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Demand Generation vs Demand Capture

Demand generation marketing is seen as the most straightforward path to revenue growth for B2B businesses. Despite this, businesses often confuse demand capture strategies with demand generation.

Figuring out the differences between demand capture and demand creation is pivotal to the success of your revenue generation tactics. It can influence your entire strategy, from execution to managing internal expectations and the delivery of revenue.

What Is Demand Generation Marketing

Think about sunscreen. When it was first invented, someone had to go around and educate buyers that there was now a solution that could protect them from the sun. This way of marketing is demand creation. The first sunscreen brands had to build momentum from scratch, and that was extremely difficult to do.

Demand Generation Marketing Advantages

Lower cost per acquisition, higher quality leads, improved brand awareness, and greater conversion rates are just some of the advantages of demand generation. RFPs and business needs are modelled around companies that succeed at demand generation because they are the first to market and influence the buying journey. This gives them a leg-up over their competitors.

Demand Generation Marketing Disadvantages

The tricky part is that most of these metrics can’t be directly tied back to your demand generation efforts. How can you quantify someone recognising your brand above all the others and click-through? Hard to measure = hard to secure budget. It will take a lot of internal stakeholder management to convince them to invest in something that might not see direct results.

The generation of demand is also sophisticated and requires multi-channel coordination and a deep understanding of the audience. It takes a lot of resources and careful analysis to be able to deliver on that.

What Is Demand Capture

Linking back to the sunscreen example, if you are bidding on searches for sunscreen or targeting people looking for sunscreen, you are running demand capture. You are not creating new demand but reaching out to existing demand. Most businesses play in this space because it is easier to go after audiences already considering your solutions.

Demand Capture Advantages

Demand capture has lower barriers to entry. It is easy to target some keywords, gate a landing page and send traffic to it. The upside is instant results. Additionally, businesses have a simpler time sourcing talent to meet their needs. It is easy to activate one channel with an expert since most digital marketing channels have specialists who specialise in one.

Demand Capture Disadvantages

Increasing competition will increase your channel costs. Low barriers to entry are also harmful. Over time, competitors will most likely copy your strategies, driving up the cost per acquisition and lowering the effectiveness of your demand capture channels.

Choosing The Right Strategy

Having a well-rounded strategy is the key, and generating and capturing demand should go hand in hand. At the very least, you should capture the demand you generate since your competitors will be scrutinising your demand generation strategies closely. 

You would want to rotate your emphasis on a particular strategy depending on the circumstances of the business. Things to consider include budgets, program maturity, resources available and competitors.

 At the start of your program, It will be difficult to foster internal support if you focus on demand creation. There is a long payoff process involved in demand creation due to its complexity. It is also challenging to measure. This is why you should shift your focus to demand capture at the very start as it is easy to prove return on investment and gains traction from day one.

Once you have secured resources internally, you can place a greater focus on demand generation strategies. It is also a good time to start looking into pipeline marketing and working closely with sales. You want to shift attention back to demand capture throughout the program as the need arises. Sales being slow would be an example of when you should shift attention back to demand capture.

Having a unified strategy will help mitigate some of the disadvantages of both approaches. That being said, the most crucial aspect of success is knowing what to focus on and when.

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