Lead generation marketing is one of the most important ways for any business to produce revenue. According to market research firm eMarketer, generating more quality leads is the top goal of 79% of marketers worldwide, more than any other marketing objective. And companies are willing to invest in lead generation, with 78% of businesses planning to increase or maintain their demand generation budgets.
This guide examines lead generation marketing and its importance in detail. We also explore the necessary tools and offer a simple, proven 7-step process to help any marketer create effective lead generation marketing campaigns.
What Is Lead Generation Marketing?
Lead generation marketing is the process of identifying potential customers for your business, developing their interest in your products and services, and collecting their contact information. The ultimate goal is to get these prospects to visit your website or talk to the sales team, converting them into paying customers. Lead generation marketing is one of the two most critical goals of the marketing function.
Lead Generation vs. Brand Marketing
Contrast lead generation with brand awareness marketing, another essential objective. While lead generation focuses on finding prospects who can be turned into customers and collecting their contact information, brand awareness marketing concentrates on improving a brand's recognition and reputation among the target demographics.
Inbound vs. Outbound Lead Generation
There are two main types of lead generation strategies: inbound and outbound.
Inbound lead generation entices potential customers to visit your website or contact you for more information about your products and services. This inbound marketing strategy is a type of pull marketing.
Popular inbound lead generation methods include:
- Content marketing: Content marketing can involve publishing blog posts, white papers, case studies, surveys, tutorials, listicles, best practices, and beginner's guides, and the content can be in different formats like text, webinar, podcast, infographic, and video. The goal is to produce materials useful to your target audience to draw them to your website and give you their contact information.
- Social media marketing: You can use social media to promote the content on your website. For example, post on LinkedIn with a link to your latest blog post to drive traffic. Alternatively, create original content for your social media accounts to generate leads, such as a survey or a giveaway that collects email addresses.
- Search engine optimization: Your content only works if your target audience can find it. SEO (search engine optimization) seeks to improve your content's position in search engine result pages. While many companies outsource their SEO operations to external experts, you can also increase your content's search engine position by implementing proven SEO practices, such as building relevant backlinks, incorporating targeted keywords, and including appropriate meta titles and meta descriptions. You can also leverage SEO tools like Moz Pro, AWR Cloud, and Ahrefs.
- Pay-per-click advertising: While SEO improves your content's position among organic search engine results, PPC puts your content in front of your target audience as paid advertisements on their search engine result pages or social media home feeds. You only pay if someone clicks on your ad, but PPC can still get expensive quickly, so use it judicially.
- Events: Depending on your company and industry, events such as trade shows, conventions, and product launches can be effective ways to find potential customers for your products and services. For B2B marketers, you can increase the number of business cards you collect by holding a prize draw.
Outbound lead generation reaches out to potential customers to promote your content or sell your products and services. This lead generation strategy is a type of push marketing.
Popular outbound lead generation methods include:
- Email marketing: The most effective email campaigns usually target people who already know your brand and have subscribed to your email list. Make sure your email adds value to your recipients and include a call to action, such as "Click here to join our beta product launch program," to generate leads for your sales funnel.
- Direct mailing: While it may seem old school, direct mailing can be an effective lead generation tool for select demographics—such as seniors—and industries, including dentists, auto dealers, and other locally-focused businesses.
- Social messaging: This method involves directly contacting a prospect via a social media platform's private messaging function, such as LinkedIn Messaging or Twitter Direct Message. While labor intensive, social messaging can be valuable in specific situations, such as startups looking for beta product users or professional service firms seeking highly-targeted prospects.
- Cold calling: Most people dislike getting calls from strangers, so think twice before resorting to this old-school lead gen method. That said, it does exist and some companies make it work for them.
Why Is Lead Generation Marketing Important?
Improving your brand awareness and reputation is good, but getting people to buy your products and services is even better. To ensure the growth and success of your business and replace customers lost to churn, you need a continuous flow of prospects.
Lead generation marketing produces a flow of potential customers and feeds them to your sales funnel to generate new revenue. An effective lead gen operation can significantly improve your sales performance by finding and developing qualified leads who are a good fit with your company's products, making the sales process smoother.
What You Need for Lead Generation
Before starting a lead generation project, make sure you have three things ready: an organized database, relevant supporting content, and accurate analytics.
An Organized Database
An organized database is essential for tracking the prospects produced by your lead generation campaigns. For each lead, the database should store data fields that may include:
- Contact information: Name, email address, phone number
- Business information: Job title, company size, industry
- Source: The channel and campaign through which the prospect comes about, for example, blog post, PPC ad, or email list
- Status: How far along the prospect is through the sales funnel, such as contacted by sales, demo complete, or proposal sent
When starting your lead generation efforts, you can use a simple spreadsheet to store your data. As you scale up your effort and the number of your leads increases, you may need to switch to a relational database, such as MySQL or PostgreSQL. Alternatively, you can use a no-code database tool (Airtable, Webflow), specialized lead management software, or a customer relationship management system (Hubspot, Zoho CRM.)
The supporting content for your lead gen marketing should fit your industry, target audience, and campaign objective to attract your potential leads' attention and entice them to give you their contact information.
