Growth Marketing vs Demand Generation: Is There Really a Difference?

Key takeaways: 

• Growth marketing and demand generation are both data-driven marketing approaches. Some marketers disagree that there’s any meaningful difference between the two. 
• In my experience, demand generation is more likely to focus on the top of the funnel. And while a growth marketing approach can be applied to any one stage of the funnel, it’s more likely to be full-funnel or mid-lower funnel. 
• Growth marketing is popular among startups and high-growth companies. Demand generation, meanwhile, is favoured by a broader spread of businesses. 
• Ultimately, these precise definitions don’t make a huge difference. Marketing rarely sits nicely in a single framework, and strategies don’t fit neat definitions, so a bit of nuance and flexibility is needed! 

When I tell people I’m the co-founder of a growth marketing agency, the natural follow-up question is: What’s growth marketing? ‍

Or if I’m already around startup and marketing folks, it might be: How is growth marketing actually different from *insert alternative marketing term*? 

Recently, ‘demand generation’ has been that common point of comparison. And in all honesty, it’s not an easy question to answer briefly (or even to answer at all because there are conflicting views on this one!). 

What follows is my attempt to demystify the battle of growth marketing vs demand generation. For any fellow growth marketers reading, I’d love to know if you agree – drop me a DM!

A bit of background first

Every one of your customers goes on a buying journey. They go from never having heard of your product (or perhaps, even knowing that such a product exists), to buying it, rebuying it, and maybe even recommending it to people they know. 

This can be visualised as a 5-stage funnel:

• Awareness - When a customer first discovers your product.
• Consideration - When a customer begins to learn more and thinks about making a purchase.
• Conversion - When a customer makes a purchase.
• Retention - When a customer comes back for more.
• Referral - When a customer refers you to friends/colleagues.

Both growth marketing and demand generation work with this funnel, just with slightly different approaches. 

Growth marketing: an overview 

Growth marketing is a data-driven, experiment-led approach to full-funnel marketing. I think it’s most helpful to think of it as an approach to meeting your marketing goals, whatever they may be. 

So what characterises that approach? Experimentation. Growth marketing works on the belief that unlocking fast growth requires running constant, structured and iterative growth experiments to uncover what does and doesn’t work for your business. 

Here at Growth Division (we’re a growth marketing agency), each of our client projects is structured around the Bullseye Framework. 

How the Bullseye Framework works: 

• Step 1: Prioritising 3-6 channels from the list of 20 different marketing channels based on current marketing objectives, past channel performance, etc. 
• Step 2: Running structured experiments across those channels over an agreed period (~3-6 months). 
• Step 3: Validating or invalidating channels based on their performance in this time vs the desired performance.
• Step 4: Doubling down on channels that work (aka adding budget and resource), and reallocating budget from invalidated channels to bring a new channel in to test. 
• Step 5: Continue repeating steps 2-4 on a loop to find your perfect blend of channels, then really make them sing. 

The approach can be full-funnel, combining multiple channels to tackle each stage of the funnel, or it can be more focused around one specific funnel stage. 

Key tactics and characteristics of growth marketing: 

• Every move is grounded in data. Each experiment comes with a measurable, provable hypothesis grounded in current data. This is crucial, but isn’t without its challenges! 
• Short- to mid-term planning with rapid experimentation. 3-6 month plans are in place, but on the understanding that they are in flux. 
• Favoured by fast-growing companies and startups. It’s natural (and normal) for most growth experiments to fail. This is a worthwhile tradeoff for startups and fast-growth companies that don’t have an external ceiling on their growth; a few winning experiments could actually alter the trajectory of their business in a meaningful way.
• Operates across the marketing funnel, with the channel mix and experiments tailored to the goal at hand. 

Objectives of growth marketing: 

Growth marketing should always work towards one overarching, measurable goal. Depending on what that is, you might be tracking one or more of the following metrics: 

• Acquisition: Website traffic, cost per acquisition (CPA).
• Activation: User satisfaction scores, completion rates of onboarding steps.
• Retention: Churn rate, average session duration.
• Referral: Number of referrals generated, referral conversion rate.
• Revenue: Monthly recurring revenue (MRR), customer lifetime value (CLV).

If the overarching goal is MRR, this will need a full-funnel approach to make sure leads move through every step smoothly. But if the goal is website traffic (unusual but possible), the approach would focus on acquisition channels only. 

