Demand Gen vs. Lead Gen: Which Should Your Lean Team Prioritise Right Now?

What is the core difference between demand generation and lead generation?

The key difference between demand generation and lead generation is that one is a strategy and the other is a tactic.

Demand generation is a full-funnel strategy which involves mapping out the pain points of a buying committee within a target audience with outcomes like improving pipeline velocity and brand authority and awareness. Creating content which resonates and targeting the audience at the right stage of their journeys is a simplified explanation of how it’s done, but this scope varies massively depending on the product, market and audience.

Lead generation usually happens at the lower-end of the funnel. It’s when your target buying committee members leave their details at the point of intent. When you use gated content, webinars, trials or demo requests, that’s lead gen. When the user converts, they’re then regarded as a warm lead and this triggers a follow-up process, which can be a nurture sequence or engagement with the sales team.

Lead generation can exist without demand generation, but demand generation increases the overall number of users that are likely to convert through lead generation tactics. If more people recognise your brand and know that it can solve a problem for them, then they’re more likely to engage with you when they’re ready to solve that problem.

Demand gen vs. lead gen: What does each one actually do?

Why do lean teams get this balance wrong?

We’ve worked with B2B teams where the pressure to hit a revenue number is so intense that they gravitate towards activity which is easily attributed - lead gen. Sales need leads, so marketing teams spend more of their time on lead gen activity. The results often don’t match expectations; neither the volume nor the quality of leads. They over-estimated how many people in their ICP know about them well enough to respond to this kind of activity.

In reality, the more you do around effective demand gen, the bigger the pool of leads you can generate. The leads you generate are more likely to be of better quality too, and your sales team is more likely to act on them.

Should lean teams prioritise demand gen or lead gen first?

For lean teams in the growth stage, investing in Demand Gen first would be a better bet. How much and when depends on your situation. Investing in lead gen alone will do a good job of filling your pipeline, but the quality of the leads will tend to be poorer than those if you’re also investing in demand generation.

The principles of demand generation involve mapping out the pain points of your target buying committee and educating them at the right stages, before they’re likely to put their hand up and say they need help with the problem. Think of it this way; if you were organising a dinner party and were preparing a show-stopping dish that was difficult to prepare, who would you turn to for advice? The answer would be the best cook you know. And you know that they’re a good cook because you’ve probably already had their food or they’ve got the reputation from their circle of friends. Demand gen is like this, but it takes time to build the reputation, so the earlier you start the better.

The amount you should invest in demand generation is down to what stage your business is at, the amount of competition you have, your pipeline targets, the size of your sales team - a myriad of factors. It’s always best to start small - pick one target persona, map their pain points, produce content to suit, build ad campaigns (awareness and retargeting) and then reporting and measurement around them, to prove the use case. However, if your pipeline is looking poor and runway short, you should focus on lead gen to fill the pipeline

The longer your sales cycle, the longer you’ll need to prove the case. There’s little point running a month trial if you have a 6 month sales cycle. The trial length should overlap your sales cycle. Remember, demand generation is about improving pipeline performance, it’s not just lead gen. Your leads should have a higher pipeline velocity and be easier for the sales team to work - and you’ll need time to prove this.

What does a "demand-first" approach actually look like in practice?

Here’s how to educate your market on how you can solve their problems:

• Events: Networking events, trade shows, conferences and webinars are a great way to get in front of key contacts in your ICP. Start with networking at seed-stage, add webinars at Series A.
• Founder-led content: Your company founder content is the best way to showcase your business growth story. Publish these on key social media platforms where your ICP hangs out and talk about how building the company solves your ICP’s problems. Start this at seed-stage.
• Partnerships: Set up a partnership with complementary products or services which your ICP will use. For example, a web development agency may set up a partnership with an ad agency. Start this at seed, but add more partners as you grow.
• Intent platforms: Adding intent data can help narrow your targeting and ad spend. For example, target companies showing intent in your product or service with use case or case study ads is a great way of showing how you can solve their problems if they haven’t interacted with your business previously. Great for Series A/B.
• SEO and AEO: Your ICP will search for solutions to their problems on the likes of Google and ChatGPT. Structure your content and website so these massive engines can find them. Start this as early as you can.
• Dark social: Slack, Whatsapp, and other gated forums where your ICP hangs out is a good place to exercise your social selling muscles. Like SEO and AEO, your ICP will ask for help in these channels - make sure you’re there to answer. This can be time-consuming, so start when you can dedicate the time to it.

How do you transition from a lead-gen-only model to a demand-gen model on a budget?

If you’re running lead gen activity and volume isn’t where you want it to be, or the quality of your MQLs is declining, now is a good time to start with demand gen. None of this requires pausing your lead gen activity - in fact it should enhance it.

Phase 1: Review your existing content

Many lean teams feel like they need to gate most of their content so that they can prove its value, particularly when good content takes time and resource to produce. This can be counter-intuitive. Good content that serves the top of the funnel will improve the quality of your activity at the bottom of the funnel. If you have any gated content which proves your value proposition, or speaks to the pains of your audience, it’s a good idea to ungate it. Make it accessible to your ICP, promote it on your website, allow the search engines and LLMs to crawl it, and create long-form social posts to provide value to your followers. This should only take a week, and you’ll see early signals engagement metrics in the first few weeks. Traffic from organic search and LLMs can take up a few weeks, and meaningful pipeline impact will take longer.

Phase 2: Create co-partnered content

A partnership is a good way to get in front of members of your ICP that you’re not currently reaching. Look at your current partner list, and evaluate how your product or service can add further value to that partner’s audience. Webinars are a good way to provide value with your partners. Find a pain that you both seek to resolve and create a how-to webinar that you can both promote to share the value of the effort. You’ll broaden your engaged audience and deepen the relationship you have with that partner. It usually takes about 4 weeks to plan and host the webinar, but if your partner already has the infrastructure and followers, ask them to take that load initially.

