The average amount spent by businesses on marketing in 2018 was 7.9% of their revenues.
With increasing competition, especially in online marketing, that amount has surely only grown. Between this competition and so much of your revenue going towards your marketing budget, you need to be sure you’re being as efficient as possible.
One way to do this is to focus on demand generation. But what is demand generation? And why is it important?
In this post, we’ll go over what demand generation is and how it can benefit your business.
Keep reading to learn more.
What Is Demand Generation
Demand generation is a marketing strategy focused on generating demand for your product or service by producing targeted content. This content should focus on helping to raise awareness for your brand, beginning to build a reputation for your company and trust with your customers, and identifying what problem of the customers you’re addressing and how you can fix it.
This content is all relevant and targeted towards the first stage in the sale funnel, awareness. To get more customers, they have to know you exist in the first place. This is why these marketing materials aren’t designed for conversion, but rather for education.
This education then helps to generate what are called marketing qualified leads or MQLs. These leads then get passed on to the sales team for them to work on moving the potential customer even further down the sales funnel.
This is often used interchangeably with lead generation but while similar, demand and lead generation aren’t the same thing. Demand generation is used at the beginning of the sales funnel to increase awareness. On the other hand, lead generation is aimed more at converting prospects that are already aware of the company and brand.
Demand generation is especially helpful if you’re in a newer industry or offer a product that isn’t widely known yet. This allows you to introduce the world to your brand and teach them why they need it.
That, however, is only one of the benefits.
Builds Brand Awareness
As already touched on, one of the main purposes of demand generation marketing is to increase brand awareness. It’s also one of its major benefits.
The purpose of brand awareness is to help your company to become more well-known and respected. The end goal being that your brand becomes synonymous with your product. An example of this is Band-Aid. Band-Aid is actually the name of the brand, not the product, but they’re almost always used interchangeably at this point.
By increasing your brand awareness you will have an easier time expanding your customer base, as well as keeping the customers you already have. Companies with a strong brand and high awareness are seen as being experts in their field and are associated with higher quality. This means customers will be more loyal to you, and will even be willing to pay a higher price due to the higher perceived quality.
Produces Higher Quality Leads
When you focus on demand generation vs lead generation you will create more specific, targeted content. While this content may not reach as many people overall as less specific content would, it will reach the right people who are more likely to actually become customers.
Getting better quality leads to pass to the sales team helps to reduce the cost of acquiring a customer since more of these leads will convert. This saves you wasted time and resources, and it shortens the sales cycle since the customer will have already learned about the product or service you’re offering.
Gives Direction to Marketing Efforts
There are so many different things to try when you’re creating a marketing plan so it’s easy for your marketing team to get off track.
By focusing on demand generation they will have a much better idea of what specifically needs to be done and what kind of content they should be producing. This helps your team to be more efficient and effective, which saves you valuable resources.
It will also make sure that everyone is on the same page and help the team to set and measure progress toward their goals. Being clear on what the goals are allows your team to determine which metrics to measure success by.
By monitoring these chosen key performance indicators (KPIs), they can track the success of the different types of content they have created. This provides invaluable data that can help to improve their demand generation efforts in the future.
A big part of demand generation is creating content. You need this content to help educate your market and the world about your brand.
Creating more, targeted content is a benefit in itself. The content you’re putting out will allow you to communicate with many people all at once and answer any questions they may ask. It also lets you anticipate what questions or concerns they may have in the future so you can produce content that addresses that now.
If you are creating content that is properly optimized using SEO or search engine optimization, it can help your ranking on search engines like Google where most people do their research. By increasing your ranking you will naturally reach more people and generate more demand without having to use more of the budget.
Additionally, the more content you have and the more time people spend on your website interacting with it, the more Google will think you’re an expert and again increase your ranking.
Create Your Demand Generation Strategy Today
Demand generation is a good way to focus your marketing and help to make it as successful as possible. This can save you time and money and can also help to take your business to the next level.
If you want help with attracting more customers and growing your business, contact us today!