This document discusses demand creation strategies and metrics for new products. It begins with defining demand creation and discussing direct and indirect customer relationships. It then covers testing hypotheses about products, markets, channels, pricing, and market sizing. Different demand creation approaches are outlined for various market types. Metrics for evaluating demand creation efforts like conversion rates and customer acquisition costs are also presented. Case studies on demand creation in healthcare are used as examples.

1. E245 Demand Creation Ann Miura-Ko January 2011

2. Agenda Demand Creation Definition Direct customer relationship Indirect customer relationship Metrics and Experimentation

3. value proposition customer relationships key activities customer segments key partners cost structure revenue streams key resources channels 3 images by JAM

5. Customer

6. User

8. Market Type

10. (Customer)

13. Demand Creation How will customers segments hear about your product? How does market type impact my strategy? How much will it cost to acquire a customer using these strategies?

14. Market Type How does market type influence demand creation? Market Type determines: Rate of customer adoption Sales and Marketing strategies Cash requirements

15. Demand Creation by Market Type Create, drive demand into your sales channel Existing Educate the market about what’s changed Drive demand into your sales channel Resegmented Educate the market Identify and drive early adopters into your sales channels New

16. Who needs to hear about you? Suppliers End User Channels Influencer / Recommender Government Economic Buyer Partners Decision Maker

17. Demand Creation Feeds the Sales Funnel PayingCustomers $ Demand Creation Acquisition

18. Agenda Demand Creation Definition Direct customer relationship Indirect customer relationship Metrics and Experimentation

19. Getting Free Users Demand Creation SEO (without consultants) Blogging / Sharable content Social Media / Gaming Mechanics Communities Proven viral coefficient > 1 NOTE: “Viral” isn’t a strategy, it’s a product feature you either have or you don’t

20. Paid Channels PR Demand Capture SEM “Free” products (e.g. widgets) Biz Dev Affiliate Marketing Market Education Webinars Email marketing Trade Shows Analyst Reports Direct Sales TV / Radio Demand Creation

21. How many come through the first step? How much does that cost? What is the conversion between each level? How much in revenues can you get out of each acquired customer?

22. Agenda Demand Creation Definition Direct customer relationship Indirect customer relationship Metrics and Experimentation

23. Example: Healthcare

24. Healthcare – system requirements Payer Approval of product category Compelling clinical benefits and cost reduction Product approval Manufacturing approval Quality control process approval FDA

25. Healthcare & Marketing Free samples Professional papers Speeches by leading academics and influential doctors Leading institution as reference customer Conference presentation Continuing medical education Product Champions Restrictions on user generated content Adverse event postings Off label use postings Restrictions on direct selling to doctors FDA

26. Critical questions What are critical regulations and approval processes that need to happen prior to launch of product? Industry Federal / State Are there regulations on marketing efforts as well? Who influences the purchasing decision and how can they become an ally? What is required to be endorsed?

27. Agenda Demand Creation Definition Direct customer relationship Indirect customer relationship Metrics and Experimentation

28. How much do you have to spend here To get one customer here PayingCustomers $ Customer Acquisition Cost Demand Creation Acquisition

29. The Sales FunnelEnterprise Software Leads PayingCustomers Qualified Lead First Sales Call Demonstration Proposal Feasibility Purchase Order $

30. Other Sales Funnels Visit Sign Up Activate Upgrade 1. Informational Meeting Trial Contract Negotiation Signed Contract 2. What does your funnel look like? How long does each part of the funnel take? What % converts between each section?

31. Cost of Customer Acquisition Calculation David Skok

32. Cost of Customer Acquisition Calculation

33. Demand Creation Pivot