Lead generation often starts as a proactive action taken by the leads. Once these leads provide their contact information to the company through lead capture software or forms, they’ll be considered marketing qualified leads.
Now, depending on the process of lead generation, we have two major types of leads — inbound and outbound leads.
Both of them are important for a business and might take precedence over the other, depending on the purpose of lead gathering or different business offerings.
Here, we explore the difference between the inbound and outbound lead generation process, their pros and cons at length, and the various methods of lead generation in each one of them.
Let’s dive right in!
Inbound lead generation involves a permission-based targeting of prospects, where a prospect approaches your business first, as a result of SEO practices or valuable content.
The inbound lead generation process doesn’t focus on selling the brand offerings as it is more about helping the customers.
Content marketing is an excellent example of attracting your target audience to your website via relevant content. However, in order to leverage it successfully, it is important to create evergreen content that will continually attract prospects and drive your website traffic.
What makes the process challenging is that you have to stand apart from the crowd in terms of content to remain visible to your prospects amidst the competition.
Take a look at the inbound lead marketing process shown in the following image:
So, when you ask “What is an inbound lead?”, the answer is “a person reaching your website or any specific webpage via the content links you promote with healthy SEO activities.”
However, this is not the only way inbound leads approach you. We will explore this more in the later sections.
First, let us find out how outbound lead marketing works.
Outbound lead generation involves interruption-based customer targeting, as you shoulder the entire responsibility of marketing, including the first interaction.
You begin by sending out a proactive message to your target audiences, some of which might become your first leads. Direct emails, cold calls, in-person events, and door-to-door marketing are some of the various examples of outbound lead generation.
However, as the world becomes more connected, marketers find themselves questioning the effectiveness and relevance of outbound lead generation techniques.
It is considered a traditional lead marketing approach, but it still works if you spruce it up with some outbound lead generation strategies that utilize modern technologies.
You can optimize and improve your cold emailing or cold calling process with proper digital marketing techniques to make the entire process better and easier.
Inbound lead generation aims at helping buyers to define, research, and solve their problems via better purchase decisions. The process is more effective at reaching prospects in the earlier decision-making process, allowing for trust-building and positively influencing the purchase processes.
Content marketing involves creating, sharing, promoting, and leveraging highly relevant content that you create for anyone who might show interest in your business and products or services. This content can be of many types, such as videos, blogs, and social media content that provide value to people.
However, to improve the lead targeting via content, it is important to ensure that you have a proper content marketing strategy in place that will drive your inbound lead marketing towards success.
Some key considerations include:
All these content pieces allow your prospects to connect deeper with you and help them understand how you solve their pain points with your awesome brand offerings.
Blogging is a subset of content marketing and deserves a special mention because of its ability to target leads or prospects.
Blogging allows you to compare your brand offerings with the competitors in a healthy manner and guide your audiences or prospects towards a smart purchase decision.
You can blog on various platforms to target different types of leads and project a highly versatile brand image.
Blogging is one of the most important, bankable, and best tactics for inbound sales as it helps you build trust among your prospects.
SEO allows your content to rank in the Google Search Engine Results Pages (SERPs) and puts you in the direct line of sight of your prospects. You can optimize the content for improving your audience targeting for different products and brand offerings.
SEO practices allow you to form a unified strategy for content marketing and rank in top results by incorporating the keywords often searched by your audience.
While SEO and blogging might appear as prospect-attracting strategies, they form a crucial part of the lead engagement stage as well.
Widgets like click-to-call widgets allow your leads to connect with your company reps in real-time and ensure a smooth process of lead gathering to lead nurturing.
These functionalities help streamline the communication process between you and your leads, significantly reducing the lead response time.
There are many different types of widgets that you can choose depending on the major traffic sources you have, your brand offerings, and channel preferences your prospects demonstrate.
That said, live chat software can be of extreme importance in this scenario.
You can install it on your website to offer your visitor some educational materials, direct access to your reps, find self-help modules, or identify a problem that your brand offerings can solve for them.
Once the customer expresses willingness to talk, you can move the conversation over to a phone call as well.
Another excellent way of inbound lead generation is using chatbots for automating repetitive conversations, lead qualification, and contact information collection.
Chatbots can monitor visitor behavior on your website and improve your targeting as well.
Outbound lead marketing involves targeting the leads on a proactive basis. It consists of sending proactive communication to the target audiences on various channels, such as social media, email, SMS, calls, and more.
This is one of the traditional outbound lead generation tactics where SDRs initiate cold calls to targeted contacts on their list. The main aim of a cold call is to organize a meeting or schedule a demo with the prospect.
