In b2b marketing, effective demand generation requires more than just getting your prospects to respond to one or two emails and then passing them off to your sales team – it’s about constantly being in front of your prospects with the right message at the right time. Statistics show that the average number of touch points it takes to propel a prospect into action is between 3 and 7. Marketing automation enables you to automatically provide relevant content to your prospects on a consistent basis for improved demand generation results. In the Lead Nurturing Cookbook, we offer a recipe for supercharging your demand generation using your marketing automation platform. Craig Rosenberg, Vice President of Products and Services at Focus and author of the award-winning blog The Funnelholic, participated as an “Expert Chef” on this recipe offering marketers insight on how to make it even more of a sales team crowd-pleaser. I asked Craig if he could offer us just a little more insight into how to build and execute effective demand generation campaigns. Here’s what he had to say:
EM: What metrics should marketers track to determine if their demand generation campaigns are successful?
CR: Before I answer that, I must first jump on my soapbox. This may be controversial, but I believe that marketers should be judged by the metrics that they can control. I realize that ultimately everyone’s goals should be revenue, but there are a lot of factors that determine whether deals close, such as the effectiveness of the sales team or the competitiveness of the product. So while the conversations I am hearing at conferences and online center around marketers being judged by closed business, I stand firm that marketers should provide and be judged by opportunities, whereas sales should be judged on closing those opportunities. I answered this question in the past on Focus.com.
The metrics I recommend to marketers for their demand generation campaigns:
- Cost-per-opportunity: For every opportunity created, how much did we spend? Formula: Total marketing costs/number of opportunities
- Sales pipeline created: How much pipeline did we build from this campaign? Formula: Total sales pipeline (in the form or potential revenue) created by leads from your campaign
- Lead-to-opportunity conversion rate: At what rate are my leads turning into opportunities? Formula: Number of leads/number of opportunities
- Conversion rate after one month: How many leads are converting after one month? I call this the “lead nurturing” metric. Formula: Number of leads/number of opportunities for all leads more than one month old
- ROI: Yes, I began by ranting against ROI — but I also know that we can’t avoid the closed business metrics. For me, ROI is defined as “how much closed business was created from the campaign.” We have to look at it; but not just to judge the marketers, as this should judge sales and other variables that either make it harder or easier to close business. One tip: Make sure you set the expectation that this metric is not be measured immediately. Calculate ROI after an ample amount of time: Take the average sales cycle and add one to two months before you calculate. Formula: Closed business generated from leads from the campaign
EM: How is demand generation different from lead generation?
CR: Personally I struggle with this question all the time. I watched the conversation on Focus.com diligently to help me solidly formulate my opinion on this. First of all, people use the terms interchangeably, and I really don’t mind. Here is my take:
- Lead Generation: First of all, lead generation is part of demand generation. The goal of lead generation: to generate a lead. Very simple, right? The lead definition is predefined and the associated activities and strategies are focused on generating the leads.
- Demand Generation: The efforts in demand generation are much more expansive and include branding, thought leadership, sales enablement, advertising, PR, and so forth. I think with my definition, the real question is what is the difference between demand generation and marketing?
EM: What role does social media play in demand generation and how can you incorporate that into your strategy?
CR: I have another soapbox rant here: Social media is an important part of demand generation, but do not let it distract you from basic blocking and tackling of demand generation. Let’s face it, marketers get distracted by the bright, shiny new objects, and social media is just that — bright and shiny.
That being said, social media is an absolutely vital aspect of your lead generation strategy. The important thing is to realize social media is another channel. The traditional channels for b2b marketers are phone and email. Now, you MUST add social to the mix. Each channel supports the other. Here is a simple example: You have an upcoming webinar which you will email your prospects, create an event page on Facebook, tweet about the event, call your best prospects, and so forth. The best marketing organizations leverage all channels, not just one. You know why? Because every buyer is unique. Some people check email, some answer their phone, and believe it or not, some people are NOT on Twitter. (I know that for those of us in marketing, that is hard to believe — but it’s true.)
EM: How can using a marketing automation platform improve demand generation results?
CR: This is very simple; there are two major points:
- Marketing automation allows you to manage and execute lead nurturing. For me, marketing automation has driven the lead nurturing movement, which may save marketers from extinction. Instead of being stuck with trying to drive immediate ROI from every campaign, we can justify our efforts over time. Heck, lead nurturing may even save live trade shows! The numbers aren’t lying: Companies executing always-on lead nurturing campaigns leveraging marketing automation are getting their ROI.
- Marketing automation allows you to track and optimize your efforts. Marketing automation helps you actually see what’s working and what's not working. In the past, we did one of two things during campaigns: We either showed everyone our “cool” design, or we blamed sales for not following up, but we NEVER could figure out if what we were doing was working. Now, we can manage an entire chain of events and optimize every step of the way.
EM: In the lead nurturing cookbook, we talk about the importance of planning for what happens after your lead takes a call-to-action like downloading a piece of collateral. Can you explain how to incorporate that follow-up into your lead nurturing process and give an example of a time when you’ve seen it used effectively?
CR: There’s couple points that I would like to make here. One mistake I see a lot of marketers make is thinking that the nurturing process is about to getting a prospect to take the call-to-action instead of looking at it from the top of the funnel all the way to the point when Sales converts the opportunity into a sale. So a lot of times where I see a breakdown is when, marketing says, “Hey, I got the call to action. We’re done.” And that’s a fail. Lead nurturing includes planning for what you do after you receive the call-to-action.
My second tip is to consider the phone as an integrated part of your demand generation and lead nurturing processes. If they’ve taken a call-to-action that tells you it’s worth engaging them, the best thing to do is to call them–use the phone. This could set off debate, but everyone asks me for what I see that works, and that’s it. I see it from the best lead nurturing companies in the world— they’re incorporating the phone.
Craig is the Vice President of Products and Services at Focus where he oversees product creation, management, and delivery. He is also the author of the popular b2b sales and marketing blog, the Funnelholic. He is known as an expert in b2b sales marketing across the entire funnel from demand generation to overall marketing to sales process and organization.