Don’t Duct Tape Your Demand Generation Right Now: Adopt a Strategic Approach to Demand Marketing
The crisis that’s emerged from the coronavirus pandemic has forced B2B marketing teams to look at their demand programs in a new light, and an ugly truth has emerged. Most B2B companies have inefficient sales and marketing motions. In fact, nearly three-quarters of businesses in this segment succeed because they have a strong product or service. They succeed ‘in spite of’ their sales and marketing investments, not because of them – spending much of their time and resources on ‘random acts of marketing.’
According to a Demand Gen Report, this was echoed by a recent CMO Council report that found:
- Just 12% of marketers believe their content marketing programs target the right audiences with relevant and persuasive content
- Only 21% said they are aligned with their sales counterparts in developing and measuring demand generation programs
It’s fair to say that traditional, tactical demand generation activities have led to a state where we fail more than we succeed at meaningfully connecting with (and converting) prospects and customers. And our current marketing technology landscape – one where thousands of marketing technology companies (actually 7,040, to be exact) claim that their product can fix your demand marketing ills – only makes it worse.
We can quantify how much we ‘fail’ more than succeed with tactical demand generation because the numbers don’t lie. According to SiriusDecisions, the typical lead-to-revenue conversion rate ranges from 0.375%-0.6%, depending on the type of market. That’s a lot of wasted investment. That’s a lot of ‘wrong place, wrong time’ programs.
Add in the type of global crisis we’re facing today and the challenge of generating sustainable, repeatable, predictable demand has increased exponentially. As my colleague, Scott Parent, noted in a blog post last week:
Business leaders and marketing and sales teams are struggling now, more than ever, to not only drive new demand, but to replace the loss of existing demand in the marketplace. And for many B2B companies, they are struggling to do so without live interactions, especially events.
Unfortunately, this environment had led to companies rushing to quickly redo their demand programs hoping for success. But given changing dynamics in the marketplace, it’s more critical than ever to make the shift from a tactical demand generation mindset to what we refer to at ANNUITAS as a Strategic Demand Marketing approach. We define this shift in a white paper, “Making the Critical Shift from Tactical Demand Generation to Strategic Demand Marketing”:
The core of tactical demand generation is optimizing a single sale. It can’t find a repeatable, sustainable model to generate demand and so tactical marketing continues to be a cost-center, often with negative ROI. It’s periodic, short-term, outbound oriented, and vendor pushed. When tactical campaigns end, demand ends.
Shifting to strategic demand opens a world of opportunity. Strategic demand is always on, repeatable, buyer-led, and inbound oriented. It engages the buyer continuously and offers a sale only when appropriate, thus increasing the quality of qualified leads to sales and pre-conditioning the buyer dialogue. Strategic demand puts the buyer at the center of everything and increases customer lifetime value in the process.
So Why Is Strategic Demand Marketing More Critical Than Ever?
What has changed? What are the dynamics of this ‘new normal’? Instead of duct taping together a new marketing plan, take the time to really think about how a Strategic Demand Marketing approach can help.
Here are five major considerations:
1. Demand is substantially harder to come by and now, more than ever, it’s key to build demand marketing around customer journey.
Spending has fallen off a cliff; that is clear. But what does that mean from a demand marketing standpoint? It means it is harder than ever to be in the right place at the right time. Which means that random acts of marketing are going to be more costly and less effective than ever. A shift to putting the customer journey at the center of our efforts – and building 360-degree, closed-loop insights and triggers around this journey, is key. It’s also more critical than ever to get the mix right – especially in an environment where live events are not an option – making digital journeys more important. Understanding this new buyer/customer journey, and adapting demand marketing programs around a critical path is vital to increasing the likelihood that you ‘will’ be right-place, right-time – i.e., in the rare moment that demand does evidence, you will be there to seize the opportunity.
2. Journeys are becoming longer and more non-linear than ever. Tracking, nurturing, and continuity of the conversation is key.
The most frequent B2B buying decision right now is to ‘not’ make a decision, or just to reduce expenditures across the board. Buyers/customers will spend more time considering, researching, hand-wringing … and likely will go several rounds on every purchase decision. What does that mean from a demand marketing standpoint? It’s more critical than ever that we are able to track this journey – this progression – and keep it in view. We must nurture for longer periods of time, and keep close tabs on the stage that buyers/customers are at in their journeys. And we have to better orchestrate a variety of interactions – possibly across multiple stops and starts – maintaining a consistent, end-to-end conversation.
3. Authenticity matters and we must build relationships.
B2B customers are being very thoughtful in their current decisions, and are carefully considering the impact of their decisions not only on their employees and shareholders, but also on their partners and vendors. Given the scope of challenges in the marketplace, customers value the authenticity and care of those they do business with. This means demand marketing – more than ever – cannot be about product/service push, nor can it be self-promotional. The focus must be on supporting diverse buyer/customer needs in their journey – particularly meeting key information needs at each stage. There cannot be gaps; organizations cannot create too much helpful content at this stage. Customer experience is also a critical aspect – more than ever because it paints a picture of the type of organization a customer is considering doing business with.
4. Status quo marketing and sales inefficiency is inadequate. We have to improve lead-to-revenue efficiency.
Countless marketing and sales organizations today are being asked to do more with less – to drive more demand and sales with less resources. Companies simply have less to spend, and that means that the inefficient, status quo ‘mass’ approach to demand marketing – which we highlighted above – for many companies simply will not fly. Shifting the overall model is not merely about being in the right place at the right time, but it also is about substantially increasing the state of productivity and effectiveness that occurs when an organization makes the shift to a Strategic Demand approach.
5. Demand cannot be short term so your demand engine must be perpetual and sustainable.
There are no short-term fixes for demand in the current environment. While companies are considering pivots in their products and solutions – to stay relevant – the truth is that driving new demand will require more foundational steps and a longer runway. And that means the focus of improving go-to-market must be on building a true perpetual, sustainable engine – so that demand becomes an annuity for companies longer-term.
How Can You Transform Your Demand Marketing?
Clearly the shift to a Strategic Demand approach is more critical than ever. But how do you drive this transformation?
We’ve covered taking this step – which at ANNUITAS we refer to as Digital Demand Transformation – in a number of past blog posts and whitepapers.
Below are some key resources to frame your next steps towards a Strategic Demand Marketing approach:
- Digital Demand Transformation: The Path to Strategic Demand Marketing
- The Case for Rapid — Not Gradual — Digital Demand Transformation
- Taking a Phased Approach to Digital Demand Transformation
Regardless of how you get there, it’s clear in the current environment that this move is critical – both to rapidly respond to the new normal, but also to build a longer-term foundation for more effective go-to-market operations that place our buyer/customer at the center. And it is in this way that a shift to a Strategic Demand approach represents not only a response to the current environment, but also a foundation for next generation growth marketing.