Demand generation vs. lead generation—these B2B marketing concepts are often mistaken to be contradictory, but in reality, an effective sales funnel requires them both to work in harmony.
Both demand and lead generation are marketing methods that involve getting the attention of consumers and transitioning them into paying customers. More specifically, demand gen creates awareness for the brand while lead gen transforms the brand-aware audience into customers.
For B2B marketers that want to create a sustainable pipeline of workable high-quality leads, there’s the need for a paradigm shift—from demand generation vs. lead generation to demand generation AND lead generation. The reason is simple: for lead generation to be effective, it must be preceded by demand generation.In this article we will detail demand generation and lead generation, highlight their differences, key techniques for each, and how you can use marketing tools to create an enhanced customer acquisition pipeline.
Lead generation and demand generation are two pivotal concepts in marketing and sales. Though they sound similar, they serve different purposes in the sales funnel. Understanding the difference between the two can help businesses build more effective strategies to attract and convert buyers.
What is Lead Generation?
Lead generation is the process of identifying and qualifying potential buyers who have expressed interest in your product or service. The goal of lead generation is to build a list of prospects you can nurture into becoming paying customers.
Some common lead generation strategies include
- Content offers like ebooks, whitepapers, webinars that prospects opt-in to access
- Search engine optimization to drive relevant traffic to your site
- Social media contests and giveaways
- Pay-per-click ads and retargeting campaigns
- Referral programs that incentivize existing customers to share your brand
Lead generation focuses on capturing contact information from interested prospects so you can continue marketing to them. High-quality leads are buyers who are more likely to convert based on criteria like job title, company size, industry, and expressed needs.
What is Demand Generation?
Demand generation aims to drive interest and create “demand” for your products or services. The goal is to get your brand and offerings in front of new audiences and ignite their interest.
Demand gen activities include
- Social media engagement through organic and paid campaigns
- Branded content like blogs, ebooks, and videos that attract new visitors
- PR outreach to earn media coverage and increase brand visibility
- Advertising through mediums like TV, radio, billboards, and online ads
- SEO to rank highly for commercial keywords and phrases
The focus is on brand-building rather than targeting specific buyer personas. You cast a wide net through awareness campaigns with the goal of capturing attention.
Lead Generation vs Demand Generation: Key Differences
While lead gen and demand gen work closely together. there are some key differences
Goals
- Lead generation: Identify and qualify interested prospects to build a sales pipeline
- Demand generation: Increase awareness, create interest, and drive web traffic through promotional activities
Target audience
- Lead generation: Focused on ideal buyer personas that are more likely to convert
- Demand generation: Broad targeting to increase overall brand awareness
Timeframe
- Lead generation: Short-term results like form fills and new leads in the pipeline
- Demand generation: Long-term brand building over months and years
Metrics
- Lead generation: Number of leads, cost per lead, lead quality
- Demand generation: Brand awareness, website traffic, digital reach
Activities
- Lead generation: Calls-to-action, gated offers, email nurturing
- Demand generation: Social media, PR, ads, brand content
How Lead Generation and Demand Generation Work Together
Lead generation and demand generation are most effective when executed together. Here are some ways they complement each other:
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Demand generation activities like social media and content marketing raise awareness and bring new visitors to your website.
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Those visitors are then converted into leads through lead gen offers like downloads, trials, demos, etc.
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Nurtured leads become part of your contact database for ongoing relationship-building.
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Customer referrals and word-of-mouth from happy clients further increase demand.
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More demand generation with new audiences starts the whole cycle again.
Aligning your demand gen and lead gen efforts allows you to drive interest at scale while also capturing contacts ready to engage further. Brand building activities reach cold audiences and prime them for lead capture.
Lead Generation Best Practices
Here are some tips for maximizing the quality and quantity of leads generated:
Offer valuable content
Create lead magnets that provide real utility to prospects – like calculators, how-to guides, assessment tools. Useful content earns trust and engagement.
Personalize messaging
Segment your campaigns based on prospect behaviors and attributes to serve messaging that resonates.
Retarget website visitors
Remarket to visitors who left your site without converting to capture leads on their next visit.
