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

digital transformation course with tom goodwin

The world of marketing (and technology) is a funny old place. Back in the day it was all hunches, cigarettes and whisky – yes, I’ve seen Mad Men – but now it’s all data, acronyms and buzzwords. It really couldn’t be much more different.

Don’t get me wrong, this is mostly a good thing. People are generally healthier (they have gym meetings, for god’s sake) and marketing methods are more efficient, but that doesn’t mean the who buzzword thing doesn’t get in the way of a lot.

The issue is, even if people do know what each buzzword means in practise – just not the actual name of it – then often you’ll get them in meetings using words that sound similar as interchangeable and unimportant, just to spice up their point.

Demand generation and lead generation are two of these. They’re both different things, but a lot of the time you’ll hear them being switched and swapped like they mean the same thing.

I’m not going to tell you that they couldn’t be more different, and that demand generation is the polar opposite and could be more detached from lead generation, but they’re definitely different enough that it matters. So, let's explain the difference.

What is Demand Generation? 

Simplified to an almost insulting degree, demand generation is almost the barebones of marketing. It’s the process of creating awareness and demand (there it is) for your product of service. It's top of funnel marketing that can educate potential customers about your company and products. 

Demand generation doesn’t include the eventual closing of a sales loop, but rather is designed purely to bring people to your website or business in order to build your target audience, general interest in your company and that create trust in your brand.

Examples of demand generation include: 

  • Content marketing - blogs, podcasts, ebooks and white papers. 
  • Social media posts. 
  • Email marketing - newsletters, product updates etc. 

Essentially, if you can think of a form of advertising that’s free to consume (both monetarily and data-wise), then that’s probably demand generation.

In a nutshell, demand generation is about raising awareness - and therefore demand - for your company, and your products and services. 

What is Lead Generation?

Lead generation, for want of a better word, is the next step. After your demand generation has made built awareness of your brand and products, and hopefully positive sentiments towards the two, lead generation is about turning this interest into qualified leads. 

It's about finding the people that have an interest in what it is you have to offer and are potentially willing to part with their time and money.

Examples of lead generation include: 

  • Gated content - ebooks, research reports, white papers. 
  • Free trials or product demos. 
  • Email subscriptions. 
  • Webinars / virtual events. 

The common theme here is that the content, trial etc is offered in return for data, an email address and/or contact number in most cases. 

If your lead generation is successful, you should have a number of prospects that your sales team can follow up on - people who have enjoyed your content and expressed an interest in your company's products or services. 

How lead generation and demand generation should work together

Demand generation and lead generation fulfil different, but complementary roles. In an effective marketing strategy, demand generation should make lead generation more easy, by drumming up interest in your content, and by extension, your products and services. 

These two types of marketing need to be coordinated to be truly effective, and it's important to get the balance right.

Demand generation needs to create enough interest from the right audience to increase your chances of generating valuable leads, while there's little point in creating lots of demand if you don't have the right lead generation in place to capitalise on it.