Welcome to the Stack and Growth podcast. I am Tory Kinlick and today I have my colleague, Garret, joining me, Garret. You want to give a quick intro? Yeah, sure.
My name's Garret, director of demand here at Refine Labs. And I get to work with and help figure out marking a bunch of cool BBSASH companies. It's pretty great. I'm excited for this topic.
Awesome, me too. So onto the topic. Let's see, how do we even start on this one? Well, damn it, Garret.
That is what we're going for today. We're talking about damming the demand. A lot of times it's where fine labs, right? You're here and myself, others, talking about the creating demand, capturing demand.
What's the right balance between the two? But there's this cousin of creation and capturing of demand, like a twice removed cousin that doesn't get invited to all of the family outings, but has a whole lot to say. And I think the concept itself, I first came about it by way of Christopher Lockhead. The first time I came across it was in his book, Play Bigger.
And I know he's published a lot more content on it lately. But in all honesty, it's a topic that I think is a little bit challenging to wrap your head around. It is not to me as straightforward as demand creation, demand capture. When you think about it in terms of what damming the demand is, which I'll toss it over to Garret here in a moment to give his two cents on it.
But when you just think about it a dam, like the Hoover Dam or something, you're effectively like harnessing existing energy in one place and redirecting it in a way that is going to benefit you, let's say. And that's, I think, at its core really what we're trying to do here with this damming the demand concept. But the part that continues to get stuck in my head with this is really like, how is this any different than just talking about your differentiators versus a competitor? And so, Garret, I think I would love it if you want to come in here and maybe if you have any thoughts on that particular question, just like, how is this any different than just focusing on your differentiators?
And I think that that's probably going to open things up for us to hit on a number of different angles on this damming the demand topic. But I'll pass that one over to you. Yeah, for sure. Well, I think that backing up one step is like, if you follow refined last content for any length of time, you know that we split strategic thinking into two buckets primarily.
So demand creation, what originally created demand? That's buyer education about your category, which the prospect is completely unaware of. Capture, once that demand has been created, what captured the demand when the prospect dictates themselves that they want to talk to sales. And then for damming the demand, which can be thought of as a subset, really demand creation first, at least in my mind, which we talked about a little bit more, you're creating demand for a different existing category and rerouting that demand to your category as Tori is mentioning.
So the big difference here is that they're aware of and perhaps already researching for a similar solution. We want to capitalize on that too, guide them toward our own. So like a practical example, this is like the most easy to understand, I think, is Peloton. Like you don't need a gym, you need a spin class in your living room.
It's the same benefits, plus you get better analytics without getting in your car, like very straightforward and clear advantage. When I think about your question of how is this different than core differentiators, is that, you know, I think it's beneficial because they're already somewhat aware of and somewhat in the purview of your category, even if they may be researching a different one. And I think that there can be less friction to actually convincing them that you are the best solution because it's just one level up potentially then than what they were researching before. So I think that's one piece.
And there's certainly an advantage, I think, for companies right now, especially who are looking for new avenues to source net new demand versus just cold audiences. So these aren't, you know, warm audiences to your solution per se. It's a way of, I think, getting there quicker and potentially creating demand a little bit quicker. Yeah, so you said a couple of interesting things there that I've got me thinking now.
But it almost sounds like there's, you know, the way that we need to kind of think about this damming the demand concept, right? So like, there's obviously the tactical element. And we'll get into that a little bit. I definitely have, you know, suffered from the incorrect school of thought on this in the past, which is just that like, oh, so this is just an AdWords play, right?
Someone searches, you know, home gym equipment and they get served that Peloton ad instead. But obviously, there's so much more to it than that. However, there is still the tactical element to it. I think the other element, you know, is like the mindset, right?
So thinking about like where this buyer is in terms of their, you know, their journey, the pains that they're understanding and the solution that they're out there looking for, it almost feels like it lives somewhere between the demand creation and the demand capture, right? So like with creation, you know, this is not necessarily synonymous with category creation. In fact, it's very different from category creation. It's almost like an alternative to category creation.
It's like there is existing demand for X. And we can siphon off some of that if we are, you know, are able to kind of place our bets strategically, get the right messages, get in front of the right people. And, you know, we can effectively kind of steal some of that existing demand from a category where a well-known brand. And then the third element of this I feel like is like the audience, right?
So the audience is obviously going to be the most critical piece because you need to understand, number one, you know, who you want to be selling to and who you've got a good fit for. But you've also got to understand like, you know, what their current behavior might be. Who are they shopping for? What are, you know, what, what is their kind of, I guess, the propensity for purchase in terms of like, you know, are they going to be pulling trigger on something soon?
