Lead Gen vs. Demand Gen: What’s the Difference and What’s Best?

After some time in the B2B and digital marketing space, you’ll probably come across the terms “lead generation” and “demand generation.” You might think those are alternative names for baby boomers and millennials, but they’re actually marketing concepts. The idea behind both is to make a conscious effort in growing your brand and building a loyal customer base.

Loads of marketing geeks use lead and demand-generation strategies together to promote a single campaign. A lot of them use the terms interchangeably, too. The thing is, you have to separate them to measure your efforts and results accurately. Like peanut butter and jelly, they’re connected, but not the same.

Let’s learn, then, what we mean by lead gen and demand gen so you can differentiate between the two and decide which of them will help you stand out as a Jedi among Padawans.

What Is Lead Generation?

Lead generation is the process of attracting prospects and converting them into paying customers. The process focuses on using gated content to capture leads. Translation: You capture potential consumers with content they access by offering up their personal info, like an email address or phone number. Then a sales rep uses that info to engage further, with the hope of advancing them on the journey toward a purchase — what you’d call getting them in “the sales pipeline.”

Lead gen assumes a linear view of marketing — from initial interest to deepening connection and, finally, to commitment. In reality, customer journeys are hardly linear. A lead might lose interest as soon as they’ve consumed that initial bit of content. Or they could drop out of consideration later, after one too many marketing emails.

In other words, you can’t conclude that things are getting serious whenever someone says “hi” to you. Because not all leads are qualified leads, a lead-generation strategy sends a heap of bad ones toward the sales team, who end up wasting time trying to engage people who aren’t that interested.

What Is Demand Generation?

Demand generation is a marketing strategy designed to spark interest in your brand from your target audience and then move them through the five stages of awareness until they hopefully get to a point where they become highly qualified leads interested in making a purchase. This approach nurtures long-term relationships between you and potential customers in hopes of gaining their trust and then their purchase. 

The process of demand generation isn’t linear, either. It’s an ongoing game where potential customers may move from one stage to another, disappear, and then pop back in at another stage. 

Your company’s marketing team develops ongoing omnichannel strategies to provide consumers with a fully integrated experience. At every step in the customer’s journey, you bust out a sick move with relevant content to keep them enthralled. For example, if they’re totally unaware of the problem, you may create a whole lot of educational content. Or, maybe you have some in your audience who know they have a problem, but don’t realize the solution, in which case, you’d create a lot of narrative content focused on the problem and telling the story of how the solution changes everything. 

The sweetest upside to this long game is that once they’ve consumed all of your awesome content, these customers are practically ready to buy. The content you’ve created has nurtured the consumer, and now they’ve reached the point where they’re ready to choose your product.

What’s the Difference Between These Strategies?

Lead gen is about collecting information about potential customers who’ve come in contact with your business once, then continually contacting them in efforts to eventually turn them into conversions. Demand gen is about generating buzz with as many people as possible, and fortifying a connection with them that later impels them to become conversions.

When sales team are contacting leads who haven’t been nurtured, they’re not really “qualified” leads. They people may not even be interested in your product at all. They may have just been interested in that one sweet infographic you created that they wanted to download. This is why such a low percentage of these leads become buyers.

Since Demand Gen is built on nurturing the audience with awesome content, when they show they’re interested in more, that’s when calls to action (CTAs) call them to greater connection — “Fill out this form” or “Text this number.” The ones who connect for more content receive further nurturing and higher-level CTAs that might ask them to speak with a rep, sign up for a service, or start a free trial. Once these leads connect with sales reps, the pump has ben primed and they’re REALLY interested in your product.

Why Is Demand Gen the Best Method?

Demand gen is quickly becoming the standard of marketing for good reason. This approach turns strangers into prospects, which is essential to every inbound campaign. While it certainly feeds lead generation, you’ll get more customers who are ready to buy when you implement a demand-gen method, and here are few reasons why:

You’ll Boost Awareness

Not everyone is ready to dive in after seeing your company’s first ad. Growing your audience and attracting new visitors to your website gives you the opportunity to introduce them to your brand. You’re on a journey with them, allowing the connection between you to tighten.

You’ll Streamline Your Efforts

A demand-gen strategy keeps you from wasting time marketing to people who aren’t interested in your solutions. Instead, you’re familiarizing the right people — your target audience — with your brand. Once you’ve connected with these people, you give your sales staff a clear direction.

You’ll Build Trust

The demand-gen approach nurtures your customers at every stage of the relationship. The goal is to draw prospective customers in — and keep them there. Then, once they’re interested, you can bombard them with awesome content that keeps them connected and engaged. And then, when they find themselves in need of your service, you’re the first brand they turn to. 

You’ll Save Money

Your staff will spend less time and need fewer steps to convince your customers to buy from you. And because people understand how well your brand fits into their lives, they become loyal customers who want to work with you again and again.

When your customer acquisition process takes up less of your budget, you can use these resources for other pursuits, like bonuses. Just remember to practice sales enablement. That means training your reps to close more deals faster. Coach them, get them certified, and bring them together at events so they retain customers for up-sell and cross-sell opportunities after the initial purchase.With both demand gen and lead gen, high-quality content is the key to success. Pay attention to the data and adjust your methods accordingly. Learn to understand your buyer, and you’ll find it easier to connect them with relevant information. Contact Liger if your business needs help building stronger brand awareness and creating a solid demand-gen strategy.