Demystifying Demand Generation

"Marketing automation" is when you automate your marketing (d'uh). You do this by aligning your sales and marketing departments to provide a better UX for your audience and increase productivity and visibility of your marketing efforts internally.

This creates HubSpot's famous phrase "inbound marketing" whereby your customers start coming to you, because you've done the job of communicating with them at a time when they're learning about their needs.

"Demand generation" is generating that demand. Let me explain...

Normally, the focus is to go out there and find out what there is demand for, then make or find products and services that meet existing demand. That means facing all the competition who have similar products that meet roughly the same demand. 

So, I’ve been thinking…this philosophy of marketing really generates a wave of “status quo” and the development of products gets stuck in cycles of unchanging consumer demand. 

But both you and I know that sometimes people just don't know what they want until they see it - I do this all the time when I go out for lunch!

As Henry Ford once said,

"If I had asked them what they wanted, they would have said, 'a faster horse.'"

How do you predict demand in the formative stages of marketing?

There are many ways to predict demand. Some popular ways include: devising an opinion poll/marketing surveys or testing of consumer demand directly (with samples of new products). But that’s old school and costs a lot of money to construct. My favourite (and cheapest) method is simply by looking at content trends through research tools like BuzzSumo, Google AdWords, Google Trends, Radian6 etc. 

How can you build demand once the basic demand level has been established?

• Create content, written for blogs and informative reading. Create live action and motion graphic video. Design, develop and execute specific programs to generate demand. Focus the program on nurturing leads that come through automated marketing channels.
• Extend the spread of this content through a number of channels. Work at making what you create visible by the right people, at the right time to bring the product into public attention.
• Differentiate the new product from its older competitors. Introduce new features and advantages of new products so that potential customers will try it out for its advantages.
• Carefully adjust the apparent characteristics of the new product so that it is perceived just different enough from existing products that advantages are clearly evident, but the product is not so unfamiliar to impede its attractiveness. Put the product into the "goldilocks region" of different but not too different.
• Place content in such a way that customers recognise your brand's history of success. Encourage word of mouth marketing.

How can we help moderate the lifecycle of demand?

 New products have demand life cycles whose length varies with factors like depth of competition, the rate of new product development in a given market and product novelty. 

• Initial demand growth. The birth of a new market will depend on consumer inertia. The development of the market for the first automobiles was comparatively fast. The demand for home computers took considerable time because the need and utility of the early computers were not obvious.
• Development stage. The product starts as an idea that gradually gets fleshed out and turned into a material product.
• Product launch. After the introduction of a new product, companies tend to spend a maximum on marketing.
• Growth Stage. The product is established in the marketplace and sales accelerate while there are few competitors. Companies focus on reducing the costs of production.
• Maturity Stage. Sales growth reaches saturation and may slow or even flatten. Competition has increased and is cutting into prices. Many companies begin a new course of product development and research at this stage.
• Decline Stage. As new competitive products enter the marketplace, demand declines and sales begin to drop. Increased marketing loses its effectiveness unless new markets are discovered. Bolstering demand.

If you’re still unsure about the term “Demand Generation” and would like to know more about how this thinking can help your sales and marketing efforts, get in touch. And let's generate that demand and get you more customers.