Are they just, you know, kind of in this research phase? And so that timing element of it. But yeah, understanding like who the audience is for this, let's say competitive category that you want to, you want to dam the demand on. But then also understanding, you know, who your smaller subset of, you know, of that audience might be as well.
So yeah, I think it's kind of starting to clear up for me a little bit just as we're talking here, Garrett. But yeah, anything that you want to care to expand on there? Yeah, I mean, I think it's your point of understanding the audience, understanding what they're shopping for and how you might structure a campaign around this. It's helpful to think about it in three different ways.
So number one, you can dam the demand by rerouting prospects from a different category, which is what we were just talking about. So a good example I have is if you are, say, you're growing internationally and hiring in a different country, you go and set up a new business entity in that country, which is going to take many months, it's going to have a bunch of administrative work, it's going to be expensive and it's going to be a huge headache, basically. If you knew there was a software and a service called an employer of record, which is an ER, that lets you skip that whole process for a fraction of the cost, there's no way you're going to go set up that new business entity. Like that's category number one is like, the message becomes you don't need an entity, you need an employer of record.
Like you thought you needed this thing, you really need this totally different thing. And that's going to really frame your campaign differently than if you're trying to dam the demand from something else. That's much more closely related to yours, which I think is more common for a lot of companies when they think about damming the demand. And they may have even, I think a lot of companies have already dabbled in this in a lot of different ways.
So the second way is like rerouting prospects from a smaller or larger niche to yours. So let's say you run a retail business with hundreds of locations. There's a lot of software solutions that manage the business listings for those locations, like Google, Yelp, et cetera, that you're likely aware of. And if you knew there was a solution that can manage your listings, but also integrate those with your website, give you analytics improvements and manage customer interactions in one platform, you'd go for that.
It's basically like we do everything that business listing people do, but we offer a much more full growth solution for businesses. You don't need a business listing solution, you need a reputation management solution, right? So that's kind of category two. And I think it's something that is more common for a lot of companies that are probably without intention, like even dabbled in this a little bit, because they know they're sort of that peripheral demand that exists somewhere else.
That's awesome. Yeah, I had a thought as you were talking through some of those examples there. And it's, excuse me, like I know that the, I mentioned this a few minutes ago, like the wrong school of thought on this is that, this is purely just a search play, an AdWords campaign. But it did kind of have me thinking that, there is probably a messaging strategy in here somewhere that does remind me a bit of an AdWords strategy, and it's using modifiers, right?
So like we're big believers, in terms of like the right way to be using search channels is to add high-intech modifiers to your keywords, right? The idea there is that if you can find the right modifiers to add onto your typical keywords for your industry for your category, you're gonna be able to identify the people that actually have legitimate buying intent, not just the people that are kicking tires, we're doing research on a overall category where the money that you're putting into that, that auction, so to speak, is just gonna be wasteful, right? Because those people are way too early in their buying stage and their buying process to click on your ad, raise their hand and say, I'm ready for a demo. And that is, in my opinion, the best way to be using searches is only for those high-intech searches.
And it comes with really just having a good handle on what the modifiers are. Now, when you talk about this, you know, damning the demand concept, I think the same can be said, right? It's about adding modifiers. It's about using this existing known, you know, search query or topic or brand that there's a lot of awareness around, there's a lot of natural demand for it, and then you add your modifier to it and explain why you're different, right?
And that is effectively the same way that it's going to help you just siphon off a portion of that search traffic to only get what is relevant to your company and that you wanna be spending money on. I think the same can be said about like the damning the demand, if you add that modifier to your messaging, again, you're starting with that natural demand and you're cutting down into only the area that you are most interested in. And of course, that's gonna mean, you know, just a portion of the overall audience is what you're gonna be attracting, but I think that that's really the name of the game here, right? You don't wanna try to overtake the, to use Christopher Lockhead's words.
You don't wanna try to overtake the category king. What you wanna try to do is just beat them in a corner of their marketplace and see if that kind of thin edge of the wedge is gonna be your best way to starting to take over a little bit more of that percentage of the market. Yeah, absolutely. And I mean, I think that that's getting late-stage high-end ten buyers of paid searches, like a fantastic way of validating whether or not it's worthwhile to put more effort into it as well, right?
If we, if we, you know, I think that there are a number of modifiers that you can use and it's a very straightforward way that you can sort of get results and get some of those early signals in the, in like a 30-day experiment, whether or not it's worth investing dollars in those to say, how possible is it to actually reroute this demand when it's clearly been created somewhere else? And or is it going to require a little bit more education? Like I think that for damning demand, my preference is to take more of a holistic campaign approach in the long run, but you know, obviously we have to prove things out and it's definitely a way that we can establish some sort of quicker wins a little bit more in the short term. So definitely like that idea.
