Demand generation vs lead generation: What’s the difference?

Content Marketing

Like every industry, marketing comes up with a lot of jargon.

To be honest, we probably have more jargon for what we do than anybody else.

Which is ironic as we’re always telling clients not to use jargon.

With so much industry speak around, it’s easy for similar terms to get mixed up.

That’s the problem with discussing demand generation and lead generation.

They share characteristics, but they’re not the same.

If demand gen and lead gen leave you confused, our guide below will help:

Let’s get into it.

 

What’s the difference between demand generation and lead generation?

Both tactics are integral to marketing and provide value to customers, supporting short-term and long-term business growth.

They both target specific audiences, use similar tools, and rely on content marketing.

However, the types of content and the intent behind them differ slightly.

Demand generation is about showcasing free content to attract visitors and build a credible reputation.

Lead generation is about using gated content to gain information for capturing leads.

Here’s a side-by-side comparison to summarise the major differences:

 

Demand generation Lead generation
Creates interest and raises awareness Turns genuine interest into possible buyers
Aims to attract and educate readers Aims to collect and deliver contacts
Supports the whole marketing cycle and sales funnel Focuses on the top of the funnel and is just one aspect of the cycle
Long-term buyer-centric process Shorter-term self-centred process
More concerned with attracting quality leads More concerned with building lead volume
Relies on SEO-driven free content Relies on gated content

Do the differences between demand generation and lead generation really matter?

It’s important to know the difference, especially for content marketing campaigns, because content can only do one or the other.

Content marketing can generate three times as many leads for less than half the cost, but only if you do it right. 

Not knowing the distinction between demand generation and lead generation can result in a wasted marketing budget.

Both are effective tools as part of a complete marketing strategy – they just occupy separate spaces within it.

However, you don’t need to use one or the other exclusively.

It’s helpful to think of lead generation as a subset or follow-on from demand generation.

After all, you can’t generate leads if you haven’t generated demand first.

Use demand generation strategies to educate people and convince them your product or service will solve their problems.

Then use lead generation to segment visitors and qualify them as leads by collecting their information to push them towards becoming buying customers.

You’ll need to understand what each type does and identify the respective goals for your content creation to achieve a good balance between the two.

 

Should you use demand generation or lead generation?

Lead generation follows on from and supports the work achieved by demand generation.

You can’t sustainably generate leads if there’s no demand, and you’ll lose the value of demand generation work if you can’t turn the interest you’ve created into leads.

You need both to support each other for each strategy to be the most effective it can be.

Is demand generation or lead generation better for your business?

It’s not as simple as doing both at the same time.

There are plenty of factors that affect a business’s marketing campaigns.

From their industry niche, to experience, to the products they sell. 

If your marketing budget doesn’t cover both strategies consistently running at the same time, it’s important to recognise when you should prioritise each one.

Some think you should always start with lead generation, because you can’t market something if you don’t have a base to market it to.

Others think you should start with demand generation, because you can’t collect leads if they aren’t aware your business exists.

It’s impossible to use one effectively without involving the other to some extent. 

You need to look at the bigger picture and assess your business goals to work out when to apply each strategy.

Mistakes to avoid with demand generation and lead generation

Though both strategies can be used at once, always remember they’re not the same.

You shouldn’t rely too heavily on lead generation just because the metrics seem easier to measure.

It’s more straightforward to gather numbers on things like eBook downloads than understanding the full reach of ungated content.

However, neglecting demand generation in favour of analysing lead generation metrics won’t help you in the long run.

When you are focusing on lead generation in the marketing cycle, use that data to optimise your efforts and smooth out any bumps in the conversion process.

Don’t stick to the same content styles or targets all the time for either strategy.

Not experimenting with both demand generation and lead generation content can quickly make your offering stale and result in you missing out on something that might really work.

The same applies to not experimenting with different types of content at different stages of the buyer’s journey.

You don’t have to structure everything the same way.

It’s extremely beneficial to try out new channels and test them to find out which perform best with your audience.

Demand generation vs lead generation: the final say

A robust marketing plan should encompass both demand generation and lead generation working harmoniously.

When and how much you focus on each strategy depends on your circumstances and goals.

Think of demand generation as planting seeds and lead generation as harvesting the crops.

Now you know more about the distinctions between demand generation and lead generation, you can improve your marketing plans and fill in the areas you might have been neglecting.

Need some help developing your content marketing strategy?

Contact us today for expert digital marketing services and get your generation game plan off the ground.

Leave a comment