The State of Demand Generation

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2 Demand generation the practice of driving awareness and interest in a brand s products and services isn t new, but modern techniques for demand generation certainly are. Visionaries like Seth Godin have taught us that personal engagement is the true marketing best practice, but technology is changing and improving faster than we could have ever imagined in the early days of direct mail marketing or even . As the marketer s toolset expands, so does our need to better understand the consumer mindset. Thanks to the speed of innovation, technology advances have vastly outpaced marketing theory and practice. With that in mind, I wanted to create a new study to help bring the paths of theory and practice together. While this research was designed to discover the best practices for today s environment, it s important to remember that better practices are evolving every day as technology warrants. What works today may not work six months from now. So take what you can from this research, analyze both your successes and your shortcomings, and refine your tactics with each campaign. To new ideas and future success, My study surveyed the demand generation habits and practices of 400 B2B buyers and 138 B2B companies. As you read the study s findings, you ll find answers to the following questions: Which best practices are best-of-breed companies using? Which industry standards should become benchmarks? What types of content are consumers searching for? What are the future best practices for demand generation? Mathew Sweezey Marketing Evangelist, Pardot, an ExactTarget 2013 ExactTarget + Pardot 2

3 Methodology This research contains two separate research studies: a survey of business-to-business (B2B) customers and observational research of B2B companies. B2B Buyers Survey For this part of the report, we surveyed 400 B2B buyers about their buying habits and preferences in other words, 400 consumers of B2B companies products. We focused on asking questions about what B2B buyers are looking for when they start evaluating new solutions. The survey began with 19 questions about how consumers engage with content and how they research purchases. Here is some additional information about these 400 respondents: 53% work for a small business 22% work for a mid-market company 25% work for an enterprise company 75% of survey respondents are not marketers We designed this survey to be heavily skewed toward non-marketers, as past research shows that non-marketers behave differently from how we as marketers might predict (check out the SUBSCRIBERS, FANS, & FOLLOWERS research report Marketers from Mars for more on this subject). B2B Companies Survey For the research on B2B companies, we researched (by observation) 138 companies in different segments of business: Fortune 500, mid-sized business, small business, and software-as-a-service (SaaS). By breaking companies down by these categories, you can identify with the companies most similar to yours. We defined Fortune 500 companies by the following guidelines: A company listed on the Fortune 500 list that is strictly a B2B company. Any companies that were both B2B and business-to-customer (B2C) were removed. Of the 500 companies listed, there were 33 in this category. We defined mid-market companies by the following guidelines: A company with 1,000-10,000 employees, but not listed on the Fortune 500. These companies were also strictly B2B, with a market where modern demand generation was an accepted practice. In verticals where purchasers do not rely heavily on online marketing (such as contracting companies or other similar companies), we did not consider those companies. We researched 42 companies in this category. We defined small businesses by the following guidelines: Companies with more than 10 and fewer than 1,000 employees. The same constraints were applied when selecting these companies as well: only B2B companies with a marketplace where online marketing is a significant source of generating new prospects (i.e., lead generation). There were 46 companies researched in this section. We defined SaaS companies by the following guidelines: Companies that deliver all of their technology over the internet. The other categories guidelines also applied. Only the top 17 largest SaaS companies in the US were included in this section. This focused the research on the most progressive companies ExactTarget + Pardot

4 The B2B Customer s Initial Search Research shows us two major findings about a purchasing lifecycle: how long a research cycle is, and what type of content someone wants during that lifecycle. Modern best practices in demand generation will revolve around an understanding of where your prospects are in the lifecycle and matching your content offers to them at that point. But what are the numbers saying now? What the Numbers Say The majority of product research begins, perhaps not surprisingly, on Google: 71.67% Google 2.76% Bing According to this survey, the combination of Google and personal networks comprise the largest majority of product research origins. It s no longer sufficient for brands to simply dominate search and search ads; you must also inspire your customers to share your brand s value through word of mouth. 72% of product research for a future business purchase begins on Google. Where do you typically start your research for a future business purchase? 5.53% Yahoo 2.01% Social Networks 2.51% LinkedIn 15.58% Personal Networks Source: Customer Focused Content Survey 2013 Answered: 398 respondents 2013 ExactTarget + Pardot 4

