(00:01):
Hey everybody, it’s Jenni from GrowthMode Marketing. You are listening to The Demand Gen Fix the podcast where our team of GrowthModers and our guests discuss the ins and outs of demand generation and why we believe it’s the key to long-term sustainable growth, especially in the HR tech industry.
(00:21):
Welcome to The Demand Gen Fix. I’m Jenni Geiser from GrowthMode Marketing, and this is our inaugural podcast. I’d like to introduce Ellen Kane and Deanna Shimota, who will be joining our conversation today. We would like to discuss a topic that’s been on our minds for a while, the death of lead generation and why demand generation is really the key to long-term sustainable growth. We’ve been talking with our clients about this and talking about creating more content and podcasting, and so we are going to be taking our own medicine and doing that same thing. So with that being said, let’s get right into our topic of the day. Lead generation, it doesn’t work. Why is that, Deanna?
(01:15):
That’s a great question. I know there’s a lot of marketers out there who still very much subscribe to the philosophy of lead generation. It’s a very traditional marketing approach over the last how many years. But the reality is you can’t convince someone to buy if they’re not already in market or ready. I think that’s where lead generation falls short. There are multiple reasons for that. So what do you tell your sales team when all they want is leads?
(01:51):
That’s a common challenge I think many marketers face. Especially coming into year end, sales teams will panic when they’re not meeting their numbers and they’ll come to marketing and say, we need leads. We need them yesterday. Help. We need you to uncover these. The flip side of that is you as a marketer rush to do all of that, and the result is a trickle of leads that sales isn’t satisfied with. The leads aren’t good enough. Marketing’s not delivering quality leads. Let’s be real. Sales reps want you to hand them leads that are ready to buy today. A lot of the leads generated from lead generation programs are not individuals that are ready to buy today so they’re not going to close quickly. They’re going to fall out of the sales pipeline. It can be very frustrating for a sales team and for a marketing team.
(02:46):
We get this request all the time. The sales numbers have fallen short, we need leads now. We need them yesterday. What, in a typical lead generation process, does that look like? I think if we walk through that, it’s super obvious why these aren’t good leads, why this is just not working.
(03:13):
I think the reality is you’re chasing prospects. They haven’t necessarily expressed an interest there. Let’s say you’re doing cold outreach, so you’re working from a cold list. Maybe you’re working off a contact form for gated content. In those cases, the person fills out the form, but that doesn’t necessarily mean they’re ready to buy.
(03:39):
I fill out forms all the time. You can’t sell to me. I don’t buy. I just want the content and I’m annoyed that I filled out the form to get it.
(03:48):
Right. It makes you wonder how many prospects you deter because they just didn’t want to provide their information because they’re worried that as soon as I hit submit with my contact information, I’m going to a ton of emails, I’m going to get sales calls up the wazoo and I don’t want that. I just wanted to read your article because the topic was interesting to me.
(04:12):
I am on the other side of that coin. I don’t fill out forms because I know it’s just going to fill my inbox with spam email or sales emails and that’s not for me. So I will stay away from that content, even if I think it’s interesting, I’ll go and search for somebody else’s content that’s free without having to give my information.
(04:38):
These days, there’s a lot of content out there that is free. A lot of marketers have stopped gating stuff and quite frankly, if you use marketing automation and you already had their contact information, you don’t need a form in 99% of the cases because you can already track what content they’re clicking on, engaging with and whether they’re jumping around on your website. So, what is the point of a form?
(05:05):
I think this model of lead generation came about through marketing automation because you were able to get information through the forms, but now marketing automation has evolved so much that you don’t need the form for that kind of lead collection.
(05:23):
The world has changed so much over the last few years where everybody has access to everything all the time at their fingertips, on their phones, on their computers, you can search for anything and there’s multiple places to search. It’s not just Google anymore. Content is everywhere. If you’re trying to gate your content, all you’re doing is putting a barrier up to getting your name and your ideas and your brand out there.
