What is Lead Generation? Our Process & Strategies

In my work as a data and marketing enthusiast, I see the same story play out all the time. A business owner, a co-founder, or a marketing executive comes to our agency. They’ve just spent thousands on a beautiful new WordPress website. They’ve published some blog posts, maybe run a few ads, and their traffic numbers are climbing.

But there’s a problem. A big one. The phone isn’t ringing. The contact form is collecting dust. They have what I call the “leaky bucket.”

All this valuable, hard-won traffic is arriving, looking around, and then leaving – forever. They have no way to capture that interest, no system to build a relationship, and no process to turn those anonymous visitors into actual potential customers.

This is where lead generation stops being a marketing term and becomes the most critical system in your business. It is the plug for the leaky bucket. It’s the systematic, deliberate process of turning strangers into interested contacts you can build a relationship with.

What is Lead Generation? A Simple and Clear Definition

Lead generation is the marketing process of stimulating and capturing interest in a product or service to develop a sales pipeline.

That’s the textbook answer.

But let’s break that down. The key is “capturing interest.” A “lead” is any person who indicates customer interest in your company, product, or service in some way. They are no longer a random visitor; they have “raised their hand” and given you a signal that they might be a good fit for what you offer.

This act of capturing interest – usually by getting a name, an email address, or a phone number – is the core of the lead generation process.

“Lead” vs. “Contact”: What’s the Difference in Your Sales Pipeline?

This is a distinction I find many business owners confuse.

A “contact” is just a piece of data. You might have a list of 1,000 contacts you bought or scraped from LinkedIn. You have their information, but you have no idea if they’re interested in you.

A “lead” is a contact who has expressed interest. They chose to give you their information. They downloaded your ebook, signed up for your webinar, or filled out your contact form. This is a sales lead – someone who has given you permission to market to them, making them infinitely more valuable than a cold contact.

Lead Generation vs. Demand Generation: A Critical Distinction

Another area that trips up even experienced marketers is the difference between demand generation and lead generation.

Think of it this way: Demand generation is the broad, top-of-funnel activity that creates awareness and makes people want your solution. It’s the blog post, the viral social media video, or the keynote speech that makes your audience think, “I have a problem, and this company seems to understand it.”

Lead generation is the specific action that captures that demand. It’s the “call to action” at the end of the blog post, the link in the video description, or the signup sheet at the back of the conference room.

Demand generation brings people to the party. Lead generation gets their names at the door so you can talk to them later. You need both to succeed.

Why is Lead Generation Important for Business Growth?

As a data analyst, I look at business growth in terms of systems, not luck. Hoping that enough people find your website and decide to call you is a strategy built on hope. Lead generation is a system built for business growth.

1. To Build a Predictable Sales Pipeline

This is the number one reason. When you have a lead generation system that consistently brings in 100 new leads every month, you can start to predict your revenue.

If you know that 10% of those leads become qualified leads (10) and your sales team closes 20% of those (2), you know that your marketing is generating two new customers every month. Now you have a baseline. To get four customers, you know you need to generate leads at a rate of 200 per month. This transforms your sales pipeline from a mystery into a math problem.

2. Using Lead Generation for Market Expansion and Authority

To capture a lead, you almost always have to offer something of value (which we’ll cover, called a lead magnet). This might be an ebook, a whitepaper, or a webinar.

The act of creating this valuable content itself builds your authority. When a visitor sees you’re offering a “Complete Guide to B2B Marketing,” you are positioned as an expert. This not only helps you generate leads but also builds your brand and trust with your audience.

3. How Lead Generation Gathers Crucial First-Party Data

In our current digital landscape, with the end of third-party cookies, first-party data is gold. First-party data is information your audience gives you directly and voluntarily.

There is no better source of this data than your lead generation forms. When a lead gives you their email, company size, and biggest pain point, they are handing you the exact data you need to market to them effectively. This is a permission-based, trust-filled-data exchange that is future-proof.

