Lead generation, demand generation and demand capture are terms experts often use as part of the marketing vocabulary. However, there can sometimes be confusion between the three and we created this short blog post guide to explain each one.
Lead generation is the process of identifying and nurturing potential customers with the goal of scheduling meetings with them. These individuals, who belong to targeted companies within your ideal customer profile (ICP), are known as leads. Success in lead generation is often measured by the number of leads generated. Common lead generation tactics focus on volume and may include methods such as direct paid ads, gated content in PDF format followed by outreach from the sales team, cold outreach via emails and LinkedIn, and webinars where the product is pitched. When implemented effectively, lead generation tactics can still be highly successful today.
Demand generation is a marketing process focused on driving awareness and interest in your products and services and getting customers excited about your offering without trying to explicitly sell to them. Success is measured by the impact on generated revenue pipeline and the quality of inbound opportunities. This approach involves a variety of marketing activities aimed at the top of the funnel: creating awareness, interest, and desire for your product or service.
Demand generation tactics are educational and engaging in their nature and may include thought leadership, content collaboration, events, social engagement, among others. While demand gen shares some similarities with lead generation, its primary focus is on building interest in your business as a whole, rather than targeting specific customers. By educating your target audience and building trust you position your company as a reliable industry player. Unlike lead generation, demand generation is more of a long-term strategy.
And striking that right balance between short-term lead generation plays and long-term demand generation plays is what we typically see working well for B2B companies with complex sales.
Short-term, sales-focused strategy
Low cost, high volumes of irrelevant leads
Example metrics: meetings booked, MQLs based on content downloads, trade show contacts, webinar signups
Long-term, educational strategy
Effectiveness is measured by target account engagement and pipeline
Example metrics: average time on page, branded search volume, # of inbound opportunities and revenue pipeline generated
Demand capture focuses on the later stages of the buyer's journey, targeting prospects who are actively seeking a solution and capturing their interest with marketing programs presenting relevant offers. Common tactics include SEO, paid search ads, building landing pages, chatbots, and intent data technologies. Success is measured by conversion rates, cost per lead, cost per channel/program, and return on ad spend (ROAS). In essence, demand capture is about converting the demand generated by your marketing efforts and your share of voice into tangible sales opportunities and closed deals.
By optimizing your demand capture strategies, you can ensure that your business effectively capitalizes on the demand generated by your marketing activities, ultimately driving growth and revenue.
