Demand generation vs. lead generation

Demand generation vs. lead generation — for many B2B marketers, these two terms mean basically the same thing. While there are plenty of important overlaps, these two concepts are distinct, and each one plays a critical role in your marketing strategy.

Continue reading to learn more about where demand gen and lead gen fit into your marketing efforts and how you can optimize each one for better leads and more conversions.

What is demand generation?

Simply put, demand generation is a marketing and sales concept that involves creating interest (demand) in an organization’s product or service offerings. Unlike lead generation, demand generation focuses on building rapport with customers through brand awareness. An essential component of a successful demand generation strategy includes developing thought leadership content that provides a potential buyer with something of value when they aren’t in the market for a product.

That’s the key. The idea is that once they are ready to make a purchase, your brand (and your products and services) will immediately be top of mind. If your strategy is successful, they will already have some level of familiarity with your offerings and trust in your reputability as a brand. The ultimate goal of a great demand generation strategy is to set the groundwork for your lead generation effort to create a healthy pipeline of highly qualified leads that are more likely to convert.

Generating demand across all channels

Today’s customers are using a wide variety of different platforms and devices to find information and research products, and they expect their favorite brands to have a presence across multiple channels. To drive better customer engagement and achieve your demand generation objectives, it’s important to leverage some combination of the following channels:

● Mail.
● Social media.
● Video.
● Podcasts.
● Blogs.

Before developing your demand generation strategy, it’s essential that you understand your target customers, particularly the channels they are spending the most time using. For example, while older, senior-level executives are probably more likely to consume in-depth whitepapers they find on LinkedIn, young professionals might prefer short videos on social media outlets like Twitter and TikTok. It just depends on who you’re trying to sell to.

What is lead generation?

Lead generation is a top priority for many marketers. According to one HubSpot report, almost 35% of marketers rated this as their top priority. Lead generation follows naturally from demand generation. If you’ve accomplished your demand generation objectives, you should have a steady stream of users coming to your website. The goal of a lead generation campaign is to identify which of those users are actually interested in your products (and possibly in the market for a purchase) and are worth investing marketing dollars nurturing for possible conversion.

Effective lead generation campaigns pinpoint and prioritize high-intent customers — those most likely to make a purchase — in the hopes of attracting more qualified leads. They incorporate bottom-of-funnel content like customer case studies, buyer’s guides and product demo videos, all of which are aimed at attracting users who have shown a serious interest in making a purchase.

While lead generation strategies tend to leverage many of the same channels as demand generation (blogs, videos, webinars, etc.), they are more focused on providing content that directly addresses the challenges and problems faced by potential buyers, as opposed to content that provides high-quality information about a more general topic (the type preferred by the demand gen campaigns).

Demand generation vs. lead generation – What’s the difference?

Demand and lead generation are sometimes used synonymously, but they aren’t exactly the same thing. Demand gen focuses on transforming (and reinforcing) your brand into a known commodity among the customers that are most likely to use your services. It seeks to establish a general understanding of who you are and what you do, making you stand out in a crowded field of competitors.

Lead generation, on the other hand, takes advantage of that demand and focuses on pointing potential leads to your sales team, where they will be nurtured and eventually converted into customers.

Despite the differences, there are important overlaps, and an effective marketing strategy should use both in tandem. Ultimately, demand gen without lead gen won’t enable you to take advantage of your brand awareness, and lead gen without demand gen will have very few potential leads to nurture.

The value of gated content

Whether or not to gate content (meaning asking customers to exchange personal information like their names, email addresses and job titles to access your blogs, whitepapers and other content) is a big content marketing question. True, gating content is one of the most effective ways to grab emails and fill your lead pipeline, but it also inevitably causes fewer people to actually click and engage with your content.

And that’s where lead gen vs. demand gen comes back in. The decision to gate your content ultimately comes down to whether you are running a demand gen or lead gen campaign around that content. If you’re trying to reach out to a prospective customer, then it’s essential you get users’ personal information so you can qualify them, add them to email drip campaigns and begin the process of nurturing them.

If you’re just trying to build brand awareness, however, then you should ungate your content, making it completely free and maximizing its exposure — and therefore increasing website traffic.