In reality, most of our clients come to us with an overarching revenue or marketing-qualified lead number goal, which we then break down into more granular objectives and key results (OKRs) for each funnel stage. And you can see this translate into our most commonly deployed channels for clients: 

Demand generation: overview 

Now, I should mention at this point that the difference between growth marketing and demand generation is a little contentious. Some marketers claim there isn’t one at all, and many use the terms interchangeably. 

Others, like myself, view demand generation as more focused on the top of the marketing funnel (awareness/consideration) than growth marketing.  

The goal here is education. And demand generation activities don’t just focus on educating users about your specific product; it’s about educating the audience about the fact that the product type exists at all, and why it’s needed. 

It’s a strategy centred around playing the long game and speaking to the 95% of people who aren’t ready to buy your product, rather than the 5% who might be. This might show up in: 

• Whitepapers, reports and lead magnets
• Newsletters 
• Guest blogs 
• Podcast appearances 
• Thought leadership content posted by senior leaders

Case study: How a demand gen content strategy influenced £300,000 in deal value for Retain International 

Retain International is a resource management software that’s trusted by some of the world’s leading firms. 

🎯 The challenge: For these very large firms, the need for resource management software is clear and unavoidable. But for smaller firms, which are likely getting by okay with a DIY-d combination of Excel spreadsheets and a frazzled planning team, the need isn’t immediately obvious.   

💡 The strategy: We’ve been working with Retain for over 3 years now, and content marketing, managed by content expert Kerry Leech, has always been a bit part of this. 

Kerry ran a demand generation strategy for this content. Instead of focusing predominantly on case studies, comparison articles, and even ‘What is/ How to’ keywords, her content gently introduces readers (service firms) to a problem they didn’t actually know they had, and a solution they didn’t know they needed (but clearly do). 

📈 The result: Retain recently confirmed that 10 of Kerry’s blog posts have influenced a combination of £300,000 in deal value. It’s a huge win that was 3 patient and consistent years in the making. 

Key tactics & characteristics of demand generation: 

• Longer-term planning. Demand generation is typically a long-term play, and you need to allow more time to see results. 
• Top-of-funnel focus. Demand generation is typically more focused on bringing leads into your funnel than moving them through it. 
• Favoured by a wider mix of businesses. I’d say demand generation tactics are often considered more traditional and are adopted by a broader range of companies. 
• Also very data-focused. Demand generation may be less experiment-focused, but the strategy is still grounded in data, and each move is still tied to a clear metric.

Objectives of demand generation:

Demand generation marketing typically has an objective of brand awareness or lead generation (for example, a list of people who downloaded your whitepaper). Brand awareness has historically been trickier to measure, but there are trackable metrics you can use here: 

• Share of voice (SOV): Shows how much online space you take up versus competitors, typically taking into account paid channels, social media and organic search. 
• Branded searches: Shows how many people are directly searching for your brand’s name at any given time. 
• Social media reach & engagement: Shows how often people see and interact with your social media content. 

Growth marketing vs demand generation: myth busting

Myth #1: “Growth marketing uses digital channels, whereas demand generation is more traditional”. 

My answer: Growth marketing absolutely still covers ‘traditional’ marketing activities, such as offline ads and trade shows. These can just be a little harder to measure than classic digital channels. 

Myth #2: “Demand generation is just about vibes, you can’t measure it.” 

My answer: There’s great technology around today to help you actively measure brand awareness, and demand generation is also very data-driven. The hard part can be assessing how different channels and campaigns are supporting each other, but this problem definitely isn’t limited to demand generation.

‍Myth #3: “Growth marketing and demand generation are two distinct approaches — you can’t just mix them”.  

My answer: To my mind, there’s no need to hold them completely separate. With demand generation, for example, just because the marketing activities will take longer to pay off in full, that doesn’t mean you can’t run experiments to optimise them in the meantime. 

What ultimately matters? Nuance and experience

Myth #3 brings me nicely on to my ultimate conclusion here: nuance is what actually matters. 

As a growth marketing agency, sometimes we find ourselves in grey areas: we believe a channel is adding value, but it’s taking a little longer to come to fruition. If we were growth marketing purists, we’d probably cut it anyway. 

But years of experience, working with 130+ startups, and witnessing our own share of false negatives and positives means we now know when to call upon one additional data point: 

Our gut instinct. 

Marketing moves fast and, in practice, rarely fits neatly into frameworks. Following the data, creating genuinely useful content, trying new things, and staying in conversation with your customers – these things all matter much more than trying to put the perfect label on your strategy. 

🎯 Growth Division builds fractional growth teams for startups and high-growth companies, handling both the ‘thinking’ and the ‘doing’. Book in a free 30-minute Bullseye session with one of our Growth Advisors.