Understanding Inbound and Outbound Lead Generation

3 minutes

Lead generation is vital to business success

Marketers rely on the effectiveness of their strategies to generate the types of leads that convert and are profitable. In our current always-on society, it has never been more important for brands to find the right lead generation strategy so they can attract prospects and turn them into paying customers.

Two common approaches to this are inbound marketing and outbound marketing. Inbound lead generation is permission-based and puts the brand in front of audiences who are already searching for solutions to their problems. Outbound lead generation, on the other hand, entails reaching out to a target audience to convey a brand’s message.

Inbound marketing vs. outbound marketing

What is Outbound Lead Generation?

Outbound lead generation is akin to traditional marketing techniques many business owners are very familiar with. It is linear and interruption-based, utilizing techniques including email marketing, website banners and pop-up ads, event sponsorships, cold calling, print media, direct mail, etc.

Years ago, aggressive outbound approaches dominated the sales and marketing activities of most companies. What worked then isn’t effective in today’s turbulent marketplace — these types of programs would be lucky to generate a handful of viable leads that likely didn’t know much about your company before they were contacted. They need to be educated about your company and its products and services before they consider making a purchase decision. It can be difficult to measure the success of these programs.

In terms of cost, outbound is 61% more expensive than inbound strategies.

Sound like a lot of work? It is and it’s not very effective, with a close rate of only 1.7%.

What is Inbound Lead Generation?

Inbound lead generation is a paradigm shift from traditional marketing practices. It is a holistic strategy centered around providing quality content and thought leadership that is informative, educational, and engaging. It makes use of SEO, content marketing, and similar strategies to pull visitors into websites and landing pages — voluntarily — in an attempt to convert them.

Inbound does away with pushing advertising and promotional materials to potential leads in favor of permission-based techniques. Your branded content serves to entice visitors to register, subscribe to a newsletter, download a white paper, or fill out a form. These opt-in activities enable you to communicate further with this audience who is interested in knowing more about your company and its offerings.

Inbound leads are already actively searching for answers to questions and solutions to problems that your content may provide. Since they already have a clear understanding of what you can offer, it takes less time to convert them to paying customers.

Companies with blogs can generate 67% more monthly leads than those that don’t. Overall, inbound marketing generates up to 54% more leads than traditional paid marketing.

It is also easier to measure effectiveness because inbound utilizes a closed-loop reporting system that is based on quantifiable and measurable metrics. In general, inbound leads can generate a far higher close rate of 14.6%.

It’s no wonder that digital marketers are turning to inbound lead generation as a more appealing strategy than traditional outbound activities. Inbound trumps outbound in every way. Aside from lower costs, the holistic approach of providing quality content that educates, solves problems, or provides answers to questions appeals to online users who have given permission to communicate with them.

Learn more about the costs, advantages and applications of inbound and outbound lead generation in this infographic from Spiralytics:

Inbound lead generation vs. outbound lead generation infographic
Understanding Inbound and Outbound Lead Generation

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