B2B Marketers Must Set Expectations for Successful Demand Generation Plans

B2B marketers need to educate and set expectations with executive teams, when building integrated demand creation and management plans that drive customer acquisition, retention and expansion.

CEOs, COOs and CFOs typically understand the sales processes for generating revenue: hire sales people and ramp them to generate bookings resulting in revenue. However, these same executives usually do not understand the key role the marketing function plays in generating revenue.

A best practice in B2B marketing is to hire marketing people to develop integrated marketing campaigns at least a quarter in advance before direct sales people, sales development or inside sales reps are hired. Why? The average sales cycle (the time between the creation of a qualified sales opportunity and a closed/won deal) typically ranges from three to twelve months. So the time required to generate a response, convert it to a marketing qualified lead, then to a sales qualified lead and finally to a qualified sales opportunity usually adds several months to the process. More often than not, this time lag is not accounted for at the executive level, wreaking havoc with developing and executing marketing strategy.

The marketing objective (i.e. create 50% of the sales pipeline for new customer acquisition) must be accompanied by the right marketing mix (the specific demand creation vehicles). These are the vehicles used by a B2B marketing organization to produce a specific, quantitative outcome on the sales pipeline.

A demand generation time lag model should account for:

• The close ratio (from qualified sales opportunity through closed/won) and corresponding time lag required
• The conversion ratio from qualified sales lead to qualified sales opportunity and corresponding time lag required
• The conversion ratio from marketing qualified lead to sales qualified lead value and corresponding time lag required
• The conversion ratio from response to marketing qualified lead and corresponding time lag required
• The time required for campaign execution and corresponding time lag
• The time required for campaign development and corresponding time lag

If the marketing goal is to fill the very top of a B2B sales funnel (identification of individuals but no qualification), then the corresponding marketing strategy and associated tactical marketing programs should focus on generating responses. The right tactical marketing program design and execution can effectively generate responses in B2B markets. Lead generation programs focused on generating responses typically target broader audiences, are relatively inexpensive, but have longer lead times to a closed/won deal.

On the other hand, the objective for marketing may be to develop opportunities for the sales team that are further down in the sales funnel—sales qualified leads (SQLs) or even qualified sales opportunities (QSOs). The marketing strategies that successfully drive these outcomes typically require interaction between the organization and the prospective customer, either over the phone or in-person. Examples of the marketing mix that may produce SQLs or QSOs include setting meetings with prospects at events, cold calling based on detailed account intelligence research and setting appointments with a trusted, respected third party.

It’s also important to take into account the capacity levels for the Sales Development Reps (SDRs), Inside Sales Reps and Direct Sales teams. For example, it’s not a good idea to create the total number of marketing qualified leads (MQLs) for an SDR to make their quarterly number in a one-week period. Everyone has a capacity limit and it’s key to build flows or responses, MQLs, SQLs and QSOs that respect those limits. A best practice for demand generation and demand management is to create a steady flow that allows an SDRs to follow-up up with at least 10 touches in a 30-day period for each and every MQL.

Set your organization up for success by setting expectations with all stakeholders – from executives on down – that respect the time lag required to build and execute a successful integrated demand generation and demand management plan.

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