Understanding lead gen vs. demand gen matters because using both correctly builds a healthier pipeline.
Demand generation builds awareness and interest. Lead generation captures that interest as contacts, then nurtures them toward closed deals.
Here's what you need to know:
What each one is
The different strategies you can use for them
How these two strategies differ.
What is demand generation?
Demand generation refers to growing awareness and interest in your product or service.
Demand gen is the first step to driving sales. Your target audience develops an interest in buying from you once they recognize your business as a credible solution to their problem.
Typical goals for a B2B demand generation strategy include:
Growing brand recognition and credibility
Gaining your target audience’s trust
Establish yourself as an industry authority.
Examples of demand generation strategies
You can use interest-generating content, cold calling, and other tactics to raise awareness.
Focus your strategy on earning buyer trust and proving your expertise. Adapt these common demand gen strategies to fit your market.
1. Top-of-the-funnel content marketing
Top-of-the-funnel content marketing involves creating informational content to drive interest and establish credibility. “It gives people useful information that builds trust and proves expertise,” notes Vito V., the founder and director at Martal Group.
Since the aim is to win your target audience’s trust, start with talking to people who align with your ideal customer profile (ICP) to learn about the questions they have. You can also head to social media and Q&A platforms like Quora and Reddit to find out what your target audience wants to know. Then, create content that addresses their questions and concerns.
It’s also important to use different content types to meet your target buyer’s content consumption preferences. At Paragon, Brian Yam, the Head of Marketing, shares that they use a handful of different content types.
“By presenting relevant resources, guides, and thought leadership, and weaving in the category and our solution, we have introduced Embedded iPaaS as a category to solve the problem of building native integrations.”
Director of Digital Marketing at Lacework, Simon Chuang, also recommends using thought leadership content:
2. Paid media
Creating educational content is only one part of the demand generation puzzle. The other part: driving traffic to your content.
One effective way to do so is using paid ads.
The Metadata team uses this tactic. Their Sr. Demand Generation Manager, Bryttney Blanken, shares, “We invest roughly 20-40% of our total paid media budget in creating demand, meaning we build campaigns that point to valuable content with the goal of educating and building trust with our ICP.
“This has impacted our overall demand generation strategy by decreasing our variable cost-per-opportunity and increasing our month-over-month demo requests by 290% from paid social ads."
3. Sponsorships
Sponsorship can be made up of contributing to industry-leading blogs, co-hosting podcasts, and sponsoring newsletters. Sponsorships increase your credibility and brand awareness.
Yam’s team at Paragon has used this tactic effectively to generate demand. “Building demand for the category has mainly been through content and sponsorships, be it newsletters or podcasts.”
Why it works:
It helps you tap into industry leaders’ already-established audiences
It grows your social proof as industry leaders recommend you
Instead of partnering up with any publication or podcast, though, be sure to research your target site’s audience to make sure it aligns with your ICP.
4. Integrated marketing
“Your buyers see your brand across multiple channels. Make sure each one delivers consistent messaging and a clear path to conversion—whether through paid, organic, or outbound.” suggests Isaac Ware, UserGems’ Director of Demand Generation.
To align your demand gen channels around consistent messaging, ensure your marketing and sales teams are aligned. They both need to develop shared goals and exchange notes on the target audience to successfully drive results.
Pro tip: Use intent data to avoid creating artificial demand.
“Intent data gives you detailed insights into buyers currently displaying signs of being ready to purchase,” says David Reid, the Sales Director at VEM Tooling.
“Intent data helps your team focus on accounts that are in-market and ready to buy, not on inventing demand. It helped us reach buyers who were ready to purchase.”
Demand generation metrics to track
“The main KPI for demand gen should always be qualified pipeline,” observes Isaac Ware from UserGems.
To this end, track these demand generation metrics to gauge how successfully your demand gen campaign is growing awareness and interest in your product:
Website demo requests
Click-through rate
On-site metrics such as time on page and bounce rate.
What is lead generation?
Lead generation is the process of capturing and nurturing a prospect’s interest in your product or service with the aim of guiding them through the sales funnel to make a purchase from you.
Since the aim is generating quality leads to build a healthy sales pipeline, a lead generation strategy’s goals include:
Capturing and using lead information to refine your messaging
Building relationships with leads to move them down the sales funnel.
Examples of lead generation strategies
Once you've generated interest through demand gen, lead generation takes over. Its aim: capture your most interested prospects as leads. Once you have a pipeline full of prospects, you nurture them into customers through lead generation.
Like demand gen, tailor your lead generation strategies to your target audience. While most of the tactics you’ll use between the two will differ, some are relevant to both — like paid media. In cases like this, you’ll need to refine your strategy based on your ICP and where and how you want to reach them.
Common lead gen tactics:
1. Middle-of-the-funnel content marketing
MOFU content educates leads about your product and how it solves their specific problem.
Examples of MOFU content you can use include product comparison posts, case studies, white papers, product-led webinars, and eBooks. You can gate most of this content to capture lead information and grow your pipeline.
Paragon’s Brian Yam recommends creating MOFU content that answers questions of users with high buying intent.
“Leveraging content that would only drive interest from high intent users as lead magnets on LinkedIn,” advises Yam. “It drives the majority of our pipeline, and also has served as a demand gen strategy given how new our category is.”
What’s more, Derrick Hathaway, the Sales Director at VEM Medical, commends thought leadership content for generating leads. “The one lead generation strategy that worked for us was to provide informative content to our target audience. We were able to attract new customers in a variety of ways by answering common questions and positioning our brand as a thought leader.”
