Growth Marketing vs. Demand Generation: Goals, Tactics, Funnel, and Software

In the field of digital marketing, demand generation, and growth marketing are two distinct but related tactics. Growth marketing is meant to help you acquire and retain users or customers. Demand generation, on the other hand, seeks to generate leads for the sales funnel by raising awareness and interest in your offerings.

Demand generation places more emphasis on increasing brand awareness and engagement than growth marketing, which aims for quick expansion. While demand generation focuses on lead nurturing and content marketing, growth marketing tactics are typically data-driven operations. CRM systems and content marketing platforms, while growth marketing is more likely to employ analytics platforms, A/B testing tools, and marketing automation software. 

This article will discuss growth marketing vs demand generation in terms of goals, tactics, software, and the sales funnel.


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What Is Growth Marketing?

Growth marketing is a comprehensive and dynamic strategy that goes beyond the traditional confines of marketing. It is based on a customer-centric philosophy, which seeks to optimize the lifetime value of existing customers by fostering long-lasting connections and acquiring new ones. Growth marketing takes into account the whole client journey, in contrast to traditional marketing which often focuses on early transactions.

Growth marketing is based on a data-driven framework that uses analytics to guide strategic choices. It emphasizes exploration and iteration, recognizing that plans that work well today may require modification tomorrow. The iterative approach will help you determine the best paths for user acquisition, engagement, and retention.

The multifaceted nature of growth marketing demands synergy from your digital platforms, social media, content creation, email campaigns, and more. By embracing a diverse set of tools and techniques, growth marketers can adapt to the ever-evolving landscape of consumer behavior and technology. The ultimate goal is not just short-term spikes in metrics but sustainable, scalable growth that provides significant value to both the business and its customers.

What Is Demand Generation?

Demand generation, a pivotal strategy in business expansion, entails cultivating interest in your product or service to yield high-quality leads that evolve into loyal customers. The overarching goals encompass: heightened brand awareness, precise lead generation, enhanced customer engagement, fortified trust and credibility, expanded market reach, elevated conversion rates, increased customer retention, data-driven insights, and competitive advantages. It should all culminate in sustainable business growth. 

Demand generation is a multimodal approach that includes: content creation, lead generation through automated marketing, customer data utilization for customized campaigns, and channel orchestration. Marketing automation platforms, analytics tools, and adaptable multichannel marketing plans can all be critical. Stages one through six of the demand-generation process are: awareness, interest, consideration, intent, conversion/decision, and retention. Demand generation is fundamentally different from lead generation, which focuses only on attracting interested prospects. Lead generation is a narrower marketing effort that promotes interest and initiates relationships. 

Best practices include: setting clear goals, defining target audiences, crafting engaging content, utilizing a multichannel approach, personalizing campaigns, optimizing conversion funnels, nurturing leads with email marketing, measuring results, continuous testing and iteration, and aligning sales and marketing. These practices collectively empower businesses to generate demand, ensuring sustainable growth and success.

Growth Marketing vs. Demand Generation: Goals and KPIs

Within a company context, demand generation and growth marketing have distinct but related functions. Growth marketing is a comprehensive approach that seeks to advance long-term company growth throughout the whole customer journey. It aims to increase user acquisition, improve engagement, and foster customer retention. To maximize each funnel stage, this strategy relies on data-driven techniques and continual testing. Growth marketing emphasizes scalability and long-term success through the use of key performance indicators (KPIs) that include customer lifetime value, churn rate, conversion rates, and total revenue growth.

Conversely, demand generation concentrates on cultivating interest in a product or service to yield high-quality leads. Its goals are to elevate brand awareness, generate targeted leads, enhance customer engagement, and foster lasting business growth. KPIs for demand generation often focus on website traffic, conversion rates, engagement levels, and revenue attribution. The primary focus lies in constructing a consistent pipeline of interested prospects and converting them into loyal customers. Together, these approaches contribute to a comprehensive strategy that integrates customer acquisition, engagement, and retention for sustained and thriving business development.

Growth Marketing vs. Demand Generation: KPIs

KPIs for growth marketing let you measure progress in the areas of acquisition, revenue, and retention. A key metric called conversion rate lists the proportion of users that complete desired actions. Client acquisition cost (CAC) measures the marketing cost per new client to determine the effectiveness of a campaign. Customer lifetime value (CLV), which informs retention and value-maximizing tactics, evaluates the anticipated yearly revenue from an average customer.

