What Is Lead Generation? (And How To Do It)

By Indeed Editorial Team

Updated December 28, 2021 | Published April 14, 2020

Updated December 28, 2021

Published April 14, 2020

Your ability to generate leads on behalf of your business is a key performance indicator for your success. The measurement of your lead generation process is used by the marketing and sales department to find out if you're making progress in reaching out to your target audience to purchase your product. You must be creative with your lead generation process to establish a long-term relationship with your target audience. In this article, we discuss what a lead is, define what lead generation is and show you how to generate leads for your business.

Read more: Using Key Performance Indicators (KPIs) To Achieve Goals

What is a lead?

A lead is when an individual or a business is attracted to the product and service you're trying to sell them. An example of a lead can be if they take a company survey about a service needed in their home. The answers provided by the lead give you a better idea about how to frame the next email you send over their way to service their needs.

Let's review the different types of leads a company can attract:

  • Marketing qualified lead: A marketing qualified lead is someone interested in your product based on the way you've marketed to them. Usually, they have an increased chance to purchase from you in comparison to other types of leads considering the engagement level marketing campaigns have with the user. A lead may have filled out a contact form on your website, used a product demo or have visited your website multiple times. However, they might be willing to hear your sales pitch that moves them into the buying stage. You'll need to identify where opportunities lie in your SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis to earn leads.

  • Sales qualified lead: Sales qualified leads aim to make it clear to you that they're interested in buying your product or service. You need to research the company and follow your organization's guidelines to find out who's qualified to be a customer. This is a combined effort from sales and marketing teams, and you can gauge their interest to buy by checking if they opened emails sent to them or attended industry webinars you've hosted.

  • Product qualified lead: A product qualified lead is a potential paying customer that used your product in the past. They could have used it if they received it as a gift or sampled it at a brick-and-mortar store in a mall or shopping complex. For a digital product, the lead might have downloaded a free trial to have the opportunity to evaluate their experience with it. Your sales representative can call the lead once they finished the trial to find out if they plan to buy your product and what reasons lead to their decision.

  • Service qualified lead: A service qualified lead notifies your company that they're ready to buy your product. They may want to purchase an annual subscription or make a one-time purchase to see if they plan on buying more of your product. A sales representative can give this lead an exclusive offer that can give them a chance to buy more products for less than face value.

Read more: Customer Service Skills: Definitions and 17 Examples

What is lead generation?

Lead generation is a method of sales and marketing that is initiated after a company sends a communication soliciting action from a user and is considered a substitution for cold calling a prospect. In other words, it's a part of a company's effort to transition a customer from a visitor of a website to an avid buyer and user of the product. In a business-to-business (B2B) environment, it's ideal for a business to have customers give testimonials about how much they like a product and the customer service they received throughout the process.

How to generate leads

Review this step-by-step guide for you to generate leads for your business:

1. Conduct research to pick your target audience

Market research is a key tool that can help you target new leads with your lead generation process. You'll need to emphasize the area in which they live in addition to their age, annual income and previous buying habits to have efficient leads and improve the performance of your marketing campaign.

2. Choose the appropriate promotional channels

The promotional channels you select should focus on getting as much exposure for your product as possible. Normally, this part also falls under your marketing plan, and you'll need to brainstorm with your coworkers and managers before you proceed.

Let's review the channels that can augment your lead generation process:

  • Content: Content can come in a variety of ways such as writing, graphics and video, but its main purpose is to provide valuable information to your target audience that they can use to improve their products or use of your products in their everyday life. Ideally, you include a call-to-action within your content, so they can interact with your website, which can get them closer to buying your product.

  • Emails: Email helps you contact customers with previous exposure to your company. This way, you can reach out to contacts subscribed to your emails, create content that attracts further interest and request them to go to your landing page. Produce a strategic plan to contact previous customers, along with new customers to have a diverse set of leads.

  • Blogs: Blogs can be written to promote your offering to the customer while enticing them to proceed with your call to action. For example, you can write a blog about the importance social media has on a brand and solicit the business to fill out a contact form and you can contact them if they're interested in purchasing marketing services from you.

  • Social media: Social media is an interactive platform for users to see your product and the human side of your brand. Your brand's reputation is essential in driving leads, so they can become consistent buyers. Produce story-based social media content that communicates directly with your audience and makes it easier for them to understand your call-to-action and how it influences them.

  • Free trials or samples: Product trails and samples can address the doubts customers may have in wanting to buy your product and give you additional sales opportunities that offer new products and add-ons to current products they purchased. Video games have additional downloadable content, whereas you may see infomercials that can give you a discount on practical household products of your interest.

Read more: What Is Strategic Planning? Definition, Techniques and Examples

3. Establish a plan to collect data from leads

Collecting data from your leads is important because you can insert them into lead generation software and document the likelihood they have of responding to marketing and sales pitches you make with your content. You can gather data from leads if they fill out a contact form, where you can render an incentive for interacting with your brand.

4. Use your promotional channels to produce relationships and create new leads

Out of all promotional channels, social media is indispensable in engaging with leads and giving your product meaning to your target audience. A professional sports team speaking with fans during a game is an example of an interaction that makes them feel a part of the organization's efforts, which they are.

A full-time social media staff member can comment on content posted on social media platforms and respond to direct messages that address concerns that arise. Remember that marketing dovetails your public relations efforts, so be conscious of distributed press materials regarding new developments with the company to give you clues on what your target audience should look forward to in the future.

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