Demand Generation vs Lead Generation

John O'Shea

If you’re like most marketers, trying to determine which between demand generation and lead generation is more valuable, can sometimes be confusing.

But you don’t have to pit demand gen vs lead gen. Instead, focus on using these two to produce maximum results for your marketing efforts and your bottom line.

Focusing on one while ignoring the other can only mean missing out on important rewards. Don’t worry if you haven’t figured out how the intersection between a demand gen campaign and lead generation can produce the best marketing results for your inbound marketing.

In this article, we help you understand:

• The difference between demand generation and lead generation.
• How to incorporate a demand generation program and lead generation in your marketing campaigns to grow your revenue.

Demand Generation Vs Lead Generation

The difference between the demand generation process and lead generation tactics is simple.

While demand generation builds brand awareness to attract your target audience, lead generation focuses on converting a qualified lead (existing demand) into a paying customer.

Generating demand entails marketing campaigns whose aim is to create an interest or demand in your service or product. It’s perfect for penetrating new audiences. Demand gen will increase excitement about your product or service and make prospective customers want to purchase.

As part of your demand generation campaign, you will focus on creating resources that will capture qualified leads through landing page forms, or people seeking more information about your product or service.

Conversely, lead generation involves campaigns that aim to gather information about potential customers and turn them into quality leads for the buyer’s journey. Here, you need information about potential buyers to generate high quality leads you can convert to paying customers.

Only then can you use targeted marketing campaigns to nurture your leads using relevant content. Lead generation content is, in most cases, gated. You can use eBooks, white papers, survey reports, webinars, how-to guides, and thought leadership articles to generate leads.

Wondering which is the best strategy for meeting your business goals? These strategies go hand in hand. Well, you can’t use either of these exclusively.

Differences between Demand Generation and Lead Generation

Demand gen and lead gen take place at different stages of the B2B sales funnel. Demand generation happens at the top of the B2B sales funnel as you bring prospects into the buyer’s journey.

Conversely, lead gen takes place once prospects have passed through the awareness stage and are showing interest in your product or service. Thus, they’re willing to exchange their personal information so they can learn more.

Much of demand generation marketing is similar to inbound marketing tactics and other top of the funnel strategies. However, the difference is that demand generation is a broad category where inbound marketing falls.

Is lead generation part of demand gen?

Successful demand generation strategies often involve lead generation. Failure to generate high-quality leads will affect your demand generation efforts negatively.

Here are the main differences between demand generation and lead generation.

• Objectives

Both demand and lead generation have different goals. While demand gen strategies aim to build brand awareness and publicise the solutions you offer, lead generation aims at transforming the demand you generate into qualified leads. You offer to solve the prospect’s issues by addressing customer pain points.

• Impact

B2B demand generation tactics provide the opportunity to educate your target audience using free resources. Lead generation takes this a notch higher, allowing you to nurture prospects with more explicit content for better brand positioning using gated resources that prospects must provide their contact information to access.

• Engagement

When you generate demand, the goal is to build trust and establish brand authority as you position yourself as a thought leader. Lead generation helps in differentiating your brand and solutions from your competitors thus, improving conversion rates. It emphasises on the benefits.

How do demand gen and lead gen converge?

B2B marketing strategies rely on both demand and lead generation. It’s difficult to generate quality leads consistently and efficiently when you’re not creating demand. Moreover, your demand generation strategy will not be cost efficient if you can’t convert it into the leads you need for growth.

Demand generation marketing and lead gen serve the same purpose but are always seen as being in competition. But this is mostly because of poor alignment of demand gen and lead gen metrics and goals.

This lack of alignment can result in:

• High cost of customer acquisition
• Unsatisfied customers
• Less productive teams
• Misaligned targets for sales and marketing teams

Emerging trends show that B2B prospects take time to assess their purchases. They also make decisions that are backed by evidence. Trying to convert leads who are not aware of your solution won’t yield results.

A good demand gen strategy will constantly focus on providing prospects with free content. This helps to capture the existing market demand while expanding your audience.

Even then, you must have a proper lead scoring system. This way, you’ll be able to tell when the time is right to target your leads with relevant content. Your sales reps won’t spend their time in sales conversations with leads that are uninterested in purchasing.

A demand generation campaign requires different content strategies and channels than lead generation. Moreover, demand gen leverages those lead sources where the intent to buy is low, like community events or podcasts.

In Conclusion…

Knowing where to draw the thin line between lead gen and demand gen is critical for improving sales alignment between marketing and sales teams.

When you have successful B2B demand generation strategies, marketing teams will easily develop high quality leads they can hand down to the sales team. Ultimately, both teams will deliver their targets.

If you’re struggling with your lead generation, book a call with one of our Growthonics consultants to discuss how we can help.