Demand Generation vs Lead Generation

Demand generation and lead generation are two parts of a complete inbound strategy.

Demand generation and lead generation are two components of a more comprehensive inbound sales strategy. Understanding how the two work together helps sales and marketing organizations to build a balanced inbound approach.

What is demand generation?

Demand generation is a top-of-funnel brand marketing program. Demand generation aims to increase brand awareness, educate and generate familiarity and trust - ultimately converting strangers into prospects.

Demand generation campaigns run the gamut from brand awareness ad campaigns to branded content like blogs or other ungated content marketing.

What is lead generation?

Lead generation moves brand-aware consumers through the buyer's journey by nurturing the interest created through demand generation. Lead generation aims to convert potential customers to leads, move them through qualifying stages, and convert them to customers.

Examples of lead generation content are gated content, webinars, newsletters, and other free offers requiring a sign-up.

Lead generation also includes intent prospecting with sales tools like G2 and Zoominfo. These solutions can provide information about buyer intent, essentially pre-qualifying leads, based on their desire to purchase a given product or service.

It’s important to remember that lead generation is middle to bottom-of-funnel. To have an effective lead generation campaign, you need to feed it a large audience from demand generation.

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Demand Generation vs. Lead Generation

Demand generation attracts and builds your target audience, converting a broad audience into viable prospects. Lead generation qualifies and converts those prospects into leads and customers.

What’s more important, demand generation or lead generation?

Demand generation and lead generation are stages of a cycle. Every organization should use a combination of the two. However, there are times that a company will need to focus more on one than the other.

As a component of brand marketing, demand generation is critical to creating awareness of your company or product. If you have a strong brand and your target audience is already familiar with you and what you offer, your focus should lean toward lead generation. If you are a new company, a start-up, or just haven’t created enough awareness, you should lean more toward demand generation.

How do I improve my demand generation?

A targeted demand generation program starts with buyer personas. When you’ve established comprehensive buyer personas, create a list of their needs and problems. Demand generation assets should provide solutions to those problems. Promoting those assets to targeted audiences puts your name in front of them, provides value with solutions, and establishes trust.

If your demand generation efforts feel flat, you probably need more content, better-targeted content, or more time. As a brand marketing effort, demand generation takes time to build. Don’t look for short returns on-demand generation; think of it as an investment that will take time to mature. Once matured, it will provide stable lead velocity (growth).

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How do I improve my lead generation?

It’s possible to generate leads without a demand generation program, but real growth will be nearly impossible, and conversions will be much lower.

Lead generation should be targeted, relevant, and up to date. These lead generation assets should be regularly analyzed and updated:

  • SEO - optimize your website and landing pages regularly
  • Landing pages - keep your design and messaging up to date
  • CTAs - use clear and relevant calls to action
  • Offers - clarify and diversify your value offers for different stages of the buyer cycle

Demand generation and lead generation create a comprehensive inbound sales strategy. Understanding how they work together helps to build a balanced inbound approach.

Demand generation tells prospects who you are, converting a broad audience into viable prospects. Lead generation converts those prospects into qualified leads and customers.

Learn more about automated lead distribution software and how it fits into a lead distribution system.

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