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In math, we’re taught early on the “order of operations” – a step by step process to understand how to calculate a multi-step expression. You might even remember the handy acronym PEMDAS (Parentheses, Exponents, Multiplication, Division, Addition, Subtraction) to guide your thinking.

Unfortunately, process and prioritization isn’t quite as simple when it comes to managing your marketing funnel. But through our work with many high-growth marketing teams over many years, we’ve developed a framework to help growth companies think about how to sequence, focus and balance their marketing efforts.

Where should you start?

The UPSYD stages of awareness

In 1966, copywriting legend Eugene Schwartz first published the five stages of customer awareness in his book Breakthrough Advertising. Since then, the stages have been popularized and applied to dozens of different use cases. We’ve slightly adapted the naming of each of the five stages below to help you remember them with the acronym UPSYD (pronounced “upside”):

  1. Unaware: Potential customers don’t have any idea about the problem you solve.
  2. Problem Aware: They know they have a problem, but don’t know there are solutions.
  3. Solution Aware: They know of some solutions to their problem but aren’t yet aware of you.
  4. You Aware: They’ve heard of you but may not be considering buying from you.
  5. Deeply Aware: They know a lot about you and are considering buying or already have bought from you.

The UPSYD model can be applied to almost any product or industry. In our view, the benefit of this model for marketers is that it prioritizes a customer-centric view of your marketing strategy. Typically, it’s far easier to focus on converting someone who is already deeply aware – or at least aware of you at all – into a paying or more valuable customer than it is to try to convert a cold, unaware audience segment. For these reasons, we recommend focusing on customers in the more aware stages of the UPSYD model and working your way up from there.

What does this look like in practice?

Demand capture vs. demand generation

You’re probably familiar with the term “demand generation”. You may even know someone with it in their title. The UPSYD model reframes this commonly used function by highlighting that, in fact, many demand generation marketers are not actually generating demand but capturing it.

Let’s revisit the UPSYD model; we recommend that companies begin with a focus on solution-aware, you-aware or deeply-aware prospects – those who may already have desire or demand for your solution or one like it. They may be Googling things like your category, your product or brand name or your competitors. They may be visiting your website, browsing your store, or looking at online reviews. At these stages of awareness, you’re not working to generate demand with this audience. Instead, you should be laser-focused on working to capture it – on persuading these prospects to choose you. Here, tactics such as nurturing; remarketing; conversion rate optimization; review recruitment; and mid- and bottom-of-funnel SEO, SEM and messaging can yield the quickest time-to-value at lower costs. These investments can also help compound returns as an increasing number of people move through your funnel over time.

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Once you’ve worked to build a repeatable approach to demand capture, we recommend turning to the problem-aware then unaware prospects. These are the prospective customers who may not know they have a problem, may not think the problem they have is a big deal or just don’t know there are solutions out there. For these groups to move down the funnel, they need to understand the pain, the urgency, what they can gain by choosing you and what they stand to lose if they don’t. Here, consider investing in education and evangelizing the problem your product or solution is designed to solve through storytelling, content marketing, PR, thought leadership, paid and organic social, broadcast media and other top-of-funnel tactics.

Across the growth stage companies with whom we partner, we’ve seen teams have the most success investing in true demand generation after they’ve fine-tuned their demand capture engine. Otherwise, you might end up generating demand that gets captured more effectively by your competitors. For example, we’ve worked with numerous software companies that have found they can effectively and quickly capture demand with a strong profile on software review sites like G2, Capterra, and Gartner Peer Reviews — common destinations for solution- or you-aware prospects. If you’ve prematurely focused on demand generation, and you’re not strong on these types of platforms, it’s possible that you generate demand for solutions like yours only to have it captured by a competitor with a more compelling review profile.

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What’s the optimal mix?