4. The Data: Why 91% of Marketers Prioritize Lead Generation Strategies

Don’t just take my word for it. The data is overwhelming. In a 2024 report by Sopro, a staggering 91% of marketers stated that lead generation is their most important goal (Sopro, 2024).

This is because they know it is the direct engine of revenue. It’s the bridge between marketing and sales, between a random visitor and a loyal customer.

5-Step Lead Generation Process That Converts Potential Customers

So, how does it actually work? Over the years, my agency has refined a 5-step lead generation process that maps directly to the customer’s journey, also known as the lead generation funnel.

1: Attract (Using SEO & Content Marketing to Find Your Audience)

First, you need to attract visitors. But not just any visitors – you need the right ones. This is the “Top-of-Funnel” (TOFU). You do this by creating helpful, valuable content that answers their questions.

This very article is an example. You searched for “What is Lead Generation?”, and our content (powered by Search Engine Optimization or SEO) was here to answer it. Other channels include social media, paid ads, and guest posting.

2: Capture (Using Lead Magnets and Optimized Landing Pages)

This is the moment of conversion. The visitor is interested, and now you must make them an offer they can’t refuse. This offer is called a lead magnet – a high-value piece of content or a tool given away for free in exchange for their contact information.

This exchange happens on a dedicated landing page. Unlike a homepage with 20 different links, a landing page has one single goal: get the visitor to fill out the form and become a lead.

3: Nurture (The Role of Email Marketing in Lead Nurturing)

This is the step almost everyone gets wrong. A lead who downloads your ebook is not ready to buy. According to research, 73% of leads are not purchase-ready when they first interact with you (MarketingSherpa).

This is where lead nurturing comes in. Using email marketing and marketing automation, you send them a series of helpful, non-salesy emails. You build trust, provide more value, and establish yourself as their go-to expert. This is the “Middle-of-Funnel” (MOFU).

4: Qualify (Identifying MQLs vs. SQLs)

Not all leads are created equal. Your sales team’s time is their most valuable asset. The fourth step is lead qualification – the process of separating the “just curious” from the “ready to buy.”

We use a system of lead scoring to automatically identify a Marketing Qualified Lead (MQL) – someone who is engaged but not ready for a sales call (e.g., they downloaded an ebook). We then nurture them until they take a high-intent action (like visiting the pricing page or requesting a demo), at which point they become a Sales Qualified Lead (SQL).

5: Convert (The Handoff from Lead Generation to Sales)

Only now, at the “Bottom-of-Funnel” (BOFU), does the lead get passed to the sales team. The salesperson now has a full history of the lead: they know who they are, what they downloaded, what pages they viewed, and that they are qualified.

This results in a warm, contextual conversation (“I see you downloaded our guide on lead gen…”) instead of a cold, interruptive call. This is how the lead generation process feeds a sales team with high-quality, high-intent sales leads.

Inbound vs. Outbound Lead Generation

There are two main philosophies for how you generate leads. As an agency, we use both, and the right mix depends on your business.

Inbound Lead Generation: Earning Interest from Potential Customers

Inbound lead generation is a “pull” or “magnet” strategy. It’s the process of creating valuable content (like blogs, SEO, social media) that naturally attracts your ideal customer profile (ICP) to you.

The lead finds you. They read your post, appreciate your value, and choose to give you their information. It’s permission-based, builds deep trust, and typically has a lower long-term Cost Per Lead (CPL). It is the foundation of modern content marketing.

Outbound Lead Generation: Proactive Outreach to Generate Leads

Outbound lead generation is a “push” strategy. This is where you find the customer. You identify a list of potential leads and reach out to them proactively.

Classic examples include cold outreach (email or calling), direct mail, and trade shows. Modern outbound also includes digital tactics like Pay-Per-Click (PPC) ads and targeted LinkedIn lead generation campaigns. It’s often faster at producing results but can be more expensive and requires great care to not be spammy.

The Hybrid Approach: Combining Inbound and Outbound Lead Generation

In my experience, the most successful businesses – especially B2B lead generation – use a hybrid approach.

