Many B2B SaaS confuse demand capture for demand creation – simply because they believe they’re trying to generate interest for their product.
But there’s a core difference that is important to understand. Let me explain:
- Demand Creation is about
- Creating a new market or expanding an existing one.
- Focus: stimulating awareness and interest in your SaaS product among potential customers.
- Demand Capture is about
- Capitalizing on existing demand in the market
- Focus: harnessing interest to drive sales from buyers who already have a recognized need or desire for a particular product or service and are looking to purchase.
Demand Creation starts from something nonexistent.
It’s about developing a need or desire in customers’ minds that can only be satisfied by your product or service. It’s, therefore, more of an educating effort.
In other words:
- Demand creation is about selling an idea to make people want,
- Demand capture is about selling a product to a concrete need
The difference is not insignificant:
We all remember when Steve Jobs announced a “revolutionary and magical product that is five years ahead of any other mobile phone.” He was mostly selling the idea of a lifestyle so cool and ahead of the times that it would change how people operate. When people lined up in droves for a new Apple product, they bought into this innovative lifestyle. The iPhone made good on its promise and still dominates the market years later.
No one was searching the market for the product or service that the iPhone generously delivered upon. Instead, Apple created demand that wasn’t there – and the rest is history.
But there are plenty of examples from the B2B SaaS space.
- Just look at vendors like Drift. They didn’t focus on selling a chatbot or a conversational marketing platform. Instead, they sold you the idea that the traditional way of marketing is over. They sold us the idea of the ‘old way’ (before Drift) and the ‘new way’ (after Drift).
- Slack did precisely the same. They don’t sell us a social collaboration tool. Instead, they made us imagine what we could accomplish together. It’s all about creating a big gap between ‘what is’ and ‘what can be.’
- Take Evernote: They didn’t sell us a tool to collect notes. Instead, they sold us the idea of ‘feeling organized without effort.’ ‘So nothing falls through the cracks.’ That you will ‘remember everything important.’
- Alternatively, Dropbox. They didn’t sell us just another better file storage tool. Instead, they sold us the idea of ‘Working better, safer, together.’
These are all examples of creating demand that wasn’t there. They all faired well by it.
Question for you to reflect upon
How many high-quality leads could you attract if you’d focus on selling an idea to make the right people want?
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