(06:02):
Let’s talk about lead scores. One could argue even if you don’t gate content, you’re using lead scores to build up the warmest leads and those engagement levels. There are some contexts that consume a lot of content and that lead score build up. Should we be handing those leads over to sales? That’s how marketing automation works.
(06:32):
Unless they have that lead score built up to a point where they request a demo or fill out a form that says, yes, contact me. I really want to talk to you because I’m ready to buy. I’m sorry if I download 500 pieces of your content, please don’t contact me. I’ll let you know if I want to be contacted. That’s where the marketing qualified lead it. The definition of it must evolve. It can’t just be the trigger for a sales handoff. It can be a trigger for marketing to drive more content to that really interested prospect in a way that’s not salesy, in a way that gives them the information that they’re looking for.
(07:24):
You’re making assumptions when you reach out to companies. They are already in market, or we will convince them that we are the better solution, and they will buy from us because it makes sense. It may make sense in your mind as the vendor, but through all my years of marketing have learned, if they’re not ready to buy, you can’t convince them that it’s time to buy. You can take them on a journey from a content perspective and help them slowly get there, but it’s got to be on their timeline. What’s hard and what’s frustrating for sales teams is they have quotas to meet. They need these leads to close today. If you’re chasing opportunities that aren’t actually opportunities, it’s a lot harder to get to those numbers.
(08:40):
It’s frustrating when you’re working with people. You’re constantly reaching out to people who don’t have the budget or it’s not the right time for them or they’re the wrong person, and then eventually you just get blocked. As a salesperson, that’s frustrating. You’re just spinning your wheels.
(09:04):
Something to think about, is that we’re talking specifically about the B2B space. You can’t make someone be in market. We’re not trying to sell a pack of gum where there are very few constraints to the buying process. ‘I didn’t want any gum, but you’ve convinced me. I really do’. We can’t convince somebody who’s not ready to buy a piece of enterprise, payroll software that ‘Oh yeah, maybe I do need that.’ It’s not an impulse buy.
(09:41):
Think about how long it takes and how many people it takes to make that decision in an organization. It’s a long process. You can’t just cold call somebody and say, ‘Hey, switch your payroll software. It’s great’.
(10:00):
I recently read an article that said that the average HR technology buying process includes 23 people, 23 decision makers and influencers in the process. That’s a lot of people that come along on this decision and this journey. Some people have way more power in that decision and influence than others. They’re going out and trying to gain buy-in internally, which means they must have buy-in and believe it’s the right thing for them to even lobby within their organization for it. A challenge with lead gen, when you’re reaching out to people and asking them to have a meeting with you. You’re trying to convince them to meet with you. They didn’t ask to meet. They don’t necessarily have a desire to meet. You hope you hit them on the right day when they actually are in market, and they have a need and the message resonates with them.
(11:14):
Let’s talk about how demand generation works so that these people know who you are and are reaching out to you when they are ready.
(11:33):
I really look at demand generation as the ticket to long-term sustainable growth. You’re meeting buyers where they’re at in the buying process. You’re not trying to force a sale. You’re really flipping it around and saying, I’m going to create demand by putting all this great content out there that’s very targeted and very intentional and speaks to a specific ideal customer profile to help them evaluate and even just come along with your unique point of view and build that brand awareness, build that brand loyalty and affinity, and ultimately get them to raise their hand when they happen to be in market because they’ve been following along with you for a while now.
(12:22):
They’re familiar with your brand, they’re familiar with your content. They know that you know what you’re talking about. You don’t have to be the salesy person trying to convince them they’ve already done that research and they’re on board.
(12:37):
Marketers got into a trap a while back where they talked a lot about growth hacking, and you can hack your way to growth. You can’t. We could bring in a million leads tomorrow and most of them would be garbage. It’s about getting back to basics and really building up your brand awareness. Getting that content out there that really speaks to what the buyers need. You’re looking at that awareness content, you’re looking at user content, you’re looking at the entire funnel and really building that up.
(13:25):
Content strategy is really important too.