Different markets and stages, different dynamics

The UPSYD model makes a compelling case for why you should focus on capturing demand before generating it. Ultimately, though, your marketing mix should be a balance of demand capture and demand generation tactics – and that balance will differ based on factors like the novelty of your offering, the maturity of your category, secular trends and your growth stage. Typically, if you have a very innovative solution in a less mature market with weaker market tailwinds, you’ll need to layer on demand generation strategies more quickly as there won’t be a lot of demand to capture already. Think Salesforce in the early days when cloud-based CRM software didn’t exist. On the opposite end of the spectrum, if you’re offering a better solution to a big problem in a mature market – perhaps with exogenous factors like COVID-19 creating more demand ­– you can invest heavily in demand capture and have a longer runway before needing to layer on demand generation.

One leading indicator to identify your potential mix is Google search volume across the UPSYD stages. If there is high and growing search volume for mid- and bottom-of-funnel terms such as category and solution keywords, competitor keywords and your brand, you likely have a large demand capture opportunity. This is the case today in categories like CRM software (thanks in large part to Salesforce’s demand generation efforts over the years). Like all good things, there is eventually a ceiling on demand capture tactics, however. Relying on demand capture alone will leave your business exposed to market movement and limitations.

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As your company matures, adding demand generation tactics can give you more control and repeatability over your funnel and can serve to move people into your demand capture engine. In addition, true demand generation can, in some cases, increase the size of your addressable market. Summit-backed Solo Brands is a great example of this. The company created a portable, nearly smokeless fire pit product (the “Solo Stove”) and was able to market this innovation to people who were unaware of the problems with standard firepits, and share the message that they could create great moments and make wonderful memories with Solo Brands’ products. By doing so, the company generated demand for their products – and for products like theirs – that did not previously exist.

 

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What about LTV?

Enter the Matrix

While the UPSYD stages help you apply a customer-centric point of view to your marketing strategy, it’s important to matrix this with a more commercial perspective. After all, just because someone is aware of your brand or solutions to problems you address doesn’t mean they’re your ideal customer profile (ICP) or have the highest expected lifetime value (LTV). With demand generation tactics, you’re typically better able to target your ICP and higher expected LTV buyers proactively. This is often due to the behavioral or contextual targeting available within channels like paid social or across the media and communities with whom you engage. But, you can – and should – develop messaging to help ensure your demand capture tactics also speak to the right individuals.

Getting focused on high-LTV segments is particularly important for horizontal or broadly applicable solutions. We have seen this approach work successfully at companies like Summit-backed Jobber, a software solution that helps a broad range of field service professionals, and Summit-backed Odoo, an open-source suite of integrated business applications. The strategy is to identify a subset of customers who you believe exhibit stronger unit economics and develop targeted marketing programs to help both capture and generate demand in those segments. This allows you to marry the customer and the commercial point of view to drive growth.

Putting everything together, here is a framework for assessing and developing your marketing strategy:

Capturing Demand Generating Demand Customer Awareness LTV Matrix

*Adapted from Breakthrough Advertising by Eugene Schwartz

One final note: your measurement framework will likely need to evolve as your marketing mix evolves. Demand generation tactics like YouTube prospecting or PR typically have a longer time-to-impact and are often more difficult to directly attribute than demand capture tactics like branded search or remarketing. So, if your marketing mix is currently focused on solution-aware, you-aware, or deeply-aware prospects, and you’re used to measuring with last-touch attribution or short time horizons, be mindful not to apply the same methodology as you layer on demand generation efforts. Otherwise, you may conflate a measurement issue with a performance issue and turn off a demand generation tactic prematurely.

About the Author

Cody Lee is a member of Summit’s Peak Performance Group, where he works with management teams to help identify and execute growth strategies that build long-term value. Most frequently, he collaborates with management teams to help expand and achieve greater ROI from digital marketing initiatives. Prior to Summit, Cody was a partner at Lever & Dial, an investment and advisory firm dedicated to helping growth companies scale with world-class marketing.


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