For example, an IT security consultant may publish a white paper on the business risks of insecure enterprise IT systems or a case study of how their client uses their service to fend off a hacker attack. A cosmetic brand can produce a video tutorial on creating a dewy look with its makeup products and a listicle of the top 10 healthy foods for a smooth and clear complexion.
You want to be able to query your database and slice and dice your data to discover insights that can help you improve your lead generation process.
Questions you may want to answer with analytics include:
- Email open rate: percentage of recipients who open your email
- Email click-through rate: proportion of recipients who click on a CTA in your email
- Average sales cycle length: the average time it takes to close deals with prospects
- Prospect conversion rate: proportion of leads who eventually become customers
- Sales cycle length and conversion rate by lead gen campaign: to compare the effectiveness and performance of different campaigns
7 Steps for Lead Generation Marketing
Finally, the how. Running a lead generation campaign involves many moving parts and can get complicated. We've distilled the best practices of lead marketing into a structured framework. Follow the seven simple steps below to generate leads effectively and grow your business.
1. Determine Your Objectives
Start your lead generation strategy by defining its goals. Avoid vague, unquantifiable objectives, such as maximizing the number of leads or creating a world-class lead gen campaign.
Instead, develop measurable objectives with specific outcomes. For example:
- Generate 100 qualified leads in July with a combined $10M projected annual revenue.
- Develop 100 prospects in May with a 5% conversion rate and $200 acquisition cost per prospect.
One of the biggest challenges of lead generation efforts is aligning the marketing team with sales. Work with salespeople closely to ensure your lead generation objectives work for everyone:
- Both sales and marketing must agree on the definition of a qualified lead.
- Ensure your marketing campaigns generate enough leads to meet the sales quota.
2. Know Your Vision and USPs
Critical to lead generation efforts is specifying how you propose your products or services. Create USPs that set you apart from your competition and use them to craft lead magnets that help you stand out in a crowded market.
If your company is an IT consultancy, your USP may be "a no-code approach to software development." Based on that, create a simplified online no-code tool as a lead magnet.
For a skincare business, the USP can be "vegan, cruelty-free, and kind to the planet" with the offer "subscribe to our mailing list, and we'll donate $1 to an animal sanctuary."
3. Understand Your Target Audience
In addition to your USPs, also define your target audience. Who's the best fit with your products or services? Who do you want to reach with your lead gen campaigns?
Construct a persona for your audience with information including their location, job, values, and the media they consume. This persona can inform you in creating an attractive lead magnet for your target audience.
4. Select Your Marketing Channels
Once you know your audience, you can identify the best places to reach them. For example, if your target audience is IT managers, focus on professional channels, such as LinkedIn and trade journals. For seniors, Facebook and email are suitable. To reach teenagers, consider Instagram and Snapchat.
Your ideal marketing channels also depend on your products. If your company sells cars, search engines are an effective channel because buyers use them to search for information before visiting dealers. With products that are more of an impulse purchase, such as fashion and cosmetics, social media and email can be more effective.
Another factor is where your target audience is on their buyer's journey. For people who have just started, social media and blog posts can capture their attention effectively. If your audience is deep into their buying process, reaching them through search engines and webinars can be more impactful.
5. Build Your Landing Page
Your lead magnet (white paper, case study, etc.) typically comes with a CTA linking to a landing page where you capture the prospect's information. An effective landing page should be simple and concise, with elements that include:
- Title: The title should tell visitors clearly what benefits they'll receive for giving you their contact information.
- Copy: Keep it short and simple. Use graphics, tables, bullet point lists, and videos when appropriate to make your copy easier to understand and more engaging.
- Form: This form is where you capture the visitor's information. While getting more information from a prospect can improve the lead's quality, asking for too much information can deter potential leads from filling out the form. Strive to strike a balance between these two factors when designing your form.
- Testimonials: By including testimonials about your company or products from existing customers, you provide social proof to convince prospects to give you their information.
6. Qualify Your Leads
Not all leads are created equal. Some are just tire kickers, while others are ready to buy. To improve performance, focus your sales and marketing efforts on qualified leads who are the most likely to convert.
Lead scoring qualifies leads by calculating a quantitative metric for each prospect. While you can use any criteria in your calculation, common factors include:
- Company size
- Job title
- How many and which of your company's web pages has the prospect visited?
- Have they engaged with you over social media or email?
- Have they searched for products on your website?
You can then classify leads based on their scores. For example, you may designate any prospect scoring over a specific threshold a sales lead who's ready to buy and pass them to the sales department.
7. Automate, Measure, and Optimize
The best way to improve your lead gen marketing is to measure and optimize your results continually. One of the most effective ways to do so is A/B testing with two versions of an element of your campaign.
For example, you may have two CTA button versions, each randomly assigned to half of your audience. You then measure and compare the conversion rates of these two versions to see which one is more effective.
You can use A/B testing to optimize any campaign element, including images and visuals, landing pages, lead capture forms, email approaches, offers, and pricing.
Ready to create your lead generation campaign? Check out our article 10 Best Lead Management Software in 2023 and subscribe to our newsletter for regular updates.