Next year’s pipeline is a budget decision you are making this quarter
At any moment only a small fraction of B2B buyers are in market, yet most budgets are built to fight over them. Why underfunding demand creation is a deferred revenue miss, and how to defend the investment in a quarterly operating rhythm.
Research by John Dawes of the Ehrenberg-Bass Institute, published through LinkedIn’s B2B Institute, estimates that roughly 5% of business buyers are in market for a typical category at any given time. The other 95% will not buy for months or years.
Most B2B budgets are allocated as if the ratio were reversed. The share of budget you put into demand creation this quarter is a forecast of next year’s pipeline, and cutting it is not a saving; it is a deferred revenue miss that will not show up until it is too late to fix.
Source: John Dawes, Ehrenberg-Bass Institute, via the LinkedIn B2B Institute.
Capture is a crowded auction
Demand capture, through paid search, retargeting and intent-based outreach, competes for the same 5% as every rival, at auction prices that rise with competition. It is necessary and it is efficient at the margin, but it cannot create the buyers it bids on. Buyers enter the market when their situation changes. What determines who they shortlist is the memory and trust built before that moment.
At VRIFY, roughly 95% of a 2,400-company market did not know us. We treated capture and creation as separate jobs with separate measures: capture against accounts showing live signals, creation through events, technical content, executive presence and peer proof across everyone else. In a finite market, every account will eventually enter a buying window. The only question is whether you are already on its list when it does.
Balance is a capital allocation decision
Les Binet and Peter Field’s long-running effectiveness research concluded that sustained growth comes from balancing long-term brand building with short-term activation; their B2B work suggests a split close to even. The ratio matters less than the principle: starve creation and activation gets more expensive every year because fewer buyers recognize you; starve activation and you build familiarity nobody converts.
| Demand capture | Demand creation | |
|---|---|---|
| Audience | The ~5% in market | The ~95% who will be |
| Payback | This quarter | Several quarters |
| Leading indicators | Pipeline, CAC | Reach and familiarity in target accounts, branded and direct demand |
| Failure mode | Rising auction costs | Invisible until the pipeline gap appears |
Defending it in a quarterly business
Creation budgets are the first cut in a soft quarter precisely because their payback is delayed. I defend them in three ways. Separate them in the plan and the reporting so they cannot be quietly absorbed. Agree in advance on the leading indicators that will be reported while payback accrues. And track, over time, how many new opportunities emerge from accounts that were warmed for months before they raised their hand. That pattern becomes the most persuasive slide in the deck.
What good demand creation looks like at executive level
Effective demand creation is not awareness for its own sake. It teaches the market something it values whether or not it buys: a benchmark only you can publish, a clear account of an emerging problem, a framework buyers adopt, a credible view of where the category is heading. It appears consistently in the rooms and channels where buyers spend time when they are not shopping. And it is unmistakably yours, so the memory it builds attaches to your company rather than to the category generally.
In finite markets, events are frequently the most efficient form of demand creation, because they combine education, peer proof and personal trust in a single moment. That is one reason events became VRIFY’s largest revenue driver: they built memory with accounts that were not yet buying while converting the ones that were.
Questions for the board
- What share of our marketing budget targets buyers who are not yet in market?
- How many of last year’s new opportunities came from accounts we had engaged for six months or more?
- If we cut creation by half this year, when would we see it in pipeline, and would we recognize the cause?
The takeaway
Next year’s buyers are not looking for you today. The budget you put in front of them now is the pipeline you will be presenting in twelve months. Protect it like the forecast it is.