Say you’ve met someone you really like. How do you get to know them and build a rapport? You could ask their friends if they’re single, attend a few meetings of their Bruce Springsteen fan club, or double-tap on all of their Instagram posts. Or, you could walk right up and ask if they’d like to go on a date.
Marketing professionals may recognize the similarities between these two tactics and upstream and downstream marketing strategies. Conducting market research by talking to friends and brushing up on the E Street Band’s discography are upstream processes aimed at setting yourself up for future success. Taking the direct approach by asking for a date represents a downstream marketing technique meant to get immediate results.
Read on to learn about the key differences between upstream marketing and downstream marketing, and how they both can influence your customers to buy from you.
What is upstream marketing?
Upstream marketing focuses on understanding and influencing the desires of the consumer over time. Rather than generating immediate sales, upstream marketing strategies aim to build relationships and identify future markets. Upstream marketing techniques aim do the following:
- Identify unmet customer needs. Market research can help your team learn about consumer desires and needs. This might also spark new product ideas, or ideas for ways to improve your current offerings.
- Shape the market. Effective upstream marketing creates demand for your product and nurtures a long-lasting relationship with the consumer. You might try publishing content to social media channels, for example, to explain the value of your product.
- Reach your target audience. Looking upstream can guide your marketing messaging, so that your brand and product positioning reaches and resonates with your target audience.
What is downstream marketing?
Downstream marketing strategies focus on short-term sales. This includes using sales tactics such as advertising, email marketing, and product promotion to sell products to consumers who are ready to buy. Downstream marketing efforts are typically:
- Focused on revenue generation. Downstream marketing emphasizes driving the sales you need in the near term to keep your business running.
- Easy to execute. Downstream marketing tactics such as sales emails and flash promotions can be executed quickly and generate immediate returns—especially when using digital marketing channels.
- More targeted. Downstream marketing campaigns have a more defined target audience than upstream marketing tactics. Sales and marketing teams can use their knowledge of the customer base to create a marketing strategy and campaign assets with focused, personalized messaging. Downstream marketing can also target current customers with tactics like upselling.
Upstream vs. downstream marketing: key differences
To understand the difference between upstream and downstream marketing, consider this hypothetical scenario. Imagine you’re the marketing director of an online business selling a kitchen device that peels and cores pineapples. You might use an upstream marketing strategy by creating a viral recipe video that includes fresh pineapple as a key ingredient, thereby increasing the demand for your product.
After the success of this campaign, the marketing and sales team could decide to employ a downstream marketing tactic with a short-term sales campaign on Instagram that celebrates International Pineapple Day (every June 27).
Significant differences emerge when you dig into the tactics and desired outcomes of each strategy. These are some ways in which upstream and downstream marketing are different:
- They target different parts of the customer journey. Marketers employ upstream and downstream marketing tactics at different points in the marketing stream. Upstream marketing focuses on targeting consumers well before they’re ready to buy. Downstream marketing activities come into play later in the customer journey, typically when they are considering a purchase.
- They have different goals. Upstream marketing processes such as trend forecasting won’t immediately generate sales, but they can give your sales and marketing managers information that helps them succeed in the future. Understanding the target audience can help you plan the messaging for future marketing campaigns.
- They have different measures of success. Upstream marketing efforts might be measured by brand awareness metrics like website impressions or social media follower count. Downstream marketing tactics, such as sales emails, are easier to quantify. Their success can be measured via sales metrics such as conversions to purchase.
Using upstream and downstream marketing together
Upstream and downstream marketing have different strengths, which is why businesses often use these strategies simultaneously.
Upstream and downstream marketing share a common goal: connecting with customers. Both marketing processes require a firm understanding of your customer base and will be most successful when executed with collaboration across sales, marketing, analytics, and design teams.
Upstream vs. downstream marketing FAQ
How do upstream and downstream marketing impact product development?
An upstream marketing plan that includes analyzing market and competitor data can influence future product development by exposing gaps in the market and revealing unmet consumer desires. This is essential for a smooth product development cycle, because potential user needs can be addressed before they arise. Downstream marketing focuses on promoting current products. Evaluating the success of downstream activities can provide insight into customer satisfaction and contribute to product development. After reviewing the success of a short-term sales campaign, your marketing team can use performance numbers and customer feedback to tweak product development, features, or messaging.
How can businesses strike a balance between upstream and downstream marketing?
Successful businesses use upstream and downstream marketing tactics in tandem to create an overall marketing strategy that balances short-term sales goals with long-term growth. Marrying upstream and downstream activities can create a cohesive campaign strategy that allows you to effectively reach customers and position your team for future marketing success. To find the right balance, establish short-term sales goals using focused campaigns and downstream processes, and long-term growth objectives with an upstream marketing plan.
How do upstream and downstream marketing affect customer behavior?
A downstream marketing strategy process aims to get the customer to click and buy immediately. Upstream marketing considers future behavior—its goal is to subtly shape the preferences and desires of consumers over time so that one day they will buy your product.