In any walk of life, it’s easy to maintain the status quo. It’s comfortable and familiar. Yet, as we all know, that is not how life works. To grow in our endeavors, we must learn to embrace the unknown. We must learn to embrace change.
For B2B businesses, the way in which we’ve approached demand generation has remained relatively the same for quite some time. We’ve focused our attention on direct sales and building 1:1 customer relationships. We’ve had sales and marketing departments function independent of one another—each with their own set of standards and objectives. We’ve employed ad hoc field tactics based not on a strategic approach tied to buyer journeys and the value of a customer lifecycle, but on the product and what we as marketers have deemed the prospect and the opportunity.
In recent years, though, a variety of factors have shifted the means by which companies solicit and interact with new customers. Whether it be the rise of inbound marketing, technology advancements such as predictive analytics or personalization, account-based marketing strategies, or increased customer expectations, the bottom line is that demand generation has evolved. And with this evolution comes a decision for businesses—stay the course or embrace the change?
As a pioneer in B2B digital sales and marketing technologies, SiriusDecisions provides the tools and resources to help organizations adapt their approach to the new realities of digital marketing. This began in 2006 with the introduction of the SiriusDecisions Demand Waterfall—a framework to help companies organize their lead management process and improve sales and marketing alignment.
The waterfall was updated again in 2012 and the framework worked well and SiriusDecisions could have easily stuck to the status quo. Instead, they listened to their customers, they understood the rapidly changing digital landscape, they got back to the drawing board to refine their methodology and in 2017 released their new Demand Unit Waterfall® with a number of important changes based on new market shifts.
One of the biggest changes in the new Demand Unit Waterfall is the notion of decreasing the importance of individual buyers and instead targeting ‘demand units’—a group of individuals within a company that have been organized to address the needs their organization is challenged with, or perhaps less formally, the various roles that make up a decision-making whole for specific business functions.
This change stems from a growing B2B standard in which an organization’s buying process is done by a committee-like structure rather than a single person. In fact, 5.4 people on average are involved in today’s B2B purchasing decisions.
At R2i we often work with clients to align these internal stakeholders and the unit comprises representatives of cross-departmental leaders from LOBs such as Marketing, IT, Finance, Communications, and Design. Alternatively, the demand unit could also consist of a single business unit. For example, the technology, content, and go-to-market strategy for corporate HR and Recruiting requires subject matter expertise in that Business Unit, whereas a product team, marketing team, or customer service team may have their own different requirements and function as a unit seeking holistic solutions for their unique role in the organization.
This Demand Unit methodology is much more aligned to the account-based marketing approach that many SMB and enterprise B2Bs have adopted in recent years. It’s important to note that this change does not diminish the importance of individual sales relationships or personalization tactics. Rather, what it does is provide a much more accurate representation of buying behaviors and roles of influence that allows Marketing and Sales teams to focus their attention on who these target demand units are and how they align with their organization.
In a digital age where customers hold the power, it’s vital for businesses to intimately understand both their market space and their target clients. This includes:
By knowing more about the target base, their circumstances, and the obstacles they are facing, businesses can focus their attention on communicating the business problems that they solve, rather than the products that they sell. This provides a much more relevant, personalized approach to demand gen that prioritizes what should truly come first in the sales cycle—the customer’s needs.
As mentioned before, B2B organizations have long thought of their sales and marketing departments as two separate entities in the demand generation process. In earlier SiriusDecisions waterfall models, each of these departments operated with their own set of goals and KPIs and were measured by the qualified leads they brought in (MQL or SQL).
While many companies have taken considerable steps to align their sales and marketing departments to work holistically, it has to go further than that. They must be fully integrated. In fact, the Demand Unit Waterfall, eliminates the old MQL and SQL nomenclature altogether, instead choosing to organize these departments as a single entity working side by side throughout each stage of the lead management cycle.
The future of demand generation will ultimately be shaped by the advancements of technology and targeting capabilities. But as the digital landscape matures, B2B businesses can be proactive in preparing for these advancements by investing the time and resources into understanding their target market, the demand units that make up this space, and their buying journeys that are often anything but linear.
While ‘traditional’ methods of direct sales and relationship selling may be comfortable, they don’t represent long-term business growth. The real opportunity for meeting prospective customers in the right place at the right moment in time leans into an organization’s ability to focus on buying groups rather than ad hoc individuals, to use technology to understand their contextual needs, and to create an integrated team hell-bent on embracing the challenge.