Demand generation vs. lead generation: what is suitable for me?

When it comes to marketing, you may be wondering: Should I use demand generation or lead generation? How do you know which one to utilize as you reach out to your intended audience? As with any form of marketing, the decision is based on what you want to achieve.

Maybe you want to increase your brand recognition. Perhaps your goal is to convert visitors to your site into leads.

Having a clear goal in mind lets you decide whether to go with a demand generation strategy or a lead generation tactic

What is Demand Generation?

Demand generation is marketing content toward those who are problem-focused. As the name of this strategy implies, it’s about creating demand.

Through your content, you are making people want to turn to you as an authority.

People are at the beginning of their buying journey. They know they have a problem that needs solving. Demand generation moves problem-focused people toward the first step of your sales funnel.

The content you produce at this stage isn’t salesy, it’s general. The idea is to establish yourself as a reliable and trusted source of information.



Demand generation content
There are a variety of ways that you can deliver information to your prospective audience. The idea behind this type of content is to drive traffic to your website. From there you can use lead generation methods to convert your visitors.

Create an E-book
An e-book gives you the chance to come across as an authority. You can use it as a chance to promote yourself while solving your readers’ pain points.

Free courses
This can build visitor loyalty. You come across as a mentor and guide. You could offer courses that provide a general solution to your audience’s problems. Then lead them to your website or other courses for more focused answers.

Guest Post
If you are wanting to get yourself noticed more within your industry, then consider doing some guest posts. By having your content published on peer websites, you gain recognition from a whole new audience.

SEO Content
Getting on the first page of any search engine takes a lot of time and strategy. Yet, it will drive traffic to your site. Then you can have your visitors move on to the next step of your sales funnel.

Use Google Trends and Google’s “People also ask” and “Related searches” to get a snapshot of what content your audience is looking for.

This lets people get to know you more dynamically. Instead of just reading words on a post, your audience gets to see your face. That creates a special bond from which trust can develop. You gain followers who see you as an authority.

Brand keywords and hashtags
Once people become familiar with your business, they may try to search for it online. What better way to rank in SERPs than by using keywords inspired by your business or brand name?

Also, create a unique hashtag for your social media fans to follow and engage with.

The adage that it “takes money to make money” rings true here. How do people find out about you if you don’t get in front of them?

With online advertising, you can select your target demographic as well as their location. That gives you more bang for your buck in your advertising budget.

Lookalike audiences
Facebook and Google offer strategies to reach out to target audiences who have similar characteristics to your main client base. That expands your marketing outreach to brand new segments.

Maybe you have had people get to the checkout stage of the sales funnel and then quit midway through.

How many abandoned carts are registered on your site? Don’t get frustrated. Reach out to these people and offer them some incentive to come back and complete the purchase.


What is Lead Generation?

Demand generation is focused on getting recognized in the market. Once people start to visit your site, you want to take them through the next step of the sales funnel.

This is where lead generation comes in. It revolves around content that your visitors are willing to sign up for. That is, they will provide you with their details so that they can access information. Now you have prospective sales leads!


Lead Generation Content
When it comes to producing lead generation content, the information is more specific than information found in demand generation material. It's about turning visitors to your site into customers. There are several strategies you can use.

Social Media Ads
Before you spend your advertising budget, decide which social media platform you will use. You want the highest ROI for your advertising spend. Where does your target market spend most of their time?

Advertising was mentioned as a demand generation tactic. So, why discuss it as a lead generation option? It's because, as you will see later, both strategies work in tandem. However, the ads for lead generation are designed to get details from those who view them. This is done by having Calls To Action within your lead generation advertisements.

Use CTAs such as "Sign up here" or, if you are going to host an event, "Go here to register".

Gated content
This is content that requires your visitors to submit their details before accessing it. A great way to generate leads! Gated content can be Whitepapers, e-books, industry-specific reports, case studies, or exclusive videos.

Hosting a webinar allows you to be seen as an industry leader. They are also an awesome way to expose yourself to new audiences via your guest speakers' fanbases.

As a lead generation option, webinars require attendees to register. That means they are giving you their name, email address, location, and any other details you have asked for on the registration page.

Now you have new leads that you can feed through your sales funnel.

People love free stuff. So they are more willing to give you their personal information in exchange for a giveaway or freebie.

You will find that, on social media, giveaways always require you to comment, share, and or tag others as part of the conditions. That expands your market reach and can attract new leads.

Another option for a giveaway is to have a form on your webpage. Visitors then provide you with their contact information. Fresh sales leads for you!

Of course, with giveaways, you want to make the item enticing and exciting.

Referrals are simply asking for your current audience to recommend you to others. You can offer an incentive such as discounts, coupons, or bonuses to those who opt to refer you.

By using referrals, your visitors are encouraged to share your site with like-minded individuals. That increases your market reach without having to spend a cent.

Many inbound doors
Have you ever visited a website that, on nearly every page, asks you to sign up for a book, course, webinar, or some other content it’s offering? These can be seen as “doors” which people open to access your content.

There is a logic behind the strategy: It is a way for you to go “Okay, you’ve got me. I’ll grab your offer”. Now you need to supply your name and other information. The result for the website owner or brand is a new potential sales lead.

So, a lead generation tool is to have many “doors”. These “doors” lead your visitors closer down the marketing funnel.

Infographics are easily digestible. They are a “snapshot” of information that can be easily shared by others within your industry. That equates to your brand being put in front of fresh audiences.

You could have a link within the infographic that takes visitors to gated content. This exclusive information can offer deeper insights into the infographic’s topic. Make sure that you are solution-focused at this stage.

