What's the Difference Between a Prospect and a Lead?

The difference is bigger than you think.
What's the Difference Between a Prospect and a Lead?
Many people are unsure about the difference between a lead and a prospect.

Leads and prospects are two different terms for describing the status of a potential customer relationship.

By the end of this article, you'll know the difference between the two and how it affects your sales strategy.

What Is a Lead?

A lead is someone you've had contact with. It could be as simple as seeing them at an event or responding to their email.


It's not anything more than that though. Leads don't become prospects until further down the sales cycle when we know more information about them.


A lead is at the first stage of a sales cycle. Leads are generated from things like inbound web forms, signing up for your company newsletter, and more.


A lead is a top-of-the-funnel, unqualified contact.


Leads have expressed some level of interest in your product or service. But it isn't determined if they fit the ideal buyer persona.

Leads Come From:

1. Names on a list: Either one you compiled yourself or one you obtained from a third party.

2. Referrals: Either from coworkers or current customers.

3. Responses: If someone replies to your cold emails or phone calls, they are still considered a lead until you further qualify them.

4. Inbound/Advertising: In the realm of sales, this is a fantastic position to be.


You must connect with them before you know if they are still a lead. Sales reps should chat with leads to see whether they're disinterested or interested in being a buyer.

What Is a Prospect?

A prospect is someone who is a good fit for your products/services and is moving toward a decision with the help of a sales rep.


Before they are ready for a demo call, prospects need additional information on what you're selling. You can do this by sending nurturing emails on a regular basis.

Turning a Lead Into a Prospect

To convert a lead into a prospect, walk them through the sales qualification process to see if your company's products or services are the best fit for their needs.


Prospect qualifying is divided into three stages:

1. Organization-Level: Make sure the lead meets the main characteristics of your buyer persona. Consider criteria such as the company's size, industry, and demographic region (if selling B2B).

2. Opportunity-Level: Determine whether the prospect can execute your company's offering and whether they would profit from employing your product at this stage of the qualification process.

3. Stakeholder-Level: Once you've concluded that the lead fits your ideal customer persona, ask if they have authority to make a final purchase decision. If not, you need to find the right stakeholder with whom to continue the sales process.

The following graphic can help you in differentiating between a lead and a prospect:.
Differences between leads and prospects

Conclusion

The most significant distinction between prospects and leads is their level of engagement. Leads are at the top of the funnel, prospects are already in it.

Now you know how leads and prospects are different, you can use this knowledge to close more deals!
Post by Lucy Zorrilla.
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