There are four demand generation strategies organizations can choose from when building a pipeline of qualified opportunities with a high propensity to become closed deals that should be part of any demand generation plan.
Unfortunately, all too often, companies set themselves up to fail from the start. In many scenarios, “the plan” starts with a list of tradeshows to attend, sprinkled in with some webcasts, a few white papers, some syndication, an update to the LinkedIn page, some blog posts and, to top it off, a few tweets. While some or all of these tactics may be appropriate, we need to go back to Tom Peters’ basics: strategy, structure, staff, systems and process — and embrace these basics when crafting a marketing plan.
Any useful marketing plan must be integrated into the objectives of the organization as a whole. There will be certain organizational objectives that Marketing can own or support, and those should be developed in a cascading manner. In almost every case, revenue will be a key objective so it is critical for the organization’s CEOs and CFOs to understand that the marketing function is directly correlated to revenue.
Once that is understood, the question becomes how Marketing will generate revenue.
First, it is paramount for the organization (including Marketing) to understand that generating leads (hate that term as it has become meaningless) is only the first step in the demand generation process. Marketing cannot claim success at merely generating leads. Marketing can only claim success when qualified opportunities are created in the sales pipeline and those qualified opportunities result in closed/won deals. For this to occur, Marketing has to own lead management — where leads are converted to qualified opportunities. To get the process started on the right foot, it is very important for Marketing to set up the first meeting. Otherwise, separating this function neuters Marketing and in the end, will typically result in a great deal of finger pointing between Sales and Marketing.
So, how will an organization efficiently and effectively build a qualified pipeline of opportunities to drive the growth requirements of the business? In short, an organization must adopt one or a combination of four demand generation strategies. These four most common demand generation strategies are outlined below.
Typically, whether they know it or not, organizations pursue a demand generation strategy based on “chase.” The Chase Strategy centers on identifying the target market and creating a profile of the type of companies and individuals with a high propensity to purchase the organization’s solution. In short, the strategy centers on building a database of potential contacts (companies and individuals) and then leveraging various demand generation vehicles to stimulate qualified individuals for marketing and or sales to follow-up with. If there is a target account selling model in place then there will be a few accounts and account intelligence plays a much bigger role in the demand generation process.
Pros: Demand Generation Chase Strategy
If an organization truly understands the target market, target buyer and successfully builds a database of companies and contacts, then it is similar to fishing in a barrel. Done well, an organization creates a very homogeneous market segment which provides great focus for the organization. Constructing a buyer behavior model that accurately resembles the buying process is crucial–this is not simply creating a persona.
Cons: Demand Generation Chase Strategy
For the Chase Strategy to work, an organization has to understand what they have to offer and to whom this solution is of value. The organization must also clearly understand what specific use cases this offering is best suited to solve. Unfortunately, many companies cannot crisply and clearly articulate answers to these questions, and when that is the case, this strategy is doomed. The issue is going to be whether the organization can build relevant and compelling content and leverage the right combination of demand generation vehicles to seek out real opportunities. If an organization can ‘t construct a detailed Target Account Profile, this approach will be similar to trying to find a needle in a hay stack or as we say, turning over rocks.
Demand Generation — Co-Create Strategy
The second demand generation strategy is the Co-Create Strategy. This is when organizations leverage other people’s brand recognition and/or relationships. Typically, an organization will have a strategic relationship with a partner and together will build a marketing plan that leverages the partner. This can be very valuable as the marketing budget can potentially be doubled if the partner is willing to put up a dollar for every dollar the organization invests in demand generation. In the worst case, the organization’s demand generation dollars will be much more effective when spent with a partner as the partner should have better brand recognition, a more mature marketing function and an established path to the desired target market.
Co-creation can be taken to another level when an organization seeks out a market thought leader or influencer and establishes a relationship, ideally exclusive for some period of time. The basic premise is that this person has established their brand positively in the eyes of the target audience and that by associating with this thought leader, that this positive image transfers to your brand.