They use inbound content marketing to build their brand authority, capture long-term organic leads, and nurture their audience.

Simultaneously, they use highly targeted outbound strategies (like Account-Based Marketing) to go after their top 100 dream clients. The inbound content warms up the outbound prospects, making the whole system more effective.

7 Proven Inbound Lead Generation Strategies

1. Content Marketing & SEO: This is the #1 strategy. By creating high-value blog posts, guides, and articles (like this one!) optimized for search engines, you create a 24/7 “lead-generating machine” that attracts your ideal customer profile for free.
2. Social Media Marketing: This isn’t just for brand awareness. For B2B lead generation, promoting your lead magnets on LinkedIn is incredibly powerful. For B2C, contests, quizzes, and “swipe up” links on Instagram can capture leads directly.
3. Webinars and Virtual Events: Hosting a free, educational webinar on a topic your audience cares about is one of the best ways to generate leads. Attendees are typically high-intent and give you their full attention (and contact info) for 45-60 minutes.
4. Gated Content (Lead Magnets): This is the “fuel” for your lead capture forms. The key is to offer something so valuable it’s a no-brainer to exchange an email for it. Examples include ebooks, whitepapers, case studies, checklists, and templates.
5. Free Tools & Calculators: If you can offer a free, simple tool (like a “Website SEO Grader” or an “ROI Calculator”), you create a utility-based lead generation tool that can provide immense value and capture thousands of leads.
6. Optimized Landing Pages & Calls-to-Action (CTAs): A lead magnet is useless if the landing page doesn’t convert. A good landing page has a clear headline, bullet points on the benefits, and a simple form. A strong Call-to-Action (CTA) (e.g., “Download Your Free Guide”) tells the user exactly what to do.
7. Email Marketing & Newsletters: Your email list is your most valuable owned asset. Offering an exclusive newsletter with high-value tips (like the one at the end of this post) is a simple and effective way to generate leads from your most engaged readers.

3 High-ROI Outbound & Hybrid Lead Generation Strategies

1. Strategic Email Outreach (That Isn’t Spam): There is a massive difference between spamming 10,000 random contacts and strategic outreach. This involves researching 50 ideal companies, finding the right person, and sending a highly personalized, helpful email. It’s about quality, not quantity.
2. Pay-Per-Click (PPC) & Retargeting Ads: Using Google or LinkedIn Ads allows you to “jump the line” in SEO. You can pay to put your landing page in front of people searching for your solution right now. Retargeting ads (showing ads to people who visited your site but didn’t convert) are also a powerful way to bring back “leaky bucket” traffic.
3. Account-Based Marketing (ABM): This is the most powerful hybrid strategy for B2B lead generation. Instead of “fishing with a net” for any lead, ABM is “fishing with a spear.” Your sales and marketing teams jointly identify a list of high-value “dream accounts” and create a marketing campaign just for them. It’s the ultimate in personalization and has a very high ROI.

The Most Critical Step: Lead Qualification & Scoring

You’ve done it. Your lead generation engine is running, and 300 leads came in this month. Now what? If you send all 300 to your sales team, they will quit. Most are not ready. This is where lead qualification – the process of finding the “gold” – becomes your most important job.

Lead Qualification: The Difference Between MQL, SQL, and PQL

You must learn this language. It’s how marketing and sales teams align.

• MQL (Marketing Qualified Lead): This is a lead who has engaged with your marketing and fits your ideal customer profile, but is not ready for a sales call. They downloaded an ebook or follow you on social media. They are a good fit, but their intent is low.
• SQL (Sales Qualified Lead): This is a lead that has been vetted (often by marketing and sales) and is ready for a sales conversation. They have high intent. They requested a demo, filled out a “contact sales” form, or their lead score is very high.
• PQL (Product Qualified Lead): This is the new gold standard for SaaS and tech companies. A PQL is a lead who has used your product (like a free trial or freemium plan) and has taken actions that signal a high likelihood of buying.

