The B2B obsession with lead gen metrics contradicts marketing fundamentals and prevents awareness from developing into active demand.
B2B marketing is overly focused on measurement and attribution, appearing and claiming to be more science than art. Everyone wants to believe it’s a science. Investors, boards and leadership expect marketing growth to be measurable, predictable and projectable.
But the truth is that marketing is not a hard science. Experiments are not repeatable and playbooks are not fully transferable between companies. While benchmarks and leading indicators help guide our decisions, the variables that can change outcomes are unique to each company, category and audience.
More concerning than this measurement obsession are the behaviors it has spawned. Believing B2B digital marketing differs from general marketing leads us to actions contrary to marketing theory.
The lead generation obsession
Marketing is a long-term effort, but it has come to have short-term accountability. Especially in organizations with a sales-led motion, things have to be viewable on a dashboard within a quarter to satisfy leadership. So-called “vanity metrics” like site traffic and ad engagement don’t cut it anymore. Now, marketing needs to show ROI quickly.
For various reasons, lead generation is now one of the dominant strategies of B2B marketing teams to satisfy this pressure. It’s tangible and can be used to tell a great marketing story. It also allows for a very clean attribution path to revenue and keeps sales teams happy (initially, at least).
And when a strategy serves your dashboard, you go all in on it. Marketers spend much of their budgets on lead generation, but the results are masking a worrying transformation that has taken place over the years.
At its core, lead generation should be about bringing people who are interested in your solution, your category or the pain point you solve — in that order. The level of intent that comes along with each of these leads differs greatly and converts into revenue at very different rates For the sake of simplicity, we’ll categorize them as follows:
- Brand interest — Bottom of the funnel (BOFU).
- Category interest — Middle of the funnel (MOFU).
- Pain point interest — Top of the funnel (TOFU).
Unsurprisingly, the number of people at the bottom of the funnel is the smallest and highest converting and most desired by sales. Getting to that level requires a lot of marketing.
However, most of the marketing budget is now going toward the top-of-funnel efforts to meet volume demand, building that lead pool and hoping they can be moved toward the bottom of the funnel by nurturing efforts.
And this brings us to the marketing fundamentals gap. This process of gathering leads at the top and moving them to the bottom is mechanical and ignores how brand awareness develops into active demand. It also creates budget allocation that prevents that from happening.
Dig deeper: From capturing leads to generating demand: Breaking down B2B marketing’s pivot
The demand generation curve
Demand generation is ultimately about brand awareness more than it is demand. Right now, there is a new narrative in marketing that we create demand, but it’s incorrect.
Demand and needs, in general, have to exist with the buyer. Our job is to increase the awareness of our solution as the best option to satisfy that need. This occurs over time and increases in different ways in the form of the “demand generation curve,” as we call it in our agency.
This is simply marketing theory shown through the lens of demand generation, but it has become absent in B2B marketing today. The stages are as follows:
- Brand recognition. The simplest form of brand awareness is recognizing your logo, which comes from seeing it enough and in the right places to leave a lasting impression.
- Brand understanding. Far more important than recognition is understanding — knowing not just who you are but what you do and for whom. This comes only from successfully delivering your message to your audience and is often the hardest part of marketing.
- Brand recall. Seed your message enough, and you’ll eventually become a top-of-mind example of solutions to your pain point, otherwise known as the “consideration set.” Brands who find themselves here are the ones mostly to find themselves receiving inbound demand in reliable volumes.
- Brand preference. Increase affinity enough over time, and you’ll reach the most coveted of places — the brand is seen as the true leader in the mind of the buyer. Few reach here, but those who do dominate the category.
Brand awareness changes over time as you increase the level of understanding and affinity your audience has for your brand. But, because of the focus on lead generation, we instead try to bring people into a funnel when they are at the early stages of this curve, if even on it at all.
Much as we’d like to believe it can, this journey can’t take place in an email drip campaign over the course of a few weeks and months — and the lead to revenue rates in the industry support that.