Business

What is the difference between a lead and a prospect?

While these terms are often used interchangeably, they do not necessarily denote the same thing. Different marketing professionals may disagree on the exact definition but the concepts can be broadly distinguished as follows: aprospect is essentially a successfully nurtured lead.

Sales lead

Leads are indefinite and information-based. To elaborate, a sales lead is a potential customer who has expressed interest in a company’s product or service. These are potential customers that have been identified via advertising or another channel. The potential customers would have shown interest in the offering, in some way or another, in varying degrees, and provided contact information as a result. The information gathered by the business, via advertising or other means, constitutes the sales leads.

Inbound web form completion is usually deemed the most basic top-of-funnel lead and this is a useful place to start for the sake of explanation. Negotiating all the leads that a business receives is made a lot easier with a lead management tool that features automatic lead capturing. Such a system is equally valuable when qualifying leads into prospects, which is a great segue into the definition of a prospect.

Prospect

Prospects are qualified leads. This means that the leads have met a certain criteria and have shown that they align with the persona, they fit the profile, of the company’s target buyer. When the business has engaged with the leads that were generated, it’s that intervention that qualifies the potential customers and renders them prospects. They are prospective customers which has a slightly stronger connotation than potential customers. A prospect is something that can develop or may become actual, hence a link to the outcome.

Sales process

To put this in context, consider the sales process. First one identifies a target audience, then implements a strategy to gather leads which hopefully produces valuable results.Next the leads need to be qualified; it needs to be established which leads show promise, because not all of them will. This is how the leads get transformed into prospects. Once leads have been filtered leaving only prospects, the salesperson can move on through the sales funnel.

Communication

The fundamental difference can be relayed in terms of communication; leads are typically characterised by one-way interaction whereas prospects are characterised by two-way communication. A prospect would have responded positively to follow-up communication by the company as part of its lead nurturing process.

Keep the dialogue going so that all leads become prospects!

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