Share what you know with millions of people
Focus is the best place to turn what you know into remarkable content
0
What is the difference between Demand Generation and Lead Generation?
Demand Generation and Lead Generation are two most commonly used words in the B2B space, especially in the Marketing Automation space, how do you differentiate between the two, when the end result of both is to increase sales for an organization. is there really a difference, when it comes to execution?
How should a marketer differentiate between the two and what B2B marketing activities fall under each of these categories.
Events
- Live now Dos and Don'ts of Small Business Marketing May 29 @ 11 am PT
- Lead Nurturing 202: The Next Generation May 31 @ 11 am PT
- The Tricks to Paid Media June 6 @ 11 am PT
- Display Advertising for Brand Awareness June 20 @ 11 am PT
Related Activity
7 Answers
Thanks for asking this important question Merlin. There are a lot of definitions floating around out there.
Lead generation is a subset of the discipline of demand generation (sometimes referred to as demand creation).
At DemandCon (the demand generation conference) last May, we proposed the following definition for demand generation:
"The practice of creating a customer's propensity for and ability to buy from you."
So you can see how there are a whole set of activities, practices and metrics that may relate to demand generation, including awareness (through the use of social media and other channels), organizational readiness (making sure that agreements are in place between sales and marketing on what the definition of a lead is, for example) and pricing/promotion that is separate from the discrete lead generation activities.
Lead generation is a set of marketing activities designed to generate customer inquiries into your company's products or services. They may include direct response types of activities like search engine marketing or the creation of interesting content offers, or may include outbound calling to prospects. It also includes referral or affiliate marketing programs.
I think that Demand Generation is as the umbrella term, with both lead generation and lead management as components with Demand Generation:
- Demand generation = Lead generation + Lead management
- Lead generation is the process to generate leads.
- Lead management is the process to turn a lead in a sales ready lead.
- Lead management = Lead nurturing + Lead scoring
- Marketing automation is a technology that will power both Lead generation and Lead management.
Demand generation is creating awareness and interest in your offerings. Lead generation is creating consideration with a call to action that can be followed up directly by sales. Demand gen is pure marketing. Lead gen is the handoff from marketing to sales.
Thanks Steve for sharing the definition.
Also, you add another very interesting perspective to my understanding of Demand gen
I never thought of organizational readiness as an important part of demand generation, but saw it more as creating a common ground for measuring marketing and sales success in an organization.
But now that you mention it, I understand how important it is to define your leads, to ensure you gain out of your demand generation activities.
It is the one link that connects your demand generation efforts to your lead generation efforts.
Steve does a good job laying out his definition. And if forced to create one, I would use a very similar definition.
However, I would caution against spending too much time defining terminology. We are in the midst of a major marketing shift where marketers are expected to have a more direct impact on revenue. As this ‘new marketing’ continues to evolve, new buzzwords will be created to define similar terms. Some will stick and some will fall to the wayside.
The more time you spend defining terminology, the less time you have to focus on generating and qualifying leads and tying results back to revenue.
Maybe I am being too old school, but the proposed definition of Demand Generation seems to me to just be a definition of what we used to call 'Marketing' in general - particularly when you include awareness, pricing and promotion as part of your definition.
In practice, and certainly in 99% of companies both large and small that I've worked with and worked for, the terms demand gen and lead gen are simply used interchangeably to indicate the practice of creating and managing lead generation programs and the metric measured is typically number of inquiries.
In more recent years with the higher adoption of marketing automation software, the 'demand gen' or 'lead gen' team has expanded to become responsible for lead nurturing programs, the lead hand-off process and systems used to facilitate that.The metrics were expanded beyond number of inquiries to include number of marketing qualified leads, sales qualified leads and pipeline measurement through to revenue.
But again, making such a distinction and trying to define demand gen vs. lead gen seems a little nit picky. And defining demand gen to include such a broad range of marketing activities not typically handled by a demand generation professional seems a bit of a stretch.
Hello,
An article you may find helpful -
LeadGen, DemandGen and the SEO/SEM tie-in (http://www.allbusiness.com/technology/software-services-applications/6635393-...).
"LeadGen people are usually market researchers who go through on and offline company data to determine if a company is in the market for some product or service and who in that company is the decision maker. When you get a call and the person starts out with "I'm doing a study of xyz and have about a minute or two of questions...", you're talking to a LeadGen person. The ruses some LeadGen groups will use to get information from company personnel is amazing.
DemandGen then takes the information gathered by LeadGen and attempts to set up meetings between a prospect company's decision makers and the sales staff of whatever company hired them to do inside sales. Smaller companies combine these two steps and if you've ever seen "Glengarry Glen Ross" you have a fair idea of what this can be like. "
Answer This Question