You've probably heard the term demand generation a lot in recent years. And it's safe to say there's some mixed messaging surrounding the terms lead gen vs. demand gen within B2B marketing.
What is the difference between lead generation and demand generation? Should you be 'generating demand' rather than leads? Has demand generation replaced lead generation? Or... are they the same thing?!
In this blog, we'll explore what demand generation in marketing is, look at lead generation vs. demand generation, and explore how to combine both strategies within your B2B marketing plan.
What Is Demand Generation?
Demand generation in marketing is a long-term approach focused on generating high-quality inbound leads over time. It's an audience-led marketing mindset and long-term strategy all rolled into one.
Demand generation is:
- A marketing strategy focused on driving awareness and interest in an organization's products and services (Gartner).
- An approach that focuses on driving long-term customer engagement (Marketo).
- The process of building an engaged audience across different marketing channels (Metadata.io).
Demand Generation Example:
Your demand generation KPIs (key performance indicators) should focus on building awareness and making prospects come to you rather than the other way around.
Therefore, your long-term goal is to generate more demand through inbound leads.
It might sound counter-productive if you're a modern marketer who's used to having access to more data than you know what to do with, but demand gen focuses on letting your customers come to you.
And, What Is Lead Generation?
In contrast, lead generation is an outbound B2B marketing strategy focused on building lists of new, relevant prospects for your business.
B2B lead generation also includes nurturing your leads, such as through email and content marketing. Lead nurturing helps your prospects consider your products and services, ready for when they're in an active buying cycle – aka, they're ready to buy from you!
Content syndication is a classic example of how to do B2B lead generation. Content syndication lead generation is a B2B lead gen strategy that repurposes and distributes your existing content on platforms you don't own.
However, content syndication also generates demand by distributing your content to highly targeted, new audiences while also generating new leads. Explore the 5 Benefits of Content Syndication to find out more.
Quality B2B lead generation can also be enhanced with additional targeting options, such as:
Demand Generation vs Lead Generation – What Are the Key Differences?
What is the difference between demand generation and lead generation? Arguably they are different parts of the same customer journey.
Demand generation services focus more on the earlier parts of the marketing funnel e.g., creating brand awareness and authority.
However, demand generation marketing is said to take in all possible touchpoints in a prospect's journey. From brand awareness and nurturing business relationships through to the purchase stage and customer loyalty - think retention marketing and long-term clients.
Where the confusion lies is that demand generation services often include lead capture and lead nurturing activities.
However, the key difference is that demand generation is a long-term strategy focusing on capturing leads via inbound marketing methods – aka letting leads come to you organically, compared to outbound lead generation strategies that focus on generating new leads there and then.
Lead Generation vs Demand Generation Example:
Let's say a potential prospect engages with your company's LinkedIn profile and reads your educational content, such as your blog. These activities would count as demand generation.
If one of your social media posts led that same prospect to your website, where they downloaded a gated eBook or signed up for your newsletter, that would typically qualify them as a lead. However, this would be an example of an inbound lead.
It's probably the most apparent difference between lead and demand generation: lead gen activities give you a list of people, with contact details, who will potentially buy your product.
So, while demand generation sounds like an exciting new watchword, it's ultimately a term for building your brand to the point of getting high-quality inbound leads.
In other words, with demand generation, you are building brand awareness that leads to lead generation. Still a bit confused? Let's look at some B2B demand generation strategies!
B2B Demand Generation Strategies Include:
- Organic social media marketing, e.g., LinkedIn and Twitter.
- Ungated content, i.e., content you give away for free to your audience. At Headley Media we love giving away ungated content, check out our Quality Lead Generation Checklist as an example!
- Webinars and events – education-led content over sales-led content.
- Ad campaigns for awareness – such as Display Advertising and re-targeting.
- Employee advocacy tactics – such as social media advocacy.
(Credit: Jonathan R Bland, Co-Founder Omni Lab Consulting - see the full post here).
