Suspects, prospects, leads, traffic… We’re all guilty of using different terms to describe prospective clients as they move through the sales funnel. But do you really understand what they all mean? Businesses units, systems, and organisations often use the terms interchangeably, or apply their own definitions. But a common understanding is essential. Why?
Both marketers and salespeople need to know how far through the sales process each client is. Here, we suggest definitions for ‘leads’ and ‘prospects’, to help you strengthen your performance.
What is a Prospect?
This is where the language can become more confusing. There are two types of prospects: marketing prospects and sales prospects.
Marketing prospects are those contacts who might become leads – in other words, ‘prospective’ leads. An example is an email list. Before any action has been taken, all contacts are prospective leads. They will become leads proper when they have confirmed their interest.
Sales prospects are different thing. If marketing prospects are at the very top of the channel, then sales prospects are at the penultimate level. Leads become sales prospects when they are ready to engage in two-way communication with a named individual. At this stage, they are likely to have demonstrated their intention to buy your product or service, and be ready to discuss details. Calls to action for sales prospects will focus on continuing the conversation until an outcome is reached.
What is a Lead?
Leads are the most basic type of contact for any sales or marketing person. As soon as anyone shows an interest in your organisation, they become a lead. Lead B2B prospecting can happen in two ways. The first is inbound. Interested parties will complete your web form, or sign up to your newsletter, and leave their contact information. The other method is through outbound marketing. Your organisation can use email lists to contact potentially interested parties. Contacts become leads as they express their interest and confirm their contact details.
At this stage, your leads will be unqualified. But they remain leads as you find out more about them. Through engaging in communications – usually automated, mass emails or mailings – you can begin to measure their level of interest, and start to develop a relationship. While there may be a number of communications, leads will not yet engage in dialogue. Calls to actions for leads are likely to include links to content, or invitations to connect.
Why It's Important to Know the Difference Between Leads and Prospects
Understanding where each client fits into the sales funnel is crucial for success. It will determine which marketing and sales approaches you use, and when.
Knowing how to guide your contacts from marketing prospect to lead to sales prospect to customer will mean the difference between failure and success. And tailoring your lead generation and outbound communications is a key element of this success. Using our definitions will help you and your team build the understanding you need.