Understanding the Language of Sales
Allow me to introduce myself — my name is Mike Humphries. I’ve work with growth-oriented companies with responsibility for producing revenue. As part of the smartPRENEUR faculty, I plan to talk about process and the need for it in sales. This blog sets the stage for the language that will be used — the language of sales. In upcoming blogs, I will list the basic sales process steps. Most of the blogs will cover a key part such as qualification, discovery, etc. My goal is to help you succeed!
Prospect: A potential customer (often mistakenly called a suspect or lead) that has become worthy of spending sales resources. A qualified prospect has met your qualification criteria.
Suspect: A raw lead that has not been through any meaningful qualification and so is not yet a prospect.
Lead: Any suspect that has come in through just about any source. Leads and suspects are about the same thing.
Customer: A person, family or business that has purchased your product, service or solution, depending if you are in the smart home or smart business market.
Reference: An existing customer who has expressly given permission to be a source of information about their satisfaction with your product or services for interested parties.
Qualify (qualified prospect): To take a suspect and determine whether they meet the minimum criteria that you have established as being worthy of the expenditure of resources through the rest of the sales cycle. An example of qualifying criteria is: a recognized need from the prospect for a solution that your product or service roughly matches, budget, identified decision maker, decision timeframe that meets your requirements and a process expressed by the prospect on how they will make this decision to select a solution and commit to buy.
Sales cycle: The term for the entire set of steps that must take place from the prospect stage to the end of cycle they meet — order close, qualified out, lost to competition, etc.
Close: The end of the sales cycle that involves getting a prospect to agree that they will purchase, and you actually get the approval of the sales agreement — by a signed contract.
Recommender: The person who has been delegated to examine proposed solutions to the problem they wish to solve. They normally sift through the findings and make a recommendation when someone else if the economic buyer. Sometimes this is the same person. If they are not the same person, your job is not done until you also have agreement from the economic buyer and a signed contract. decision maker (also called the Economic Buyer): The person at the prospect or customer who has the authority to make a decision to buy or not (independent of the evaluators.) In the case of consumers this may be a specific family member and not necessarily the one you are speaking with.
Economic buyer: The person at the prospect or customer who owns the budget that will be used to pay for the purchase. Or, the person at the prospect or customer who has the sole authority to make a decision to buy or not (independent of the evaluators).
Common Terms in Sales
Coach: A person at your prospect who is not the decision maker or economic buyer, but is an insider, has a vested interest in your solution winning and is willing to help guide you through the internals of the prospects’ evaluation and decision process, within ethical bounds. There may be more than one coach per prospect.
Gatekeeper: A person at the prospect or customer who has the task or clout to make sure your product or service meets their particular requirements yet is not the decision maker or economic buyer. Gatekeepers can decide not to allow your product or solution to succeed but cannot decide to buy. There may be several gatekeepers in any given opportunity.
Stakeholder: Anyone at a prospect or customer that has a legitimate interest in the solution of their problem, or the outcome of the sales cycle. This overall term includes decision makers, economic buyers, etc. Often, they have a high degree of interest in the problem you propose to solve but are not the problem owner. They are usually a part of the prospect team recognized internally as a part of the process on their side. You may find that you have not met all the stakeholders, or in some cases, even know who they are. It is usually important to find out.
Feature: A product attribute that describes what it does or how it works. It does not directly convey a benefit to the prospect. Examples — aluminum case, extensive control menus, three patents, etc.
Benefit: A characteristic of your product that describes what it does or how it achieves a result. Examples — cuts preparation costs 10%, reduces the time to deliver completed designs to customers by 40%, greatly reduced training time.
Note: Often a way to distinguish between feature and benefit in the tech world is if the statement appeals to a technical person but not to a non-technical business person, it is likely a feature. There are plenty of gray areas in distinguishing the two, but more often than not the answer is pretty clear. Benefits are what you sell as value, and often play into the ROI. Features usually do not.
Agreement: Often interchangeable with Contract. The written (or soft copy) agreement between two or more parties as to what is being licensed or paid for, what responsibilities each party is obligated to perform, deliverables, etc. Key to this is execution by all parties as to agreement whether by signing a paper copy, or electronic signature or approval of a soft copy.
Commitment: Usually a non-written agreement to do or perform something. With prospects, a commitment is usually a verbal agreement that they are going to sign an Agreement. Sometimes Letters of Intent are used with prospects or customers. They are almost always non-binding and should be treated as such. Their purpose is usually as a test of sincerity, or psychological to help move a prospect mentally towards signing an Agreement.
A commitment from an employee, especially a salesperson carrying quota, is a serious and important statement that might be used to validate a forecast or other form of sales status. Company culture should make clear what is expected from anyone making a ‘commitment’.
Commitments are important, but from prospects they are non-binding and should always be treated as such.