Is Demand Generation the Right Fit for Your Business?

Watch Time – 4:00 Minutes


This video examines the topic, Is Demand Generation the Right Fit for Your Business? The purpose of this video is to help business owners decide if a demand generation and lead nurturing engine makes sense for their specific type of sales process.  We will quickly:

  • Compare and contrast a lead generation process to a demand generation process
  • We will discuss when lead generation without demand generation makes sense
  • What types of businesses and sales process need to extend their marketing operations to include demand generation.

This video was  excerpted from The Differences Between Lead Gen vs, Demand Gen and the Impact on Your Sales Funnel (part 4 of our free  On Demand educational series, The Digital First Transformation and Sales Automation)


Transcript of “Is Demand Generation the Right Fit for Your Business?”

Comparing and Contrasting Lead Generation to Demand Generation

Lead gen and demand gen are much different processes. Lead gen starts with marketing or a cold caller generating a lead. Then marketing immediately turns the lead over to sales. Sales then does all the pre-sales and sales education, typically during one-on-one meetings. Then the lead is either converted into an opportunity, which happens about 20% of the time, or they’re abandoned about 80% of the time.

In contrast, demand gen is a buyer-driven process. Marketing generates the lead, and then marketing nurtures those leads with sustained and automated content marketing and sales education campaigns that supports a buyer’s consideration and preference stages, while at the same time, your technology stack is capturing data and scoring those leads for readiness, interest, and fit, replacing the need for one-on-one early stage meetings with your sales reps.

As a result, marketing passes well educated sales ready Leads to the sales team, where 50% are typically converted into opportunities, 10% are disqualified and 40% are recycled back in the lead nurturing campaigns to keep your solution top of mind until the buyer’s ready to buy. Beyond the 2.5X increase in initial conversions, this recycling is a big advantage demand gen has over competitor running a lead gen process because if we’re 50% of those recycled leads will convert into an opportunity within six to 18 months.

When is Lead Generation the Right Choice for Your Sales Process?

So now that we’ve explained the difference between lead gen versus demand gen, how do you know which choice is the best solution for your business? Let’s start with lead gen:

  • Standalone lead gen is a great choice when you have an established brand or when your market is large enough and mature enough to provide a continuous stream of fresh inbound leads. And just as important, you can continuously afford to compete for these leads, especially if they’re generated through pay-per-click campaigns.
  • It’s a great choice when you can educate and convert the buyer into a real sales opportunity on the first call
  • Lead gen makes sense when there is only one decision maker involved in the sales process and the close takes less than 30 days, and typically the deal is simple enough for an entry level rep to close, and there are no product specialists required to support the close of the deal.
  • It’s also a great choice when your closing rate is above 50% or you can win on lowest cost.
  • Finally, it’s a great choice if the product or solution is a one-time purchase or once it’s purchased, buyers rarely or never switch vendors.

When is Demand Generation Required for Successful Selling?

So next, when do you need to support your sales process with demand generation?

  • You need demand gen when you don’t have an established brand.
  • Demand gen is helpful when there’s not enough traffic for effective pay-per-click campaigns, or you’re priced out of pay-per-click campaigns.
  • Demand generation is also important when you have a complex sales process. When there’re multiple decision makers or influencers, an when it takes more than three calls to close a deal.
  • It’s valuable when you need a product specialist to support sales or you have a senior sales rep closing the business.
  • It’s a great investment when your annual deal size is above 12K a year, when you can scale a customer once they close, or you have additional cross sells and upsells to offer your existing customers.
  • Or it’s critical when sales success means you need to stay top of mind to replace a buyer’s existing vendor or solution.