Thomas Industrial Marketing & Manufacturing Blog

Lead Generation: Definition, Strategies, KPIs

Written by Team Thomas | January 4, 2024

Finding and nurturing new consumers or clients is a key component of lead generation. It’s critical to any modern company. The whole goal is to guide mere prospects toward your products or services and make them more likely to buy. 

Lead generation. Image Credit: Shutterstock.com/Funtap

Leads come in many forms, and each reaches engagement stages and purchasing readiness at different times. Leads are categorized as: marketing qualified leads (MQLs), sales qualified leads (SQLs), product qualified leads (PQLs), and service qualified leads (SQLs). You can gain leads through email campaigns, social media, content marketing, and more. This article will discuss lead generation to understand the types and ways to spur people or businesses to become new leads.  

What Is Lead Generation?

Lead generation is the process of locating and attracting sales leads. Leads are potential clients who indicate interest in your product or service. Usually, you need to induce awareness, interest, consideration, and intent. Prospects must first discover your business. They engage with your content or offerings and then evaluate your solutions. Finally, they express interest or intent to purchase.

Lead generation is essential to many types of organizations, including both B2B and B2C enterprises. Email campaigns, social media, SEO, and content marketing are some of the techniques for attracting leads. HubSpot, Salesforce, and Mailchimp, among other tools, can help you manage them. 

Lead Generation Strategies — How to Generate Leads for Business?

If you’re trying to attract leads for business, some primary strategies for lead generation include niche directories, SEO, PPC, and others.  See below for more info:

Niche Directories for Lead Generation

In terms of lead generation, niche directories are specialized internet platforms that categorize companies by industry, size, location, or other factors. An excellent example is Thomasnet.com. These directories provide special advantages like cost-free focused lead creation. They list phone numbers, email addresses, and business categories. This information is priceless for email marketing and cold calling initiatives, which improve B2B lead creation.

SEO for Lead Generation

One essential strategy for obtaining leads and increasing brand recognition is SEO (search engine optimization) lead creation. SEO lead creation outperforms rivals and enhances your visibility by optimizing website content with targeted keywords. Both direct and indirect approaches are effective, including: guest writing, Reddit/Quora posts, social networking, and local listings. Lead creation techniques include: website auditing, loading speed optimization, keyword research, content updating, competitor analysis, blogging, link building, and local SEO. Salesmate CRM (customer relationship management) is a useful automation system, and many other tools are available to simplify the process.

PPC for Lead Generation

The pay-per-click (PPC) strategy centers on obtaining prospective leads via Internet advertising campaigns. Unlike some strategies, potential customers must take certain actions for PPC to be effective. Often, this means signing up or submitting contact information. PPC is great for lead generation since it often places your ad on the first page of search results, drawing in visitors who are actively looking for solutions. It provides precise tracking of ROI, control over the messaging, and instantaneous keyword rankings. In the end, PPC helps companies expand their database of leads and reach out to possible clients.

For even more strategies, see our full guide on Lead Generation Strategies.

Lead Generation KPIs and Metrics to Track

Important KPIs and metrics must be monitored to determine the performance of your B2B lead generation efforts. Keep track of the following:  

  1. Average deal size
  2. Bounce rate
  3. Average revenue per customer (ARPC)
  4. Average response time
  5. Email marketing performance
  6. Revenue/ROI
  7. Website traffic
  8. Engagement (social media interactions)
  9. Booked and attended meetings
  10. Cost of customer acquisition (CAC)
  11. Lead quality and value
  12. Customer lifetime value (CLTV)
  13. Inbound response time

These indicators aid in the optimization of lead-generating initiatives. To learn more, see our full guide on Lead Generation KPIs.

Types of Leads

The different types of marketing leads are listed and discussed below:

Marketing Qualified Leads

Marketing qualified leads (MQLs) include contacts who have engaged with your marketing but aren't quite ready for cold calling. An MQL could be someone who accesses an offer by filling out a form on your landing page, for example. You pick up these leads through your marketing activities where they show interest in your goods or services.

To learn more, see our full guide on Marketing Qualified Leads.

Sales Qualified Leads

Sales qualified leads (SQLs) represent contacts who have taken actions signaling their explicit interest in becoming paying customers. An example of an SQL is an individual who submits a query form about your product or service. SQLs are advanced prospects in the sales funnel who display high levels of engagement and purchase intent.

To learn more, see our full guide on Sales Qualified Leads.

