Why Demand Gen is NOT Lead Gen

Demand Generation vs. Lead Generation. If you’ve been involved in marketing for even a brief period, you know that these two terms are often used interchangeably. Yet, it is important to realize that a demand generation program is definitely NOT merely the creation of leads. While both marketing strategies are concerned with creating demand for a business by targeting prospective customers and gaining their awareness and interest, there is more to demand generation strategies.

What is Lead Generation?

B2B lead generation is the process of identifying, attracting, and converting your target audience of potential customers (i.e., leads) into sales prospects for your company. The goal of lead generation in B2B marketing is to build a pipeline of qualified leads who are interested in the company's products or services, and who are willing to make a purchase.

Lead generation typically involves a combination of tactics and channels, such as targeted advertising, search engine optimization (SEO), email marketing, leveraging content marketing, social media marketing, and events. The goal is to create awareness of the company's brand and offerings, and to encourage prospects to take action by providing their contact information, requesting a demo or consultation, downloading a whitepaper, or engaging sales in some other meaningful way.

Leads are top of the sales funnel interests. Attracting leads often also includes articulating pain points impacting the target market, highlighting solutions to ease these pains, and offering educational content on how to resolve them.

However, creating leads is NOT synonymous with generating qualified leads. It is merely the beginning of the cycle.

What is Demand Generation?

Demand generation are marketing techniques used to drive awareness, interest, and ultimately - a decision to purchase a product or service which a business offers.

Lead generation is the start of the demand generation cycle. Where lead generation concern itself with building awareness, and creating an interest in the offering; demand generation is the full cycle of lead creation guidance into the sales funnel. This includes nurturing, growing the sense of need and urgency for your specific offering, and guiding the prospect through the buying cycle through to the decision phase.

In short, demand generation is the full cycle of lead generation, right through to nurturing, educating, and refining the high potential prospects to make it into the sales pipeline. Demand generation is about creating a sustained flow of interest and engagement among potential customers. It involves a longer-term view of the customer journey, and often needs ongoing efforts to nurture and educate leads over time. Marketers will leverage lead scoring, inside sales teams, and educational content programs to bring solid opportunities to the sales team over time.

Why Is this Important?

Even as a marketing professional, I too have made the mistake of thinking these two aspects of marketing were the same. They are not. In fact, too many marketers make this error, explaining why so many fall short of creating sustainable demand generation programs that fill the sales funnel continually.

Marketers are good at crafting messages, articulating pain points, highlighting solutions to those pains, and pointing out the benefits of their offerings. But, solving the customer's problem is the best way to create demand.

Whether generated from SEM, organic social media, or SEO by having a prospect come to visit your website ... visits that convert into leads are the first step. But it isn't enough to just generate leads to then throw over to sales expecting conversion magic to happen.

Demand generation marketers understand this to be a long term cycle. Articulate a full plan that generates new leads, qualifies them, and figures out the best way to bring a lead to sales pipeline fruition through a series of interactions. Merely generating leads, then having an organization that is unclear about what to do with them... is even worse. It is wasteful. In this case, you have now expended the company's time, energy, budget, and resources on collecting leads, without a plan on how to close them. Not something a board of directors wants to hear.

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Steps in Lead Generation

Undermining the importance and effort of lead generation is not the intention of this article. Good lead generation is an important first step in the demand generation process.

In the B2B world, start by developing content that resonates with your target audience. Focus on educating your audience on the importance of your topic, truly accentuate the pain points they are experiencing, and finally show how your product or service resolves the pain. Make sure to focus attention on the benefits your customers will experience, and how the solution resolves issues that left alone will fester and grow into even greater pains and future challenges.

Your friends here will be a solid focus on SEO for your website's findability, with organic social media used to amplify your messaging. Brand and product awareness are important, as they will make lead flow easier. Greater brand and product awareness will also help you build trust and credibility. With trust, your target market will be more willing to provide personal data, and be more open to being contacted to discuss their needs.

Of course, you must not forget the other techniques and tools like using SEM, SMM, eblasts, free webinars, events, and so on - to keep that new lead pipeline flowing, too. Use a combination of gated and ungated content to entice your audience.

Cleaning your Leads

Rather than exclusively focusing on lead generation, think of a broader longer term demand generation strategy. Always consider the next steps after the leads start flowing. What will you do them to get them to convert?

Will it take further filtering, cleaning, and qualifying of the leads to get them into a sales-worthy state? No matter how good and clean a lead generation technique you run, there will always be 'junk' leads that come in. Junk meaning the leads that are false positives, which looked like opportunities, but on further inspection were not. For example, these might be the students doing research for a project with no intention or means of buying your product. Or perhaps, these are the droves of competitors eager to see what you are up to.

So first step is to clean your leads. Do so either with your SDR (sales development representative) team or with marketing researchers. Determine which leads are within your target market, which also have the means to buy your product or services. There is no point in selling to companies that simply cannot afford your offering.

Following Up On Solid Leads

Finally, the heart of your demand generation strategy is to further qualify the leads to uncover the ones with a possibility and promise of buying your solution. This is the stage of taking your MQL's (marketing qualified leads) through to the SQL (sales qualified leads) stage.

Now your SDR team takes the leads and contacts these prospects. Here the important part is to drive engagement. Telephone calling is still the most important tool in the inside sales arsenal. From my own investigations, telephone calls have the highest correlation with booking a prospect meeting. In 2023, for SaaS development sales, I found a ρ = 0.79 correlation between telephone calls and sales meetings booked (N = 23). Although a statistician might argue that we need a larger sample size, this high correlation is quite indicative of the importance of calls to engage prospects.

Good inside sales is about taking a multi-touch approach. Don't stop at telephone calls. Leave intelligent and compelling voice mail messages, send emails to the recipient telling them about your message, connect on LinkedIn, send a LinkedIn In-mail, connect on Twitter, try WhatsApp, and text your contact. Most importantly, experiment to find out what works for your business, and in what frequency. You may not want to bombard your prospect, all at once. Instead take a gradual, and strategic approach to your spectrum of messaging.

Most importantly, remember that it takes perseverance and determination to make your demand generation programs successful. Industry averages suggest that it takes 209 customer touches (all the activities expressed above), to get to a meeting booked with a prospect. So, keep going even if you don't get early results. Persistence will pay off in the end.

Demand Generation Is Your Goal

Every marketer needs to be clear about the mission of marketing. Sure brand recognition is a good thing. Branding is a long term impact that will make the job of selling your company's offering, easier and possibly at higher margins; as a known and recognized entity. It makes the process of selling easier. But, don't fool yourself. EVERY marketer's job is to find ways to generate demand for your company's offering. Lead generation is an important early step in this process. However, be weary of of just creating leads, and throwing them over the fence to the sales team. This is cause of the classic sales versus marketing conflict.

Instead, plan your your next lead generation strategy in a more holistic way. Create a full demand generation plan, instead. Think through how your leads will convert into demand that your sales teams can use to create sales pipeline, and ultimately closed-won deals.