Demand generation and lead generation are both important business-to-business marketing strategies. You can’t produce leads successfully and sustainably if you’re not creating the need, and producing the need for your product (demand) results in leads for sales (lead generation).
Demand generation and lead generation have similar approaches but have different objectives.
- Demand generation – The objective is to create the lead
- Lead generation – The objective is to capture contact information
Some B2B marketers use terms interchangeably, but this is incorrect. Lead generation might fall under the basic demand generation umbrella. However, it’s a particular part of the process. You wouldn’t have a demand generation campaign without lead generation, and you can’t have lead generation without demand.
Exactly what’s the distinction in between demand generation and lead generation?
Demand generation is the procedure of getting prospects thinking about your offer (producing need); lead generation is the job of turning that interest into names (leads) that sales can follow up.
Demand generation takes potential customers on a journey from awareness of a business problem to convincing the prospect you are the vendor that can solve the problem.
Lead generation takes demand (the need) of the prospect and gives them the opportunity to identify themselves as a potential buyer or sales-ready lead.
Demand generation doesn’t generate any tangible results until that demand generates leads. Lead generation without demand generation doesn’t work without the pipeline of interest. So as you can see, demand and lead generation are the intrinsically linked, but not the same thing.
In demand marketing, we don’t see any ROI until lead generation takes place. Things like “awareness” aren’t tangible assets that will hit sales targets. Demand generation itself doesn’t capture contact details for followup. That’s the job of lead generation.
What causes the confusion between lead and demand generation?
Demand and lead generation use pretty much the same tactics. As marketers, we want to educate prospects so we may publish a series of educational articles. Each article makes the prospect increasingly aware there is a problem to solve. With each article we may have a content upgrade that prospects need to register for, this is the lead generation element.
Lead generation can occur at any point in a demand generation campaign because we don’t wait until the very end to try and capture the contact details of a prospect. We proactively trigger opportunities to capture contact information so that we can nurture the lead.
What do we need to know when planning a demand generation campaign?
1) What is a lead?
A lead isn’t the same thing for every business. There are also different levels of lead. A marketing qualified lead may simply be someone who downloads an asset. A sales qualified lead might require a phone call to validate the need.
2) Who is the ideal prospect? (lead)
We want the demand we are generating to be aligned to the ideal customer profile of the business. There’s no point trying to generate demand in a sector that’s not relevant or can’t be sold to.
3) How can demand be generated?
The typical demand generation campaign involves educating the market and asking them to put their hand up as a sales opportunity. We use content to educate and to provide the triggers for data capture.
4) What’s the media budget?
Almost every demand generation campaign will have an element of ad spend. A budget may also be needed for building landing pages, tooling and collateral.
5) How many leads do you want?
In many organisations, B2B marketing teams generate leads, but the majority of them aren’t followed up. There’s no point in creating demand if the resulting leads won’t or can’t be followed up.
Is a lead immediately ready for sales?
A fresh lead is rarely ready to be contacted by sales. This is likely to damage the vendor/prospect relationship not support it. An immediate call would be akin to a retail sales advisor following you around the shop as you were browsing. You always need a lead to validate their interest and we do this by building marketing funnels that result in leads taking tangible actions that further validate their interest. Some of our marketing funnels even leave it to the prospect to book in their sales call.
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