Ana Khlystova
Jan 23, 2021 | 6 min read

There’s no consensus among business leaders on the inbound or outbound strategies and their effectiveness. 

Do you take the high road and untwist inbound marketing channels gradually? Or do you reach out directly to those who may be interested in your services no matter how disruptive it may occur?

Lead generation is the number one challenge for businesses of all sizes and niches. In fact, 53% of marketers claim they spend half of their budget on generating valuable leads.

In this blog post, we want to talk about two fundamentally different marketing strategies — inbound lead generation and its outbound counterpart. What are they and which one is more effective? Let’s find out!

What is lead generation?

Lead generation is a process of initiating interest in your product among people and attracting their attention to your business. It usually involves collecting leads’ contact information to be able to nurture them further down the funnel.

Sales funnel and sales pipeline comparison

It is the ultimate goal of both marketing and sales departments to catch as many relevant leads as possible. Marketers are directly responsible for the process, while sales reps take charge of all the nurturing work after a person becomes a lead.

However, customers’ behavior has changed dramatically over the last decade (and the pandemic didn’t quite stabilize things either):

While the traditional consumer was usually not involved in the production, conformist, and most often uninformed, the new consumer is individualistic, involved, independent, and generally well informed.

People are more independent in their buying decisions than ever. They do most of their research without any help and are perfectly aware of the plethora of choices available to them. So where does it lead us with our outbound and inbound lead generation endeavor?

What is inbound lead generation?

Inbound lead generation is a process of attracting website visitors by offering them relevant content in the right place at the right time.

So, what are inbound leads? They are the people who are perfectly aware of their goals and pain points. In fact, those goals bring them to your website or store in the first place.

Inbound marketing leads are inherently more eager to seal the deal faster. So, all you have to do is to showcase your business in the most flattering way and demonstrate its numerous benefits over similar competitions.

Inbound lead generation campaigns include content marketing backed by search engine optimization, social media, email marketing, and other distribution channels. Brand awareness falls under this category, too.

The ultimate goal is to create the most relevant content and distribute it across valid channels. These efforts should result in people visiting your website and, you guessed it right, becoming your qualified inbound marketing leads.

What is outbound lead generation?

Outbound lead generation is a process of reaching out to potential buyers proactively. It’s also called interruption marketing because of its rather trespassing nature. You just force your push messages on people who never opted in for it.

Traditional outbound lead generation channels include cold calling, emailing, and different kinds of advertising — all targeted at a cold audience. Basically, you’re trying to contact people who are completely unaware of your business, and frankly, had zero intention of discovering it.

Sounds a little intrusive, doesn’t it? Well, that’s because it is. People hate being cold-called in the middle of the day and offered stuff they didn’t even know existed a moment before.

While 26% of people agree that cold callers are only trying to do their job, the vast majority of us have absolutely no time for them – and two thirds of us will immediately hang up the phone.

Inbound vs Outbound lead generation

Inbound lead generation meme

From the inbound leads definition above, it may seem like they’re some panacea for all woes. People come to you on their own and are ready to buy right away? What can be better?

There’s a catch, though… Of course, there’s a catch! If it were so simple, marketers would be out of a job in the blink of an eye.

Inbound lead generation takes way too long to bring any real results. And a client is always in control of when and where they want to get in contact with you. So, unless THEY decide they have a problem and come to your website, there’s not much you can do.

But what about all those people who do have a problem but aren’t aware of it or of the fact there’s a solution to it? What about the competition? What if they’re better, faster, and more proactive than you?

Thankfully, there are many ways to generate leads, and you can choose the one that suits your situation.

INBOUND LEAD GENERATION OUTBOUND LEAD GENERATION
Definition Inbound lead generation is a process of attracting website visitors by offering them relevant content in the right place at the right time. Outbound lead generation is a process of reaching out to potential buyers proactively.
Target audience Highly aware of their problem and available solutions Cold audience with low interest and motivation
Best practices Content marketing, brand awareness Cold outreach, advertising, networking
Channels Word-of-mouth, organic search, referrals, social media, retargeting ads, email marketing Phone calls, SMS, emails, messengers, TV commercials, ads, billboards
Cost per lead Very low or free Usually higher
Time of execution Usually longer Immediate
Pros – Scalable
– White-hat
– Sustainable
– Cost-effective
– Quick results
– Predictable
– Easily manageable
Cons – Takes time – Can get pricey
– Targets cold unqualified audience
– Feels intrusive

Similarities between inbound and outbound lead generation

There are not many similarities between outbound and inbound lead generation except for its main objective — to generate leads. The methods, target audience, and most of the channels are completely different for the two.

Although some communication channels do coincide sometimes. For example, emails are one of the most popular cold outreach channels. However, they also prove useful for pushing relevant content to inbound marketing leads and nurturing them towards a purchase.

Social media are traditionally considered an inbound marketing channel, but what about social media ads? 

And what about retargeting campaigns aimed at website visitors who bounced? You see, the line is blurred here.

In all other regards, inbound lead generation couldn’t be any more different from outbound sales.

Differences between Inbound and outbound lead generation

? Target audience

The main difference is kind of the nose. Inbound leads are more qualified than outbound. Their awareness is higher, and they do most of their research without any help.

The outbound audience is always cold. Selling to them is much like doing a standup gig at a pub on Monday night. The crowd is tough, and you have to work really hard to translate your message.

?  Channels

Inbound lead generation is all about getting more eyeballs on your content. So, the marketing channels include word-of-mouth, brand awareness, organic search, referrals, social media, and email marketing. Ads with related offers are also used to re-engage visitors who’ve already seen your website but bounced for some reason.

With outbound leads, you have to find a way of getting their contact info or at least track them down with cookies and stuff. But how do you get in touch with someone that hasn’t had a single touchpoint with you? You just make a far-fetched bet and use phone calls, SMS, emails, messengers, TV commercials, billboards, etc.

? Cost per lead

Inbound lead generation is widely considered more cost-effective. According to Demand Metric, content marketing brings three times as many prospects as outbound marketing but costs 62% less.

It’s just that call center infrastructure, billboards, and ads are not exactly the most affordable communication channels. Cold emails are probably the most affordable strategy when it comes to generating outbound leads. All you need is an email automation tool and a list of prospects with their email addresses.

⌛ Time of execution

Inbound lead generation sounds almost too good to be true. But it does have a significant disadvantage. Creating relevant content, making it rank on Google, building loyalty, and raising brand awareness takes time. You can wait months if not years to start getting inbound marketing leads.

Outbound lead generation has the advantage of being immediate. You can purchase a list of leads from some third-party vendor (not that I recommend it) and set up a cold email sequence in less than 24 hours. And that’s it, your pitch is already out there. The more people you manage to contact, the higher are chances of generating some interest.

So, which lead generation strategy is for you?

It seems like there’s only one question left now. Is outbound lead generation even effective? Many claim that it’s dead and isn’t worth an effort.

My answer is more middle of the road, though. It depends. For instance, B2B lead generation can still benefit from outbound prospecting. LinkedIn allows businesses to source for potential leads with such a granular filtering system that you can basically target companies and their decision-makers.

At the same time, inbound lead generation is way more reliable and white-hat, and it will always stay so. No matter the times, creating targeted high-quality content won’t lose its effectiveness and accumulating effect.

So, it’s not really a question of inbound or outbound lead generation. Just start with your goals and objectives, and you’ll see the right path. If you want to get a reliable and scalable source of qualified leads, go inbound. If quick results are more preferable at the moment, outbound leads can be a way to achieve them.

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