If you measure a marketing activity’s value by how much companies are willing to invest in it, lead generation is clearly near the top of the heap.
71% of marketers are planning to increase their lead generation budgets this year, and 46% of those believe that this area deserves an additional 20% or more budget than what is currently earmarked for it now.
There are two main types of lead generation – digital and traditional – and it pays to be familiar with both.
Check out what they are, some pros and cons for each side, and some considerations to take into account when choosing which to use.
What Is Lead Generation, And Why Should You Care?
Lead generation is the process by which a company acquires new leads (people who show interest in your product or service).
Your leads are the people who will become your customers.
Not all of them, to be sure – the exact number you get will depend on your conversion rate, or the percentage of your leads who you know have bought from you in the past.
Without making any changes to your lead nurturing strategies, you can expect approximately the same number of leads to buy from you going forward.
For context, the average global e-commerce website conversion rate is just 2.86%, so you’ll usually need hundreds or even thousands of new leads if you want to end up with an appreciable number of new customers.
The number of leads you can secure for yourself is directly correlated with your company’s success.
70% of companies who fall short of their revenue goals are generating less than 100 leads per month; they simply cannot make adequate sales numbers with so little to go on.
Understanding how to craft a lead generation strategy with specific goals that work for your business is one of the first parts of setting up a business for success.Top 4 challenges for marketers and how to overcome themRelated:
Investigating The Two Sides of Lead Generation
Lead generation is not a single monolithic concept.
There are many ways to do it, and these methods primarily fall along two lines.
Digital lead generation is the 21st century’s way of finding potential buyers, taking advantage of the fact that virtually all of us have a device at our fingertips now.
It takes place entirely online and includes various techniques such as social media marketing, search engine optimization, digital ads, email marketing and content marketing. It’s currently the dominant form of lead generation across most companies and in most industries.
Digital lead generation excels at drawing in young people – statistically speaking, people aged 36 and under in countries across the world are far more likely to use the internet regularly, sometimes leading by a gap of more than 50 percentage points. It also boasts excellent geographical reach, since it is accessible to anyone who is online and the majority of the global population is these days.
Another big advantage that digital lead generation has is how easy it is to implement and keep running with little input from you. As long as you prepare the content in advance and set up the right automation, your campaigns will mostly run themselves. They will require some manual monitoring, maintenance, and updates, but overall, this side of things is far less taxing in terms of human labour.
Just be sure not to take that easy head start for granted – you still need to do regular contact data quality checks if you want the data you get this way to remain useful to you.
Related to that point, digital lead generation’s most compelling selling point is its low cost. Digital lead generation only costs $25-$30 per lead, whereas using traditional techniques will typically run you $300-$500 per lead.
The savings come partially from not having to pay for as much labour time, but also from eliminating external expenses such as travel and accommodation costs. This approach is so inexpensive that any company can afford to use it, making it extremely popular.
Digital lead generation is not without its downsides, however.
The most glaring issue with it is that it is easy to ignore; more than three-quarters of North American consumers regularly block or skip ads on at least one digital platform, and many also send any emails that look even vaguely promotional straight to their spam inbox.
You can circumvent this problem by focusing on drawing in truly interested leads through organic approaches like content marketing, but it’s never optimal to rely on just one technique.
The other significant problem isn’t as obvious, but it may be an even greater concern.
Relying exclusively on digital methods makes it very hard for you to stand out.
Everyone has a blog and an email campaign now – it’s practically a requirement for businesses.
If your lead generation efforts stop there, you risk looking unimpressive and uninspired. You won’t capture every available portion of your market that way, either; many large companies won’t even consider dealing with another company without speaking to a representative, so digital-only firms have no chance at winning their business.
Traditional lead generation is the other half of this field.
It involves more of the kinds of techniques that companies probably used to draw in customers when you were a child.
It includes things like attending networking events, putting out print, TV and radio ads and cold calling prospects.
Though it can be enhanced by the use of tech behind the scenes, much of this half of the lead generation dichotomy is much more focused on face-to-face connection and real-world impressions than its digital counterpart.
