OpGen Media: Marketing Ops & Demand Generation Insights

What is Demand Generation?

Apr 22, 2020 10:32:40 PM / by Taran Soodan

How to Improve Demand Generation

Marketing strategies have evolved significantly over the past two decades for businesses, thanks to the plethora of new communication channels, sources of data, and technological tools available to marketers. One of the latest strategies to arise is demand generation, an approach utilized by a wide variety of B2B SaaS companies and services companies to increase demand for their products or services. 

what is demand generation

This is done by focusing on two key areas: 

  • Awareness: Much of your demand generation strategy will depend on customers being aware of your presence. If they don’t know you exist, and that you’re offering a product that can solve one of their main problems, they aren’t going to make a purchase. 
  • Interest: Beyond awareness, customers must also be interested in your core products and services. This requires them to be aware that they have a problem, and actively motivated to solve it. Oftentimes, this requires time for development; there’s no switch to flip to suddenly make a customer interested in buying your product. Instead, it’s a slow burn that gradually increases their motivation. 

Through demand generation, businesses can naturally make prospects more interested in their brand, including their core products and services. But how exactly does this work, and how is demand generation different from lead generation? 

Demand Generation vs. Lead Generation 

Let’s start by contrasting demand generation with lead generation—two very similar and overlapping strategies that ultimately have different outcomes. 

Lead generation is a combination of marketing, advertising, and sales techniques designed to stimulate leads, with leads being potentially interested customers. Already, you can see that lead generation and demand generation share a vision for the end goal: generating more potentially interested customers. 

However, lead generation typically fixates on generating as many leads as possible, through whatever means are available. This occasionally inspires companies to invest in tactics more focused on quantity than quality; they may rather than 1,000 leads of varying quality than 100 highly relevant, interested candidates. 

Additionally, demand generation is a more encompassing strategy. While lead generation might actively try to make people interested in your product, demand generation will instead try to naturally prioritize the most interested people—and make them discover their interest on their own. 

Why Demand Generation Is Advantageous

With a well-run demand engine, you can generate qualified leads who are interested in your products or services. Demand generation is advantageous for several reasons:

Lead quality 

First, the leads generated through demand generation tend to be higher quality, leading to more sales and a smoother, more streamlined sales process. The people signing up to learn more about your products and services are actually interested in those services and are more likely to eventually make the purchase. In many cases, by the time a lead speaks with a salesperson, they’ve been exposed to your brand and your content for weeks, or even months.

Lead trust 

Leads generated through demand generation tend to be immediately more trusting of your brand, which is useful for closing deals faster. This is because demand generation is a subtler, less overt marketing strategy; leads don’t feel like they’re being pressured or persuaded because they’ve discovered their needs and this product on their own. 

Competitive differentiation 

One of the problems with conventional marketing and advertising is the level of competition you’re going to face. Certain tactics, like paid advertising, increase in cost based on the number and intensity of competitors you have. Choosing a more robust demand generation strategy will distinguish you from your competitors, ultimately saving you money and increasing the appeal of your brand.

Customer loyalty

For many types of businesses, including those with subscription models, customer retention is everything. And with demand generation, customers tend to be more loyal. That’s because leads cultivated from demand generation tend to spend more time thinking about their decision and researching their options; by the time they sign up for your product, they’re already fully on board with what you offer. 


Demand generation functions as a kind of engine. It has many individual components working together to produce excellent bottom-line results. It can also be tweaked, nurtured, and adjusted to adapt to new circumstances and serve your evolving needs. Accordingly, demand generation is incredibly sustainable. 

Long-term costs 

Assuming it’s executed correctly, demand generation has a massive return on investment (ROI). It takes a significant investment of time and money to get a strategy rolling, but the momentum is easy to sustain once established. Beyond that, the quality and reliability of incoming leads are unparalleled. 

Key Points of Demand Generation 

So far, we’ve discussed the high-level goals of demand generation, and why it’s such a favorable strategy. But what are the key components of demand generation? What makes this a unique approach?

Data foundation

One of the tenets of demand generation is a focus on quantitative data. It’s not enough to choose tactics that seem like they’re going to work—you want to use tactics that are proven to work. Most companies employing demand generation begin with a store of data they collect from third-party sources, including marketing agencies, research firms, or even competitors. Then, they collect data on their own work and use it to further refine their efforts, reallocating their budgets and trying new things. 

Long-term nurturing

Rather than mining an audience for potentially interested leads, demand generation relies on long-term nurturing to cultivate leads. New people are gently introduced to the brand and are ushered into an approach with frequent touchpoints. They consume content, see ads, and read emails from the brand, gradually becoming more familiar with it—and hopefully, more fond of it. 

Customer personas

Many marketing strategies these days rely on the creation and use of customer personas, but for demand generation, it’s a practical necessity. The success of your strategy depends on the quality of your leads, so before you even begin, you should have a model for what those leads might look like. 

