What Is Demand Generation: The Definitive Guide for Marketers

| Updated on March 22, 2024

Demand generation is a data-driven process for creating and nurturing sales-ready leads. By aligning marketing activities with the buyer’s journey, demand generation marketers can better understand and predict when a lead is ready to buy.

Demand generation works best when done through an integrated tech stack because it provides the data and analytics necessary to track, measure, and optimize marketing programs. Additionally, a demand generation platform can automate many of the tasks associated with lead management, making it easier for marketers to scale their programs.

But what is demand gen, exactly? Let’s break down the fundamentals.

Fundamentals of Demand Generation

Demand generation encompasses every single touchpoint of a lead’s journey, from the very first time they hear about your brand to when they eventually become a customer. It consists of:

  • Brand awareness
  • Inbound marketing
  • Sales enablement
  • Customer retention

Brand Awareness

The first stage of the buyer’s journey is awareness. In this stage, the lead is just becoming aware of their problem or need. They don’t yet know that your brand exists, but they are starting to search for a solution.

Demand generation is critical at this stage because it’s the first opportunity to introduce your brand to a new potential customer. If done correctly, you can begin to build trust and establish yourself as a thought leader in your industry.

There are a few ways to do this:

  • Thought Leadership: Publish blog posts, whitepapers, ebooks, and other resources that educate your target audience on their problem or need.
  • Social Media: Use social media to share your thought leadership content and build relationships with potential customers.
  • PR Management: Proactively manage your brand’s reputation by monitoring online conversations and responding to any negative sentiment.
  • Creating a GTM Strategy: Your go-to-market strategy is the blueprint for your demand generation efforts. It outlines your target market, ideal customer profile, buyer persona, messaging, and more.

Inbound Marketing

Inbound marketing is the process of attracting, engaging, and converting strangers into leads and customers. It’s a more modern marketing approach focused on providing value at every stage of the buyer’s journey.

Inbound marketing is effective because it aligns with how people actually buy today. With so much information available online, buyers are no longer relying on salespeople to educate them on their options. Instead, they are doing their own research and self-selecting the brands they want to do business with.

Inbound marketing and demand generation are often considered to be the same—and while they are similar, there is a key distinction. Inbound marketing is one component of demand generation. It’s the top-of-funnel, lead-focused activity that happens before a lead is sales-ready.

Some common inbound marketing tactics include:

  • Blogging: Publish blog posts that educate your target audience on their problem or need.
  • SEO: Optimize your website and content for search engines so you can be found by people who are searching for what you offer.
  • Gated Content: Offer valuable resources, like ebooks and whitepapers, in exchange for contact information.
  • Social Media: Use social media to share your blog posts and build relationships with potential customers.
  • Paid Ads: Run paid ads on search engines and social media to reach more people with your message.
  • Chatbots and Conversational Commerce: Use chatbots to engage with leads in real-time and answer their questions.

Sales Enablement

Sales enablement is a method of equipping salespeople with the resources they need to become successful. This includes training, content, tools, processes, and more.

Demand generation and sales enablement go hand-in-hand because demand gen is responsible for generating the leads that sales will ultimately convert into customers. Without demand generation, there would be no leads to follow up with.

Some common sales enablement activities include:

  • Lead Scoring: Rate and prioritize leads so sales knows which ones to focus on first.
  • Lead Nurturing: Send targeted content and messages to leads over time to build relationships and trust.
  • Whitepapers: Write helpful resources that educate leads on their problem or need.
  • Testimonials and Case Studies: Share stories of how you’ve helped other customers solve their problems.
  • Fact Sheets and FAQs: Provide detailed information about your product or service.
  • Product Demos: Give potential customers a tour of your product so they can see how it works.
  • Pricing Calculators: Help leads calculate the cost of your product or service.
  • ROI Calculators: Show leads how much they can expect to gain by investing in your solution.

Customer Retention

Customer retention is the process of keeping your customers happy and engaged so they continue to do business with you.

Happy customers are essential for any business, but they’re especially important for companies that rely on recurring revenue.

Some common customer retention activities include:

  • Onboarding: Help new customers get started with your product or service and set them up for success.
  • Training and Education: Provide resources that teach customers how to use your product or service.
  • Net Promoter Score (NPS) Surveys: Measure customer satisfaction and identify areas for improvement.
  • Events and Webinars: Host events where customers can learn more about your product or service.

Demand Generation vs. Lead Generation

In the world of marketing, the terms demand generation and lead generation are often used interchangeably. However, there is a key distinction between the two concepts.

Lead generation refers to the process of generating interest in a product or service, while demand generation focuses on creating a need or desire for a particular offering. Simply put, demand generation is about making people want what you have to offer, while lead generation is about getting people to raise their hands and say they’re interested.

While both concepts are important for driving sales, demand generation is typically seen as more important for long-term success. That’s because customers who are actively engaged with a brand are more likely to become loyal advocates and repeat buyers.

In contrast, customers who simply express interest in a product or service are more likely to forget about it or be swayed by a competitor. As a result, businesses should focus on demand generation strategies that create an emotional connection with potential customers. Only then can they hope to turn leads into lifelong fans.

Wrapping Up

Demand generation is a critical part of any marketing strategy because it helps you turn leads into lasting customers. By creating a need or desire for your product or service, you can build relationships with potential customers that will last long after the sale is complete.

Leena Ray

Digital Marketing Writer and Editor

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