Promote leads in-store
Generate in-person leads by promoting downloads, trials, etc. in brick-and-mortar locations.
Prioritize lead quality
Focus on generating leads that fit your ideal customer profile rather than chasing volume alone.
Demand Generation Best Practices
Some effective tactics for building brand awareness and demand include:
Social media
Craft engaging social content across different platforms like Facebook, Instagram, LinkedIn, Twitter.
SEO
Optimize website content for search rankings so you appear for relevant queries.
Content distribution
Repurpose content and share it across as many channels as possible to extend reach.
Influencer marketing
Partner with industry voices and thought leaders to create co-branded content.
Paid advertising
Invest in PPC, social ads, retargeting and other paid channels to reach new audiences.
Wrapping Up
Lead generation and demand generation should work hand-in-hand to drive results. Demand gen brings in new visitors through awareness-building. Lead gen then converts those visitors into contacts for your sales team to nurture.
Balancing broad promotional activities with targeted lead capture will allow you to generate interest at scale while also building a pipeline of qualified prospects.
Key components of a demand generation strategy
Demand generation feeds into the Attention and Interest parts of the AIDA model (Attention, Interest, Desire, and Action). Therefore, your demand generation strategy is mostly focused on name recognition and creating buzz around your brand.
Five key components of a demand strategy are:
A smart tech stack can help you scale your activities, amplify your efforts, expand your reach, and enhance the efficiency, effectiveness, and performance of your demand generation campaigns. Solutions like Clearbit’s B2B ad targeting tools can help to supercharge demand generation efforts.
For an effective demand generation campaign, your goals should focus on increasing the visibility of your brand. Specifically, you should consider goals such as brand lift, visibility, traffic, and share of voice.
The marketing space is incredibly competitive, and maintaining brand awareness is how you ensure that new leads flow into your funnel. For brand awareness to be effective, you need to leave a positive lingering impression of your brand on your audience.
The goal is to grab attention, so strategies like influencer marketing, experiential marketing, product placement, guerilla marketing, lifestyle marketing, and branded entertainment can help to enhance brand awareness.
This includes social media, blogs, webinars, podcasts, videos, eBooks, case studies, infographics, and market reports. These types of content help you build a stronger brand voice and authority in your industry.
Key components of a lead generation strategy
Lead generation is focused on the Desire and Action parts of the AIDA model. Therefore, a lead generation strategy focuses on turning someone’s interest in your product into a desire for the solution it provides—and eventually a sale.
Seven key components of a lead generation strategy are:
Without a strategic lead capture plan, you’ll find it difficult to move your prospects into a sales funnel. A lead capture plan will rely heavily on web forms through which you collect data from the visitors on your landing page. You can improve the efficiency of your lead capture model by leveraging solutions that can dramatically shorten the number of fields on the form.
A lead magnet refers to an offer that a brand provides to its audience in exchange for collecting their email, phone number, or contact information. Your offer—typically a downloadable resource or digital tool—is a gift to your prospects. Lead magnets include product trials, gated content like whitepapers or books, coupons, discounts, or other exclusive or time-sensitive deals. Lead magnets permit you to reach out to potential leads who have shown interest in your brand.
Landing pages are key to the success of your lead magnets. They function as a destination for ad ctas, a tool to keep leads focused by reducing distractions, and provide a clear and incentivized call to action.
Social media is an important part of lead generation by using paid and organic channels. Sites like Twitter, Facebook, and LinkedIn provide you with tools to promote your offerings or thought leadership, and should include a call to action within your posts and ads.
Marketing automation workflows help you create systems and processes to expand your reach. They also help to monitor and evaluate the effectiveness and performance of your lead generation campaigns.
Lead scoring systems help you prioritize your inbound leads based on the depth and quality of their engagement.
Remarketing enables you to stay in touch with your site visitors and bring your brand to their attention across other parts of the internet. For instance, targeting customers who have visited your site through social media ads. Remarketing is a great way to recapture the attention of interested prospects, provide them with an irresistible offer, and collect their information to transform them into workable leads.