Phase 3: Take Dark Social seriously

Your ICP will be hanging out in areas where you won’t necessarily be able to attribute, but that doesn’t mean it should be ignored. Find out which Slack groups, closed forums and Reddit groups that they’re sharing their problems with. A good way to do this is using deep research with your LLM and letting it find those places for you. You can copy and paste the following prompt into an LLM (like Gemini or ChatGPT) to begin your research. Replace the bracketed text with your specific business details.

The Prompt:
"I am a marketing lead for a lean B2B team. Our product is [Insert Brief Product Description] and our Ideal Customer Profile (ICP) consists of [Insert Job Titles, e.g., CTOs at Series A Startups] in the [Insert Industry] sector.
We are shifting to a demand generation model and need to find 'Dark Social' channels where our ICP discusses their core pain points, specifically [Insert 2-3 Key Pain Points, e.g., scaling infrastructure or reducing churn].
Please perform deep research and provide a categorized list of:
Niche Communities: Specific Slack, Discord, or WhatsApp groups relevant to this persona.
Professional Forums: Subreddits, specialized Stack Overflow tags, or private industry-specific forums.
Events & Peer Groups: Mastermind groups or recurring digital meetups where these professionals seek peer advice.
For each recommendation, explain why this persona hangs out there and what specific keywords or topics they are likely discussing that relate to our product. Do not suggest broad platforms like 'LinkedIn' generally; focus on the specific sub-groups or 'dark' spaces where attribution is difficult but influence is high."

Then you’ll need to monitor and respond with posts where you think you’ll be able to add value. Don’t be overly salesy, but also don’t be afraid to drop a link to one of the pieces of content you’ve ungated to help prove your point. Pick one channel to start with and try to make natural, honest engagements with the audience. Consistent engagement over time means better quality leads, and you should see your pipeline quality increase in the same quarter.

If you need help trying to figure out where to start, our Pipeline Diagnostic is designed to give you the tools to get going.

How do you measure demand gen when direct attribution is difficult?

Measuring demand generation activity is another hurdle many lean teams face especially when they need to prove the value of their investment in time and budget. Attribution is a significant issue in the post-third party cookie realm, particularly when dealing with longer sales cycles. Privacy changes, consent mode, iOS changes and cross-device journeys mean that accuracy of last-click attribution is waning, and to prove impact teams need to look beyond the story that ad platforms and analytics tools tell them.

Leading indicators are important here. Only 5% of your TAM will be actively searching for a solution to their problem at any one time, so a user seeing value in your recently ungated content might only convert 6 months down the line. Looking at trends in the following are good indicators to future performance:

• Branded search volume. Use Google Search Console to show a trend of users searching for your brand name over time. Compounding increases will lead to improved future pipeline.
• Direct traffic. Users visiting your website without any referral data are likely to be users that already know about you or have been referred by places where your analytics can’t track. A steadily increasing trend is a good indicator of future performance. This is only true if your tracking setup is spot-on, however. Incorrect configuration of your tags, tag manager and consent functionality can skew your direct traffic count. If you’re unsure of your tracking setup, it’s worth getting it checked out before you draw conclusions from the data. Our Revenue Source of Truth sprint is a good place to start.
• Social engagement metrics. Look at company and founder follower counts, impressions and engagement on your posts, and visits to your company pages.
• Pipeline source mix. You want these to be consistent with the sources you can track from your demand gen efforts - organic search, referrals from LLMs, organic social, events.

On top of this, you need to introduce self-reported attribution wherever you can. Add a free-text field to your contact forms, tell your SDRs and sales team to ask on discovery calls, even add it in a quarterly survey to your lead and MQL list. This will tell you, in your audience’s own voice, how they first heard about you. It may not be entirely accurate, but if you use this overlaid to your auto-captured sources, it will paint a better picture for your demand gen attribution.

Frequently Asked Questions

Can you do demand generation without lead generation?

Yes - some B2B companies, particularly those with product-led or self-serve motions, operate predominantly in demand gen. For most sales-assisted B2B businesses, however, demand gen and lead gen work in sequence.

What is the difference between demand gen and lead gen?

Demand gen is a long-term strategic activity aimed at education and awareness. Lead gen exists to capture contact info for sales follow-up. See the table above.

Which is better for a small marketing team: demand gen or lead gen?

This is dependent on your pipeline health right now. If you’re missing targets and have limited runway, then lead gen will help you fill the pipeline faster. If the quality of your leads is declining or your sales team is struggling to convert, then you should prioritise demand generation. It helps you increase the size of your available market and improve the quality and volume of the leads you generate. You’ll then see a healthier pipeline as a result.

For growth stage companies the correct answer is to run both. Start building your demand generation foundations whilst still managing your lead gen activity. Teams at pre-Series A stage generally run with founder-led content and events before exploring paid lead-gen, whereas Series A and B companies have more budget to run both.

Avoid running lead gen activity in isolation - you’ll often see diminishing returns without demand gen backing it up.

How long does demand generation take to show results?

This depends on your GTM and sales cycles. If you have a longer sales cycle, then you need your demand generation activity to overlap the duration to truly evaluate its impact. Leading indicators will give you a good idea how your pipeline will likely trend whilst you’re in the evaluation stage, however.

What metrics should a lean team track for demand gen?

Branded search volume, direct traffic, social engagement metrics, pipeline source mix and self-reported attribution sources are a good starting point. Also look at traffic to key pages, pipeline velocity, lead > MQL and MQL > SQL rates.