targeted marketing campaigns. This fosters better customer relationships and helps identify upsell and cross-sell opportunities.

Marketing automation platforms streamline repetitive tasks, such as email marketing and lead nurturing, freeing up time for strategic planning. These enable personalized and timely communication with leads and customers to increase engagement and conversion rates.

Integrate these demand-generation tools into your marketing efforts to get the most possible out of your marketing campaigns.

Continuous optimization

Data-based strategies rely on using data and analytics to make informed decisions at every stage of the customer journey. A/B testing and iteration play a pivotal role in this process. 

A/B testing involves creating two or more versions of a marketing asset—such as an email or landing page—and comparing their performance to determine which resonates better with the audience. This iterative approach allows marketers to continually refine their strategies, optimizing for higher conversion rates, better engagement, and increased return on investment (ROI).

Even with the best KPIs, tools, and testing, however, you’ll inevitably run into challenges.

Common B2B demand generation challenges

B2B demand generation comes with its set of challenges that marketers need to navigate effectively to achieve success.

What are the challenges?

Generating high-quality leads is an evergreen challenge in B2B sales and marketing. Many businesses struggle to attract prospects who are genuinely interested in their offerings. It's crucial to align marketing efforts with a well-defined ICP and create content that speaks to the specific needs and pain points of this audience.

Another common challenge is data accuracy. As databases grow, data can become outdated or inaccurate, leading to wasted efforts on irrelevant leads. Regularly cleansing and updating data is essential to ensure marketing campaigns reach the right audience.

Lastly, adapting to evolving tech and trends is an ongoing challenge. Staying current involves regularly evaluating and adopting new tools and tactics. Examples include AI-powered marketing automation and embracing emerging social media platforms, in order to stay competitive.

B2B Demand Gen Challenges vs. Solutions

What are the solutions?

Some key solutions to these challenges are improving lead quality, following data-management best practices, and staying up-to-date with industry changes.

To improve lead quality, implement lead scoring and nurturing processes to focus your attention on prospects showing genuine interest, and ensure valuable resources go to high-potential leads. Dealfront Datacare plays a crucial role here, enhancing data quality within CRM systems to pinpoint the most promising leads accurately.

Effective data management involves following data-management best practices like regular data cleansing and updating to keep contact information accurate and relevant.

Finally, stay updated with industry changes by doing things like reading industry-specific news websites, magazines, and newsletters. You can also join industry forums and participate in discussions there, as well as attend conferences and trade shows.

These solutions will help your demand-generation strategy stay sharp and growth-oriented.

Maintain accurate company data painlessly

Check, cleanse, enrich, and optimize company data and qualifiers from your sales databases and CRM systems.

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Demand generation for growth

In this exploration of demand generation, we've uncovered the essentials for kindling interest and desire in your products and services. We started with the crucial tasks of pinpointing your target audience, sculpting a persona that resonates, and ensuring your message aligns with their needs. We also covered distribution to ensure you put your content out where your target audience is most likely to see it. And, perhaps most importantly, we learned about nurturing the leads your demand generation yields.

Demand generation is essential. It helps you target the right people, foster relationships with them, and deliver your valuable solutions to them. It helps you acquire leads as well as build a strong customer base that keeps driving revenue over time.