B2B Lead Generation Strategies Include:
- Webinars and events – still with a focus on education-led content over sales-led content; however, the additional objective of capturing people's contact details and marketing permissions.
- Pay-per-click (PPC) campaigns – such as Google Ads and Bing.
- Paid social media marketing, e.g. LinkedIn Ads.
As with any marketing strategy, whether you want to focus on generating demand or generating leads, the quality of the methods, channels, and suppliers you use will significantly impact your results and ROI.
B2B Lead Generation Services vs B2B Demand Generation Services
The difference between B2B lead generation and demand generation can get even more confusing when you start researching lead generation and/or demand generation suppliers to work with.
Why? Well, some suppliers and 'specialists' are using the wrong terms to describe their services.
For example, a supplier might call their services demand generation when they only offer lead generation solutions. To help you make more sense of the two B2B marketing strategies, we've laid out the main differences between B2B lead and demand generation services below.
B2B Lead Generation Services:
- Transactional: Your objective is to capture business contact details from relevant, new prospects.
- Short to Medium-Term Strategy: Marketing activities are focused on generating new prospects now, ready for further nurture.
- Outbound Lead Capture: Campaigns with the specific objective of generating new leads.
B2B Demand Generation Services:
- Non-Transactional: Your objective is to build awareness and authority amongst your target audience.
- Long-Term Strategy: Marketing activities are focused on generating new prospects more organically when they are ready to buy.
- Inbound Lead Capture: Campaigns that drive awareness amongst your target audience so they'll consider your products or services and contact you when they're ready.
B2B Lead Generation & B2B Demand Generation Strategies:
- Building long-term business relationships: Both strategies are designed to nurture your audience over time and should be a crucial part of your marketing strategy, whether you're focusing on lead generation or demand generation activities. Building long-term business relationships helps drive your business forward. Lead generation and demand generation strategies should both focus on providing value to your target audience and keeping your business front of mind for future purchases.
What Are the Drawbacks of Demand Generation?
Demand generation sounds like a B2B marketer's dream, right? Providing educational content, positioning your brand as a thought leader, and waiting for relevant sales inquiries to roll into your inbox.
However, does demand generation really work in reality for a busy B2B marketer?
Let's say you're a Marketing Manager working for a tech company that sells payroll management software.
You'll most likely have:
- Monthly, quarterly, and annual targets and objectives to meet – which include MQLs and SQLs.
- Senior Management that you need to share regular, tangible progress reports with.
- Budgets you need to justify, optimize, and sometimes even fight for.
Therefore, lead generation is likely to still play a big part in your B2B marketing strategy.
Plus, you will most likely be doing plenty of demand generation activity within your current marketing strategy, whether you realized it before reading this or not!
After all, demand generation is a great mindset to have as it puts your target audience and their needs first.
By becoming more aware of the demand gen concept and common demand generation strategies, you can use it more effectively to communicate your marketing strategies within your own business.
Demand Generation vs Lead Generation: Combining the Two Strategies
Your B2B marketing strategy should include a mixture of demand and lead generation activities, such as:
- Brand awareness initiatives.
- Lead generation tactics.
- Nurturing your prospects.
- Retention marketing strategies.
If you search for B2B demand generation companies, you'll most likely find companies that cover different elements of B2B marketing. For example, B2B demand generation companies often include lead generation activities, which is why it can be confusing when there's industry noise that you shouldn't focus your marketing strategy on lead generation.
As you might expect, we wholeheartedly disagree that you should only focus on demand generation over lead generation. Instead, a well-considered, strategic B2B marketing plan should combine demand and lead generation activities for the best results.
Measuring the Impact of Lead Generation vs Demand Generation:
The impact of classic demand generation strategies can be a little trickier to measure, as they include some of the less exact methods: such as display advertising, ungated content, social media, and campaign impressions.
Why has demand generation taken the B2B marketing community by storm in recent years?
Over the years, the lead generation industry has, unfortunately, had more than its fair share of shady players, which could help to explain why companies that offer lead generation services have adopted the term demand generation instead.
