Advertising

Demand Generation: What Is It & How Does It Work?

Demand Generation: What Is It & How Does It Work?

12 Min Read

If you work in marketing, you’ve probably heard the phrase “demand generation.” But what does demand generation mean, and why is it important? How do you use demand generation successfully?

Read on to discover everything you need to know about this critical element for the success of your marketing strategy.

What Is Demand Generation?

Demand generation is a marketing strategy focused on creating awareness and interest in your brand, ultimately driving high-quality leads into the sales funnel. It spans the entire buyer journey, from attracting new audiences with content and advertising to nurturing prospects into sales-ready leads.

By aligning marketing and sales efforts, demand generation ensures a steady pipeline of engaged prospects primed for conversion.

Demand Generation vs. Lead Generation

Demand generation is the bigger-picture start of the process, involving the creation of awareness and excitement around your brand. It involves exciting your existing audience base and also potentially reaching out to new ones.

Lead generation is the ultimate and likely more concrete act of converting prospects’ attention to actionable leads by collecting tangible information.

Demand Generation vs. Growth Marketing

Growth marketing involves experimenting with various strategies across the entire customer journey to optimize and scale business growth by retaining existing customers and attracting new ones.

Again, demand generation focuses on creating awareness and interest in a product or service to drive customer acquisition by focusing on the top of the funnel rather than the entire sales funnel.

Demand Generation vs. Account-Based Marketing

Account-Based Marketing (ABM) focuses on identifying and targeting specific high-value accounts with personalized marketing strategies to drive conversions.

The key difference is that ABM is account-specific, while demand generation casts a wider net to attract a broader audience.

Benefits of Demand Generation Marketing

Demand generation isn’t just about attracting leads—it’s about building sustained interest, nurturing prospects, and driving long-term growth.

1. Increased Brand Awareness

Consistent demand generation efforts position your brand in front of the right audiences across multiple channels. The more brand awareness your business has, the more likely prospects are to engage when they’re ready to buy.

2. Higher-Quality Leads

By targeting audiences with relevant content and personalized campaigns, demand generation attracts leads with genuine interest. This results in better-fit prospects who are more likely to convert into paying customers.

3. Shorter Sales Cycles

Educating prospects early in the buyer’s journey helps reduce friction and speeds up decision-making. When leads enter the funnel already informed and engaged, sales teams can close deals more efficiently.

4. Better Marketing and Sales Alignment

Demand generation bridges the gap between marketing and sales by delivering well-qualified leads that meet sales criteria. This ensures both teams are working towards the same goal—converting high-intent prospects.

5. Scalable and Predictable Revenue Growth

A steady pipeline of engaged leads creates a reliable foundation for long-term business growth. With demand generation, brands can scale marketing efforts while maintaining consistent revenue performance.

How Does Demand Generation Work?

We know that demand generation is a multifaceted, data-driven marketing strategy designed to create awareness and interest in a company’s products or services. Its main goal is to build and nurture key prospect and customer relationships for the long term. But how does it work?

The entire demand gen process can be broken down into five easy steps.

Step 1: Identifying the Target Audience

The process starts by defining your ideal customer profile and understanding their pain points, behaviors, and interests. By leveraging data and audience segmentation, marketers can ensure campaigns reach the right people at the right time.

Step 2: Creating Engaging Content

Once the target audience is identified, brands develop high-value content designed to capture attention and provide solutions. This could include blog articles, videos, reports, and interactive experiences that educate and build trust.

Step 3: Generating and Nurturing Leads

Marketing campaigns drive potential customers to take action, whether by downloading a resource, signing up for a webinar, or engaging with an ad. Once leads enter the funnel, personalized email sequences, retargeting, and relevant content keep them engaged until they’re sales-ready.

Step 4: Qualifying and Scoring Leads

Not every lead is ready to buy, so marketers use scoring models to rank them based on engagement and intent. This helps sales teams focus their outreach on the most promising prospects while continuing to nurture lower-intent leads.

Step 5: Measuring and Analyzing Results

Data-driven insights help marketers track campaign performance, optimize strategies, and refine audience targeting. By continuously analyzing key metrics, brands can improve ROI and drive long-term demand generation success.