Demand generation and lead generation are the same but different
Demand and lead generation do have several things in common. That is why, sometimes, people get confused between the two.

There are differences between them. The overarching goal of both is to increase your brand awareness and the generation of fresh sales leads. Yet, demand generation and lead generation approach this aim differently. Demand generation is about promoting yourself as a trusted figure within your industry. Lead generation is focused on converting your audience into sales leads.

Both marketing techniques use content to attract attention to your brand. That content needs to be marketed.

For this, you have to know what will drive demand for your product or service. Additionally, you need to understand which media channels you will use to disseminate the information.

There are plenty of things that set demand generation and lead generation apart. Once you understand these differences, it’s easier to create a broad sales lead strategy.

Demand generation is focused solely on brand awareness and getting your name in front of your audience. Lead generation then takes your inbound leads and converts them into customers.

The content of demand generation touches upon your audience’s pain points broadly. Whilst, the information associated with lead generation is very specific and solution-focused.

Lead generation content can be salesy. It can ask for a commitment from your website visitors.

The CTAs for both strategies are also different. Demand generation CTAs can be “Learn more here”, “Have a look at this” or anything else that piques the general interest of those you have come across your brand.

CTAs for lead generation request a stronger obligation from your visitors. For example, “Sign up now”, “Access your free trial”, or “Download your ebook”.

At the demand generation stage of the marketing journey, you aren’t asking for personal details. With lead generation, people have to provide you with their names and contact details.

Which tactic should you use?
Deciding which generation strategy to employ for your marketing depends on the end goal. Are you wanting to increase your brand awareness? Do you want to be seen as an authority by offering general information? Then go with a demand generation technique.

If your marketing aim is to get more sales leads, then go with a lead generation idea. Lead generation means your audience needs to give you their contact details. You can then pass that information onto your sales team to follow up on.

Demand generation and lead generation can stand alone in their own right. That doesn’t mean you should let them.

A synergistic approach
The most effective marketing plan is all-encompassing. If you are a startup, you will want to look at promoting products and services to your niche marketing. However, that doesn’t exclude established brands from also wanting to increase their market share.

Demand generation is focused on making your audience aware of your brand. The content you offer is broad yet sets you up as an authority. At this initial stage of the buyer’s journey, everything is designed around building trust towards you. Why should someone decide to do business with you? What makes your brand different from your competitors?

Remember, the demand generation stage isn’t sales-focused. At this first access point in the sales funnel, you want to “attract the fish”. Give them a lure they can’t resist.

Lead generation is the next step in the sales journey. People now know about you. They are willing to go to your site and consume more content. Entice them with lead generation tactics. Give them the bait so that you can “hook the fish”.

After you have got the fish on the line (they have given you their personal information), you can reel them in. Landing the fish is the job of your sales team.

Measuring the success of your sales generation
With your marketing efforts, you want to know what worked and what didn’t. There are key metrics you can consider regarding demand and lead generation. These will tell you what your wins were.


Demand generation metrics

You can gauge the interest shown towards your content and brand by analyzing data such as:

  • Cost per mille (also referred to as Cost per Thousand): How many ad impressions were there for the budget spent? You can try A-B testing to find out which ad format has the higher engagement rate with your audience.
  • Organic traffic: All your content should be SEO optimized. Look at your Google Analytics and the keywords. Where are you ranking on the SERPs? How much of your traffic is driven from paid vs organic keywords?
  • Market share growth: As a start-up, you aren’t going to eat away at your competitors’ slices of the market overnight. Look at this as a long-term goal. However, have markers along the way to check whether your demand generation strategies are working.
  • Cost per Acquisition: How much will it cost you to gain a prospective customer through your chosen channel(s)? The average for what is an acceptable CPA varies from channel to channel. Ask yourself: Is it worth spending advertising money on this channel or not?

Lead generation metrics

How can you tell if you are successfully converting visitors to your site into leads? Use these metrics to determine if your strategies are working:

  • Marketing ROI: When you run a lead-generating ad campaign, look at the overall ROI. Did you achieve the level that you were hoping for? What did you do right and which campaigns failed to deliver?
  • Amount of email subscribers: Lead generation through email lists is still a popular option. It’s free and allows you to keep your audience informed about new content and offers. Yet, you want to increase the number of subscribers. What is your plan around this?
  • Click-Through Rate (CTR): This will quickly tell you if the content you are providing is on the button or not. How many people are clicking through to your site and engaging with it? More traffic means an increase in potential leads for you to follow up on
  • Bounce rate: If people are leaving your site as quickly as they found it, then that tells you something: Your content isn’t great. The lower the bounce rate, the better. That’s because your visitors love your information and are hungering for more.
  • Time to conversion: Here you learn how long it takes for someone to become your fan. If this metric is high, then you need to look at your sales cycle. Where is the block in the sales funnel?

Look at everything holistically

As you consider your marketing tactic, demand generation and lead generation both have a role to play. You may wonder which one suits you the best. The answer to that is: both.

Sure, each strategy focuses on different marketing aspects. Yet, they work in tandem via a top-down approach. Think of an inverted triangle with the base at the top and the apex at the bottom.

Demand generation develops awareness about your brand. Which you can consider as the top of the sales funnel. This is the broad base of your inverted triangle. The content is general yet touches upon the issues your audience face. You set yourself up as an authority within your market.

Once trust is created, you can move your audience further down the triangle. The apex represents sales conversion (your visitor is now a customer). Lead generation takes your potential clients closer towards the bottom of the triangle.

That makes the processes, though slightly divergent, holistic. There is an end goal: to gain and convert people into loyal customers for your brand.

So, it’s not a question of which is right for me. Use both and you will be maximizing your marketing efforts.


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