Keeping your “sales pipeline” full is essential to making sales and meeting your goals. It is always challenging to manage your time – between prospecting, selling, and maintaining existing relationships, it can be a lot to keep straight. One of the most important, and often overlooked, stages of the sales process is prospecting. It doesn’t matter how much you practice your sales presentation and refine your selling skills if you don’t have anyone new to meet with. If you’re not consistently seeking new potential clients, you are doing yourself a disservice.
The “prospecting” stage can be a bit daunting as there are a variety of categories that your contacts can fall into. How do you know if a contact has become a “lead” an “opportunity” or a “prospect” when in the early stages of interactions? This can be even more challenging when the terms are used differently by different companies and business units. Creating a consistent system for defining and categorizing each of the terms with your team (and hopefully your company as a whole) will be extremely helpful for increasing the efficiency of the prospecting process.
The biggest difference between the three is the nature of the interaction and if you have researched and qualified them as a viable client. As such, the following definitions can be helpful in categorizing and planning during the prospecting phase.
A “lead” is contact information for an individual that is related to a sales opportunity. The lead can be the eventual purchaser, an advisor, a friend, or a referral. Typically, a lead is not as fully qualified as a prospect, though this can vary by company or industry. A lead is usually categorized by primarily one-way communication, as in, the lead has contacted the company in some way – by a contact form on a website or some other message.
A “prospect” is typically a lead that has been qualified and is receptive to being sold what you offer. Generally, a prospect would be a “sales receptive” lead and you could convert the contact with a prospect into a sales opportunity. A prospect is generally categorized by two-way communication – that is, you or someone on your team has connected with the prospect and has sent them information as well as receiving an initial query.
A sales “opportunity” is then the time and space to take advantage of the receptive attitude of the prospect and meet with them to give your sales presentation. When you’ve reached the “sales opportunity” phase, that typically means the prospect has engaged with you multiple times and has been receptive to setting up a meeting or has actually scheduled a meeting with you.
It is important to remember that there are different categories in the sales prospecting process and that each level should be treated differently to be sure you have the most successful and efficient interactions.