Demand Generation

Inbound vs. Outbound—Where to Focus Your Lead Generation

There is a time and place for both inbound and outbound lead generation strategy; the trick is knowing which one you should be focusing on. Both approaches underscore the need for incentive, and regardless of which method used, every initiative requires some form of lead nurturing. The most efficient lead generation strategies utilize a combination of both approaches, but the key is to understand your target audience so you can leverage the most cost-effective practices to reach them via a personalized buyer’s journey that enhances the overall experience. Here are some factors that contribute to how you should tackle your market and lead generation strategy:

Total Addressable Market (TAM)

One of the key elements in the decision to push your resources on inbound or outbound is the total addressable market for your product set. Is your product/service niche and focused on a very specific company/buyer persona, or are their millions of potential customers to sift through? The TAM matters because of the cost of resources needed to cover the bases in order to most cost effectively and efficiently scale. As a general rule of thumb, products and services with a huge total addressable market should focus on an inbound sales and marketing strategy. This strategy should identify those companies in market for your products and services, and most efficiently route them to your sellers. For those of us with smaller, more specific target markets, employing a targeted outbound approach can not only be more effective, but also friendlier on budget.

Growth Stage

The one key consideration that most sales and marketing executives don’t take into account when building their strategy is that inbound leads don’t grow on trees. On average, there are roughly 3% of your target buyers in market for your solution at any given time. Given that the average B2B technology vendor has a minimum of 10+ direct competitors, generating enough inbound marketing pipeline to reach your growth goals may in fact be impossible. There are only so many sources of inbound leads, and when the tap has run dry, your sales and marketing team needs to be ready to increase your outbound focus. For early-stage companies looking to simply get money on the board using as little resources as possible, it’s all about the inbound! Early stage investments should be in a TOP NOTCH PPC and SEO specialist (or company) to ensure your product and service is generating the maximum amount of hand raisers.


While I’d love to tell you that every marketing department is well funded, the cold hard truth is that most organizations’ marketing budgets (and resources) are stretched thin. In the cases where there simply isn’t enough budget to compete in the competitive inbound space (PPC/SEO/HQL), it’s important to focus your resources on cost effectively building out your internal marketing database. The key to outbound marketing is getting in early, identifying buyers at the top of the funnel (where they are cheaper to acquire), and nurturing them into thought leadership and content until they enter the buying stage. The real difference between a $30 top-of-funnel lead and $300 inbound lead is only time. By leveraging outbound marketing and planning long term, you can actually cut your inbound marketing costs significantly.

To better develop your lead generation strategy, it’s imperative to have a strong understanding of your ICP and TAM. The right data will give you valuable insights for building customer relationships and sales prospecting. Outbound lead generation can produce results quickly when done right. Implementing inbound lead generation usually takes more time but can potentially uncover more opportunities over a longer period. At the end of the day, it’s vital to choose a strategy that aligns well with your business. Evaluating the TAM, growth stage, and budget of your organization will help you decide when to best utilize inbound and/or outbound.