October 20, 2022 | Written by Steve Whittington

Demand Generation or Lead Generation: Which One Should You Do?

This is a question I hear a lot: demand generation or lead generation, which one is the right strategy for my business? In most cases, the simple answer is that you need to disenthrall yourself from the tyranny of "or". You need both.

Demand generation and lead generation are different, but they should be an "and" strategy and work together, instead of an "or" choice. Where the confusion often lies is that many people do not know or see the difference between demand generation and lead generation.

Demand generation is the process of increasing awareness and demand for your product or service. The goal is to expand your audience, build authority, and generate interest around your brand, resulting in high-quality leads.

Lead generation is the marketing process of stimulating and capturing interest in a product or service to develop a sales pipeline,  with the end goal of converting those leads into a customer.

Simply put, one activity is building an audience (an audience consisting of your ideal client profile), and the other activity is capturing that interest. The differences are subtle but essential.

To do demand generation, you need to know the following:

  • Your ideal prospects
  • Their pain points
  • Common questions they ask

And then, you need to create content (videos, blogs, webinars, a knowledge base) that answers those questions.

Then lead generation tactics or tools are used to capture the interest generated from your demand generation activities: in its simplest form, this is a Call to Action for an offer of product or services.

Call to Action + Offer = Form Fill Out = Lead 

The challenge in the marketplace is too often, there is one tactic without the other. Mostly, it is stand-alone lead generation tactics that are not supported by the heavy lifting of demand generation.

The problem with unsupported lead generation is that it can create an extensive lead list but with low conversions to sales opportunities.

An example of this unsupported tactic is a targeted ad providing broad generic "free content" that asks a prospect to download the gated content (i.e. provide their email to access the content). That list then gets immediately worked as high intent leads by a sales team (which they are not), and typically very few, if any at all, become customers. This can create an enormous cost per customer acquisition.

In my opinion, these types of actions are due to goal misalignment.

Often in organizations, there is an obsessive drive to create leads, which can overshadow the real purpose of your organization: to educate and solve your customer problems - which demand generation does through thoughtful, educational content.

If you focus on solving your customer pain points with your marketing instead of just generating impressions and leads, the right leads will come and, ultimately, sales.

Further, your teams will be focused on the right goal: driving revenue.

We partner with many businesses for both their demand generation strategy (such as content creation) and lead generation through digital campaigns. With our years of experience, we're here to guide you with a research-driven strategy and all the steps along the way from marketing and branding, to customer experience and digital optimization.

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