These calls are placed at a well-researched time, and the callers are well-versed in pitching your brand offerings in the best manner.
There is no doubt that cold calling is a challenging outbound lead generation method. In fact, many sales professionals think that cold calling sucks or have developed a fear of cold calling due to immense rejection.
This has resulted in many SDRs avoiding cold calling in their outbound lead generation strategy.
Also known as cold emailing, it is one of the most used sales prospecting techniques. In cold emailing, sales data reps send cold emails (single or a chain of emails) to encourage engagement and lead conversions.
This series of emails can be set in motion once a visitor or customer takes an action, such as clicking your CTAs, signing up for your newsletter, or browsing specific web pages.
Statistics report that 78% of salespeople opting for social selling are outselling their competitors and peers who are not using it. Furthermore, 31% of B2B professionals say that social selling allows them to build deeper relationships with clients.
However, to make the most of social selling, you must figure out which channel or platform your target audience is more perceptible to and what type of content they prefer.
Then, start creating different campaigns, track and monitor them, measure them, and finally compare them with the other campaigns to refine your outbound lead generation strategies again and again.
By now, you might have realized that be it inbound lead generation strategy or outbound marketing; you need data insights regarding your customers, their preferences, shopping or browsing behavior, and the overall market. You can also collect customer feedback to obtain in-depth insights into their behavior and opinions.
Inbound marketing assets are highly relevant and accurate because the customers themselves opt to interact with your brand.
Once they find the brand voice relevant to their requirements and feel that your products address their pain points, these leads never stop doing business, especially when you target them with proper marketing.
No matter how long ago a prospect became a customer, you can convert them many times until you have a proper marketing strategy in place. So, inbound marketing is evergreen!
On the other hand, in outbound lead generation practices, the campaigns are shorter, have finite results, and come with a certain level of risks and costs involved.
Some of them include:
Inbound lead generation practices help you establish your brand expertise in various ways. You can leverage content marketing, which is one of the most crucial parts of inbound marketing, to target both the audience and the brand.
When your content resonates with your prospects at multiple levels, such as offering insights and answers to their pain points or challenges, you are able to connect with them at a deeper level.
Further, you can position yourself as an industry expert by putting more effort into designing and delivering highly streamlined content across all the channels. You boost your brand reputation and conversions when you do this for all your customer segments.
In inbound prospecting, the leads proactively approach you in various ways — reading your blogs, watching your content, or making a recommended purchase. Hence, the prospects feel that they are in control when they are interacting with your brand.
So, any message or email coming from your side doesn’t seem too pushy or persuasive. Further, as you progress, you refine your content and improve your brand image, which allows your prospects to consume more relevant content.
All in all, there is no specific hindrance from their side when it comes to overcoming the initial communication barrier.
This, in turn, paves the way for effortless communication and brand interactions.
We have been consistently stressing the importance of content marketing and improving the brand interactions for your prospects with streamlined content offerings.
However, creating a wealth of well-defined and targeted content, such as podcasts, blogs, ebooks, guides, product how-tos, and whitepapers takes up a lot of time.
Furthermore, the time and effort consumed in this process are highly subjective as you cannot replicate the efforts put in one type of content in some other content piece for the sake of originality. This calls for a fresh content piece every time, for every platform, and every campaign.
Finally, the speed at which your prospects interact with your brand, or the time they take to reach your brand offerings, is extremely variable and can be very slow.
So, you have no control over the time and pace the leads will come to you.
Inbound marketing requires niche skills as you need expertise in many areas, such as content creation, SEO skills, social media marketing, digital marketing, etc.
Further, you need to choose proper channels to steer your inbound campaigns in the right direction and focus on the right people.
So, if your in-house teams have skill gaps, you might need to hire some experts or outsource your processes. While outsourcing is cheaper than in-house staff hiring, it means lesser control over quality workflow and outputs.
All in all, it becomes important to put in more effort as well as have a reliable and robust talent pool to create a successful inbound lead generation, nurturing, and conversion system.
Inbound lead generation relies heavily on content and online platforms. It also depends on your prospects’ proactive actions in relation to your brand offerings.
So, you cannot directly emerge as a unique brand.
Brand differentiation stems from your prospects’ understanding and experiences by continual use of your services, products, and content.
Also, even before a lead shows an interest in conversion, you need to consistently serve all of them with rich, streamlined, and high-quality content on all platforms. It’s a good practice to ensure that your brand maintains its SERPs and social media visibility for keeping your customers engaged.
