Hiring and Growth

Inbound and Outbound Marketing 101: Understand the Difference and Why It’s Important

Olivia Jones  
Two women work at a table.

There are many different marketing strategies out there, and it can be challenging to decide which strategies will help your business meet lead, conversion, and sales goals. Inbound and outbound marketing are the two primary categories that encompass the majority of marketing activities, and it’s critical that you understand the difference between the two styles in order to select the best strategy for your business. In this article we’ll explore the differences between inbound and outbound marketing, strategies that fall under each category, and how you can determine which style will best suit your business’ needs.

What is inbound marketing?

Inbound marketing is a collection of marketing strategies that focus on naturally drawing potential customers into your business funnel using content that attracts your ideal customer profile. This style of marketing often works by providing some value to potential customers for free first. By providing free value (information, helpful content, access to webinars and industry reports, interviews with experts, etc.), you can build brand awareness, attract potential customers, and cultivate loyalty. Inbound marketing takes time because a hallmark of this strategy is not pushing your audience too hard to convert to paying customers. You need to allow time for the relationship to grow naturally. This strategy tends to build trust and pays off in the long run.

Below are examples of inbound marketing:

  • Keeping an active, updated blog on your company’s website. In order for this strategy to work well, you’ll want to carefully tailor your blog content to appeal to the profile of the clients you’re seeking. Paired with SEO research, a blog can be a great inbound marketing tool for building name recognition and brand loyalty among potential clients.
  • Creating a podcast for your business, where a member of your team interviews leaders in your industry.
  • Offering a detailed, informative e-book about a topic relevant to your industry. Ebooks can be used as lead magnets, or incentives for potential customers to share their contact information in exchange for free access.
  • Maintaining a presence at industry conferences and events to engage with potential customers

What is outbound marketing?

Outbound marketing is a collection of marketing strategies that focus on actively seeking out potential customers to draw them into your sales funnel. This type of marketing pinpoints where your potential clients already are (either physically or online) and then targets them directly. Outbound marketing is primarily active rather than passive and requires a clear understanding of who your potential customers are and what your value proposition is. These strategies may include paid advertising and digital marketing, in-person networking, or cold-calling strategies—among others. Regardless of your chosen techniques, effective outbound marketing is easier than ever these days, since detailed demographic information is available for purchase through major advertising platforms and third-party cookie agencies.

Examples of outbound marketing include:

  • Running digital advertisements on platforms like YouTube, Facebook, or other social networks. Google Ads allows businesses to purchase advertising on participating websites, or promote website or product links in Google search results. The cost of running digital advertising campaigns varies widely by industry.
  • Placing advertisements in a local newspaper, or purchasing a commercial slot on a local TV network.
  • Sending hard mailers, such as flyers or physical coupons, to potential customers in your target geographical market.
  • Working with influencers to ensure product placement in videos, on blogs, and/or on social media.
  • Cold-calling potential leads.

What are the key differences?

Both outbound and inbound marketing share a common goal: to make sales. But these strategies differ in their approach to that goal. The most obvious difference is in the time to sale for each of these techniques. Because outbound marketing is more narrowly targeted to potential leads, it generally requires less time from campaign to sales or conversions. Outbound marketing is also a bit more aggressive in its approach, which is another reason why it tends to take less time for marketing dollars to show return in sales.

In comparison, inbound marketing has a longer lead time. It doesn’t directly target potential customers, instead creating attractive, tailored content designed to passively draw in leads over time. Because it isn’t aggressively targeted the way many outbound marketing techniques (like paid advertisements, sales email campaigns, and cold-calling) are, it can be difficult for marketing managers to track the cost per conversion of inbound marketing techniques. Marketing team leaders may have to do a good amount of legwork to educate leaders from other sides of the business about the value of investing in inbound marketing. And it does generally have great value, even if it’s difficult to obtain hard data at times.

Inbound marketing can capture high-value leads that may be less responsive to outbound marketing techniques. If your business sells technical software to other businesses, mailing out a marketing flier is unlikely to lead to connections with decision makers in the business—and those are the people you need to reach if you want to make a high-dollar sale. Because inbound marketing techniques are less “sales-y” they can be more effective at drawing C-suite executives and other decision makers into the sales funnel.

Why does it matter?

Simply put, inbound and outbound marketing are both effective, but they’re well suited for different marketing goals. And while taking advantage of either of these strategies will likely result in increased sales eventually, using the wrong type of marketing for your business can disrupt your sales timeline.

How to decide which strategy is right for your business

Inbound and outbound marketing both work well. The best strategy for your business will depend on factors like your marketing goals, your ideal customer, and the service or product you’re selling. Below are a few ideas to consider as you evaluate which marketing approaches are best for your business.

  1. Identify your ideal customer profile. A strong understanding of your ideal customer is the foundation for any effective marketing campaign. If you haven’t done this before, devote serious time and resources to it. Get as specific as possible.
  2. Conduct market research. Check out some of your competitors’ marketing campaigns. As far as you can tell, how do they invest their money and attention? Is their ideal customer profile different from yours? This information provides a broader basis of knowledge that you can use when identifying your ideal customer.
  3. Go to where the potential customer already spends time. The more complicated your product or service is, the more important it is that you follow this rule. Meet your customer where they already spend time. Do they spend time on Instagram? Advertise there or work with Instagram influencers. Are they active on LinkedIn? Send them a well-crafted InMail message. Use demographic information to decide whether to pursue more traditional, “old-school” techniques or take full advantage of digital marketing.
  4. Set clear business goals and a timeline. We’ve already discussed how using inbound versus outbound marketing can impact how quickly your business meets its sales targets. In order to decide which strategies to use, decide on a timeline and goals for your marketing campaign. You can use these targets as a reference point for decision-making.
  5. Connect authentically with your target audience. Even when using paid promotions like digital advertisements or influencer marketing campaigns, your points of contact with leads need to be meaningful. All of us are constantly bombarded with people, corporations, and lobbying groups vying for a piece of our attention. If you want to stand out, find a way to create a meaningful connection with your potential leads through your marketing strategy. This kind of attention stands out in a good way.

It can be challenging to decide on a marketing strategy for your business, especially when the differences between inbound and outbound marketing aren’t always clear. But if you focus on your ideal customer and use their needs, habits, and interests to guide your marketing strategy, you’ll be off to a great start!

Olivia Jones
Olivia Jones Olivia Jones is a freelance writer and former HR professional. She writes about HR and education for tech companies around the world.

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