Inbound vs. Outbound Demand Generation

INBOUND vs. OUTBOUND DEMAND GENERATION

We are often asked which strategy makes more sense for business development in creating demand that convert to leads – the fuel for revenue growth. There are two types of tactics – better known in the marketplace lingo as INBOUND lead generation or OUTBOUND.

The INBOUND portion refers to all types of on-line digital marketing such as search engine optimization, online media, and marketing automation systems designed to use content to generate interest in your product or service. The more traditional term is a PULL strategy.

The OUTBOUND portion refers to all types of activities that are more overt – a tactic to reach out to your prospect and may include emailing, direct mail, trade shows, direct sales and tele-sales.

In our opinion, the answer is really both. An integrated approach will yield better results when you utilize several different strategies in conjunction like a campaign. Some other determining factors include who you are targeting and what you are marketing. If you are in a B2C ( Business to Consumer ) market you will use different marketing tactics than if you are in a B2B ( Business to Business ) marketplace. A solid understanding of your cost per lead is the first function to understand which marketing and sales channel is generating the best results and engagement.

For instance, if you run an on-line ad campaign for $1,500 per month and it converts to 5 scheduled sales appointments, your on-line cost per opportunity identified is $300. Make sure to examine the same for any OUTBOUND strategies such as tele-prospecting. Which work better? It really depends on so many variables that there is no cut and dry conclusion. The key is to be measuring the ROI to determine the best channel to drum up business.

Some rules of thumb are INBOUND leads are usually more abundant, but much earlier on in the marketing cycle – so lower quality ( lower cost – higher volume – not as qualified ). Outbound often allows you to intercept a sales process already in play and due to the human interaction may be more qualified, and may convert to revenue faster ). Since you are using higher labour costs, the cost per lead is higher, but the leads are usually more qualified and will convert to revenue faster.

Since the buying journey has changed significantly in the past several years, as a marketer it is equally important to have a balanced approach to your business development using some INBOUND and some OUTBOUND so that you can determine the right strategic and tactical mix!

– Jason Cacaci, Founder and President