Demand generation isn’t new. Smart marketers have always understood the importance of building awareness and trust long before prospects are ready to buy. But in today’s uncertain economic environment, shifting more of your marketing investment toward demand generation, rather than relying too heavily on lead generation, is more critical than ever.
The Right Mix: Why Demand Gen Should Take the Lead
Many B2B companies still prioritize lead generation, spending the bulk of their marketing budget on capturing prospects who are already in-market, those actively searching for a solution. But research from the Ehrenberg-Bass Institute shows that up to 95% of potential buyers aren’t in-market at any given time. That means most of your audience isn’t looking to buy today, but they will be in the future.
Marketing effectiveness experts Les Binet and Peter Field recommend a 60/40 split between brand building (demand generation) and sales activation (lead generation) to maximize long-term success. Their research, which spans various industries, shows that businesses investing more heavily in brand building tend to see more sustainable growth and lower acquisition costs over time. While this ratio isn’t an absolute rule, it serves as a valuable benchmark for balancing short-term results with long-term brand equity. And yes, brand building is not exactly the same thing as lead generation, but more on that in a minute.
Building on Past Insights
Nearly a year ago, we discussed the significance of adopting a Business-to-Human (B2H) approach in B2B marketing, emphasizing the power of emotional connections and brand building in our blog post Shift the Focus: Why B2B Brands Should Invest More in Business-to-Human Brand Building. Building upon that foundation, it’s now more crucial than ever to focus on demand generation strategies that not only create awareness but also ensure our brand remains top-of-mind as market dynamics evolve.