Product Qualified Leads

Product qualified leads (PQLs) are contacts who have tried your products and demonstrated behavior that suggests they may eventually become paying clients. They are often pursued by businesses that provide free trials, limited-feature product versions, or upgrade options. A PQL might, for example, be a user of your product’s free version who is curious about premium features. PQLs are more likely than others to become paying customers because they are already familiar with your product.

To learn more, see our full guide on Product Qualified Leads.

Service Qualified Leads

Service qualified leads (SQLs) are contacts who have expressed a clear interest in your service offerings and are primed for direct service-oriented engagement. An example of an SQL is someone who submits a service request form. SQLs signal a high likelihood of requiring your services and can typically be transitioned into service discussions, helping streamline the service sales process.

How To Qualify A Lead

Qualifying a lead involves several key steps:

  1. Identify the business problem the lead wants to solve with your product or service.
  2. Determine why they're addressing the issue now and what triggered this decision.
  3. Assess the budget they’ve allocated for the project to ensure alignment.
  4. Understand the decision-making process and key decision makers involved.
  5. Address potential challenges, ensuring the lead is committed to implementing your solution.

These steps help ensure you focus on high-quality, qualified leads and save valuable time in the sales process.

For more information, see our full guide on How to Qualify Inbound Leads.

How to Nurture Leads

To nurture leads effectively, you can follow a so-called lead nurture funnel approach. It consists of three stages:

  1. Top of the Funnel (TOFu): This is the lead generation stage where you capture potential leads' contact information through various channels and tactics.
  2. Middle of the Funnel (MOFu): In this phase, you engage with leads who have expressed interest in your product or services. Here, you provide relevant content to educate and move them closer to making a purchase.
  3. Bottom of the Funnel (BOFu): The goal here is to convert leads into sales-ready opportunities. Marketing hands over the qualified leads to the sales team for follow-up.

To nurture leads effectively, you may wish to: employ sales experts and inside sales teams, create a lead nurturing track, reuse and repurpose content, use third-party content, and simply be persistent. The ultimate aim is to convert leads into customers, and lead scoring and qualification play a crucial role in this process. This comprehensive approach is known as full-funnel marketing.

B2B vs. B2C Lead Generation

B2B (business-to-business) and B2C (business-to-consumer) are distinct marketing approaches. B2B focuses on fostering trust and personal relationships with business prospects for long-term partnerships. In contrast, B2C targets price-sensitive, emotionally driven consumers in a competitive marketplace. Lead generation methods and tools vary accordingly. B2B lead generation strategies often employ content marketing, networking, and relationship-building, while B2C relies more on advertising, discounts, and emotional appeals to generate leads.

For more information, read our full guide on B2B Lead Generation.

Lead Generation vs. Demand Generation

While both lead and demand creation are vital marketing tactics, their functions are distinct. The main goal of lead generation is to locate and obtain the contact details of potential clients to increase sales and conversions. By contrast, demand generation seeks to establish a company's reputation and identity to generate sustained interest in and demand for goods and services. These concepts have different goals, but they both aim to increase a company's overall revenue and growth.

For more information, see our full guide on Lead Generation vs. Demand Generation.

Lead Generation vs. Prospecting

Lead generation and prospecting are distinct activities in the sales process. Prospecting, typically carried out by sales reps, involves one-on-one interactions meant to generate interest from individuals who may not be familiar with your brand. It's a short-term approach to quickly identify and qualify potential clients through activities like cold calling, outbound emailing, and LinkedIn messaging. Lead generation, on the other hand, is a marketing function that focuses on attracting customer interest and converting it into sales. It's a more holistic, long-term strategy.

To learn more, see our full guide on Lead Generation vs. Prospecting.

Lead Generation vs. Customer Acquisition

In the sales funnel, lead generation and customer acquisition are connected phases. The first stage of lead generation involves identifying and piquing the interest of potential prospects. This stage creates a pool of potential clients by converting awareness into interest. The next step is customer acquisition, which is meant to turn those interested prospects into paying clients. Lead generation serves as a prelude to client acquisition, which solidifies the conversion, and both procedures are essential to the customer journey.

Lead Generation vs. Lead Nurturing

Although they have different purposes, lead creation, and lead nurturing are essential components of the client journey. The main goal of lead generation is to fill the sales funnel with prospective clients by gaining new leads through a variety of marketing methods. Conversely, lead nurturing focuses on preserving connections with these leads throughout their journey, bringing them one step closer to becoming paying clients. Even though they function at distinct phases, both are essential to converting prospects into devoted clients. 

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