Unlike with digital advertising, potential leads can’t automatically block these attempts to reach out and will absorb some portion of what you’re telling them purely as a result of having been exposed to it.
Traditional lead generation allows your company to build notoriety by osmosis and also adds some additional prestige into the deal.
When a company runs an ad on TV or puts up a booth at a trade exposition, it gains a certain air of legitimacy in the eyes of those who witness these efforts. It accurately represents your company as one that is robust and successful enough to justify spending a significant amount of money on promoting itself, and that image is enticing to many prospective buyers.
Traditional methods are also great for going in-depth with a prospect and really convincing them that your company is the one they want to buy from.
Many traditional lead generation techniques involve in-person elements that give you much more time to explain the nuances of what you’re selling and plant the seeds of interest in your leads’ minds.
There’s a reason why 84% of people in company leadership positions believe that live events are vital to a company’s long-term success; no blog post or banner ad will ever be able to match the knowledge and prowess of a representative with a mission.
Again, though, it’s not all good news.
Aside from the obvious cost issue, traditional lead generation techniques also more active work from you and your staff than digital lead generation efforts do.
For techniques like cold calling and attending events, the entire maneuver hinges on the active work being done in the moment.
You have to work hard and be at your best every single time you go into the field or you won’t succeed.
You also usually don’t have the option to implement automatic lead capture processes like you do with digital marketing, so it’s up to you to be diligent about recording and storing the information you need.
If you’re going to go to all the bother of hosting or attending an event, be sure to take advantage of advanced lead capturing tools that will allow you to easily build a well-rounded profile for each lead; it’s far too easy to get caught up in the moment and forget to gather any information from people when you’re on your own to do so, and that neglect will leave you with nothing to show for your investment.
Choosing a Side
Now that we’ve covered the two different sides of lead generation, one question still remains:
Which is best for you?
That depends on a number of factors:
Your primary consideration should be what kind of product you are selling.
Different products are better suited to one approach or the other.
If you’re representing a budding tech company selling IT services to other businesses, for instance, it’s in your best interest to look as tech-savvy as possible and digital marketing would be a great fit for you.
If you’re selling recruitment services instead, however, you’ll definitely want to include traditional elements in your marketing strategy in order to avoid coming off as cold and distant; the human touch is vital to properly represent your brand.
2. Method of sale
Another thing you want to think about is how your choice suits your method of sale.
If a lead can easily buy your product online at any time, you want to make sure that your lead generation efforts are also online and can reel them in at any time as well.
Otherwise, you may lose out on some sales from people who want to buy in the immediate future but aren’t yet aware of your company.
When you’re selling the type of product or service where you would usually have to drive out to a retail location or speak to a salesperson to buy anyway, traditional lead generation makes more sense - the loss of immediacy isn’t a concern.
Perhaps the most important consideration of all, however, is the budget you have to work with.
As was mentioned above, traditional lead generation can be very expensive in comparison to the digital kind.
If you don’t have the funds to spare for buying ad space or traveling out to events, you’ll be stuck using digital methods by default.
That’s not a terrible thing, considering how effective they can be when you’re just starting out.
Don’t forget, your lead generation strategies can and should evolve over time, so you can always build in traditional approaches later on as your available resources grow.
While these points can help you to determine which part of lead generation you should focus on, you ultimately want to strive for a mix of the two. Doing so will ensure that you get the best of both worlds.
Bridge the Lead Generation Divide
Although acquiring enough leads to keep your company growing will always take work, the right lead generation tactics can make the task much easier on you, and balancing digital and traditional lead generation is a big part of that.
Even if you know that one will be more useful in your current role than the other, don’t neglect or overlook the other half of the dichotomy.
Almost every marketer will have times in their professional life where a mastery of both sides will come in handy, and almost every business can benefit from employing a mixture of the two as well.
There’s always more to learn about generating leads, so remember to come back next week for the next instalment in our series on this topic.
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