Building a great demand generation campaigns

Here are some of the core objectives and components of a successful demand generation strategy:

● Produce the right content: It’s important to remember that when developing content for a demand generation campaign, most of your readers won’t yet be interested in your products. Many of them won’t even know who you are. Demand gen is mostly a top-of-funnel approach, so avoid the temptation of pushing your offerings too hard in your content, and instead aim to provide helpful information about your industry at large.

● Establish authority: Customers want to buy from brands they trust. Edelman found that 81% of customers have to trust a brand before buying from them. Focus on creating high-quality content that provides real value to customers even when they aren’t buying from you (yet). Good demand gen content could include an in-depth state of industry report, a blog containing helpful tips or an e-book covering next year’s key industry trends. Whatever it is, the goal of your content should be to establish your brand as an authority in the industry to ultimately build a deeper level of trust between you and your potential customers.

● Create an omnichannel experience: Your customers are everywhere. You need to be too. Make sure you are posting regularly to your blog, staying in touch with every potential customer over email and maintaining an active presence across all relevant social media platforms. Demand generation depends on visibility, and that means engaging customers on the channels and platforms they’re using most.

● Leverage intent data: Intent data gathers the various signals given by users during their online browsing sessions to provide marketers with information about the potential customers that are most likely in the market for a product or service. You can use intent data to drastically enhance the effectiveness, precision and efficiency of your demand generation campaigns by better placing your brand in front of your target audiences.

● Create relevant CTAs: Calls to action have to be properly tailored to generating demand. Customers at this stage of the buyer’s journey might be turned off by too many mentions of your product/service offerings. Instead of pointing them to your sales team (or even your product pages) at the end of your content, share another piece of relevant content with them to maintain engagement and further reinforce your industry expertise.

Building a great lead generation campaign

Some of the fundamental components of a successful lead generation campaign include:

● Identify your target audience: Take the time to identify every buyer persona that either has or would have a need for your product. Be as specific as possible. Narrow this down to demographic, job title, company size and purchasing power to ensure that your lead gen strategy matches all of the specific requirements of your target audience. Leveraging intent data can help you here.

● Focus content on the customer: Whether you’re creating an email marketing campaign or optimizing landing pages for search, it’s important you create mid-funnel and bottom-of-funnel content that directly addresses the specific challenges your target audience faces. Buyer’s guides and customer case studies are hugely impactful for lead generation campaigns because they explicitly showcase the value your solutions create.

● Select the right keywords for search engine optimization: Search engine optimization (SEO) is critical to bringing your target audience and valuable content together. Successfully reaching those potential customers, however, means targeting high-intent keywords that increase the likelihood of meeting customers with buyer intent. For example, a CRM software company targeting the keyword “best CRM platforms” is much more likely to generate qualified leads than if they target “why customer relationships matter.”

● Encourage customer action: In addition to forms that ask customers to provide personal details before accessing your content, lead generation content itself can more explicitly encourage customers to take action by pointing them to your product pages and sales team. The goal now is to move them closer to conversion (they should have an understanding of who you are), so it’s important to make it easy for them to take the next step in the journey.

● Nurture your leads: It’s not enough to make contact with potential customers once and leave it at that. It’s critical that you stay close to them throughout the buyer journey. Stay at the top of their inboxes by including them in email drip campaigns that provide more valuable content, see the product in action through a video demo or offer to open a conversation with a sales rep. Either way, leads will only convert if you keep them warm.

Measuring your demand gen and lead gen campaigns

Tracking the right key performance indicators (KPIs) is the only way to accurately measure the performance of your lead gen and demand gen strategies. To pinpoint the successes and shortcomings of each one, you’ll have to focus on different KPIs. Consider the following when measuring your lead generation campaigns:

● Cost per acquisition.
● Cost per lead.
● Marketing qualified leads.
● Sales qualified leads.
● Conversion rate.

Measuring the performance of your demand generation efforts is slightly more challenging because many of its goals are somewhat amorphous (i.e., how “brand aware” is enough to count as brand awareness?). The following metrics will help you get started:

● Website traffic.
● Total impressions.
● Share of voice.
● Click-through rate.
● Time on page.