Many lead generation suppliers secretly outsource their campaigns to 3rd parties to fulfill their leads or don't authenticate each lead, leading to poor-quality leads that don't convert once they're delivered to the client.
However, we're on a mission to show B2B marketers that you don't have to settle for poor lead generation. And that you can run successful B2B lead generation campaigns that deliver completely transparent, relevant, and quality B2B leads.
Lead generation is still a vital part of your marketing strategy when you work with reputable suppliers.
Alongside the shady players giving lead generation a bad rep, some companies struggle to convert their leads or prove their ROI.
However, those same companies are also likely to lack in areas such as:
- Marketing Technology & Systems – for example, they don't have a suitable CRM, accurate tracking in place, or a lead nurturing or scoring strategy.
- Marketing & Sales Alignment – a lack of communication between teams, leading to misaligned objectives, messaging, and core focus areas.
- Lead Nurturing Activities – for example, not following up with leads quickly or not sending them the right follow-up content to suit their needs.
Why Should You Still Run Lead Generation Campaigns?
When you choose to work with transparent suppliers, lead generation should still play a vital part in your marketing strategy. Plus, by working with a reputable B2B lead generation company, the benefits of lead generation are tenfold.
The benefits of B2B lead generation services include:
- Quality lead generation tactics are one of the most trackable, ROI-driving marketing strategies you can adopt.
- Lead generation targets, such as MQLs and SQLs, are among the most common KPIs for marketers everywhere.
- If you search for B2B demand generation companies, you will get lead generation companies or demand gen companies that offer lead gen.
- Many job titles, such as Demand Generation Managers, will still include plenty of traditional lead generation activities within their role.
In addition, when you work with a reputable, transparent lead generation company, you'll be able to combine many elements of demand generation and lead generation strategies to:
- Build brand awareness with your target audience.
- Deliver high-quality, educational content that showcases your business as a thought leader.
- Generate high-quality, relevant, and engaged leads.
- Predict your campaign's ROI. By running your campaign with a fixed cost-per-lead (CPL) - meaning you'll know how many leads your campaign will generate for your budget before it begins.
- See precisely when, where, and how your leads were generated – from the content they downloaded or the form they filled out to their consent and the quality control process they've been through.
Therefore, in our opinion (backed up by over 30 years in the media industry – not that we're bragging), lead generation will always play a significant part in a B2B marketer's marketing strategy.
B2B Lead Generation Services
At Headley Media, we use the term lead generation for our services because it more accurately describes what we deliver. However, our methods still incorporate many elements of the demand generation concept.
We use content syndication for lead generation. Content syndication hosts your content – typically eBooks, whitepapers, research reports, and case studies – to platforms you don't own, such as content library websites.
At Headley Media, your chosen content is downloaded by our audience of senior professionals and decision-makers who are looking for valuable technology resources in the IT, Cybersecurity, HR, Marketing, Finance, and Electronics sectors. In return for your free content, readers give their business details via a gated form.
To qualify as a lead, each reader must opt-in to hear from your company directly and go through our quality control process. Take a look at our lead generation process to see how this process works in action.
Content syndication lead generation also supports your overall demand generation objectives. How? Well, our readers are also exposed to your brand's content through email promotions, landing pages, and post-download messaging, which all help to build brand awareness.
In addition, some readers might not consent to hear from your company this time around. For example, they might only be doing high-level research, or they're not ready yet. And that's okay. By providing them with educational content, you'll still be contributing to your longer-term demand generation strategy. Plus, you'll still be getting the number of leads you agreed with your Account Manager upfront - so it's a win-win!
Even more importantly, though, whether you choose to work with a demand generation or lead generation supplier, they should be trustworthy and transparent.
The external specialists you work with should feel like a natural extension of your team. They should support the work you've already done to build your brand's credibility and authority. And finally, you should be able to follow exactly how they are building your brand and, ultimately, getting you those new leads.