Demand Generation vs. Inbound Marketing – Is There a Difference?

    by Chad Levitt

    Date

    June 17, 2010 at 7:00 AM

    demand generation

    Have you ever wondered what the difference is between demand generation and inbound marketing ? What does each phrase mean for marketing and sales? Which approach should your company focus on? Is one more relevant or important than the other? If you find yourself scratching your head trying to hammer out the differences between demand generation and inbound marketing so you can execute, well, this post is for you.

    Is There Really a Difference?

    Demand Generation and Inbound Marketing are pretty similar at first blush, but don’t be fooled. Demand Generation and Inbound Marketing are very different.

    Demand Generation is More Sales Centric:

    Let’s call demand generation what it really is….. it’s really just a new approach to driving revenue with traditional outbound marketing approaches. There are some cool technologies that are improving on the last 50 years worth of demand generation best practices, but there is nothing really and truly paradigm shifting. It is the same type of outbound marketing practices that prospects are getting more adept at shutting out – think unwanted cold calls (these days called warm calls), email blasts, list buying, TV commercials, sponsored webinars and the like. The demand generation approach is really gravitated to by companies with sales driven cultures that place an emphasis on the cold call.

    Inbound Marketing is More Marketing Centric:

    Inbound Marketing is paradigm shifting and the strategies used to implement inbound marketing have been around for less than ten years. The real shift has only occurred in the past five years as blogging, true opt-in email, social media, and SEO have grown in popularity. Inbound marketing is all about creating content and viewing yourself, company, etc. as a publisher of content, that when combined with other inbound marketing best practices,  can generate quality inbound leads for your business, inside and outside sales teams. Inbound marketing leads are also less expensive than traditional outbound marketing approaches to demand generation. This approach is adopted by forward thinking companies that place an emphasis on being where the marketplace is moving.

    What is the Right Mix of Demand Generation and Inbound Marketing?

    This is what I like to call a holy grail question – every organization will be starting from a different level of skill, attitude, and belief set so the mix will vary greatly from company to company. If we look at the data we can see that inbound marketing budgets are increasing and traditional outbound marketing budgets are declining. The marketing mix is shifting to inbound marketing and expect this trend to accelerate in the years ahead.

    What Does it Mean for You?

    The big idea is that for the vast majority of companies a budget focused on inbound marketing instead of traditional outbound marketing will be more than enough to improve revenue, bottom line profitability and make your job much easier.

    Photo Credit: Garrett Albright

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    Chad Levitt is an Inbound Marketing Specialist with HubSpot and author of the New Sales Economy blog that focuses on how sales 2.0, social media, and how inbound marketing can be used as a sales strategy for the Web 2.0 world. You can connect with Chad on Twitter @chadalevitt .

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