One caveat: “If you are gating content, use LinkedIn lead gen forms that are simple to fill out and avoid slow loading, clunky landing pages,” Simon Chuang from Lacework notes.
2. Paid media
Paid media works for lead gen too. — both UserGems’ Isaac Ware and Metadata’s Bryttney Blanken recommend paid media for lead gen, with Bryttney sharing that paid media brings them leads at a low lead acquisition cost.
Bryttney explains, “For Metadata's annual event DEMAND, we used paid ads to drive a percentage of event registrations across LinkedIn and Facebook. We drove 2500+ total leads with a low CPL of $47 (33% more efficient from the year prior), resulting [in] impactful results down the funnel, which helped us drive more pipeline and revenue. We are now nurturing these event attendees based on account rank to build on the trust and momentum we established through the event.”
To succeed with paid media for lead gen:
“Make sure the messaging is specific to them as an individual in their role. With market conditions making people anxious, it is important you speak to their personal concerns in addition to their company goals,” Ware explains.
3. Email marketing fueled by audience segmentation
“Email marketing remains essential for staying in touch with prospects and customers. Email builds relationships and drives revenue when done right.,” writes Alex Armstrong-Paling, the Managing Director at Tool Fit.
Instead of mass emailing your list with generic messages, segment your email list according to their persona and the funnel stage that each lead is in. From there, nurture them by sending unique and personalized content.
“Monthly content or informational newsletters, automated email nurturing sequences that are customized for different contacts, and sales, automated lead nurturing sequences that help marketers be more effective and consistent with an email marketing strategy are examples of the different kinds of email marketing assets,” adds Armstrong-Paling.
Aside from tactics that aim to personalize subscribers’ experiences to nurture them, ROI-driving email marketing is permission-based. This means that each time you ask for a lead’s email address, you also need to ask for their permission to email them relevant marketing content. Not only does this gain your leads’ trust, but it also builds a warm lead pipeline.
4. Live chat
“Customers want immediate answers to their questions.,” notes Abe Breuer, CEO and owner of VIP To Go. That's why Breuer recommends live chat for lead gen.
“You can gather contact information, assign the new contact to a salesperson for follow-up, and send a welcome email to your new lead all at once by setting up automation processes using Zapier or its counterparts.”
Start by going through your past conversations with customers to identify any questions they had before buying from you. Write out helpful and straightforward answers to these questions and set up a chatbot to share them with site visitors when they search for certain keywords.
Don’t forget to also give site visitors the option to connect with a sales rep through your live chat, as it’s a great way to nurture leads.
Pro tip: Enrich your pipeline with ready-to-convert leads by targeting your customers, prospects, and end users when they move to new companies. These individuals are 3X more likely to buy from you and more open to introducing your sales reps to their new teams. To this end, use a tool like UserGems to track customer job changes and add warm leads to your sales pipeline.
Lead generation metrics to track
Most teams track MQLs to measure lead gen success. Lacework's Simon Chuang disagrees—he thinks it's pointless.
“If you're driving pipeline and closed revenue, focus on meetings booked and qualified sales opportunities. Beyond volume, track pipeline velocity. Are you moving accounts through each stage efficiently? Prove that, and you've got something valuable.”
Keeping this in mind, here are the lead generation metrics to track:
Cost per lead
Meeting booked
Pipeline velocity
Lead qualification rate
Key differences between lead generation and demand generation
Demand generation and lead generation serve distinct purposes in your marketing strategy.
Demand generation builds interest and awareness. Lead generation converts that awareness into pipeline and revenue.
These different goals drive distinct results for each tactic. Demand gen delivers potential buyers. Lead gen gives you a pipeline of interested buyers. Demand gen reaches a broad audience. Lead gen focuses on the most interested prospects.
Martal Group’s Vito V. summarizes this well: “Demand generation attracts loads of potential buyers at the top of the sales funnel who are fit to convert if nurtured correctly. Lead generation increases the number of converted leads at different stages while shortening the sales cycle and increasing revenue.”
Paragon’s Brain Yam agrees: “Demand generation is not intended to help you book demos or get the lead. Its job is to educate and build awareness for the category, to show problem-aware audiences that there is a solution tailored to that problem, so when the problem becomes a priority to solve, your category, and subsequently your product, is the first thing that comes to mind.”
On the flip side, “Lead generation is meant to capture users at the bottom of the funnel, who have the problem and know there is a solution and are looking for the best solution,” Yam adds.
Here’s a summary of demand generation vs. lead generation:
Use demand gen and lead gen together for a healthy pipeline
Use both demand gen and lead gen to build a healthy pipeline.
Start with generating demand to grow awareness about your product and increase your credibility. This way, when potential buyers are ready to buy, you’ll be one of their top choices.
As these potential buyers express their interest, use lead generation tactics to capture their contact information and educate them further about how your product can solve their specific problems. In doing so, you can persuade them to choose you over your competitors.
But beware, not every prospect is worth nurturing. Instead of adding any and every lead to your pipeline, add only warm ones. This way, you can save yourself from wasting time and resources on nurturing irrelevant or cold leads.
UserGems helps with this. It tracks customer, end user, and prospect job changes — allowing you to add alumni customers (read: ready-to-convert leads) to your sales pipeline.
It also identifies and alerts you of ICP-matching leads that start new roles. This way, you can reach out to interested buyers when they’re actively looking for a solution like yours and have the budget to invest too.
So what are you waiting for? Try UserGems today and grow your sales today by building a warm sales pipeline.
