Demand Generation vs. Inbound Marketing

Demand generation and inbound marketing are two terms that have often left B2B marketers with their head-scratching. Since the inception of the multichannel marketing funnel, both have been at the center of many discussions. There have been a lot of hues and cries associated with the similarities and differences between these two marketing channels. Many believe that demand generation and inbound marketing are similar, and many believe they are two distinct online marketing approaches.

Digging deep into both marketing concepts will help you realize that both are not quite similar rather have more differences – especially in marketing execution approach, strategy, and individual outcomes. It’s also noteworthy that the simultaneous implementation of both for the multi-channel marketing funnels can have astounding results, especially for B2B businesses.

We have tried to dissect both at all levels to introspect everything related to the much-hyped conversation of demand generation vs inbound marketing in this blog. So, without further delay, let's begin from the very basics.

What is Demand Generation?

Demand generation is more of a sale-centrist approach that utilizes traditional outbound marketing along with other digital marketing techniques (inbound, lead generation, and more) to drive revenue. It is a cumulative marketing strategy wherein a company seeks to create awareness and nurture interest in its products and services. A well-focused campaign will use both inbound and outbound marketing in the client acquisition funnel.

In the first step, synchronizing content with prospect intent across multiple marketing channels based on the audience's location helps to create awareness. Outbound marketing practices (e.g., cold calls, emails, TV commercials, sponsored webinars, social media marketing, etc.) generate interest in identified prospects for any business. This step is also called the lead generation stage of the funnel, where prospects will be made aware of the company's products or services through outbound channels, such as traditional advertising and SEM/PPC ads, and inbound channels, such as SEO and PR.

Further, inbound, lead generation, and other online marketing practices are combined together to create a structured sales process. This is also known as the lead nurturing phase, where demand generation will reinforce interest in the company's products and services through targeted outreach such as email drip campaigns, account-based marketing, and re-targeted display ads. These reinforcing channels, in other words, lead nurturing channels, are often outbound rather than inbound.

What Are the Benefits of Demand Generation?

As mentioned above, this marketing approach helps in creating awareness about a brand or product/service that a company offers through relevant content. It flows through a channel where each stage has a specific goal to accomplish. Demand generation strategy for the B2B industry works like an effective approach to create interest and demand for the company's product or services.

For B2B businesses, integrating this marketing technique into a marketing mix approach shows innumerable benefits. A few are listed below:

• Increases ROI over a longer duration and also reduces client acquisition costs.
• Helps increase the conversion rate at each marketing funnel stage.
• Produces high-quality leads based on the indigenous products and services of a business.
• Helps in the identification of prospective clients and also encompasses all the marketing aspects to nurture them by understanding their needs.
• Allows businesses to develop a strong relationship with potential clients by implying engaging and relevant content strategies.

Strategies to Implement Demand Generation:

To elevate the impact of the B2B demand generation, marketers often get overwhelmed with multiple options. However, having a proper goal centric approach always facilitates the process and increases the outcome. Here are some impactful strategies for fueling the B2B demand generation process. Try implementing below mentioned data-driven strategy to get the best out of it:

Use Data-driven Leads to Align Marketing & Sales:

The success of any demand generation campaign depends heavily on feeding qualified leads to the sales team. For that, the marketing and sales teams must work in sync and ensure that both use the same metrics to get quality leads and convert those leads, respectively. While generating leads, targeting the niche-oriented details rather than the broad categories is imperative.

Tracking of Metrics:

It is mandatory to track both the top and bottom of the funnel to assess the effectiveness of the marketing approach. As a B2B marketer, to reap the benefits of a marketing approach implemented using demand generation, you need to evaluate ToFu (top-of-funnel), MoFu (middle-of-funnel), and BoFu (bottom-of-funnel).

Using this process will enable you to track the engagement and consumption rate at the top of the funnel, conversion related to demo and trial at the middle of the funnel, and get the insights of revenue and marketing sourced pipeline at the bottom of the funnel.

ABM or Account-Based Marketing:

The account-based marketing approach with demand generation completely transforms traditional online marketing.

We all know that, generally, with a digital or online marketing approach, marketers tend to propel more people to the website, nurture those visitors with automated emails, and finally identify the target companies. While leveraging the ABM approach, the very first step is to identify the target companies and then engage them with customized campaigns, and finally, establish a professional relationship with clients.

Also, it is worth mentioning that ABM helps you target leads that are best fit for your business but are untapped or have shown very little interest.

Above, we have discussed everything that can be brought under the umbrella of demand generation; now it's time to discuss inbound marketing.

What is Inbound Marketing?

Inbound marketing is mainly marketing-centric and focuses on converting well-informed prospects that a company has found through online research. The conversion process of these prospects is accomplished by regularly publishing high-quality content via organic channels such as websites, blogs, SEO, or social media. In short, it is a component of demand generation and is implied to make the business visible to the target audience by addressing the prospect's pain points through engaging content.

Similar to demand generation in B2B marketing, inbound marketing depends mainly on understanding potential client's needs and creating relevant content that addresses those needs.

Simply put, it is a less expensive approach to drive website traffic and is used to increase brand awareness to help potential clients with relevant content and guide them through their prospect's journey. The whole idea of inbound marketing is to drive organic traffic to accomplish the same.

Benefits of Inbound Marketing:

Inbound marketing is a modern-day digital marketing approach that focuses on the long–term impact rather than achieving short-term goals. Traditional outbound marketing often costs a fortune for advertising, and the same can get costlier for a mass ad – like a billboard ad – and may also not create the desired impact on a campaign. However, inbound marketing, such as SEO or Content, can save the day with a cost-effective, focused, and content-driven marketing approach. Below are a few benefits that set inbound marketing apart from traditional marketing approaches.

