“The tragedy of the commons is a term, originally used by Garrett Hardin, to denote a situation where individuals acting independently and rationally according to each’s self-interest behave contrary to the best interests of the whole group by depleting some common resource.“ (Wikipedia)

While the term was initially used to describe the lamentable conditions of British common grazing fields, does it not also describe what is happening to the inboxes of decision-makers in enterprises today? And of course, with response rates of .1%, ( http://www.marketingcharts.com/traditional/direct-media-response-rate-cpa-and-roi-benchmarks-53645/ ) it’s easy to see how this entire approach is failing miserably for marketers as well.

Understanding why is easy – it’s about incentives. The marginal cost (the cost of sending the next email) is next to nothing for email marketing, so why not do an “8×3” campaign that sends 8 emails to a ‘prospect’? Sure, there are diminishing returns on each email sent but it does drive up response rates and hey, you are compensated on getting results so that’s just the reality of our world today, right? The fact that it’s just getting harder and harder to get results just means you need a larger list, right?

Wrong. As I described, it’s a race to the bottom (B2B Demand Gen – A Race to the Bottom?), and it’s also true that the limited digital behavior of our email campaign targets is less valuable than you think. An open doesn’t indicate interest in your product or service, it just means the subject line hit home. Even 3 opens means very little. A click through to a link – often it’s just idle curiosity. As a B2B marketing gadfly myself, I can’t tell you how many lists I get on where an “SDR” calls me or emails me multiple times as a follow up – I’m never a prospect for any of them. A simple web search would tell them that.

It’s also going to keep getting worse – see the attached chart (sorry I couldn’t find a more recent one but the trend is clear). A CEO/Founder of a SaaS company that I know recently told me that it takes a list of 2000 companies to get one customer from a demand generation POV. He is a brilliant, hardworking guy and an engineer by training. I responded by noting that any process which yielded so little must be broken, but he just moved along. It was 1000 3 years ago. It will likely be 4000 in another 3 years.

 

My point? Rethink “demand generation” utterly.