Multi-phased approach

Generating demand is a process that takes time. You can’t instantly make someone fall in love with your brand, and the more time you spend connecting with your potential leads, the stronger and more loyal those leads are going to be. Demand generation is, therefore, a multi-phased approach. You’ll be targeting people who may not yet know they have a problem, people unfamiliar with your brand, and people who are ready to make a final purchasing decision—all with different arms of the same strategy. 

Sales and marketing alignment 

Demand generation has elements of both marketing and sales, so it’s imperative for your marketing and sales teams to be in alignment. Your marketers and salespeople should be frequently exchanging information in recursive feedback loops, offering information and direction so both branches of the demand generation strategy can be better. 

Demand Generation Tactics

Now, it’s time to focus on actionability. A good demand generation strategy will actually include a series of other, smaller strategies working together—again, like components of an engine. These are some of the most common approaches:

Content marketing 

Content marketing is the development and distribution of content—informative or entertaining material that provides value to your target audience. Many companies attempt to produce blog posts, infographics, videos, quizzes, and other pieces of content meant to help their readership; and they offer this content for free, expecting nothing in return. It’s a great way to increase brand visibility and make people more familiar with your brand values. 

Search engine optimization (SEO) 

Content marketing is also useful for search engine optimization (SEO), which can stand on its own as an independent part of your demand generation strategy. SEO relies on onsite content, offsite content, and a variety of other tactics to boost your search engine rankings for specific types of search queries. The end goal is to increase your visibility in search engines and attract more targeted traffic. If you choose the right keywords and phrases to optimize for, you can attract people who perfectly fit your target demographics. 

Paid advertising 

While traditional advertising is used as an outbound strategy, rather than an inbound strategy, it can still fit in your suite of demand generation tools. Pay per click (PPC) advertising, specifically, has a handful of advantages that make it especially worth considering; if you use a platform like Facebook or Google, you can choose a niche target audience, and dramatically increase your brand visibility within that niche. 

Social media marketing 

You’ll also want to integrate social media marketing into your approach. Social media will help you increase both your brand visibility and potential customer interest; and because it functions as a free distribution platform, you can easily use it to nurture your existing audience. It may be hard to build momentum from scratch, but once you attract your first few hundred followers, this can lock into place. 

Email nurturing 

Email remains one of the highest-ROI online marketing strategies available because of how inexpensive it is to launch and sustain a campaign. With the help of machine learning, automation, and a targeted drip campaign, you can easily nurture all your audience members, gradually introducing them to more information about your brand. With the right calls-to-action (CTAs), you can also use them to increase sales.

Gated content

Gated content is content hidden behind a form (i.e. a gate); for example, you might offer a whitepaper or eBook in exchange for a customer’s personal information. It’s inexpensive to develop the content, and the rewards are potentially lucrative. 

Sales enablement 

You can also increase your knowledge of customers and improve sales with sales enablement materials on your site. These include things like testimonials, case studies, FAQs, and calculators that help your customers estimate their expenses. Materials like these are most effective near the end of the buying cycle when customers are ready to commit their purchase.

Analytics for Demand Generation 

Remember, one of the most important qualities of demand generation is its reliance on data. If you’re going to be successful, you’ll need to spend time measuring and analyzing your results. 

There are several platforms and approaches you can use to get access to these data. For example, you could work directly with a demand generation agency to reduce the burden of internal analysis, or you could pay for a data analytics platform that helps you measure your own results. 

In any case, pay close attention to the following:

Customer acquisition costs (CAC)

Demand generation tends to have a high ROI, but it does require investment. You’ll need to keep a close eye on your customer acquisition costs to make sure you’re seeing an adequate return. If not, you may need to cut costs strategically, targeting the tactics that cost you money but provide limited benefits. 

Customer lifetime value (CLV) 

You also need to consider the lifetime value of each of your customers. This requires your attention to a number of variables, including average subscription costs (or average cart volume), customer spending habits, and customer churn. Once you have this figure, you can use it to estimate the effectiveness of your strategy. 

Quantitative lead scoring 

Lead scoring can take many forms, but it always serves the same purpose: helping you understand how “good” your leads are. No matter what, you should have some kind of lead scoring process in place, both to help your salespeople approach new leads appropriately and to help you understand how effective your strategy has been. 

Close ratios

How quickly or reliably are your salespeople able to close sales? This is often a reflection of the quality of your leads (and the strength of the demand you generated), but could also help you diagnose other problems in your strategy. 

Starting a Demand Generation Strategy

One of the only issues with demand generation strategies is that they’re difficult to pull off on your own. Because demand generation relies on so many interconnected, moving parts, and because it’s so reliant on data to be successful, many amateur marketers and small teams find it difficult to build momentum. 

What kinds of demand generation strategies are you seeing work best? What have you tried?

Request Free Consultation

Topics: Demand Generation, Lead Generation, Digital Marketing

Taran Soodan

Written by Taran Soodan