(13:27):
The more you’re putting out there and the more people are interacting with your content, the more your ideal customer is going to come into play because you’re going to see who it is that’s interacting with your content, who wants to read more, who wants to learn more about you, and you’re able to narrow that down to the right people that are the ones that are going to make those decisions.
(13:51):
Absolutely. I love that you brought up your ideal customer profile. Because I know that’s something that we’re all really passionate about and will be getting into in future podcasts and other content that we’re producing.
(14:03):
The beauty of demand generation, if you do it well, is that you have buyers who ask you to have a meeting with them when they are ready. That is a key difference from lead generation because lead generation, you are asking them for a meeting. Demand generation, if you do it well, when it works, they’re asking you for a meeting and just imagine, how much better that sales process is, how much more efficient it is, how much faster things close when they’ve done their research. They’re already actively seeking solutions. You made their consideration set. There’s a lot of options out there no matter what type of software you’re selling. There are over 21,000 HR technology vendors out there competing for those dollars. Let’s go back to that payroll example. You’re looking for HR payroll software. There’s still 600 of those out there that they can choose from. They’re probably going to pick two to three that will make their consideration set and that they will seriously evaluate. So it’s really important that you build a marketing strategy that ensures that you have a chance at making that consideration set. I think demand generation is how you do that.
(15:32):
You can think of the big three in the payroll industry, those are the ones, their brands are out there. Those are the first ones that everybody looks at. It’s easy to remember and you want to get your brand out there to be whatever it is in your sector. You want to be one of the brands that everybody thinks about right off the top of their head.
(16:00):
You have to be out there and people must know you exist, but if you’re not in the top three, it’s even more important that you establish a unique perspective and point of view so that you can differentiate yourself from those top three in that space so that people say, oh, I don’t really want to work with them. I want something different for these reasons. If you’re that different, then you make their consideration set.
(16:25):
You need to have that unique point of view. Content that you’re putting out there revolves around that.
(16:35):
There are obviously differences between lead gen and demand gen. Let’s break that down a little bit more. Let’s look at lead generation. How would you describe that to somebody if they were thinking about the difference between lead generation or demand generation?
(16:58):
We could talk about the really old school way of doing a lot of the lead gen, by a list of cold prospects. Send them emails, talking about your product, send them to a landing page where you have a gated piece of content that they fill out a form and download and then start calling them.
(17:28):
That’s how I think of lead gen not done well.
(17:33):
As soon as they hit that submit button, they’re automatically put into that lead bucket, and you don’t know if that’s a lead or not. They might not even be the right person to contact. They might not be the buyer, they might not have the budget. They’re most certainly not ready to buy at that exact time.
(17:58):
They probably didn’t open your email to begin with or you went into the spam filter.
(18:08):
From a lead generation standpoint, you have to explain who your company is unless you’re a big known brand already. You also have to persuade them to consider your product or service because you’re doing cold outreach. They may or may not have known you existed. They certainly weren’t going out of their way to find you and consume your content at this point. And the issue is you’re trying to force them into your sales process instead of them bringing you into their buying process.
(18:43):
I think it’s clear why we’re pretty fed up with lead gen as being your only lead marketing tactic. It just doesn’t give you the results you want. I think it leads to a lot of rocky relationships between marketing and sales too.
(19:01):
It feels as though sales and marketing are always butting heads. Sales is mad because they’re not getting good leads. Marketing is saying, we’re doing all this work for you. We’re trying, we’re giving you all of these names, why aren’t you doing your job? It’s a constant struggle between the two departments, and that’s not how it should work. Sales and marketing need to work hand in hand.
(19:28):
With lead generation you have to explain who your company is and convince them to buy. On the flip side, what is demand gen? How is that different?
(19:38):
They should know who your company is because you’ve done the foundational work to get your name out there and your unique point of view, and there are lots of ways you can do that. You need to build up credibility. Not with a sales first approach, you need to put out resources and content that are actually valuable to people. A podcast, a webinar, something that helps them be better at their jobs or find more success in their career or their life or what have you. Keep doing that. There are lots of other ways to build up your brand, but if you can really get into the buyer’s consideration set and their mindset, they should be coming to you eventually.
