In a world filled with business jargon, sometimes it can be hard to understand precisely what someone is talking about. Last year we shared a beginner’s guide to venture capital, and we figured it’s about time we make one for modern sales since we couldn’t find one that already exists.
Sure, Tomasz Tunguz‘s article about the five key players in the sales process and Jeff Haden‘s about overused words salespeople use when talking to customers provide us with new perspective, but what about a deep dive on the modern sales dictionary? Learning what sales basics and complicated terms that everyone throws around mean can be a challenge. That’s why we created this list, as a jumping off point for those new to the sales space or sales professionals looking for a simple way to explain sales language to a colleague in another department or a friend.
While this list is not comprehensive of all words and phrases relevant for today’s salespeople, we hope it serves as a good foundation for learning about the modern sales era and inspires you to dig deeper. Companies and teams define these terms differently, and as the responsibilities and strategies for sales evolve, we encourage you to revisit your team’s definitions.
- The process between first contact with a prospect and when the sale is made
- The length depends on the company, type of business, effectiveness of sales process, market and customer’s situation, and can be less than a minute or many months
- The cycle includes seven phases: 1) prospecting and qualifying leads, 2) preapproach, 3) approach, 4) presentation, 5) handling objections, 6) closing the sale, 7) following up
- A person or company that has shown interest in your product or service
- Could be a MQL (marketing qualified lead) or SQL (sales qualified lead)
- A person or company that could become a customer
- A prediction of what sales will be achieved over a given period
- Sales managers require sales reps to forecast for overall business planning and to ensure the necessary resources are available
- A sales model that targets high-value companies, or accounts, rather than specific leads
- Relies on predicting and targeting accounts that will be most receptive to buying
- Create and optimize the process, data and applications to help sales reps succeed and drive growth and revenue
- Oversee sales performance and reporting, territory alignment and goal setting
- Has been around since the ’70s, when Xerox first created its sales ops group
- Originally handled “all the nasty number things that you don’t want to do, but need to do to make a great sales force.” – Harvard Business Review
- Often referred to as sales ops
- Stands for sales development rep
- An inside sales rep focused on outbound prospecting
- Qualifies leads, schedules appointments and converts them to SQLs
- Conducts product demos, negotiates terms and closes deals
- Leads and guides sales ops, account executives and SDRs
- Assigns sales territories, sets quotas, mentors sales team and builds sales plan
The Art and Science of the Sell
Ideal customer profile
- Description of the target organization that would get value from your product or service and is considered a high-quality sales lead
- Also known as ICP
- The method for getting consumer interest in your product or service
- Includes organic search engine results, referrals from existing customers, advertising and more
- Short for customer relationship management
- Describes the process of managing the sales process
- Often refers to CRM systems which store and organize customer details, contacts, sales history and account development
- An integrated application of CRM tools that automate and streamline sales inventory, leads, forecasting, performance and analysis
- The process of planning sales territories, which are geographic areas that a salesperson is responsible for
Annual run rate
- Annual recurring revenue for the coming 12 months if you don’t add or churn anything
- Also known as ARR
- The rate at which customers cancel their revenue subscriptions
- Calculated by dividing the number of customer who churned in the period by the total number of customers at the start of the period
- Stands for lifetime value
- An estimate of the total subscription value of an average customer
If you’d like a more in depth definition for any of these terms or think we’re missing any essential ones, feel free to let us know via email.
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Also published on Medium.