Key Lead Qualification Frameworks: BANT & MEDDIC

How do you vet a lead to turn them from an MQL to an SQL? You use a framework. The most classic is BANT:

• Budget: Does the lead have the money to buy?
• Authority: Is this person the actual decision-maker?
• Need: Do they have a real, painful problem your product solves?
• Timeframe: Do they have an urgent timeline for finding a solution?

More advanced sales teams use frameworks like MEDDIC, but BANT is the perfect place to start.

What is Lead Scoring? A Primer on Marketing Automation

Lead scoring is how you do this automatically at scale. Using marketing automation software (like HubSpot, which we use at our agency), you assign points to leads based on their actions.

For example:

• Visited pricing page: +10 points
• Downloaded ebook: +5 points
• Job title is “VP of Marketing”: +15 points
• Email is from a “gmail.com” address: -5 points
• Opened 5 emails in 1 week: +20 points

You can then set a rule: “When any lead reaches 75 points, automatically change their status to ‘MQL’ and notify a sales rep.” This is how you automate your lead generation funnel.

Measuring What Matters: Your Core Lead Generation KPIs

As a data analyst, I live by one rule: If you can’t measure it, you can’t improve it. Your lead generation strategy must be tracked with data.

Here are the essential lead generation KPIs (Key Performance Indicators) you must watch:

• Cost Per Lead (CPL): Total Marketing Spend / Total New Leads. This tells you exactly how much it costs to acquire a new lead from a specific channel (e.g., Google Ads CPL = $50, LinkedIn CPL = $120).
• Lead-to-Customer Conversion Rate (LCR): New Customers / Total New Leads. This is the ultimate metric. It tells you the quality of your leads. Who cares if you get 1,000 cheap leads if none of them become customers? I’d rather have 10 expensive leads where 5 of them convert.
• Landing Page Conversion Rate: Total Leads from Page / Total Visitors to Page. This tells you how effective your lead capture mechanics are. If 1,000 people visit your landing page but only 10 convert (a 1% rate), you need to fix the page, the form, or the lead magnet offer.

You track these using tools like Google Analytics and, most importantly, a CRM (Customer Relationship Management) platform like Salesforce or HubSpot.

Conclusion

It’s not just a marketing tactic. It’s not just about collecting emails. It is the single most important system for creating predictable, scalable business growth.

It is the engine that connects your marketing efforts directly to your sales results. It’s the process of building a bridge of trust with a potential customer, starting with a small “yes” (an ebook download) and nurturing that relationship into a “yes” that transforms your business. It is the solution to the “leaky bucket,” and it’s the first step to building a true revenue-generating machine.

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Frequently Asked Questions

What is a good example of lead generation?

A perfect, common example is a software company offering a free, downloadable “Guide to E-commerce” (this is the lead magnet). To get this guide, a visitor must go to a specific landing page and provide their name and email address in a form. The moment they submit that form, they have become a lead. The company can now nurture this lead with helpful email marketing.

What is the difference between B2B and B2C lead generation?

B2B (Business-to-Business) lead generation typically involves a longer sales cycle, a higher average sale value, and a focus on building trust and demonstrating ROI. The tactics focus on value and expertise, like webinars, detailed whitepapers, and LinkedIn lead generation. B2C (Business-to-Consumer) lead generation usually has a very short sales cycle and is more transactional. The tactics focus on more immediate, emotional value, such as discounts, coupons, contests, and social media giveaways.

What is a lead generation funnel?

A lead generation funnel (also called a sales funnel) is a visual model of the journey a potential customer takes, from first discovering your brand to becoming a paying customer. It maps directly to our 5-step process: Attract (Top-of-Funnel), Capture & Nurture (Middle-of-Funnel), and Qualify & Convert (Bottom-of-Funnel).

What is a lead magnet?

A lead magnet is a free, high-value resource or service that you give away in exchange for a user’s contact information (like their email address). It is the core “offer” in the “Capture” step of the lead generation process. The best lead magnets are specific, solve a real problem, and are instantly downloadable. Common examples include ebooks, checklists, free templates, webinars, and free trials.