While becoming this week an Amazon best seller in the Business Sales category, “Driving Demand” from Carlos Hidalgo claims to be “a clear roadmap and framework on how B2B organizations can implement change management and transform their demand generation.” I will share with you in this article my best tips from this reading.
Carlos Hidalgo is known as the writer of “Driving Demand: Transforming B2B Marketing to Meet the Needs of the Modern Buyer” and as the CEO & Principal of ANNUITAS a B2B Demand Generation Strategy and Change Management firm.
Coincidentally, the first article I prepared before I launched BtoB Marketing Sales was an article by ANNUITAS. A report on the 2014 B2B Enterprise Demand Generation Survey. It wasn’t until after purchasing this book that I realized Carlos was in fact the CEO of this very organization.
Carlos begins by summarizing all the meetings he has scheduled with B2B industry leaders and marketeers in preparation for the content of this book. Already I feel this book is credible. Carlos goes on to explain “The only missing ingredient in most organizations is change” in relation to enhancing, streamlining and even revolutionizing B2B Demand Generation Strategies. Let me share with you, chapter by chapter, how Carlos Hidalgo believes change can be positively be put into place in a company.
The Issue with Modern Demand Generation
Below are my key takings from his first chapter:
- Low quality leads, coming from marketing (commitment on quantity but not always on quality),
- Inefficiency of campaign-driven approach in generating demand (Tactical Approach),
- Versus Strategic Approach: “A perpetual process that is both operationalized and optimized to engage, nurture and convert both prospects and customers along their buying process”,
- Don’t make technology the focal point of your demand generation plans. As an example, according to ANNUITAS, only 21% of those who own marketing automation have claimed to have been successful at achieving their goals with this technological tool,
- Know your buyers (interviews) and understand the market conditions in which your buyer lives on a day-to-day basis (research) to better anticipate the B2B buyers’ purchase patterns
- “Organizational Stratification”; web teams, social media teams, marketing automation teams: working in silos limits B2B marketers in creating demand and driving pipeline & revenue forwards,
- Train your marketing teams to face new challenges which emerge from the on-going digital disruption happening in the B2B playground,
- Only 1/3 of B2B organizations have a common set of KPIs that both marketing and sales share to measure success, this sort of alignment should be prioritized by any company in this market,
- Having a team specifically dedicated to all aspects of demand generation is the only way to activate consistent, effective and buyer-centered demand generation. To just add this to your corporate marketing team’s to-do list (content creation, development of buyer personas) is not going to help.
Leading Demand Process Transformation
In this chapter, Carlos Hidalgo introduces the concept of Demand Process Transformation and shares an existing user case (PR Newswire) to illustrate the way B2B companies should change their approach in demand generation, to encourage a sustainable and repeatable growth model.
“Demand Process is the practice of aligning people (marketing and sales), processes, content, and technology to that of buyers and their buying process” describes Carlos Hidalgo. But what concrete changes does this practice involve in a B2B company?
It is now clear to me that the concept of Customer Lifetime Value (CLV) is the main key to success in any Demand Process Transformation, over just working your butt off to generate a high number of qualified leads. To summarize, you need to put a sales & marketing machine in place, able of identifying, nurturing and converting B2B leads into a “repeatable and programmatic fashion”, with all structural changes involved to achieve a continuous interaction with potential buyers. This to happen from the moment they are identified to the moment they sign their first contract.
I love the concept of conversion content: conversion-friendly content (if you do it right) will turn visitors into leads, leads into customers, and customers into fans. It is the concept of delivering tailored content to get your lead to take action, based on your lead maturity level. And this is what Demand Process Transformation should lead result in.
Why Transformation Fails
I selected some of the transformation failures mentioned in the book, mainly those which stood out to me.
- “When it comes to retooling the approach to demand generation, there are no quick fixes.” writes Carlos,
- Taking Shortcuts: Carlos Hidalgo takes one compelling example (at least to me…). Carlos recently worked for a company in developing a strategic demand generation program, on a complex and multiple products offer, involving many buyer personas. The recommendations made by Carlos involved a very deep change in the marketing machine, requiring a certain budget of course. The CEO of the company responds: “Can you compress this strategy? It sounds good but too complex, expensive and long term too us.”. It doesn’t work like this. This project failed. The first question to ask yourself is: “is my company ready for this?”. If not, you probably have a few more people to talk to!
- Other phenomenons related to individuals “blocking the way” consisted of pride of ownership, a dangerous lack of vision, and conflictual political agendas as they lie in the concepts of being human and change management. How to convince people who are afraid that their position might possibly be threatened by the implementation of Demand Process Transformation?
- Transforming demand is an all-or-nothing proposition. Organization leads cannot expect to make changes to just one small area of their demand generation strategy and expect tangible results.