5 The B2B Customer s Product Research How many times do you go back online to conduct further research for a purchase that requires your boss approval? After initial product research on Google, our research shows that customers conduct further research two to three times before seeking manager approval on a purchase. I do it all in one sitting. 18% I may go back 2-3 times doing research. 70% I go back more than 3 times. 12% Source: Customer Focused Content Survey 2013 Answered: 369 respondents Do you agree with the following statement? As my research deepens on a subject, my search terms usually become more refined as well. Our research indicates that 98% percent of surveyed customers agree that their search terms become more refined as their research on a product offering deepens. Yes No 2% 98% Source: Customer Focused Content Survey 2013 Answered: 369 respondents ExactTarget + Pardot

6 The B2B Customer s Research Preferences Does the cost of the item you are purchasing affect the amount of research you do before a purchase? Overwhelmingly, B2B consumers say yes the cost of the potential purchase does affect the level of time and effort they re willing to invest in product research. Yes No 11% 89% Source: Customer Focused Content Survey 2013 Answered: 398 respondents Do you agree with the following statement? I prefer different content at each stage of my research process. From the content side of things, the majority of B2B buyers approve of receiving different types of content along various stages of the buying process. Yes No 24% 76% Source: Customer Focused Content Survey 2013 Answered: 369 respondents 2013 ExactTarget + Pardot 6

7 The B2B Customer s Reading Habits How long do you think a written piece of content should be? (Written content could be a whitepaper, case study, or other asset, excluding ebooks.) Interestingly, 70% of respondents say that they d prefer content under five pages (versus content over five pages or simply as long as it takes to inform me ). As long as it takes to inform me. 28% I d prefer under five pages. I d prefer over five pages. 2% 70% Source: Customer Focused Content Survey 2013 Answered: 369 respondents Modern best practices in demand generation will revolve around an understanding of where your prospects are in the lifecycle and matching your content offers to them at that point ExactTarget + Pardot

8 Modern Best Practices: Content for the B2B Customer Forming Your Best Practices Customers answers to the preceding questions provide some insight into how to better execute a lifecycle marketing campaign. Be cognizant of where prospects are within the lifecycle. The typical lead lifecycle has three stages. As evidenced by the results listed previously, 76% of prospects prefer content tailored to each stage within the buying process, so tailor content to these three stages. Stage One For customers in stage one, we recommend broadly focused content that helps readers better understand a problem. You should limit your discussion of products or services in these documents and make sure the content provides real value to the reader even if that reader never buys anything from you. For even better stage one content, determine the words that your prospects start searching for when they begin their research, and create content to speak to those keywords. Stage one content could include: Blog posts either written by your brand or others within your industry. Keep the discussion helpful and suited to your readers, and avoid being overly promotional. Industry articles to build trust and your credibility instead of pushing your products. Infographics focused on helpful content that pertains directly to your readers jobs. Once again, you don t want to focus on pain points or your company. Stage Two For stage two, we recommend nurturing potential customers with content demonstrating social proof that is, third party support and concrete evidence of your products value. A person at this stage has figured out they have a problem, but does not have the budget, authority, need, or timeline yet to purchase. Remember that the researcher will likely have to convince others of the need to purchase a service to solve this problem. Social proof of how others solved it and what kind of results they earned are best shared at this stage. Examples of excellent stage two content include: Video testimonials sharing how other companies benefitted by using your technology. The focus isn t on why you re better than your competitors, but how you solved a problem. Analyst reports allow people to share trusted information with executives to gain buy-in for evaluations. Webinars are a useful tool to share education on adapting your product. ROI calculators are a nice way to provide black and white value to stakeholders. Knowing when someone has moved from stage two to stage three can be easily determined based on behaviors. Use lead scoring and allow prospects to choose their own content to move themselves ahead to the next stage. Begin to allow people to move themselves from stage to stage by leveraging secondary calls to action whenever you offer content. For example, in a stage two nurturing , your main offer is for a stage two piece of content. However, lower in the , offer a secondary call to action for a piece of stage three content. This gives people the option to move themselves ahead if they re ready ExactTarget + Pardot 8