Offers a Non-invasive Approach to Potential Clients:?

Many businesses research the company and its services before joining hands to proceed with the business deals. The inbound marketing acts as the visiting card and helps them with all the informational content and lets them explore all about your organization. This strategy doesn't aim to push prospects for any purchase; instead, they can enter the sales funnel entirely based on their judgment and without any marketing pressure.

Helps in Generating Relevant Leads From the Target Audience:

Many queries are made online on a regular basis about different products and services. And if you have the right solution to that query and have created an informational piece online, a user will likely act. In simple terms, through qualitative online content, inbound marketing appeals to the target audience who is already interested in the business offers.

Ensures Higher ROI:

The cost of implementing inbound marketing strategies is often less than that of outbound marketing strategies. All the tools, like – social media, blogs, websites, etc., are either free or less expensive. Also, the integration of marketing automation tools ensures better lead nurturing and reduces the overall marketing cost.

Increases Visibility to the Potential Clients:

Promoting informational content on the proper online channels (like – social media, video sharing platforms, etc.) gives marketers an edge by making that available to a larger audience. This increases visibility and reach and assists in attracting prospects.

Creates Brand Awareness:

Using inbound practices, a business or company creates a lot of online informational content, addressing some pain points or problems, which are more likely to attract only interested clients rather than uninterested leads. In the long run, the right content creates a loyal user base that ultimately helps build trust and relationships. These users will also be encouraged to share the company's content with others through social media or word of mouth, ultimately increasing brand awareness and content reach.

Inbound Marketing Strategies:

The inbound strategies for marketing revolve around attracting, engaging, and delighting potential leads through informative online content. All these are discussed below in detail:

Attract Your Target Audience:

To reach the target audience or the potential leads through inbound marketing, you need to create compelling, valuable, and informative content and then publish those online on your website, blog, social media, and more. Content like – how-to guides, informational pieces discussing some pain points and their solution through your services/products, and testimonials can attract prospects at a deeper level and keep them hooked. Further, implementing the SEO strategy is necessary to target potential leads and rank organically on the search engine results page.

Engage Your Audience:

Personalization plays a critical role in inbound marketing. To engage potential clients, you need to ensure that your content is speaking in a one-to-one manner addressing their problems viably. It will help in making a long-term relationship with them.

Delight Your Audience:

It is essential to assist your clients at every stage of their interaction with your services and products. Even long after the purchase, it is imperative to provide the required support to build a long-term association and trust. This inbound marketing step guarantees happiness and satisfaction through assistance from your side.

Including chatbots on the websites, surveys & feedback forms is an effective practice to keep checks on the level of satisfaction that a user is getting from your services or products. Also, it is essential to monitor social media comments and address all the necessary grievances. A delighted and satisfied client can become a brand promoter and a staunch advocate of your services and products.?

How Is Inbound Marketing Different from Demand Generation?

As discussed above, many marketers get confused while trying to differ inbound marketing from demand generation, so in lieu of addressing this, we have compiled all the differences below:

1. As the name suggests, inbound marketing is a marketing approach that revolves around creating brand awareness and long-term relationships with clients through an effective content marketing strategy. At the same time, a demand generation is a sales-focused approach that works primarily on creating the client's need for a specific product or service at a particular time.
2. Further, to implement a successful marketing technique for fueling demand inside the mind of the prospect, various traditional outbound marketing techniques are also used, where the general target is to make the potential leads go through the sales funnel. On the other hand, inbound marketing focuses on seamless content creation and delivery processes to build long-term trust in a business and its products & services.
3. Demand generation focuses on creating short-term hype about products and services and is best to push for sales, especially for offerings and immediate deals. But it is not best suited for creating a long-term sustainable business model. However, there may be fewer sales through inbound marketing strategies, but it helps companies to develop a long-term sustainable and trustworthy business through valuable online content.

How to Effectively Combine Demand Generation & Inbound Marketing?

Demand generation and inbound marketing are indeed two distinct strategies that accomplish different marketing targets, and both are two different methods of brand promotion strategy. For a short period, it brings in a client rush for promotions, sales, or other marketing goals. In contrast, inbound marketing is based on long-term goals, establishes a connection and trust with potential prospects, and lays a solid foundation so that these clients keep coming back.

So, to get the best of both, it is in the marketers' best interest to incorporate these two and get substantially higher returns for their online marketing efforts. This effort can be achieved by using two methods:

First, a B2B marketer can use demand generation to create buzz around the business and its products and services. Once the hype is made among a larger audience, inbound marketing comes into play, as it can hold their attention and convert them into long-term clients.

Secondly, a business can use inbound marketing to generate trust with potential leads and then increase their need for products/services through demand generation. The need can be induced by pushing the product/services through promotions and other traditional demand-generation marketing tactics, where a user can be persuaded to make the purchase at the right time. ????

Conclusion:

Inbound marketing and demand generation are complementary marketing concepts to generate leads and drive revenue. Often, inbound marketing is interwoven with demand generation to induct an effective and proactive marketing strategy. Generating demand is a sale centric approach, and inbound marketing is a marketing approach for long-term business goals. The above benefits and strategies are truly impactful for your business.

Ultimately, depending on goals and business objectives, marketers need to decide between demand generation and inbound marketing to achieve the target. In order to make an informed decision about the best strategy for your business requirements, it is crucial to comprehend the distinctions between the two alternatives. Also, businesses need to come up with a marketing plan that embeds both to achieve their business objectives comprehensively.