August 9, 2022

What is lead generation? and How does it work?


When it comes to having any kind of business, the principle of how the business works is the same. For it to function and prosper, it needs to have an ongoing inflow of clients. This process of acquiring clients starts with what you call lead generation. The leads are the prospective clients you walk through a process to convert from leads into customers.

So what is lead generation?

Lead generation is the identification of potential clients. Basically, when people have an interest in a company’s product or service, they are considered a lead. Lead generation is thus the process of attracting prospects and converting them into people who want to make use of your company’s products or services.

Why does lead generation matter for brands?

For any business to function, it needs to have interested clients that will buy the service or product and for that it is important to generate that pool of prospects who are going to likely purchase. Lead generation is about taking prospects through the process of helping them fulfil a need or solve a problem they are having. 

Not everyone is going to be a potential lead for your business which is why lead generation is an ongoing process that helps you to attract those who are interested and develop that relationship further with them.

Paying attention to your target audience is done through lead generation to make sure that you are always talking to the right people at all times and not potentially damaging your company’s reputation by marketing to the wrong target market. 

Quality leads and why they make a difference

Quality leads are what make the difference between developing relationships with potential clients and wasting both your and the lead’s time. Finding quality leads is what also makes the difference in your business’ success. 

How do businesses attract quality leads?

It’s all about knowing where your company best aligns and then taking the necessary steps to meet the leads there.

For example, social media is one of the most popular ways to attract quality leads today as long as you stick to the platform that best suits your industry. 

B2B lead generation can take place on a number of platforms. 

For example:

  • 39% of B2B marketers say they generated leads from Facebook
  • 30% of B2B marketers say they generated leads from Twitter
  • 44% of B2B marketers say they generated leads from LinkedIn

Why a lead generation strategy is necessary?

Lead generation is an important part of the functioning of a business especially when it comes to growth. Increasing the number of leads your business generates ultimately means increasing the awareness of your business and having more people taking an active interest in what you do. You then have the chance to convert all those prospects into clients in a cycle that continues to help your business function and grow.

The different types of Lead Generation

Lead generation usually falls into the following categories:

Outbound – prospecting people and contacting them via phone or email

Online – having traffic driven to your website where you generate inquiries

Paid 3rd Party – where you use content distribution networks, lead brokers, and lead generation agencies for example

Events – things like tradeshows, business networking events, and anywhere where you can prospect potential leads

Branding/Advertising – use of mainstream media 

Direct mail – mailers sent out to prospects to garner interest

Referrals – getting referred from other leads and customers

Public Relations – editorials, press releases, opportunities for the brand to appear and speak

There is also two types of lead generation more commonly that is known as B2C (Business to consumer) and B2B (Business to Business). These two categories encompass the lead generation types categorised above and refer to either marketing directly to customers or marketing to other businesses when it comes to finding your leads.

Lead Stages

The process from prospective lead to a customer is not instant even if the prospect loves what you’re selling they are still going to go through lead stages.

The lead stages can be classified into 3 steps.

These are:

ATTRACT (or nurture)

At this point the lead is a stranger who you are looking to catch the interest of. They will discover your business through a number of ways like your website, an advert your blog, or even a social media page. The goal is to attract them and interest them enough to want to see what you are offering.

Not sure how important lead nurturing is? 

  • According to a DemandGen report, lead nurturing drives 20% more sales opportunities than non-nurtured leads. 
  • Companies that nurture leads generate 50% more sales at 33% lower costs.
  • Nurtured leads spend 47% more than non-nurtured leads


The conversion process is what takes place when a lead goes from a prospect to interested to then finishing as a customer. This involves them interacting with your business and lead generation strategies. For example, the prospect lands on your page and the contents of the page peak their interest, the next step is then to fill in a call to action form that lets you know they are interested and takes them to the next stage of qualifying the lead.

This process can take a while depending on what your business offers. According to Marketing Donut, 3% of leads who inquire about your business won’t convert for at least 3 months.

The point is that this process is ongoing and your business will find its effective conversion strategy.


Once your prospect progresses through the lead generation stages and has advanced from the conversion step. The next logical step is that the offer you present to them will result with you closing them as a client. This step can be in the form of a sales letter offer and ends in them signing up/buying from you.

Lead Generation Channels 

Now that the process of what lead generation is, it’s important to know what channels can be used.

These include:

Email Marketing: According to a report from Ascend2, email marketing still tops the list of the most effective methods of lead generation. Email marketing has transformed over the years and so have the applications used to send mass emails.

Content Marketing: This is the process of creating content that helps your business connect with users and is an important part of lead generation that emphasizes the term “content is king”.

Search Engine Optimisation: If you are not on the top of search results, your business is not going to be as visible when it comes to finding leads who have a problem you have the chance to solve.

Social media marketing: Learn how to use social media to help you connect with prospects and better understand their needs as well as clearly define the audience your business appeals to.

Website usability: Today the website of a business is the face of that business and a way for people to interact with the business so making sure that it works well and does what it needs to do is very important.

Pop-ups: When pop-ups are used in the right way they can provide information to leads and encourage them to click. 

Events: Before the internet became as popular as it is, leads were gathered at events and even though the recent pandemic has changed the way socialising happens, events are still a great wayo to gather leads and establish trust with potential leads.

Touchpoints: These are great ways for people to interact with your business that help drive them to your website. These touchpoints usually appear on Instagram accounts or social media in general

The Lead Generation Technology Stack 

Lead generation is done with the help of software and programs that allow us to move through the process of converting leads. 

The steps through this process include 

  • Content
  • Awareness/Promotion
  • Lead Capture
  • Lead Management


For people to exchange their details with you (which helps your lead generation) your content offering has to be worthwhile. Some platforms to make this happen include: WordPress, Joomla, Clickmeeting (for webinars).


The next step is a CMS, CRM and marketing automation platform to help you successfully manage your lead generation. Applications useful for this include Hootsuite, Buffer, Sprout Social, Sprinklr (For social media marketing) and then applications like Google adwords, LinkedIn, AdRoll, Terminus (for advertising).

Lead Capture:

For landing pages the following applications can be used: unbounce, Leadpages, instapage, and lander and for forms and systems integration formstack, wufoo, and gravity forms, and zapier respectively.

Lead management is divided into 3 sections.

For marketing automation, applications to use are Hubspot, InfusionSoft, Marketo.

For Data Enrichment: applications to be used can be Clearbit, Discoverorg, insideview, netpropex, and circle back.

And for CRM: applications used can include Oracle, Microsoft dynamics, netsuite, zoho, and insightly

Statistical Trends of lead generation in recent years  

And to wrap up, we’ve collected some of the stats of lead generation from recent years regarding lead generation to help you understand if your campaigns are working the way they should be.

  • According to a report from Hubspot, 61% of marketers consider generating traffic and leads to be their biggest challenge.
  • Marketers are still focusing heavily on lead generation, with 53% of them spending half or more of their entire budget on lead gen efforts. Only 34% of marketers spend less than half their budget on lead generation.

According to recent reports, 80% of marketers that use automation software drive increased leads (as much as 451% more), and that 77% of them convert more leads than those that don’t use automation.