Improving Marketing Pipeline Contribution

Using Demand Generation to Deliver Closed Revenue

Demand generation is critical to drive revenue growth in today’s competitive business landscape. Healthcare organizations now recognize that they must improve their marketing pipeline contribution by focusing on demand generation performance and proven investment strategies to close revenue.

Healthcare leaders expect demand effectiveness and profitability. Across industries, limited industry peer-to-peer statistics exist to evaluate demand generation investment allocations and performance effectiveness. As a result, companies must continually assess best practices to improve return on marketing investment tied to demand generation efforts.

That is why the Alexander Group surveyed over 300 marketing executives, including more than 50 leaders from the healthcare industry, to reveal insights and trends that healthcare organizations can use to enhance their marketing pipeline contribution.

Investment in Demand Generation Activities Increased 53% YoY

Leaders recognize the link between revenue growth, pipeline contribution and demand generation, as shown by a 53% YoY increase in demand generation investments by top-performing companies. The study found that healthcare organizations are shifting their demand generation activities, utilizing AI/SEO for mid-funnel demand, focusing on educational content, programmatic personalization and account-based marketing. Additionally, leaders use virtual and in-person roundtables and forums to generate demand, resulting in more efficient and productive results.

Demand Generation Reveals Improved Marketing Efficiency

The study revealed that profitable marketing organizations have tighter top-to-bottom pipeline controls. For instance, their investments resulted in a 2:1 demand generation ROI vs. marketing ROI ratio, indicating that demand generation is more efficient than other marketing activities. Leading organizations are willing to push out cost, resulting in a lower cost per marketing qualified leads (MQL) than their peers.

Aligning company goals is also crucial as organizations that do so are 3–7x more likely to outperform revenue targets. Approximately 80% of healthcare organizations inform investment levels by assessing overall marketing performance at least monthly, and they optimize investments to justify incrementality. Additionally, 65% of healthcare organizations formally assess demand generation investments based on pipeline size and revenue contribution performance.

For organizations focused on demand generation, the Marketing Expense-to-Revenue percentage ranged from 4.1% to 4.4% for organizations under $1B in revenue and 2.8% for those over $1B. Demand Generation Expense-to-Revenue ranged from 1.1% to 2.3% for those under $1B and 1.5% for those companies with revenue over $1B.

40%+ of Pipeline Development Comes from Marketing Functions

Healthcare organizations now recognize the importance of cross-functional collaboration and accountability in driving demand generation. The study found that Marketing continues to increase functional pipeline contribution across all organization revenue cohorts. An estimated 80% of healthcare organizations reported “alignment of segmentation and ideal customer profiles (ICPs)” as a top priority to drive growth across functions.

Marketing is a primary functional area for growth, with a 5% increase in annual pipeline development. For instance, 48% of companies with $500M–$1B in revenue indicated that Marketing was the group they depended on most for pipeline growth. While all enterprises primarily relied on Marketing, business development/lead generation and direct sales were also significant contributors to pipeline development.

The Marketing Channel Mix is Evolving

However, it’s not just about generating any demand but generating qualified demand. By prioritizing quality over quantity, healthcare organizations can attract the right customers and patients who will truly benefit from their services.

Paid search remains the primary marketing channel focus. But executives also reported that 15–26% of their pipeline yield is attributable to organic search (SEO). However, utilizing multiple channels within demand generation to maximize reach is critical. Events and conferences also contribute to pipeline development, but successful demand generation requires leveraging digital marketing, social media and other platforms to connect with potential customers and patients.

Demand More

Prioritizing demand generation today will take your healthcare organization to the next level by improving your marketing pipeline contribution and delivering closed revenue. Alexander Group provides valuable insights and trends so healthcare organizations can improve their marketing pipeline contribution.