SEO-generated website traffic demonstrates the importance of online visibility through search engine optimization techniques. One of the most critical metrics in growth marketing is retention rate, which measures the proportion of consumers who use products or services regularly. Return on investment (ROI) measures the profitability of campaigns and indicates how well data-driven strategies work. The churn rate helps you focus your improvements by displaying the proportion of customers who end their journey without buying.

On the other hand, demand generation KPIs, such as: marketing qualified leads (MQLs) and sales qualified leads (SQLs), center around lead creation. Several metrics, including return on investment (ROI), customer lifetime value (CLV), and cost per lead (CPL), show the direct profit you generate when you turn leads into customers. When combined, these KPIs give marketers practical information to improve tactics and promote long-term growth.

Growth Marketing vs. Demand Generation: Marketing Tactics

Growth marketing and demand generation employ distinct tactics to reach business objectives. Growth marketing strategies often revolve around customer expansion. Referral programs incentivize existing customers to bring in new ones, while user acquisition campaigns target fresh audiences through channels like social media. A/B testing optimizes conversion rates, and product upselling encourages existing users to explore additional features. Retention strategies focus on engaging and retaining current customers to reduce churn.

Conversely, demand creation seeks to raise interest and awareness of your brand's goods and services. While SEO maximizes internet presence, content marketing focuses on creating informative and engaging material to draw in and educate potential clients. Events, webinars, and social media marketing will generate leads for you and raise brand awareness. Email marketing uses tailored approaches to further nurture leads.

Despite their differences, these strategies are often employed together. To successfully achieve overarching corporate goals, a holistic marketing approach must integrate both growth- and demand-generating methods.

Growth Marketing vs. Demand Generation: Customer Funnel

In the growth funnel, the AARRR methodology outlines the stages of acquisition, activation, retention, revenue, and referral. It starts with attracting users (acquisition), engaging them (activation), encouraging return visits (retention), generating revenue (revenue), and fostering referrals (referral).

On the other hand, the demand generation funnel focuses on converting prospects into customers through stages like TOFU (top of the funnel), MOFU (middle of the funnel), and BOFU (bottom of the funnel). It begins with creating awareness, progresses to research and consideration, and concludes with the purchase decision and customer conversion.

Growth marketing strategy, content marketing, email marketing, social media marketing, performance marketing, search engine optimization, user experience, and measurement/reporting are important elements that support these funnels.

The funnels can be optimized using a strategy approach that emphasizes value delivery, targets the appropriate metrics, and modifies KPIs as needed. To stay in step with the changing preferences of business-to-business (B2B) buyers, the demand generation approach is now centered on offering value up front.

Remember, success lies in measuring the right metrics such as revenue, MQLs, cost per MQL, conversion rates, CAC, sales cycle length, and qualitative feedback. By paying attention to the dark funnel, incorporating qualitative data, and avoiding common mistakes, you’ll draw up a more robust demand generation strategy.

Growth Marketing vs. Demand Generation: Software and Tools

There are entire suites of tools meant to help you streamline planning, execution, and optimization. TrueNorth stands out as a comprehensive growth marketing platform that consolidates campaigns, data, and forecasting in one user-friendly interface. With features like idea collections, simulation, and progress tracking, TrueNorth is good for planning marketing campaigns and demonstrating your ROI. ActiveCampaign complements this by offering an all-in-one CRM, email marketing, and automation system. It facilitates targeted lead nurturing, customer retention, and business growth on autopilot. Zapier, meanwhile, will help you automate time-consuming tasks and connect disparate apps seamlessly. focuses on prospecting, helping you find email addresses for targeted outreach using tools like domain search and email verification.

By targeting businesses’ specific IP addresses with ads, the Dealfront Promote service generates B2B demand. For business-to-business teams, LinkedIn Sales Navigator boosts lead connection efficiency with features like InMail and expanded network access. And voilà, Norbert can help you find leads' email addresses. Pipedrive is a CRM created by and for sales teams that makes account management and platform synchronization easier. Zapier is a basic tool that helps automate demand-generation tasks. Scalable website and landing page construction and testing solutions are offered by Leadpages. A/B testing is vital for improving advertisements and landing sites, and Google Optimize can do that for free.

Ortto streamlines data optimization for fast-growing SaaS brands, focusing on customer relationships. Pardot, a Salesforce product, automates your targeted email campaigns and lead management. Wishpond, an affordable marketing platform, caters to diverse industries. SEMrush offers on-page SEO analytics, helping marketing teams make informed, strategic decisions. This diverse toolkit can aid both your growth marketing and demand generation strategies, making the whole process more efficient and effective. 

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