9 Modern Best Practices: Content for the B2B Customer Stage Three For excellent stage three content, let prospects know why your brand is the best. This is finally the right time to talk about you. Talk about why you re better than your competition, whether that s ease of use, customer service, or any other differentiators. Customers at this stage are very knowledgeable and will be almost ready to talk to a sales representative. The following types of content are best suited to this stage: Buyer guides show prospects how to evaluate vendors, allow you to set the bar for their evaluations. Sample RFPs help prospects prepare for the coming evaluations. Comparison documents show how you stack up against your competition and identify who your real competitors are. Build trust by showing all competitors, remembering that they ll already know who they are if they ve ever done a Google search. The length of content should vary based on the purpose of your campaign. Typically, longer-form content works better for paid search, and shorter-form content works better in lead nurturing. Content Conclusions Keep in mind the length of your content when designing your modern demand generation campaigns. The length of content should vary based on the purpose of your campaign. Typically, longer-form content works better for paid search, and shorter-form content works better in lead nurturing. According to our survey, most people prefer content under five pages; however, many ebooks with more than five pages have a high download rate. The purpose of your content will play a role in determining the right length. If the goal of the document is to get someone in your funnel, then longer documents are more likely to provide enough value to persuade readers to share their addresses. Once you have the potential customer interested, you should keep your content shorter so it can easily be consumed. Content that isn t read does you no good. For example, consider this document. It s longer than five pages, but it s being published as a research report for the purpose of education, not demand generation. Your content is your brand s chance to help your future and current customers as you demonstrate your own expertise. Always keep your content focused on the ultimate goal of helping your readers, and always present them with appropriate calls to action that speak to where they are currently in the customer lifecycle ExactTarget + Pardot

10 Demand Generation: Who s Using Content Marketing Best? Demand generation is something every company must never stop working to perfect. We ll look at four verticals to determine which one is best at demand generation: enterprise, mid-market, small businesses, and SaaS. These cross sections will help you compare yourself to others and get a glimpse at what s going on outside your own vertical. Within demand generation, we ll consider how companies are using content marketing, forms, and marketing automation. Demand Generation: Adoption of Content Marketing Vertical Adoption Enterprise 98% Mid Market 98% SMB 98% SaaS Companies 100% Content marketing was adopted at some level by all companies in this research, and at a very high rate. Sometimes, the smallest businesses with the fewest resources can produce the best content, because smaller companies are often more nimble and timely with their content, with fewer approval processes to go through. Best Practice: Mid-sized and large companies can produce great content, too. They just need to streamline production and approval processes. In your content calendar, allow space and plan ahead for current eventthemed posts. Before the content is even created, designate who is going to review it and get it launched quickly, so that you never fall victim to irrelevancy due to a lagging approval process. Most companies use some form of content in their marketing, but doing content marketing well is still a differentiator among brands. Track the results of various types of content and test the timing of new content to make sure you get the maximum impact from your content marketing efforts. Demand Generation: Adoption of Forms Vertical Adoption Enterprise 25% Mid Market 22% SMB 48% SaaS Companies 53% The use of forms (yes, those blank boxes you hope your prospects will fill out) for demand generation is key in any online marketing strategy. Forms allow companies to collect addresses, which are needed for continued communication with a prospect. But forms, however, can both help and hinder if they re not used correctly. Looking at the four verticals in this study, note that SaaS companies are the best at using forms. They have the highest adoption rate, and we observed that their forms were often the most sophisticated in terms of informationgathering and design. Enterprise companies use very few on their sites typically only a Contact Us or sign-up form ExactTarget + Pardot 10

