Demand Generation vs Lead Generation: Which Google Ads Campaign is Right for Your Business?

As a brand or business owner who deploys the power of Google Ads campaigns to realize their paid ad goals, you might find yourself at a crossroads when asked to choose between “demand generation vs lead generation campaigns.”

Both approaches are powerful in their own right. However, it’s like comparing apples and oranges—both are delicious (and useful), but they serve different purposes.

We at Mavlers have met the paid ads needs of 7K+ clients globally, successfully managing 43 million dollars of media spend. In these endeavors, we have picked up a few tricks of the trade that will help you in your Google ads journey.

So, which one should you choose for your Google Ads strategy? Let’s break it down and explore the strengths of each to help you make the right choice for your business.

Table of contents 

• Understanding demand generation in Google Ads
• Understanding lead generation in Google Ads
• Demand generation vs lead generation: Key differences 
• Making the decision: Which approach fits your brand’s needs?

By the end of this blog, you will be able to understand the key differences between the two campaigns in Google Ads and make the best decision for meeting your unique business needs. 

Let’s get kicking!

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Understanding demand generation in Google Ads

Think of demand generation like a movie trailer—it’s designed to get people excited about something they didn’t even know they wanted to see. You’re not asking for a sale right away. Instead, you’re warming up the audience, piquing their interest, and making sure your brand becomes part of their mental landscape when they’re finally ready to buy.

Simply said. demand generation is about building brand awareness and sparking interest in your products or services. It’s a long-term strategy designed to create demand in the market, often targeting potential customers who are not yet in the buying phase. The objective is to educate, inform, and position your brand so that when customers are ready to purchase, they think of you first.

Let’s now explore the plethora of tactics in demand generation campaigns.

1. Display ads – Like billboards in a digital world:

Just like a billboard catching your eye on the highway, display ads are designed to build awareness. You’re reaching people who might not be actively searching for your product but could be intrigued when they see it.

Example: A SaaS company launching a new app could plaster display ads across relevant websites to introduce their solution to a broad audience, sparking initial curiosity.

2. YouTube ads – Lights, camera, engagement:

YouTube ads allow you to connect with your audience using video content. Think of them as a mini-movie, telling a story that resonates with viewers and hooks them emotionally.

Example: A tech company could showcase a “day in the life” using their product to simplify daily tasks. By showing relatable scenarios, they make viewers feel like they need the product in their lives.

3. Discovery ads – The right nudge at the right time:

Discovery ads are like those perfectly timed recommendations. They appear in places like Gmail and the Discover feed, where users are already browsing casually, making them open to discovering new products.

Example: A fashion brand promoting a new seasonal collection could target users based on their interest in fashion, ensuring their ads pop up at just the right moment.

4. Broad match keywords – Casting a wide net:

Broad match keywords help capture a diverse audience. This tactic ensures you’re getting the attention of users in the “just browsing” stage of their journey.

Example: A travel agency using broad terms like “adventure vacations” can attract wanderlust-filled users who are daydreaming about their next trip.

There is a common saying in marketers’ water cooler banter: anything that cannot be measured doesn’t really exist. Yep, data is everything! Let’s delve into the different metrics to monitor for demand generation campaigns.

• Impressions: How often is your ad shown?

• Reach: The number of unique users exposed to your ad.

• Engagement: Interactions with your ads, such as clicks or video views.

• Brand lift: Changes in brand awareness, measured through surveys or external tools.

Understanding lead generation in Google Ads

Now, let’s flip the script to lead generation. This is the checkout line of marketing. Your audience is already in the store—they’re interested, and now it’s about making it easy for them to buy. Lead generation is designed to capture information from people who are already further down the funnel and closer to making a purchase.

To surmise, lead generation campaigns focus on capturing contact information from users who are already interested in your products or services. These campaigns target users further down the sales funnel, aiming to collect specific information such as email addresses or phone numbers that will allow you to nurture them into customers.

Let’s delve into the different campaign types and tactics for lead generation in Google ads:

1. Search ads: 

Search ads target users who are actively looking for your product or service. These ads appear when users input relevant queries into Google, making them high-intent prospects.

Example use case: A home renovation company could target keywords like “kitchen remodeling services” to capture people who are already seeking renovation help.

2. Lead form extensions: 

Lead form extensions allow users to submit their contact information directly from the ad without leaving the Google search page. This streamlines the process, making it easy for potential customers to express interest.

Example use case: A real estate company could use lead form extensions on search ads for “new homes in [city]” to gather details from users interested in a home tour.

3. Landing pages: 

Optimized landing pages are essential for lead capture. These pages feature a clear call-to-action and a form where users can submit their contact information.

Example use case: An online education platform promoting a free webinar could direct traffic from its ads to a dedicated landing page with a registration form.

4. Remarketing ads:

Remarketing targets users who previously visited your website but didn’t convert. These ads encourage them to return and complete an action, such as filling out a lead form.

Example use case: An e-commerce company could remarket to users who added products to their cart but didn’t check out, urging them to complete the purchase.

As discussed in the above section, it is important to have key metrics in place for lead-generation campaigns as well.

• Leads generated: The total number of form submissions or contact details collected.

• Cost Per Lead (CPL): The average amount spent to generate one lead.

• Conversion rate: The percentage of users who completed the desired action, such as filling out a form.

• Lead quality: The potential of collected leads to become paying customers.

Before the ultimate showdown, let’s explore the major points of difference between lead generation and demand generation.

Demand generation vs lead generation: Key differences

Here’s a ready-to-use reference guide to help you understand the key differences between the two campaign types in Google ads.

Making the decision: Which approach fits your brand’s needs?

When asked this question, our in-house subject matter expert, Shravan Jaiswal, had the following answer: “Well, it depends!”

The answer depends on your business goals.

When demand generation is better:

• New products or brands: If you’re launching a new product or entering a new market, demand generation campaigns can help introduce your offering to a broad audience and build brand recognition.

• Long sales cycles: For industries like B2B software, where customers take time to evaluate options, demand generation helps keep your brand top-of-mind during the research phase.

• Complex products: When your product requires education and a longer engagement, demand generation gives you room to tell a story through YouTube ads or compelling display ads.

When lead generation is better:

• Sales-driven businesses: If your goal is to drive sales and quickly capture leads, lead generation is the way to go. This is especially effective for services with shorter sales cycles, like home repairs or dental services.

• Nurturing high-intent prospects: Lead generation works best when you already know there is demand for your product and you need to capture and nurture high-quality leads.

• High-conversion goals: When you want users to take immediate action, such as booking a consultation or filling out a form, lead generation campaigns will drive conversions more effectively.

However, no rule book says that you can’t have the best of both worlds, and a little mix and match never hurt the outcome of a marketing campaign! 😉

For instance, in many cases, a combination of both demand and lead generation campaigns may be the optimal approach. Starting with a demand generation campaign helps build awareness, while a follow-up lead generation campaign captures users who are further along in the buying journey.

Example: A B2B marketing agency could use YouTube ads to introduce a new digital marketing service (demand generation) and then run remarketing search ads targeting users who clicked on the YouTube ad but didn’t convert, prompting them to book a consultation (lead generation).

The road ahead

Now that you are quite conversant with the ins and outs of both campaign types and know how to choose the right one for your business, you might want to consider reading ~ Paid Ads 2.0: Why Continuous Innovation and Client Collaboration Are Game-Changers.