In B2B marketing, we use numerous terminologies interchangeably, often with no clear understanding of their definitions. There will be moments when we may get perplexed and mix some terms because of the stacks of jargon, ever-evolving strategies, and new technologies that keep adding to the list. Lead generation and demand generation is a classic example of this.
Yes, lead generation and demand generation look alike (and even read alike), but they’re distinct in terms of definition, function, and content. In this article, we’ll look into how lead generation and demand generation differ from each other. But first, we’ll start by defining each term separately.
What Is Demand Generation All About?
Demand generation aka demand gen is the method of generating awareness and creating demand for a company’s products or services among various target audiences.
When using a demand generation technique, brands can build customer trust, enhance their reputation, and even attract new audiences. This inventive approach focuses on education in which companies describe the specific solutions they offer that address and/or combat customers’ existing or upcoming problems and pain points. As a result, most customers will likely view a specific brand as a leader in regards to its functionalities, values, deliverables, and standards.
What Is Lead Generation?
Next is lead generation, which is the process of converting targeted prospects into qualified leads. Unlike demand generation, which focuses on creating awareness for a company’s solutions, lead generation aims to capture prospects’ details such as their usernames, email addresses, phone numbers, and job roles. Essentially, lead generation is one step ahead of demand generation.
When utilizing a lead generation method, brands can fill their sales pipeline with qualified leads, witness new opportunities for cross-selling and up-selling, and also increase revenue. And that’s the same reason over 50% of marketers spend more than half of their marketing budgets on lead generation.
Major Differences Between Demand Generation and Lead Generation
In today’s ultra-competitive age, both demand gen and lead gen are important strategies worth applying in order to gain better prospecting and add more leads to a sales funnel. However, keep in mind that the content B2B marketers use in lead generation can differ from the content used in demand gen.
Demand Generation Content
In addition, demand generation involves ungated, free-to-download, and free-to-share content such as blogs, social media posts, videos, or podcasts. By using and sharing demand generation content, companies like yours can demonstrate the many benefits of your products or services, focus on establishing recognition, create brand authority, and position your brand as an industry subject matter expert.
Lead Generation Content
Then there’s lead generation, which includes gated content such as white papers, research reports, videos, free trials, eBooks, surveys, and more. Lead generation is known to target audiences who are already in the sales funnel. By using lead generation content, brands can address their leads’ specific concerns and then nurture them by providing required information across the buying journey. Also, through lead generation content, companies can spread more awareness about their products or services, capture prospects’ in-depth information for sales follow-up purposes, reduce their allocated marketing budget, and achieve better ROI.
Where Do Demand Generation and Lead Generation Fit Into the Sales Funnel?
Overall, demand generation empowers brands to reach volumes of various new audiences. It also helps increase the digital visibility of a brand, makes a specific business stand out, and establishes a brand as a thought leader. Demand generation marketing strategies fit well into the top of the sales funnel.
Conversely, the lead generation process enables brands to set up their first sales consultation or product demo with leads who are interested in their solutions. Lead generation also helps brands fill their sales pipeline with sales-qualified leads. From here, brands can further nurture those leads by using lead nurturing programs and making them sales-ready.
The more information you and your organization have about demand generation and lead generation and the more visibility you have about these strategies, the more effectively you can implement them. Do you currently focus on demand gen or lead gen? What has worked for you thus far, and where can you make improvements? Check out the blog articles included below to learn some specific ideas and suggestions!