How to Measure Demand Generation

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How to Measure Demand Generation

If you are a B2B marketer, then Demand Generation is one of the important KPIs. It will help in gaining more credibility within the business. It will show how the overall marketing strategy contributes to the growth of the business.

Demand generation is the process of generating awareness and inducing interest in the products and services offered by you. Every stage of the marketing funnel involves some kind of demand generation strategy to make this goal successful.

When you pick the right Demand Generation strategy, your company will show tremendous growth. You’ll have many inbound prospects ready to buy.

But how will you achieve the best results? Is it sufficient to create strategies? It is certainly an important step, but it is not sufficient. You need to have a close watch on it, and you should evaluate every step of it so that the demand generation funnel becomes effective and smooth. 

Studies say that two-thirds of B2B marketers feel that demand generation is much more than raising awareness and interest. They feel that it is about creating content that can educate and inform customers and change their perceptions.  Demand generation is all about building long-term strategies.

It is important to remember that demand generation doesn’t have a last-touch approach to track channel efficacy in general. Rather, it has a multi-touch attribution model. Therefore, without expertise in it, nailing it down might be difficult.

How will you measure the effectiveness of Demand Generation? Here are some of the important methods.

Cost per acquisition

CPA or Cost Per Acquisition is an important parameter to measure demand generation. This is because one can measure the effectiveness of marketing campaigns with respect to the cost incurred to generate a new customer. It is more critical because demand generation is mainly focused lower in the funnel. Not just that, CPA measures the direct costs associated with the acquisition of a new customer, e.g., promotional or advertising expenses.

Experts say that tracking this matrix is useful because it can tell clearly whether demand generation effort is generating a positive ROI or not. If the CPA value is very high, then it is essential to reevaluate the strategy.

CPA throws insights into which demand-generation activities are bringing more new customers.

Tracking data over time

Some marketers feel that the process of demand generation is very long and hectic. Also, they have difficulty in measuring performance, especially when there is no reference point.

Comparing metrics to industry standards is a method, but it might not always be fruitful. If it is a startup company, then there may not be any industry standards.

There one has to spend time measuring success against self. It is important to ensure that your demand campaigns are yielding the results that you want. You can do it by tracking channels and sources on a regular and individual basis.

According to experts, the demand generation funnel expects time and patience from the marketers. One shouldn’t be in a hurry for results. The measuring process takes some time.

Well-thought tracking will lead to better results. Examining the metrics and relating them to the strategies will give a clear picture.

Building a pipeline at a particular stage

Demand generation drives deeper into the sales pipeline so that you can measure efficacy for only those leads that can be converted into true customers. To do this, marketers often land on a certain pipeline stage to drive leads.

However, it is essential to know that the exact pipeline stage will vary depending on the company and sales process.

This pipeline stage typically closes at a close rate of 20-30%. The junk leads would have been removed at this stage.

When you analyze the pipeline and find a stage that has a 20 to 30 percent close rate to measure against it, for many businesses is the proposal stage, in the B2B sector precisely. This measurement is helpful in highlighting the quality of demand generation over quantity approach.


Demand gen is all about creating interest for your business and then turning that interest into real customers. The process is made up of two parts: demand creation and demand capture.

It is possible that something is amazingly profitable for someone else but it might not be that useful for you. When you measure the demand generation metrics, it will help you to track your progress, and determine what’s working and what is not.  Then, you can tweak the strategy as per your needs to improve the results further.

The process of measuring demand generation campaigns is a continuous process. It evolves and gets better with time. It is a wrong expectation to have overnight success while tracking your outputs. Patience is important when you compare strategies and decide what works for you and what doesn’t. Track your progress against your own efforts.

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