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3 Proven Demand Generation Strategies for Startups

November 18, 2021
Lead Generation
5 Min Read

3 Proven Demand Generation Strategies for Startups

Having a way to generate demand for your product or service is fundamental to achieving growth. If you can build a system that enables you to identify potential buyers, educate them around your product or service, and show them why your solution is the answer to their problems, you’ll be on track to hit your ambitious targets every single quarter.

In this guide, we’ll show you exactly what demand generation is, how it differs from lead generation, plus proven strategies to drive demand.

What is demand generation?

Demand generation is the top and mid funnel activity designed to raise awareness of, and subsequent interest in, your brand product or service

The goal of any demand generation programme is to build a continuous stream of new prospects into the top of your marketing funnel which you can then work to convert into sales. This ongoing process ensures that you are constantly growing your prospect pool which for most businesses is a core component of the growth strategy. Successful demand generation usually requires you to execute on 4 things :

  • Find people who are like your existing customers 
  • Identify new audiences and segments to go after
  • Build awareness for your product or service to those people
  • Educate your buyers around their pain points and how you can solve them
  • Prove how your product or service is better than the alternatives
  • Have a clear hand off point to convert interest whether that be through website, CRM or other discipline.

Demand generation vs lead generation vs marketing

Demand generation and lead generation often get confused. They are linked, and work together, but they are not the same.

Lead generation is all about turning already-interested people into serious sales leads. For example, encouraging a website visitor to book a demo or fill out a contact form on your website so your sales team can get in touch with them. The goal of lead gen is usually to take an interested person and get them to give you some information that you can use as the basis for further tailored communication that moves them closer to point of sale.

Demand generation needs to happen before lead gen can occur. Generally you have to be building demand, by identifying audiences and getting your product or service out there in front of the right people, in order to have any chance of scaling lead generation. 

Channel/audience fit is a key part of effective demand generation

If your audience spends their time on Pinterest but you’re investing the majority of your budget in Facebook and Twitter Ads, you won’t see results. So the first (and most critical) part of building effective demand generation is to have a deep understanding of your buyer persona. 

You need to know:

  • Which channels they use to discover new products/services
  • What type of content they consume, and for which purposes
  • How much it’s going to cost to reach your buyers

To inform your demand generation activities, talk to customers (or people matching your ideal customer profile) to fully understand their goals, behaviours, and preferences.

Only then will you know the best channels to invest your time and money into.

3 startups with different demand generation strategies

There are a variety of ways to generate demand. Here are some real examples from startups that have created incredible demand for their products.

1. How Hibob uses paid ads to capture qualified in-market buyers

If you're a startup operating in a market with established competitors, you can use this strategy to generate demand from buyers that would have otherwise gone to competitors.

People management software company, Hibob, runs Google Search Ads targeting competitor names to ensure they are reaching a tightly defined,in market, audience. When you search for a competitor, BambooHR, the first result is an ad from Hibob.

Source: Hibob’s Google Ads

The key benefits of this include:

  • Anyone searching for a competitor brand name is already familiar with the market
  • Searchers are pre-qualified and actively researching solutions

If a searcher clicks on the ad, they’re sent to a landing page that directly compares Hibob to BambooHR.

Source: Hibob vs. BambooHR

On their landing page (it’s actually a blog post), they focus on the unique benefits of their solution over their well-established competitor. They’re up-front, direct, and not at all coy.

Bidding on competitor brand names and positioning your company as an alternative is a powerful way to capture existing demand and direct qualified buyers to your website. But it’s important not to break the rules, because bidding on competitor terms can sometimes land you in trouble. Check out this post by AdEspresso for more information about doing it right.

2. How Deel uses targeted content marketing to get in front of qualified prospects

Deel is a fast-growing startup (they recently became a unicorn) for managing payroll and compliance when hiring team members around the world. 

They’ve created smart content marketing tactics to get in front of qualified prospects and quickly grow their traffic to almost 20,000 visitors/month.

Source: Data from Ahrefs

Payroll is notoriously complicated, and the first place most people go to find answers is Google. So, Deel created informational content around all of the common questions they know their customers have (in other words, publishing content around relevant long-tail keywords).

For example, explaining what a 1099 Employee is, what a  W-9 tax form is, and a variety of other topics that someone would only search if they’re currently dealing with it in their business.

Here’s a snippet of some of their top ranking pages and keywords:

Source: Data from Ahrefs

Every keyword is closely related to the real problems (aka, pain points) someone has when hiring. Deel are perfectly-placed to answer the question, and direct them to their platform.

As well as having content targeting valuable keywords, each blog post includes a clear call-to-action relating to the main problem that Deel solves: hiring international talent. This means any qualified visitors can quickly take action and test out the platform.

Source: How to Run Payroll as a Small Business, Deel

This call to action is in fact the seamless link to the lead generation element of the user journey, where data is captured to convert people at a later date. 

To track ROI on this strategy, the Deel team will be tracking demand gen metrics like rankings and traffic — as well as lead gen metrics such as sign ups and trials. 

3. How Notion fuels demand with an engaged community

Community can be a powerful lever for growth. Notion, a digital workspace platform, takes full advantage of it. They encourage users to involve themselves in Notion’s ecosystem, for example, joining forums on Reddit, Facebook, Discord, and Slack, as well as groups based on location:

Source: Notion Community

This focus on community engages their existing user base, thereby improving customer retention but also enables them to build naturally occurring  prospect pools, of similar audiences with similar interests which they can then market to.

One way they activate these communities is to sponsor people with existing large fan bases:

Source: Notion Community

Notion provides each partner with a unique referral code or UTM code for traffic to drive to Notion, they can then easily track if the influencer content is generating new demand. 

Metrics to track in your demand generation campaigns

When looking at your results, you need to break down every strategy and channel you test into clear metrics that make it easy to compare channels and see which ones deliver the best performance. Use the help of your Analytics expert of gather enough relevant data to analyse,

Here are some common metrics to measure demand generation as well as end business performance:

  • Reach: as you build demand you should see the overall reach of your activities increase. You can use top of funnel metrics like traffic and audience reach/coverage to track this.
  • Search: increased search volumes are a good indicator of demand gen programmes working. Tracking the volume of your branded search queries on Google enables you to see if your programme is increasing the pool of people interested in your business.
  • Cost per Lead/trial (CPL): If your startup offers a free trial or has a long sales cycle, then CPL is a good metric to measure. It’s a clear indicator of whether or not your efforts are bringing people to your product/service. If a prospect starts a free trial of your product or engages with your sales team, it’s a sign they think you can solve their problem.
  • Cost per Acquisition (CPA): CPA is a great way to compare channels, and one of the best indications for whether or not a channel strategy is delivering ROI. For example, if it costs you £75 to acquire a customer using Facebook Ads, you can then compare that with your Customer Lifetime Value to see if it’s a cost-effective and profitable channel.

  • Customer Lifetime Value (CLV, or LTV): As mentioned above, CLV/LTV is important because it determines what you can afford to spend to acquire a customer. And different channels will generate buyers with different CLVs. By keeping track of your CLV, you can find which channels drive the best long-term ROI.

    For example, if the average customer generated from Facebook Ads generates you £500 in CLV, but the average customer from a conference generates £5,000 in CLV, you can afford to spend more to acquire the people you find at conferences.

If you need help developing, executing, and measuring your demand generation strategies, try Traktion for free today. We’ll match you with the world’s best growth marketing talent — experts who work with the biggest brands. All are pre-vetted, proven, and highly-experienced.

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