Five Keys to Effective Demand Generation
As a former startup sales leader and current edtech investor, I’ve had countless conversations about growth with entrepreneurs, employees, and investors over the years. An effective growth engine is the lifeblood of every aspiring edtech startup team and it’s hard to do well, especially in selling to education institutions. An effective process begins with filling the top of the sales funnel with opportunities and that starts with doing demand generation well.
First, I think it’s helpful to briefly define demand generation, since it’s often conflated with lead generation. Demand generation is a marketing operation that serves to create demand for your product or service. Lead generation, on the other hand, is used to collect information about potential clients to turn them into sales leads. Demand generation is all about encouraging people to buy from you, while lead generation activities are about helping people want your content so you can collect information about them that then turns them into sales leads. As an example of lead generation, you offer a webinar or case study to your audience. When they register for the webinar or download the case study, you can collect their contact information in a web form for sales lead purposes.
Again, here we focus on demand generation. A separate blogpost on lead generation is coming soon.
Every edtech startup team would like to have more people buy their products and services, but demand generation is not easy. I see two types of startup teams when it comes to demand generation. First, there are those that struggle with it. These are startup teams that wish they were doing demand generation effectively, but just aren’t. They struggle to engage enough prospective customers to grow their business at the rate they desire. This could be because of gaps in understanding of the right customer personas to target, ineffective messaging, poor processes, or not having the right people in the right roles. Second, there are a select group of startups that are doing very well at generating demand, but they wish to go even faster. They’ve figured out personas, messaging, sales processes, growth roles, and so on, but could grow more quickly and have a bigger impact with more quality resources focused on demand. Regardless of which type of startup you are, there’s always room for more effective demand generation.
Here are five keys to improve your demand generation effectiveness.
- Know your audience.
At first blush, this seems like an obvious point, but as you peel back the onion there’s a complexity to knowing your audience, especially when selling to educational institutions. Some key questions to consider about your audience are:
What are the role(s) and persona(s) of the education buyer(s) you want to connect with? What about other stakeholders in the process?
What’s the right message that will resonate with your audience and engage them in meaningful conversations with you?
What are the different market segments? How do you adjust your approach to get maximum engagement with each of the different segments?
When, where, and how does your audience prefer to hear from you?
Finally, a positive signal of demand can be found in organizations that have created solutions that resemble what you do. These in-house “prototypes” or “hacks” as I call them are efforts to solve a pressing problem, but are often far less efficient and effective because the organization lacks the expertise, focus, and resources you have. Identifying these prototypes and the prospects that create them can be a fast track to finding customers that are likely to demand what you do.
It takes time, experience, and a lot of learning to optimize how best to connect with your audience, but the effort pays off as you build your business over the course of many years.
2. Website as an engagement and nurturing tool.
Education buyers are much savvier than they were a generation ago, in large part because of improved access to information via the Internet. The majority of purchasers will spend time researching and learning online and from different vendors before they make a purchase, so it’s more important now than ever before to have a website that effectively engages your audience and nurtures them along in the purchasing process. Think about what your audience wants to learn about and provide content that helps them self-learn. This approach builds trust and credibility with your audience.
It also can work effectively at generating inbound opportunities. All things being equal, inbound opportunities are more valuable than outbound opportunities because inbound prospects are generally at a more advanced stage in the buying process than an average outbound contact. Whether a prospect is ready to buy now or sometime in the future, they’ll remember your organization because you helped them become smarter about solving a problem.
3. Use a portfolio approach to demand generation.
All entrepreneurs would love to find a “magic bullet” for demand generation, but rarely does a single outreach channel deliver the results you need to grow rapidly. More often than not, a multi-pronged approach to demand generation is what it takes to get the job done. For most B2B entrepreneurs in education, the inbound channel is just a small part of what it takes to fill the top of the sales funnel. If you’re in a high demand market and/or you’re able to develop a self-service freemium product that provides value, you can develop an effective inbound channel.
Unfortunately, not all solutions lend themselves to a freemium approach. For example, many administrative workflow solutions are hard to turn into a freemium offering that spreads virally. At some point in your venture’s growth, effective outreach via outbound demand generation is key to providing the number of opportunities one needs to reach goals. Channels including conference/events, content marketing in the form of email outreach, webinars, white papers, and other outreach tools in addition to outbound sales development are all useful tools in a robust demand generation approach. Some of these channels (e.g., conferences/events and resellers) are expensive, so consider setting up low-cost experiments to test and measure the impact of different channels before making bigger investments.
4. Use an integrated growth team approach.
Close communication and coordination between marketing, sales, and customer success is critical to making the most of your demand generation efforts. Here are a few examples of what that looks like in practice:
1. When marketing sends out an email message to prospects, sales should be right on the heels of the email to see who engages with the content and follow up in a timely fashion to set a first meeting.
2. When a new customer signs up, marketing and sales should create and execute a plan to reach out to prospects who could view that new customer sign up as a positive signal.
3. When a customer completes a survey and rates your product/service a 9 or 10 out of 10, you’ve got a “promoter” of your product/service. Ask for referrals and make sure marketing and sales gets in contact with any referrals to start a conversation.
Collaboration between teams in these examples and many other scenarios are key to optimizing your demand generation efforts.
5. Be patient. Your efforts will pay off, but it could be a long-term proposition.
It’s no secret that sales cycles when selling to educational institutions can take weeks or often months from initial interest to close, and this is what the process looks like for customers who do sign up. Many more conversations will begin that won’t lead to a closed sale in weeks or months. In my experience, it’s typically the majority of the market that’s not ready to buy today, next month, or even next year; however, I’d be willing to bet that many of them will be ready to buy one day if you stay patient. Keep building credibility, add value by helping them become more educated about the topic you address, and create trust, and you’ll be in a strong position to sign them up when they’re ready.
Demand generation is a journey and not a destination. Think of it as a long-term relationship between your venture’s marketing and sales teams and the prospects you’re trying to reach. In the many startups I’ve been a part of as an operator and investor, each team had to chart their own journey to create demand for their products and services. With a commitment to providing value at each interaction with a prospect and a view to the long-term, you’ll build an effective demand generation engine.
What other keys have you seen for effective demand generation? Do any of these work especially well for you? I’d love to hear your ideas and stories.