11 Demand Generation: Who s Using Forms Best? Demand Generation: Adoption of Short Forms Vertical Adoption Enterprise 28% Mid Market 43% SMB 89% SaaS Companies 88% Notice that only 28% of enterprise companies are using forms of ten fields or less, while small businesses and SaaS companies are at 88-89% for short forms. Best Practice: Use forms on your website to hide valuable content (in exchange for an address or other contact info), offer enrollment in loyalty programs, and offer subscriptions to different types of communications (including , but also mobile services and more nichespecific options, if applicable). Ideally, forms should only request two fields of information: first name and address. Try not to fall victim to the mistaken belief that more questions will better qualify a lead for sales. A shorter form will help improve your completion rate and won t spook those beginning to enter the form. For an additional tweak to improve your existing forms, implement progressive profiling. Each time a prospect sees your form, ask two questions but make sure they re two different questions each time so all the information you require is eventually acquired. Here are a few fields you can eliminate today to shorten your forms: Last name: You only need a first name to send s. You can ask for last name later. Phone number: Forrester reports that 65% of people lie when asked for their phone number. You can ask for this later when you have a more established relationship with the customer. How did you find out about us? With marketing automation s prospect tracking features, you know exactly where your relationship with each prospect started. Custom questions: Forrester also reports that 68% of people lie when asked any type of custom question outside of name, address, etc. Purchasing timeline: If they are downloading content, they are in a timeline. If your content is crafted correctly to correspond with their purchase stage, you ll know where they are by what they are reading. Demand Generation: Adoption of Marketing Automation Vertical Adoption Enterprise 25% Mid Market 59% SMB 66% SaaS Companies 76% Marketing automation is a new technology that businesses of any size can use. Its abilities to track leads, remove IT from form creation and management, and allow marketing to engage in better lead nurturing have made it widely accepted as a marketing best practice ExactTarget + Pardot

12 Demand Generation: Who s Using Marketing Automation Best? Interestingly, enterprise companies those with the largest budgets have been slowest to adopt marketing automation, while companies with smaller budgets have been quicker to adopt. Best Practice: Marketing automation is an expensive tool, but your brand can t afford to neglect it. Invest in a high-quality marketing automation tool, and begin to experiment with which customer touchpoints can be automated and improved, thanks to better targeting and more personalized communications. With the time saved from marketing automation, you can turn your thoughts to other pursuits, like overall strategy, A/B testing, and segmentation. One use for marketing automation is a more modern approach to lead nurturing. Lead nurturing s can improve your odds of getting engagement with a new lead. Try these tactics for improved lead nurturing s: Place your call to action as high as possible in the copy, and have it match your subject line. Write like you re writing to a friend. Keep your s short, and consider using rich text as opposed to HTML. It appears to be written by a friend, rather than by a marketer. Use secondary calls to action to allow readers to choose their own adventure. This allows them to pull themselves through the lead funnel at their own pace, letting them be the driver, with you as the guide. Use content that can be consumed in five minutes or less, and make this clear in your copy. Otherwise, people are likely to save your for when they have more time, and forget about it. Overall, SaaS companies scored the highest throughout the study in terms of demand generation best practices. By adding content marketing, appropriate forms, and marketing automation to your marketing plan, you can join the ranks of these companies among the top of the heap when it comes to marketing capabilities no matter your vertical or product line. With the time saved from marketing automation, you can turn your thoughts to other pursuits, like overall strategy, A/B testing, and segmentation. Shorten your forms, ask for only what you need, and tailor your content to each stage in the customer s lifecycle, and you ll be a leader in demand generation s future. Your journey to inspired marketing begins at exacttarget.com. Request a personalized demo to see how ExactTarget landing pages and forms, along with Pardot s marketing automation, can power your demand generation efforts ExactTarget + Pardot 12

13 There s marketing. And then there s Inspired Marketing. With billions of hyper-connected consumers on the planet, there s never been a better time to be a digital marketer. You have an incredible opportunity to use data and technology to drive relevant messages, to connect, to inspire. Your journey to inspired marketing begins at exacttarget.com

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