Demand Generation vs Lead Generation: What’s the Difference?

by Stephen Graveman

7 Min Read

Most of today’s marketers build campaigns around attracting customers into the store. Since buyers are more informed than ever, it’s important to use the right strategy to stand out from the competition, build brand awareness, and convert new customers.

Demand generation and lead generation are two of the ways your business can attract new customers, each with its own end goal. To successfully execute these marketing tactics, it’s important to know the difference between demand gen and lead gen, and how you can use them to grow your business.

What is Demand Generation?

Demand generation marketing is a strategy used to build and strengthen your brand awareness. A demand generation campaign helps you explain your business to potential customers, showing them how you will solve a problem for them. They may or may not know the problem exists, but they haven’t started looking for solutions.

Demand generation campaigns, whether it’s B2C or B2B demand gen, are targeted at people who aren’t familiar with your brand, bringing them to your website or contacting you for more information.

One of the main goals of demand generation is to establish yourself as a credible, authoritative resource to improve your audience’s chances of moving from brand awareness to qualified leads.

Common Demand Gen Strategies

A solid demand generation strategy is all about creating a need for your product or service and setting yourself up as the best solution. You can use different tools to accomplish your demand generation goals.

Content marketing: Content marketing is a common demand generation tactic because it helps boost your search engine ranking and answers potential questions about your business. Using content including videos, blog posts, and social media helps boost your brand and establishes you as a credible solution to customer problems and pain points.

Social media engagement: Social media lets you connect with potential customers and learn more about their needs. Go beyond your followers by looking for keywords in your field. You can offer advice to people looking for your expertise and join in on industry-related discussions to improve brand awareness.

Webinars: Webinars are an excellent way for you to build your authority in your field. If you have unique and helpful knowledge, share it through a webinar and encourage others to share your invitation. Focus your webinar on specific problems you can solve to create awareness about how you can help potential customers.

Pay-per-click (PPC) advertising: Since pay-per-click advertising puts you at the top of the searches, it’s great for building brand awareness. When creating PPC ads for demand generation, think of the keywords buyers may use when looking for a solution to their problems. Structure your headings and ad copy around these keywords so the right people can find you online.

Free resources: Offering tools like product guides or hosting live chats in which people can ask questions helps you build your brand and offer something of value to people who aren’t fully aware of what you answer. These resources don’t have to be sales pitches. You could celebrate a previous client with a case study or video about their success.

Website analytics: Your analytics is a valuable tool because you can see what people are searching for when they find your site, and you can analyze how they’re interacting with various pages. These insights can help you identify content preferences you can use to run demand generation campaigns that draw people to your website.

What is Lead Generation?

Lead generation is a performance marketing strategy used to convert people who are already aware of your brand into qualified leads. Your lead generation campaigns are targeted at people who know you and are aware of what your company could potentially do for them.

These ad campaigns are usually focused on how your product can benefit a new prospect. They help you find the most interested leads in your existing pool.

Common Lead Gen Strategies

You can use the demand strategies listed above to generate leads, but your aim will be different. Personalize your lead generation marketing campaigns to move people through the sales funnel.

Gated content: Offering people something for free can encourage them to listen to your pitch, but make sure you get something in return. To generate more leads, offer higher-quality content to people who sign up for your email marketing list. Create offers that make people want to sign up.

Targeted Landing Pages: Using a landing page with a clear call to action and sign-up form is one of your best lead generation tools. With a targeted landing page, you can go into detail about your products and services and what they can do for potential customers. They also help you track how many people sign up as a result of a specific campaign to help you refine your marketing in the future.

Retargeting Ads: Retargeting ads only appear in front of people who’ve already been on your website. You can set them up with Google Ads and social media. They remind people who already know about your business that you’re still around and ready to offer a solution.

Demand Generation vs. Lead Generation: Summary of Differences

So, what are the primary differences between demand generation and lead generation? Here is a high-level summary outlining the areas in which they differ.

Objective

Demand generation focuses on driving awareness and interest in the company’s products or services to nurture relationships with potential customers.

Lead generation concentrates on capturing contact information from interested prospects for direct marketing purposes.

Approach

Demand generation uses a comprehensive, holistic approach, influencing potential customers at every stage of the buyer’s journey, from initial awareness through to customer advocacy.

Lead generation is more direct and immediate, focusing primarily on the conversion stage of the buyer’s journey where prospects are converted into leads.

Content Strategy

Demand generation content is typically ungated, aiming to reach a wide audience and generate broad interest.

Lead generation often involves gated content, where users need to provide their contact details to access valuable resources, thus generating leads.

Measurement Metrics

Demand generation metrics evaluate success based on awareness, engagement, and customer acquisition, such as web traffic, social shares, or customer lifetime value (CLV).

Lead generation is often measured by the number of leads generated, cost per lead, and conversion rates, among other digital marketing metrics.

Target

Demand generation focuses on a wider audience, nurturing prospects at all stages of the sales funnel.

Lead generation targets individuals who have already shown interest and are likely to become potential customers, focusing on moving them further down the funnel.

Remember, both tactics are part of an inbound sales strategy in which you provide customers with the right information to aid in their decision-making process. The primary difference lies in what information you’re presenting to your audience, based on their current awareness level of your business, to get them into your funnel.

How Do Demand Gen and Lead Gen Work Together?

Your marketing strategy shouldn’t be based on demand gen vs. lead gen, but rather on making them work together for a stronger sales pipeline. Here are the primary benefits for why you should harmonize these two marketing strategies:

Enhanced Prospect Nurturing: Demand generation draws prospects in and nurtures them through the sales funnel, while lead generation then captures the contact information of these interested prospects for further personalized communication.
Improved Brand Awareness: Demand generation strategies increase brand awareness and create a receptive audience, which lead generation tactics can then convert into tangible leads for the sales team.
More Holistic Content Strategy: Demand gen focuses on disseminating high-value content to pique interest, while lead gen provides more targeted, often gated, content to potential customers.
Higher Conversion Rates: Demand generation warms up the audience, making them more receptive to lead generation efforts, and as a result, can boost conversion rates, turning prospects into actual leads more effectively.
Better Data Analysis and Feedback: The insights obtained from lead gen metrics can inform and improve demand gen strategies, and vice versa, creating a continuous feedback loop that refines overall marketing strategies.

Why Performance TV Can Help

Performance TV lets you deliver your Connected TV ads to a target audience, allowing you to measure results and gauge your effectiveness. With performance TV, you can create different video campaigns for demand generation and lead generation and target them based on where people are in your sales process.

Performance TV lets you target and measure in a way you can’t with traditional television ads. You can use the data from your website analytics and social media ads to tailor ads for building brand awareness and getting them in front of the right audience.

If you’re using performance TV as part of your lead generation campaign, create ads that go further into detail about your products and services and how to use them successfully. Then include a call to action encouraging people to go to your website or sign up for a free trial.

Demand Gen vs. Lead Gen: Final Thoughts

You need demand generation and lead generation strategies to create a pipeline of well-qualified leads. The two work together to improve your chances of connecting with new potential customers and convincing them to take the final step and buy. Content plays a valuable role in both strategies and video content is a fun and engaging way to appeal to new and interested customers.