Guide to Profitable Sales

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Demand Generation

Demand generation, revenue or sales in most cases, is a key result to pursue. Throughout this site, you will find ‘profitable’ growth in demand is the critical way to think about optimization. Obviously if you give away your product or service for free, one would anticipate high demand. Non-profits may give away their goods and services but even they must consider the cost of attracting volunteers and donations, the support of builds to operate from, the transportation needed, etc. They also may need to consider that totally ‘free’ goods are too often wasted, discarded, etc.

Why do they care

It is pretty easy to jump directly to Advertising, Promotion, and Salesforce thought around the topic of demand generation. More basic is first to consider what you are offering. Something as basic as starting with a list of why would anyone care about what you have. You may want to start putting down features and attributes of your product or service to flesh out this list. Maybe put another couple columns on the sheet where you write down your list and also answer: a) in the scheme of these people’s life, is that item a small, medium, big, or really big deal? b) who it is that cares about that?

These can be a starting point for positioning your product or service. At this point you are likely just ‘in your own head’ or maybe you have bounced it off your circle of friends. Probably not scientific enough to prove the validity to investors or bankers, but a great starting point set of hypotheses you want to test out. For that, we would move to concept development and testing.

Who cares

We added that column to your list about ‘who cares’ and if you still think the idea opportunity might have legs, you want to formalize the details about the who. You aim to start the journey toward outlining the potential and structure for your opportunity. That step is where you begin to turn a rough description into some basic counts. With 8 billion people in the world all you need to do is collect a dollar from each and you will be a billionaire!

Of course the ‘who cares’ probably already told you that all 8 billion aren’t you likely targets. So the basic count process moves increasingly toward being clear about specific segments who are likely to want what you have to offer. As you move through the process of crystalizing your potential and most attractive segments, you become more and more clear on who you will want to bounce your concept off of to get their reaction.

Will they pay

Reflecting back on your list, you also hypothesized how big a deal you thought each item was in people’s lives. The most basic way to confirm your thoughts on this importance is to see how much they are willing to pay. For this we want to understand what is known as their price elasticity. Ok, this is starting to sound a little fancy. It can be and in a number of situations it might be worth the deep dive. But at a minimum we should think make sure we include the price within our concept statements when we get a reaction to them. It is also logical to present the exact same concept to different people at varying price levels and see how the differences shake out in terms of purchase intent scores. Regardless of how fancy your get with these types of measures, NEVER bother doing a concept test without having a price on the concept or the results are meaningless.

Offer Solutions

It is pretty common that people deep in developing a product or defining a service that they are all about nailing down the details. Clearly this is critical to understanding how to make something, to determine the costs, to buy machinery, to layout assembly lines, to source materials, to calculate shipping costs, to define competitive solutions, etc. That last point is key… “solutions”! You want people to understand your product or service in their terms. You might have some novel widget in there that you are rightfully very proud of. However, the prospective customer likely cares very little that that thing is made of titanium, is precision cut with plasma fabrication, etc. Rather, they would care about the resulting durability, the frictionless smooth operation, the glistening beauty they proudly display; because they feel fulfilled in owning the best to share their experience with friends and family. Communicated as end-benefits, emotional rewards aligned with their personal values, your concept will be more persuasive and be likely to achieve a price advantage and buyer retention bonus.

Highlights

Demand Generation is enabled by people knowing what you offer. In that sense it connects to Advertising, Promotion, and Selling actions. However, that “knowing what you offer” clarity is the first and foremost element of demand generation.




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