Yeah, and so in some of our past conversations, Garrett, I know you've shared with me that like, you see kind of two major mistakes being made for companies that are pursuing this strategy. So we have talked about the first one at length, which is just, you know, mistaking this for an AdWords strategy and when it is so much more than that. But why don't you kind of share a little bit more about your thoughts on the other primary mistake that you're seeing marketers making today when they're, you know, when they're trying to demand for their company, their solution? Yeah, I think that it's, I think there's a second mistake.
I would say that it's not taking a true campaign level approach, right? Like I think that a lot of companies may hear this and say, hey, get with the paid media team and ask them to sprinkle in some of this stuff. And like I've been guilty of that in the past rolls and things for sure. But if you take that approach and sort of, you know, for lack of better term, just have acid with the message, you're not going to understand what worked and what drove an actual business outcome over time.
So if you're running a true campaign experiment, which is kind of the structure that I'd recommend you structure it for, that means a few different things, right? It means one that you have a single value prop in that campaign, right? Like your ICP can only really process a single value prop at a time. So make sure you have a really clear and tight message on this and to really make it clear, like, what is the difference between the demand that they had before and how is this either an up level of what they thought they were going to get in the other category or how is it different?
Like there probably is a top priority one or two benefits in the message that should be highlighted with it. And I think understanding and, you know, if there's a part of this to agonize over, I think this is it, right? Like making sure that part of it is right so that it can be executed properly and understand if it's going to work. It also means like coordinated efforts across channels, right?
So that means to me, like demand creation and it means demand capture. You can tell much deeper, more meaningful stories in a demand creation environment than you can and just paid search or just in G2 reviews and things of that nature. So, you know, if you're running Pay Media, this generally means that you are investing 80% and spending 20% in creative and messaging in those sorts of pieces, which most companies miss big on, like they're still missing big on, I think. So many companies just try to hire a static amount of creative, whether that's an agency or whether that's internal, and then they just pile campaigns and pile initiatives on those assets if it's not going to move up in conjunction with spend.
So, you know, I think that's kind of a second point there. And then a third would just be dedicating a time period for runtime and for evaluation. So, most companies with longer sales cycles, this is gonna be more of a period of like six to 12 weeks to start, so there's adequate time together, success signals, this is easily something that could fall by the wayside, if it's not evaluated and if there's not something on the calendar too, look back and see whether or not it's successful, which we can talk about some different metrics here too. But I think that again, like the longer time period, you can extend something out into the better idea that you're going to have, whether or not it's actually a driven outcome, down funnel just beyond any metrics.
So, yeah. Yeah, and I think that, you know, patience is key, right? This is a narrative that you hear from us pretty frequently, especially as it pertains to any demand creation efforts, and the same can be said, maybe to an even larger extent when it comes to category creation, right? Category creation is harder shit, and it takes a long time.
It's not something that, you know, the executive team, the marketing team are just gonna come up with some new messaging and say, okay, like this other category are, you know, there's a dominant player in the space, you know, we're not gonna catch them the way that we are right now, so we need to pivot and create our new category. That's great that you've got that type of agreement and alignment inside of a conference room, but you know, when the rubber hits the road, right, when everyone actually starts kind of working on these things and building it, patience is gonna be absolutely critical, because at that point, when it comes to category creation, not only are you responsible for creating awareness and demand for your brand, so that you can prove out that it's working, but like, you also have to create, for, create the demand and awareness for an entirely new category. And so, I think that the same can be said when it comes to damning the demand, right? Like, although, you know, effectively, it should be a little bit of a shorter timeline because you are trying to leverage some of the existing demand and awareness in the marketplace, you are still taking a, you know, a smaller attempt here at category creation.
It's just a different way of doing it, and you know, almost kind of cutting a corner in some respects, but you know, what it all kind of comes down to, right, is how can you prove that this is working? And so, you know, do you have any thoughts, Garret, like as far as, let's just say, like leading indicators, you know, that that company should be looking at, like, are these things effectively the same as, as what we're looking at with demand creation efforts? You know, or is it, do you see any kind of, any nuances, any differences between the two? Yeah, I think a lot of them are the same as demand creation, I think for the most part.
I mean, if you follow our content for a while, you know that we're huge fans of playing a long game, especially when it comes to metrics, because you're not going to create net new demand and have that closing a short window of time necessarily, at least if you're comparing it to like a lead generation approach. But I do think that you should look at the balance between quantitative and qualitative insights. So like early on, if we're thinking about quantitative side of things, looking a little bit higher in the funnel in an experiment like this, like what is there a lift in what we call PQMs, high qualified meetings, just hand raisers through the website with high buying intent, are you seeing lift from that? And I think those early signals are sort of more important and come at a premium when you're running any experiment, but certainly an experiment like this.
