Demand Generation and How it Differs From Lead Generation

Emily Kingland
June 8, 2021
Demand Generation and How it Differs From Lead Generation

Whenever I'm in a store and see a sales employee approaching, I will literally turn and speed-walk away. Doesn't matter if I actually needed the thing I was looking at. I'll order it online later.

You might think I sound like an anxiety-ridden hermit, but being sold to is seriously one of my pet peeves. So, do you think I'm going to let some digital lead magnet squish me into a sales funnel? No thank you.

A lot of buyers -- to at least some degree -- feel the same as I do when I'm being sold to. That's why B2B companies need to get familiar with demand generation marketing... fast.

What is demand generation? Demand Generation is the creation of interest in your product or service to build a healthy pipeline of qualified leads for your sales team. B2B is different from B2C demand generation marketing in that it involves multiple decision-makers in each transaction as opposed to one consumer.

In this episode of B2B Growth, host Lesley Crews discusses the following with Refine Labs CEO and demand gen guru Chris Walker:

  • What is a Demand Generation Strategy?
  • The Difference Between Demand Gen & Lead Gen
  • Why the Traditional B2B Sales Funnel is Dead
  • Sales-Led vs. Product-Led
  • The Difference Between Demand Gen & Marketing
  • How to Use B2B Demand Generation Marketing

Below, we're going to go through each one of these topics in depth.

What is a Demand Generation Strategy?

What is a demand generation strategy? A demand generation strategy is ideally a plan created and carried out by the marketing, sales, and customer success teams to develop an interest in their solution at every stage of the buyer's journey.

Goals of a Demand Generation Strategy

The goal of a demand generation strategy is to rejoin the previously separated segments of the sales (buyer's journey) funnel. It's kind of like the sticky putty that bridges the awareness, consideration, and decision parts of the funnel.

Then, demand generation goes even further to involve Marketing in the purchase, retention, and advocacy stages of the customer's entire experience. If the goal is to align Marketing, Sales, and Customer Success, why disclude Marketing as soon as the lead is passed onto Sales?

"A lot of companies -- especially larger ones -- make the mistake of segmenting the funnel into different groups which, one, has a very disjointed experience and two, you have one person relying on the beginning and no accountability for what happens at the end which is why you end up with a lot of marketers who toss leads over the fence to Sales that don't want to talk to them."

-Chris Walker, Refine Labs

The same goes for Sales and CS. As we all know, a successful customer handoff takes as much effort from Sales as it does CS.

In other words, a successful demand generation strategy involves all three departments throughout the buyer-to-customer journey.

This way, you can actually draw a line from Marketing's efforts to revenue earned.

The Difference Between Demand Generation & Lead Generation

What's the difference between demand generation and lead generation? The difference between demand generation and lead generation is that instead of collecting contact info from leads and trying to sell to them, demand generation encourages direct communication with buyers, creating a desire in them to use your product or service. Demand generation is a more holistic strategy than simply soliciting for leads' email addresses and putting them through the funnel.

The Times are Changing

You might be wondering why top performers are shifting from lead generation to demand generation. It's mostly due to the way people make purchases today.

In case you didn't know, people don't want to be pushed down a funnel toward your sales team like a baby seal to a pool of killer whales.

Sorry it got a little grim there, but it's a pretty apt analogy. (Just be glad there's no GIF.)

"The way people buy things is fundamentally different than when the lead generation model had a lot of success."

Chris Walker, Refine Labs

People Hate Being Sold To

Think about the last time you found yourself on the contact form for a lead magnet. You just wanted insights into your industry's latest selling techniques and now you have to sacrifice your email address and company name.

Did you fill it out? If you did, were you happy about it? Did it give you a warm, fuzzy feeling for the brand that just carried out a virtual stick-up?

Probably not.

Companies need to switch from this primitive way of selling to a more human, fluid way of creating the desire for your solution.

Why the Traditional B2B Sales Funnel is Dead

Why is the traditional sales funnel dead? The B2B sales funnel is dead for the fact that buyers are more informed than ever and know when they're being sold to.

"Buyers continue to need marketing more in order to make buying decisions and Marketing is still stuck running lead gen and passing shitty leads to Sales."

-Chris Walker, Refine Labs

People know when they're being sold to. With all of the information we have at our fingertips, we don't need another salesperson spitting off product features. In fact, most people avoid being stuffed into a sales cycle at all costs.

It's why I don't shop at The Buckle anymore.

And it's not Sales' fault. It's the mindset most companies still have around qualifying leads.

Marketing is still gathering up email addresses of people who pray that they're not going to be contacted by Sales. They obviously don't want to talk to your sales team -- so why is Marketing still pouring unwilling leads into the sales funnel?

It's for this reason that companies need to fall in line with how people want to buy.

Sales-Led vs. Product-Led

What is sales-led vs. product-led selling? Sales-led is the traditional method of selling through a salesperson or team. Product-led selling is a method in which the buyer uses technology to serve themselves as opposed to going through a salesperson.

Switching to the product-led method of selling does not mean death to salespeople. It just means that if a company has access to technology that makes buying more comfortable for today's customers, it should be used.

Think of it as a soft-serve ice cream shop.

If you walked in and had the choice between serving yourself ice cream directly from the machine or asking the employee behind the counter to do it for you, you'd likely choose the former. But no matter what you choose, the employee is still necessary for...

