Demand generation vs lead generation

You’ve probably heard of demand generation and lead generation in regards to inbound marketing strategies. However, you might be struggling to differentiate the two. Both are sales techniques that are used by companies that are trying to generate prospects and sales.

A key difference, though, is that they are both used at different stages of the sales cycle and therefore have independent aims. These strategies are generally used by B2B companies as a way to establish a presence on the market and draw new prospects in so that they eventually buy products and services from the company.

Having a good understanding of both demand generation and lead generation strategies can help your sales team generate qualified leads from an established target audience.

In this article, we’ll take a look at the differences between the lead generation process and a demand generation campaign. We’ll also look at how you can apply these methods to make successful sales.

Demand generation vs lead generation

Demand generation and lead generation are closely linked as one stage follows the other. The aim of demand gen is to spark interest from prospects in the company’s services and products, whilst lead gen aims to establish a relationship with them and convert the prospects into customers and sales.

Demand generation content should create awareness of how your company can provide the solution to a prospect’s problem and therefore create interest in your services and products. Lead generation, on the other hand, is the process by which you turn these prospects into paying customers.

If demand generation is at the top of the sales funnel, then lead generation is at the bottom. Companies usually create gated content as part of their lead generation tactics and then ask for the prospects contact information so that they can receive that information.

Continue reading to find out about both tactics in greater detail and how you can use both to generate leads into sales.

What is demand generation?

Companies use demand generation to create awareness and demand for their products and services. This includes data-driven strategies that are focused on revenue creation. Some examples of demand generation content include blogs, ebooks and videos that are aimed at your target audience.

You could post this content on your website and advertise it on other platforms (such as social media) once you have established your target customer group and know what they will be looking for.

The main goal of demand generation is to raise brand awareness and customer association between their need and your products and services. For example, if a customer has run out of face cream, you want them to immediately think of your company when they go to buy some more.

Thought leadership and a good social media presence are both important aspects of demand generation. The main aim of thought leadership is to establish your company as experts in your field so that when people think of a particular topic or problem, they instantly think of you.

Social media is also a good way to gain a public presence that helps with brand recall. Various sites such as Facebook, LinkedIn and Twitter can all help you advertise your products and services to your target audience.

Sponsored adverts and posts can also lead prospects to your website, where you can encourage them to sign up to a mailing list for more content. This is when you can move on to the lead generation part of your sales plan.

What is lead generation?

The main aim of lead generation campaigns is to turn prospects into paying customers. You can gain their attention through your demand generation efforts and then your sales team can seal the deal through lead generation tactics. One way that lead generation nurtures qualified leads is through the use of gated content.

Gated lead generation content includes things such as eBooks and PDFs as well as courses, free trials and events. The prospect must provide their contact information to your company in order to access these documents and content.

Good lead magnets for lead generation include sign-up content upgrades. For example, you could offer a PDF version of a web page if the prospect enters their email address. Once you have their contact information, you have already established a connection and can nurture this into real sales.

You will have already established brand recall and thought leadership through demand generation, so this is the time to build a relationship with your prospects and help them translate into long-term customers.

What are the main differences between demand generation and lead generation?

Demand generation is used to attract customers to your company whilst lead generation turns those prospects into actual leads and moves them on to the next stage of the sales journey.

You want to create a positive experience for potential prospects during your demand generation campaigns. However, along with brand awareness, you also need to increase conversions by identifying your target audience and creating buyer personas. You then need to think about their customer journey and how each individual persona will experience it.

Lead generation efforts differ from demand generation because these strategies are more targeted. Gated content is a popular lead generation strategy because prospects can only access specialised content once they have given personalised contact information, such as their email address.

Prospects will be expecting relevant and targeted content in return for giving you personal information. Lead generation, on the other hand, provides free information so the content is broader.

A strong demand generation campaign builds brand awareness and nurtures opportunities that will generate high-quality leads and will build your business through increased sales.

How do demand generation and lead generation work together?

Despite their differences, lead generation tactics and demand generation ideas are closely linked and can have a big impact on one another. They are used at different stages of the sales process, which means that they don’t work at the same time. Lead generation relies upon the interest and excitement that demand generation has built for prospects and then converts their interest into actual sales.

Demand generation is at the top of the funnel whilst a lead generation campaign is at the base. This means that you can broadly appeal to lots of prospects with demand generation and then filter down to actual customers and sales with lead gen content.

You want to attract leads through your content, whether that be blogs, social media or videos on YouTube. The next time the prospect needs an item or service, the goal is that they will remember your company because of the content they’ve seen.

After this, you should aim to get their contact information so that you can share specialized content with them through email campaigns in the hope that they will turn into paying customers.