The above examples are expanded on in the book, these are my brief takings.
Action Does Not Equal Change
Carlos is starting this chapter with a very simple statement: if you ask B2B marketers “how many of you feel they do not have enough time to do their jobs?”, a big majority of those people raise their hand. All studies show that the majority of B2B marketers will increase their budget this year and create more content than they created last year, while only a little part of the B2B organizations claim to have succeeded in delivering the tangible results they expected last year. So basically, more time and money spent leading to no ROI increase. That sounds pretty sad indeed.
I don’t want to list in full ANNUITAS’ consulting offer and explain all the new concepts introduced by Carlos at this point of the book, such as Demand Process, Blueprint or DGCoE (Demand Generation Center of Excellence), but overall one of the main point is that your company needs a Demand Process model that can be replicated effectively across the organization: a Demand Process Framework℠. The design of this framework is basically something you will require help for, and this is where organizations like ANNUITAS show up.
Other interesting perspectives highlighted in the book: split content marketing teams up and divide the resources into Engagement content specialists and Nurture content specialists, because the content in the Engage stage should be different from the content in the Nurture stage.
Changing the Marketing and Sales Mind-set
The key statement of this chapter is:
“The role of sales has changed dramatically over the years. Buyers are no longer dependent on a sales guy or a sales teams to provide product information; in fact, they manage and execute much of their own buying process, especially in the early stages, without any help from a vendor.” (Carlos Hidalgo)
This says it all. 57% of the purchase decision is complete before a customer even calls a supplier. This is true for both B2B and B2C (source CEB).
So no, being in sales for 20 years doesn’t prove that you are an efficient sales person anymore, even if you used to get all the “sales of the year” awards back in the 2000’s.
“57% of the purchase decision is complete before a customer even calls a supplier. So no, being in sales for 20 years doesn’t prove that you are an efficient sales person anymore, even if you used to get all the “sales of the year” awards back in the 2000’s.” (Aurélien Gohier)
The key of success is also to recognize the role of marketing is the poor way the demand generation approach is driven. Maybe your company’s strategy is mainly driven by old-fashion sales managers unwilling to adapt their way to generate demand, but this is not an excuse along as you tried to inspire change in a smart way. It is your job to get sales people to understand your vision of modern B2B demand generation. Start small. Defining common measurable objectives between sales & marketing as step one is not going to work, it should come later in the evolution process. Only 38% of B2B marketing departments today have both lead and revenue quota goals, so let’s look in our own backyard first…
Very important point highlighted by the writer: “Sales are not Marketing’s customers but both departments’ customers.” I leave you with this thought.
I love the way Carlos defines the big Social Selling buzzword: “it is about sales people building a strong personal brand”. Also, I will definitely propose my sales to experiment this exercise suggested by Carlos:
“Ask one of your best sales to educate you on some industry trends without mentioning your company or any of our products, and see the result.” (Carlos Hidalgo)
This is the key. Social Selling is nothing new. As Susan Tatum explains in my last interview:
“B2B companies need to understand that social media is just another business tool for generating awareness and getting the initial connection.” (Susan Tatum)
Align Content to Your Buyer
Carlos Hidalgo describes a interesting phenomenon: every two marketing articles I see on LinkedIn Pulse, I read so-called content marketing specialists advizing “align content with the buyer”. But how do B2B marketers do that? Not easy to find concrete answers.
It won’t hurt to remind everyone the proper definition of content marketing: “a strategic marketing approach focused on creating and distributing valuable, relevant, and consistent content to attract and retain a clearly defined audience, and, ultimately, to drive profitable customer action.”
The writer highlights the importance of generating a dialogue with your audience. Content marketing generating no feedback or interaction between the buyer and the vendor could almost be considered as push marketing! “Less than 30% of the B2B companies align their content to each stage of their buyers’ journey.”; as many companies which take the risk to waste their efforts and money in creating new content.
Facing this accurate content generation challenge successfully involves a good analysis of the B2B prospect buying path. Also, as explained by the below chart, make sure to keep in mind to not blindly concentrate your content creation efforts on not only the Engagement stage of your leads, but also to the Nurturing stage. On average, your prospects keep reading about your company one month before they actually engage with you. This information should lead the way you build and segment content.
“Buyers want content that educates them and enables them to make a more informed purchase.” (Carlos Hidalgo)
Three key questions that every organizations should consider before even starting to develop content:
- Does our content educate the buyers and speak to their pain points and challenges?
- Does our engage content focus too heavily on our products, services and brand?
- Is our content written from the perspective of a subject matter expert or from our position as a vendor?