B2C vs. B2B Demand Gen

B2C and B2B demand generation differ primarily in their target audiences; consumers are individuals or families, while businesses are larger entities requiring the attention of entire teams.

Consumers (B2C demand gen) are open to discovering new products through browsing or watching TV, often making spontaneous purchases that align with their personal goals.

In contrast, businesses (B2B demand gen) evaluate products based on how well they align with their long-term plans and productivity goals. Consequently, messaging for businesses should be professional with data-driven content, whereas messaging for consumers should emphasize authenticity and reliability, often using user-generated content.

Demand Generation Channels

Demand generation utilizes various channels to attract and engage potential customers. Here are the top demand generation channels to consider:

1. Content Marketing

Creating high-value content—such as blog posts, whitepapers, and videos—helps educate potential customers and establish brand authority. The goal is to attract and nurture leads by providing relevant information that guides them through the buyer’s journey.

2. Search Engine Optimization (SEO)

Optimizing website content for search engines improves visibility and drives organic traffic from high-intent users. By ranking higher for relevant keywords, brands can attract potential customers who are actively searching for solutions.

3. Paid Search Advertising

Running targeted PPC campaigns ensures your brand appears at the top of search results when potential customers are looking for products or services like yours. With precise keyword targeting and audience segmentation, paid search accelerates lead generation efforts.

4. Social Media Marketing

Leveraging platforms like LinkedIn, Twitter, and Instagram helps brands engage with their audience, share valuable content, and drive website traffic. Paid social campaigns further amplify reach, targeting ideal customers based on demographics, interests, and behaviors.

5. Webinars and Virtual Events

Hosting educational webinars or live demos allows brands to showcase expertise and engage directly with potential customers. These events generate high-quality leads while building trust and positioning the company as an industry leader.

6. Account-Based Marketing (ABM)

ABM focuses on targeting high-value accounts with personalized campaigns that address their specific needs and pain points. By aligning marketing and sales efforts, ABM helps drive engagement and conversions within key accounts.

7. Email Marketing and Lead Nurturing

Automated email sequences and personalized outreach keep leads engaged throughout the sales funnel. By delivering relevant content at the right time, email marketing nurtures relationships and moves prospects closer to conversion.

8. Referral and Partner Marketing

Encouraging satisfied customers to refer new leads or partnering with complementary brands expands reach and credibility. Incentivized referral programs and co-branded campaigns can drive high-quality, trust-based conversions.

9. Retargeting Campaigns

Retargeting keeps your brand top-of-mind by serving ads to users who have previously visited your website or engaged with your content. These campaigns help re-engage prospects and guide them back into the sales funnel.

10. Connected TV Advertising

CTV advertising delivers highly targeted, high-impact video ads to engaged audiences on premium streaming platforms. With precise audience segmentation and real-time attribution, CTV ensures your brand stays in front of potential customers at every stage of the buyer’s journey.

Demand Generation Strategies

Okay, so demand generation is key. But what are the actual demand generation strategies that work? As noted above, there will be some differences in your approach depending on whether your orientation is B2C or B2B. But there are similarities, too.

1. Predictive Lead Scoring with AI

AI-powered lead scoring analyzes behavioral data, engagement patterns, and firmographics to predict which prospects are most likely to convert. This allows marketing and sales teams to focus on high-intent leads, increasing efficiency and accelerating pipeline growth.

2. Conversational Marketing with AI Chatbots

Intelligent chatbots engage website visitors in real time, qualifying leads instantly through personalized conversations. By automating lead capture and nurturing, chatbots ensure that prospects get immediate responses, improving conversion rates and customer experience.

3. Hyper-Personalized Video Campaigns

Dynamic, data-driven video content delivers tailored messaging to prospects based on their behavior, industry, and stage in the buyer’s journey. Personalized video increases engagement, builds trust, and drives higher response rates than traditional static content.

4. Dark Social Tracking

Many high-value conversations happen on private channels like Slack, WhatsApp, and direct messages, making attribution difficult. By using tracking tools and custom UTM parameters, marketers can uncover hidden demand signals and refine their strategies accordingly.