Pros: Demand Generation – Co-Create Strategy
An organization has the ability to tap into pre-existing and positive relationships with their target audiences which would otherwise take considerable investments in both dollars and time to establish. Finding and gaining access to the organization’s target market should be expedited.
Cons: Demand Generation – Co-Create Strategy
This approach assumes that a “good partner” has been selected and that the two companies work well together. Often when a small company seeks out a large company the politics and bureaucratic red tape smothers the relationship. Or, a partner may not have the organization’s best interests at heart and is focused on the quantity of partnerships versus the quality of partnerships.
Also, the relationship may not be exclusive which will dilute the value of the relationship as prospects may be confused. Or, this may discount the relationship or cause prospects to consider the other organization when considering yours. The relationship has to be a healthy one and it cannot consist of only doing a one-off executive event. As such, the investment must consist of people, time and dollars and be sustained.
Demand Generation – Drawn Strategy
With the third strategy, the Dome Strategy, the basic idea is that the knowledge and content that the organization provides is so valuable that it attracts or draws in the sought-after community of companies and individuals. In short, the focus is to build a relationship with individuals based on market, industry, and competitive knowledge of an organization’s specific business problems. In doing so, a level of trust and respect is created, allowing the organization to bridge in potential solutions to solve the prospect’s business problem—when the time is right.
Pros: Demand Generation – Drawn Strategy
If done correctly, the organization will have such a command of the market, industry and competitive forces (the target organization’s competitors) that it becomes a trusted advisor, in the eyes of prospects. As such, this requires a deep understanding of business problems, business acumen, workflows and a mind-set that approaches problems from a unique perspective. The organization will help educate a business on how to look at business problems in a way that they have not looked at those problems before. This will open up the doors to proposing solutions that have not been as yet been considered–creating value.
Cons: Demand Generation – Drawn Strategy
The foundation of this approach is knowledge—current knowledge. It requires a constant monitoring of the market, technology, competitor’s workflows and companies to bring insights to bear. A market intelligence and sales enablement function are critical to create knowledge that can be shared externally and to transfer knowledge internally.
Further, an organization that embraces a Drawn strategy has to be very disciplined. Understanding a prospect’s business and sharing insights has to remain center stage. The organization will have to be disciplined to refrain from introducing the solution to the prospect until the prospect requests insights into approaches and available technology to solve their business problem. If the organization jumps the gun and introduces technology too quickly before all the hooks are set, a lot of time and effort will have been invested that competitors will benefit from.
Demand Generation – Community Strategy
The Community Strategy is similar to the Drawn Strategy in the sense that the approach is to establish a relationship based on knowledge of markets, industries, business problems and competitors. However, rather than the company creating all the content, the focus is to embrace the relevant community and harness the collective knowledge of the peer network to provide insights to like minds.
The primary focus is to educate the marketplace with stimulating content. Subtle hooks can be used in and around that content to engage with individuals. The idea is to work from the premise that where there is smoke there is fire. The community will tip your organization off with identifying where the smoke is located (a specific company and physical location or a particular individual). Then, a direct or indirect approach can be taken to find the fire—i.e. the parties interested in the topic at hand.
Pros: Demand Generation – Community Strategy
In this scenario, the creation of content is not all on the organization’s back as the amount, variety and currency of the content will be immense. The followers of the community contributors may follow and the brand value from those contributors may transfer to your organization.
Con’s: Demand Generation – Community Strategy
Because the community is contributing, it may become a challenge to manage and monitor all of the contributors. At the end of the day, this community reflects on the organization’s brand — the last thing one wants are spammers or weak content to proliferate the site and reflect negatively on the organization’s brand.
In today’s competitive global market place where prospects are seeking out vendors before vendors are even aware of it. Organizations must be smart and embrace intelligent demand generation strategies. This includes sculpting a detailed target market, a buyer behavior model, personas, a target account profile, a journey board, a qualification matrix and a detailed demand management process. Organizations that do not embrace this mentality will suffer through poor ROI, a weak pipeline, sales and marketing conflict and ultimately the replacement of the head of Marketing.