And then from there, you'll go down funnel like core pipeline velocity metrics. So we're looking at stage conversion rates, wind rate, sales cycle links, ACV, all of those components, which I think why it's even more important to expand your time window, right? Like you're not just capturing demand here. It's going to take time to market this way, to buyers who aren't yet raising their hands.
And when we're educating them on something new, we have to set that expectation accordingly. So, but I think even also like more importantly, this is where you get to flex your qualitative insights a little bit, right? It's gonna be super important early on to of course look at self-recorded attribution. Like can't go podcast without mentioning it for sure, but you're gonna get faster and better customer insights on what created the demand via self-recorded attribution.
So just asking how they heard about you in their primary high-intense demo form is an absolute must for this. And then the other thing that I would say about it as well is like I would have a pre-planned open dialogue with sales so that they understand the purpose of the campaign, what the nature of the, and for you to get an idea on the marketing side like what the nature of the early sales conversations are. And depending how drastic the differences are in the categories your damage against, so to speak, there may be some drastic changes. So I think that qualitative feedback from the sales team is also really important here.
Yeah, for sure. Actually, I think that last one to me is probably the area I would recommend most marketers are focusing on, right? We always promote having a strong partnership with your sales counterparts. It's going to lead to the best marketing.
But with what we're talking about today with Deming the Man, this is very likely going to be a very new approach for your company. And you would expect by way of that that you're probably gonna have some different quality, different types of inquiries that are gonna come inbound assuming that you're doing everything the right way and able to drive that inbound. And like I think one of my favorite, let's say, the lines about this entire approach is that it's not about being better than the category leader, it's about being different. And there are plenty times where different is better than better.
And so it's one thing to be putting that message out of the marketplace, figuring out the right channels to utilize for Deming the Demand. Obviously you do wanna see those early indicators, you wanna see the hand raisers coming to your site, you wanna see the traffic sources in GA that are backing up all this as well. You definitely wanna be looking for those things. But yeah, I think Eric said it best when it's like, you gotta connect with your sales team and hear about how or if their conversations are changing with their prospects.
Number one, because you would expect there's just going to be a different level of curiosity from people that are coming in and saying, hey, I thought I needed this thing, but I wanted this instead. And like what comes from those conversations? But additionally, you wanna make sure that the sales team is reinforcing a lot of this messaging and kind of company strategy that you're taking on with Deming the Demand. It can't just be the same old song and dance, the same type of sales process that the team has been using.
It needs to be differentiated, just like the messaging strategy, just like the targeting strategy. It can't just be all on the outward facing messaging, what marketing is putting out there into the environment. It absolutely has to be connected with the sales messaging and ensuring that they are getting crystal clear on the differentiators that we're ultimately using to kind of set ourselves apart with some of these Deming the Demand campaigns and experiments. Yeah, absolutely.
I mean, I think what you said, basically different is better than better. I add to that to you on your last point, I think clear is better than better, right? Especially in B2B software, so much of the message out there is the same, like save time and save money has gotten so tired. And if you're just out there saying, hey, we're a different solution, but we're just doing the same things, but better, like that's not enough.
It has to be a very specific and clear value prop. And I think that in this type of campaign, this type of experiment, the clearest message is going to win. Yeah, and everyone that comes inbound might not understand that value that you're trying to promote about all these differentiators. Because the likelihood is that, what you're creating here, what you're promoting here might not be for everyone.
But if you can start to get those correct signals, if you can start to hear the conversation shifting from your buyers, you might just be onto something. And that might be worthwhile to continue pulling on that thread and seeing if you can get this entire category king to start coming unraveled. Because that's where it starts, right? It's just finding a wedge into the marketplace, ideally focused around what differentiates your brand from the leader in the category and building your entire strategy around that, focusing on the differentiators.
And trying to carry that through the entire inbound process and into the sales motion as well. So this has been awesome, awesome Garrett. Any other thoughts, any other topics that we didn't get a chance to hit on today that you want to speak to before we wrap things up? No, this has been great.
I think there's just one final takeaway to it. I think that if the more companies can separate this type of experimentation into an organized and orderly effort, the better. If you have a quarterly campaign cadence, just adding this in as a replacement into one of those and shinning this in, I think is not a great approach to it. And I'd actually dedicate the resources to it and treat it as its own experiment, right?
That has a hypothesis and that has a conclusion to it and really challenge yourself to add some structure to this stuff because to your point where I think that this is definitely a new thing for a lot of companies. And it needs to be treated as such. So yeah. Awesome.
Well, this has been great, Garrett. Thank you for coming on, joining, sharing some of your knowledge with the rest of us. And for those of you listening today, damn it. Go ahead, go do it.
Let us know how it's going. We'd love to hear back on any questions or successes you're having. And otherwise, until next time, thanks for listening.