  • Making a payment
  • Making sure you have a napkin and a spoon
  • Making sure the soft-serve machines are operating properly
  • Helping you out if you decide you want more

AKA, they're there to guide you along the customer journey to ensure it's as frictionless as possible.

Moral of the story: Lead with the product. Have Sales jump in to smooth out the journey.

The Difference Between Demand Generation & Marketing

What's the difference between demand generation and marketing? The main difference between demand generation and marketing is that marketing focuses more on upstream strategies like the product-market fit and competitive analysis. Demand gen focuses on downstream tactics such as brand affinity and actually increasing the understanding around your solution.

Marketing can be viewed as the high-level textbook definition of finding a place in the market for your product or service. Demand gen is marketing's more fun and creative little brother.

You've Gotta Understand Both

The thing about marketing, though, is you have to understand it before you can move on to demand gen tactics.

"People want to move into tactics really quickly but oftentimes they don't understand the foundation."

-Lesley Crews, Sweet Fish

If you start on your new branding elements before you understand who your audience is or what it is they want, you're putting the cart before the mini horse, so to speak.


Marketing & Demand Generation Are Equally Important

Yes, it's fun to get into the ways your team is going to generate demand from your audience. But your company's marketing foundation needs to be in place first to make any of it worthwhile.

CoSchedule categorizes marketing's fundamental aspects into four buckets:

  1. Product
  2. Price
  3. Promotion
  4. Place


Product, obviously, is what your company sells. But a lot of times it's not that simple to nail down.

Even if you invented the lightbulb, it doesn't mean it's automatically going to fly off the shelves. Some things you need to consider about your product are...

Variations -- Will you sell one size and shape of your lightbulb? Or does your target market require more options?

Packaging -- What's the best packaging for your light bulbs as they're being transported and displayed in-store? Are you going to use the same packaging to sell online?

Services -- Will you fix or replace the lightbulbs that are defective? Will you provide warranties?

Of course, we're probably talking about a B2B SaaS product here and not lightbulbs. But the analogy still stands.

Will you have different variations of your solution for varying needs? What type of branding will your target market receive the best? What's your "return" policy if things aren't working out for a customer?


Product decisions, then, flow naturally into pricing. Make sure you get a clear understanding around all of these considerations:

  • What's a fair price for your solution in the current market? If you're going to charge more, how will you deliver more value?
  • How will your pricing be structured? Will it be a monthly subscription for all of your product variations? Or will you use a freemium model?
  • Will you offer different pricing structures? An up-front price and a pay-as-you-go price?

Launching an effective pricing model takes a lot of market analysis. Make sure you know what other players in the space are offering.


The next step in your marketing plan should be figuring out how best to promote your solution.

  • What channels are the most used by your target market?
  • What kind of messaging is the most effective for your target market?
  • Will different variations of your solution be promoted on different channels?

As you can probably tell, promotion comes mighty close to demand generation tactics. Promotion is essentially demand gen, but right now we're looking at it at a higher level. We'll get more specific in a sec.


In regards to B2B, place is a little less relevant -- you're probably selling your solution online.

However, consider place in terms of...

  • Are you connecting with customers and selling at in-person events?
  • How much of your selling could be done at in-person events?
  • How will you demonstrate your solution at in-person events?

Otherwise, it makes the most sense to keep your marketing digital.

How to Use B2B Demand Generation Marketing

This is where we get into the actual demand generation tactics. Before your team initiates a demand generation campaign, make sure you have your company's marketing strategy in place.

Ideally, your entire team is involved with coming up with on-brand demand generation tactics.

How do I use B2B demand generation marketing? To drum up more interest with B2B demand generation marketing, start leveraging...

  • Organic media
  • Earned media
  • Paid media

Organic Media for B2B Demand Generation

Organic media are the first your team should consider because they take the longest to yield results. They're also the pieces that will eventually yield the biggest results.

Organic media for B2B demand generation include...

Earned Media for B2B Demand Generation

Next up, earned media. This is the coverage that you can initiate, but you don't have complete control over it.

Earned media for B2B generation include...

Paid Media for B2B Demand Generation

Lastly, there are paid media. These are probably the least effective in terms of drumming up demand for your solution.

To make paid media more effective, try using an earned media spin. For instance, feature adjectives from a shining customer review in your upcoming PPC campaign.

Paid media for B2B generation include...

Always Keep Marketing In Mind

Before you go off and start writing scripts for your brand's new video series, make sure it's what your audience will resonate with.

All of your demand generation maneuvers should make sense with your marketing objectives. If your audience isn't on YouTube, don't make a bunch of videos hoping they'll create interest.

For every demand generation tactic, go back to your marketing strategy. Make sure it serves your plan.

Demand Generation Takeaways

Transitioning to a completely different way of operating for your marketing, sales, and customer success teams probably sounds daunting. Just remember these five takeaways:

  1. Demand generation is the sticky putty that turns a disjointed funnel into a holistic experience.
  2. People don't want to be sold to.
  3. People know when they're being sold to.
  4. Lead with your product, not your sales team.
  5. Establish a marketing strategy before you jump into demand generation tactics.

Thinly-veiled sales pitches have become outdated. The key now lies in providing REAL value to your audience. Learn more about the future of demand generation by understanding media brands.