Sales Leads versus Sales Prospects – What’s the Difference
This is a question that comes up fairly frequently. The question isn’t a minor one. Too often people use them interchangeably.
A prospect is a potential customer that fits the market that you are targeting, has the means to make a purchase of your product or service, and also has the power to make that purchase. Imagine that you have found a company that you believe is a potential client/prospect. You’ve done a bit of homework and they seem to have the capacity to purchase in terms of financial capacity and have the ability to make a decision to purchase. They are a potential customer/prospect. If you find that they either don’t have the capacity to make the purchase due to finances or an inability to make the decision that are not. But it might mean someone else in the business/household could be. Ask questions to see if there is someone else who is a prospect.
So what is the basis for developing a list of prospects? When you started your business, did you develop buyer personas? One of the important parts of planning a business is identifying who your ideal customers are. If you can’t describe them how will you know them when you see them? If you really have a good picture of who you are marketing to it is easier to identify your prospects.
A lead on the other hand isn’t qualified. They may not have the ability to make the decision or they may not have the ability to purchase. Your sales funnel starts with leads and work through them to see if in fact they are prospects or if you can help them become a prospect. If your services are a $5,000 value and they have $50, they aren’t a prospect. Your job is to move leads into a prospect status. If they can’t possibly reach the capacity to actually move forward they are not a prospect. You may choose to continue that relationship because they are a potential referral source, but they lack capacity.
In many sales situations the salesperson doesn’t do enough to determine if the individual or company is really a prospect. Those people are not really sales people, they are order takers.
The very best salespeople aren’t looked at as salesmen, they are looked at as problem solvers. They help people solve their problems, be they the need for professional clothing, or someone who can teach or train them.
Are you selling solutions, or just what you want to sell? If you can’t fix their problem are you strong enough to admit it and help them find the solution they need, not the one you are selling?