Those questions say it all. In terms of what format you should focus on, some studies show (do not expect something surprising here…) that 91% of B2B buyers prefer interactive, visual and on-demand content. Another huge SEO paradox, when the best way to be ranking well in Google result pages is to generate long read articles containing a fair amount of plain written text. Thanks for the brain teaser Google…
Adapting the Lead Management Process
As the writer explains, the concept of lead management might sound simple, but this is typically an area where B2B companies have always been struggling in, despite the democratization of marketing automation. In the ideal world, your new leads should remain in your marketing automation system until they get a sufficient level of maturity and qualification, with a proper progressive profile and lead scoring configuration (I am using Pardot and can only recommend this solution). Then (and only then) should they be assigned to sales in CRM (Salesforce in my case). This is not something easy, in particular when a company has a, highly complex and multi-products offer. However what are the risk if you don’t follow this strategy:
- You are going to discredit the marketing department actions because the quality of the leads delivered to sales are not good enough,
- Your lead conversion rate will be low and you will have a hard time convincing your management that all of “this is because of sales who don’t deal with the leads” you provide them with and that “their reactivity to check new leads is too low”,
- You are going to generate frustration for you and your sales team
To avoid that, your lead management process should include (and I quote the book):
- Lead routing definitions
- Lead qualification model
- Lead scoring model
- Progressive profile model
- Service level agreements
Also, make sure not to be delusional about the two next points:
- Marketing automation doesn’t fix your lead management issues. Technology will be a waste of time of money if it is not defined in a company where a proper lead management process was already defined and actually works,
- Even though a big part of the buying process now happens in a digital way, lead qualification still requires human interactions to be efficient. This is where having an inside sales team in charge of giving a call to (even) high-scored leads before assigning them to sales people will make a huge difference. Only 41,5% of B2B companies are actually following this approach, so just try to be part of the remaining 58,5%. Don’t make the mistake of having your inside sales calling a new contact too early in the buying process though, or this might become counterproductive (too agressive). Keep in mind that “the average B2B buyer consumes three to five pieces of content before engaging with a sales person.”
The book gives great insights into how to build a decent B2B lead scoring model, I encourage you to read it if this issue is problematic for you. Let me quote Carlos Hidalgo, who summarizes a big piece of the full lead scoring issue with this sentence:
“The scoring should have a higher importance and value based on where in the buyers’ journey an action is being taken, rather than depending entirely on the type of asset consumed.” (Carlos Hildago)
Measuring for Success
As scary as it might seem, only “26% of B2B organizations reported to be able to measure and report of the contributions of the program to the business” (source ITSMA and VisionEdge Marketing).
To cut it short, here are the few minimal KPIs you should be able to track tangible outcome from, of your demand generation actions:
- The number of qualified leads coming from your marketing programs,
- The conversion rate of those leads,
- The financial impact of these conversions on your marketing pipeline.
Carlos Hidalgo is giving is this part of the book some good guidance on what the most frustrating question can be to ask a CMO: “can you please prove the tangible value of our demand generation activities?”. There are many ways to measure success, you just need to find the appropriate way to do it, taking into account the business culture and objectives of your company.
Putting in place those trackable KPIs and investing more budget in analytics tools are important steps, but your team needs to be trained on Marketing Performance and Marketing ROI tracking. The Fournaise Marketing Group estimate that the proportion of B2B marketers being having had proper training is a mere 10%. An incredible statistic when marketing & sales actions’ ROI is critical for CEO, CFO and so on.
Optimizing Data and Technology
You can have the best KPIs in the world, but the success of your demand generation programs depend on the quality of your data. B2B organizations should all consider the importance of having dedicated resource management and daily database cleanups. Proper data governance and centralization in one single e-CRM system is a must.
I have a concrete example of the terrible impact a poorly-managed database can have on your business, and even on your reputation as a company. In a previous professional experience I was in charge of ensuring the integration of a recently acquired SME of an international company I was working for at the time. Before I moved their data from Microsoft Dynamics to Salesforce, I ran a series of emailing tests based on some data reactivation techniques that I knew about, with the view of estimating an average bounce rate of 26%. A 26% average bounce rate for three campaigns I ran which hosted 20.000 leads and contacts. As you can read in details on Campaign Monitor‘s website, bounce rate, what email providers and anti-spam networks monitor, will decide if participants will accept mail from you in the future. Being under a 2% bounce rate will avoid you such trouble. Besides the risk for your company to get all its IPs blacklisted, studies have found the cost of bad data amount to an increase in marketing costs of anywhere between 12-15% annually.
Your CRM should be the SSOT (single source of truth) and only a few people should have full administrative access to this data. The book is perfectly describing how to put in place some “minimal governance standards that your organization should define to ensure data integrity”. You can also use some external help from Data.com for better and automated customer data and intelligence from directly inside your CRM system.