Finally, as the digital tools and online channels are limited, your competitors are also using them. Hence, you need to keep your strategies unique, which can be challenging.
Outbound lead generation is a resource-consuming process and incurs higher costs, especially when it comes to outbound campaigns, such as Pay-per-Click (PPC) ads. These costs arise because you need to distribute campaigns across multiple channels, run ads of different costs, and measure them for better conversions.
All this effort comes without any confirmation regarding the lead conversions, as your prospects might or might not convert.
However, the outbound methods don’t consume as much time as taken by inbound tactics.
Inbound lead marketing focuses on the people or prospects that are already searching for solutions or services that resemble or are related to the ones that you offer. On the other hand, outbound marketing is essentially a proactive reach out focusing on your entire target audience.
However, you must note that this audience pool might or might not include people who know your brand or its services and offerings.
So, your outbound efforts are mostly focused on making people aware of their pain points or unfulfilled needs that you can solve for them.
As you are experimenting with a number of marketing strategies, consistently upgrading and refining them as per the results generated, and streamlining them for specific demographics, you are in control!
You can create a well-defined marketing strategy that is a mix of various marketing tactics. This way, you can have in-depth control over how you want to target your prospects. Therefore, you can plan activities that will guide them towards the purchase and repeat purchases more tangibly.
Finally, you can create different marketing strategies for different platforms, purposes, channels, and customer segments. Hence, your marketing tactics are no longer relying on the prospects for getting recognized.
This is one major difference in approach when it comes to inbound and outbound lead generation. In outbound prospecting, your efforts are more aggressive and more active, thus, allowing you to reach and target your leads irrespective of the stage of conversion they are in.
This way, you are able to project yourself differently as compared to your competitors and even put yourself in a better position against them by identifying their weaknesses via proper competitor analysis.
Once you have your customers’ attention, you simply have to keep them engaged so that they keep on moving towards conversions again and again.
No matter what outbound tactic you follow, be it an ad or a cold call, you are basically interrupting your customers and asking them to take time out of their day to respond to your communication.
Such tactics also involve enforcement, such as non-skippable YouTube ads, and the moment you adopt them, your prospects are thinking about that “SKIP” button only. Their focus is shifted from all the good things your brand offerings can do because they are thinking of returning to what they were doing earlier.
Furthermore, ad blockers and spam filters are also becoming increasingly popular, making it even more challenging to target your audience through outbound lead generation methods.
For outbound lead generation, you are having a one-way communication with your prospects that might or might not be interested in communicating with you, let alone buying your brand offerings.
Hence, you are always at the shorter end of the stick, which is disadvantageous as you might not have understood your prospects’ needs and pain points.
There is no way to identify the exact stage your leads are in with outbound tactics. They might be ready to receive the brand communications, or might appear as the right use case as well, but there is no way to quantify their readiness to convert.
They might be just there for free, engaging content and might not at all wish to commit.
These prospects pose challenges to your marketing efforts and might be extremely hard to convert.
Now that we have had a thorough discussion of the pros and cons of the strategies of inbound leads vs outbound leads, let us move on to have an overview of the major differences between them.
The prospects initiate inbound tactics, which means that your prospects are in control of the engagement. On the other hand, the outbound tactics put you in the control seat of engagement.
The communications in inbound lead generation are customized to target segmented prospects, while in outbound marketing, all the communications are personalized. Outbound communications can be one-on-one as well.
As you do not initiate the inbound lead generation, there is no way to measure the mark. It is hard to identify the actual source of a lead. On the other hand, the ROI is highly measurable in outbound marketing as you have proper records of all the marketing activities you are doing.
You also track, monitor, measure, and compare the various campaigns to refine the outbound strategies over time.
The inbound lead gathering can span over a day, a month, or a year, as it’s the prospects that are coming to you and not the other way round. So, they will come when they will come.
This means that there is no fixed time frame in the inbound lead generation.
On the other hand, the time for prospecting in outbound marketing is small, ranging from a few days to one month.
To summarize, here’s a visual table to show the difference between inbound and outbound lead generation:
Some say that outbound lead generation strategies are dead, while others say that it’s worth the effort and can drive your business towards sustainable growth.
However, there can be no definite answer to this comparison.
This is because your marketing needs and strategies change from time to time. You just cannot have a marketing mix that stays relevant for years on end without making any change.
Hence, we recommend approaching the lead generation by incorporating elements from both inbound and outbound lead generation.
Be clear on your marketing goals, target audiences, and compile a robust and exhaustive lead generation, nurturing, and converting strategy with the tactics shared above.
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