(20:43):
When done well, you have shorter sales cycles and higher close rates, and who on a sales team doesn’t want that? A point around content is a foundation of a demand gen strategy, but it’s not just about putting top of the funnel awareness content out there. You’re not just publishing best practices and tips and advice on how to solve problems. You’re looking at content for the middle of the funnel, which is the consideration stage, and you’re looking at content for the bottom of the funnel, which is that decision phase so that a perspective buyer can take themselves through that kind of self-guided buying journey. Because let’s face it, we’ve become a society of on demand everything. I don’t want to talk to a sales rep. I don’t think a lot of buyers actually want to talk to a sales rep. They want to figure out as much as they can before they submit that contact form and say, okay, show me what the pricing is on this or what do we have to do to make this happen? And so, it’s really important to, from a content strategy, really think through what you’re going to put out there for every stage of the buying process. And how do you get it out there?
(22:05):
You’re talking use cases, customer generated content even, about how they’ve used your product. You’re absolutely right. We can’t just be top of funnel. We can’t just be talking about the big pain points. We have to get all the way down to the bottom too. We have to be everywhere all the time.
(22:27):
That doesn’t mean literally everywhere, but everywhere that your specific ideal customer profile is, you want to try showing up in those places. So the question becomes where are they going to seek information to train themselves for their job, for their industry? Where are they going to research and make buying decisions? And do we have that kind of content out there? Because for example, over the years I’ve worked with many software companies where I’m buying something, let’s say marketing automation. Well, you say, okay, I’m interested in marketing automation. I care about two things. I want to see a demo and I want to know what the pricing is. You get on the first meeting with the sales rep, and it’s an intake call where all they do is ask you questions so that they can customize the demo, and then four meetings in you finally get to see the demo, and then they follow up with pricing. And that’s not the experience I wanted. Tolerate it because that’s the only way to get the information. But what if there is a very viable competitor out there that gave me all that information up front to be quite honest, I might have gone that route because it saved me the hassle of having to go through the seller’s sales process.
(23:59):
We’re talking about a more frictionless experience.
(24:02):
People feel empowered when they’re able to do their own research. You go out there and you look at all the different things yourself and you feel like I’m making my decision based on things that I have found and that I have learned, and you don’t feel like somebody’s forcing you into something. You feel a lot more comfortable with that decision. If you’ve been able to make those go through that journey and figure it out for yourself.
(24:29):
It gives so much more value to that salesperson’s job because they can start to handle any objections that you might be bringing up.
(24:42):
If you’re already at the table ready to buy, you’re going to have more questions and then that salesperson is able to handle things from there on out.
(24:55):
This is a personal example. I bought a car this morning but honestly when I was in the car with the dealer, we’d already done all this research, so it’s just like, how does this button work and this button? I already knew I wanted that car. We had done our homework on the pricing, everything else, I just needed him to answer a few questions for me.
(25:23):
He kept saying, no, you can go and talk to your husband about this. I said, no, I’m good now.
(25:31):
You can really take those personal experiences and replicate them in your work life, so the consensus is that lead generation is dead. That’s a little bit tongue in cheek. There’s a place and a time for lead generation, but for the most part, we believe that demand generation is the way to go.
(26:14):
Don’t build your whole marketing strategy around lead gen. Please think about demand gen. We’re going to tell you a lot more about it in upcoming podcasts and content that we have coming out. Just think about it from a revenue perspective, how much better it is to have inbound leads coming to you, rather than wasting time and resources chasing people who aren’t in market.
(26:39):
Thanks for joining us on The Demand Gen Fix, a podcast for HR tech marketers brought to you by GrowthMode Marketing. We sure hope you enjoyed it. Don’t forget to subscribe for more perspectives on demand generation and B2B marketing strategies. Plus give us a like. Tell your friends. We’ll see you next time.