5. B2B Influencer and Employee Advocacy Programs

Leveraging industry influencers and employees as brand advocates extends organic reach and builds credibility in niche communities. Encouraging employees to share thought leadership content increases visibility and drives engagement with target audiences.

6. Intent-Based Connected TV Retargeting

By serving streaming TV ads to users who have previously visited your site, engaged with emails, or interacted with ads, brands can reinforce messaging in a high-impact format. Intent-based retargeting ensures that marketing dollars are spent on prospects already showing buying interest.

7. Interactive and Gamified Lead Magnets

Quizzes, assessments, and interactive tools capture lead data while providing instant value to prospects. Gamification enhances engagement, making lead generation more compelling and increasing form-fill rates.

8. Reverse IP Tracking for ABM

Reverse IP lookup identifies anonymous website visitors and matches them to company data, enabling marketers to launch highly targeted ABM campaigns. This approach allows brands to engage decision-makers from high-value accounts before they even fill out a form.

9. Podcast Guesting and Owned Audio Content

Featuring executives on industry podcasts positions your brand as a thought leader and builds credibility with engaged audiences. Launching a branded podcast further nurtures demand by providing in-depth insights tailored to your ideal customers.

10. Offline-to-Online Attribution

Bridging offline and online marketing, QR codes and NFC-enabled experiences track real-world interactions and drive measurable engagement. This strategy helps attribute conversions from physical marketing touchpoints like events, direct mail, and in-store experiences.

How to Measure Demand Generation

Although you might think demand generation involves somewhat amorphous concepts such as goodwill and interest, your success can still (and must) be measured.

It’s important to set key performance indicators (KPIs), and other benchmarks to make sure your efforts are paying off. Some of these demand generation metrics include:

  • Marketing Qualified Leads (MQLs): These are potential customers who have shown enough interest in your product or service that they are considered more likely to become a customer than other leads.
  • Sales Qualified Leads (SQLs): These are leads that have been vetted by both the marketing and sales teams and are deemed ready for the next stage in the sales process.
  • Cost Per Lead (CPL): This is the total cost of your marketing campaign divided by the number of leads generated.
  • Cost Per Acquisition (CPA): This measures how much your business spends to acquire a new customer.
  • Customer Lifetime Value (CLV): This is a prediction of the net profit attributed to the entire future relationship with a customer.
  • Return On Investment (ROI): This is a measurement of the efficiency or profitability of an investment, calculated by dividing net profit by the cost of the investment.
  • Close Rate Per Channel: This measures the percentage of leads from a specific marketing channel that convert to a sale.
  • Marketing Cycle Length: This is the average amount of time it takes for a lead to become a customer after initial engagement.
  • Average Deal Size: This measures the average revenue your company makes from each closed deal.
  • Contribution to Total Revenue: This metric shows how much revenue can be attributed directly to marketing efforts.

In the age of big data, you can track not just how many visitors come to your site, but what content they read and find useful, so you can keep iterating and making improvements to your strategy. Stay on top of your demand generation strategy and keep it nimble and flexible.

Performance TV Changes Everything

Want to generate demand that drives real results? MNTN Performance TV helps you reach, engage, and convert high-value audiences with precision-targeted OTT advertising. Here’s how:

  • AI-Powered Targeting: Find and engage your ideal customers with data-driven audience segmentation using MNTN Matched.
  • Seamless Retargeting on CTV: Keep your brand top-of-mind by serving high-impact video ads to users who’ve already shown interest.
  • Real-Time Performance Insights: Track site visits, conversions, and engagement with MNTN’s advanced reporting suite.
  • Automated Campaign Optimization: Machine learning continuously refines your campaigns to maximize performance and efficiency.
  • Premium Streaming Inventory: Get your ads in front of engaged viewers across top-tier networks and streaming platforms.

Turn brand awareness into demand—and demand into revenue. Sign up today to launch your TV advertising campaign with MNTN.

Demand Generation: Final Thoughts

Demand generation is a strategic, full-funnel marketing approach to creating awareness, nurturing interest, and driving high-quality leads that convert into customers. By leveraging data-driven marketing tactics, personalized content, and multi-channel engagement, brands can build a steady pipeline of prospects primed for conversion.