Frankly I was so surprised to read that 87% of B2B demand generators are listing email as their top channel for generating leads, when I read everywhere on the web that “email marketing is dead”. Yes, stupid mass emailing is dead, but well-segmented email marketing supported by smart BI is still king when it comes to driving B2B demand, even though maintaining good B2B email deliverability rates became a nightmare due to more and more efficient network filters and corporate firewalls.
“Yes, stupid mass emailing is dead, but well-segmented email marketing supported by smart BI is still king when it comes to driving B2B demand.” (Aurélien Gohier)
Creating an Outcome Accountable Culture
The need for B2B marketers to show business outcomes and be accountable for these outcomes is more urgent now than ever before. A CEO having to ask his CMO on a monthly basis to provide figures to asses whether the marketing department deserves to live is obviously counterproductive, highly demotivating and even humiliating. As a CMO, one of your priorities is to inspire change in your company, in the way that your department moves “from being viewed as a cost center to being considered as a growth-driver”.
One of the solutions to make this happen is to put in place indisputable success measurement metrics that you can share internally. Choose the right words though: don’t sell your CEO as from now on, “drive 30% of the corporate business” instead sell the fact that marketing will contribute to at least 30% of the corporate business generation, with a minimum of X million new business pipeline for example. You can also stop considering the number of new leads as a proper KPI to communicate to the management, but calculate instead the number of qualified sales leads. Make your KPIs more credible to the management. Meet those objectives and you will have done one of the best things you can do to inspire the expected culture of change.
Once this is done, you have to empower people, and move from a “play safe” corporate culture to a “take a risk” one. Having marketers scared to innovate or to try something new will never help growth. Carlos Hidalgo suggests a nice initiative that you should run as a marketing manager: the “take a risk” initiative: each employee in the marketing department was given the permission to take a risk and try something new in their responsibilities perimeter. Playing everything safe never helped in transforming demand generation.
Managing People through Change
Yesterday I was contacted by the general secretary of a marketing club which I’m a member of (The CMIT: Club of French Marketing Directors and Managers from the IT industry, I salute you guys) to write an article on the following topic: “Should marketers be Thought Leaders?” This part of the book actually helped me to find what, is now, the introduction of this article: “Marketers don’t have to be Thought Leaders, they have to be Attitude Influencers”. So thanks Carlos for that!
One brilliant statement from the writer is: “One of the mental stumbling blocks I see most often when working with our clients on demand generation transformation is the fear of starting over.” Why? Because most people spent huge efforts to build the current system, and feel this is sort of a defeat to build the new system from scratch and don’t see change as a positive thing, which I personally find understandable. This is where B2B marketing should be an Attitude Influencer: a transformation rarely implies to start over. Help people to embrace change by identifying the areas that they are currently working on, which the writer calls “bright spots”. You need to be the “Mister Full Glass” in your company, encourage employees to always be positive about what was achieved in the past, and even though it may have not been perfect people always learn from their journey to change. This philosophy will make attitudes move towards change.
Another concept identified by Carlos Hidalgo in key for change management is “Agile Learning”. The Center of Creative Leadership (CCL) lists five characteristics that agile learning individuals posses: innovation, performance, reflection, risk and not defending to anything (interestingly detailed in the book of course). The idea shared by the writer, at this stage of the book, is that B2B companies should have their demand generation transformation led by agile learning individuals because only they will have the vital levels of sociality, creativity, resistance and willpower to make change happen.
Driving Demand: Change Ahead!
“The complexity of B2B demand generation will continue to grow as buyers will continue to add sophistication to their approaches to purchase” explains Carlos. Kathleen Schaub from IDC published an article about her “10 Predictions for the Next Three Years”, and I believe it is worth a look.
“The complexity of B2B demand generation will continue to grow as buyers will continue to add sophistication to their approaches to purchase” (Carlos Hidalgo)
At the end of the day, this book is aimed at answering one main question: are all those changes worth it? And Carlos’ answer is “it is clearly not easy to achieve, but yes it is worth it.” This below chart developed by Adam Needles, Chief Strategy Officer at ANNUITAS, shows that the more advanced your demand generation processes are, the higher your conversion rate is.
To conclude, I believe that this book helps you to answer two questions:
- Where is my company in terms of Demand Process maturity? (people – processes – buyer insights and content – technology systems and data – KPIs)
- How to change the people, processes, content and technology in order to “effectively drive demand, maximize budgets, optimize technology and resources, and have a greater impact on business and better alignment with B2B buyers?”
And believe me, for one single book this is quite an achievement. Congratulations to the author for this great book. I learned a lot.