48 essential sales terms that all salespeople and marketers should know

When sales and marketing teams align to share insights and resources, they can generate more leads, increase prospect engagement and ultimately create more revenue.

According to LinkedIn’s research, 90% of sales and marketing professionals agree that aligning their teams’ initiatives and messages positively impacts the customer experience. Around 85% think this type of collaboration is the largest opportunity for improving business performance.

However, members of both teams must be able to speak the same lingo for this cooperation to work.

In this sales terms glossary, you’ll find definitions for the most essential words and phrases you’ll likely hear in your next sales and marketing strategy meeting. Brush up on old knowledge or use it as a go-to reference guide next time you need sales lingo clarity.

An A–Z sales glossary for reps, managers and marketers

While sales strategies and trends continue to evolve, there are certain words and phrases that endure.

Here are 48 sales lingo examples to add to your vocabulary.

ABC (Always be closing)

ABC is an acronym for “Always Be Closing”. “Closing” refers to making a sale.

Sales teams use this motivational phrase to emphasize the importance of moving leads from a discovery phase of the buying process to purchase.

Activity-based selling

Activity-based selling is a sales strategy where reps focus on a series of clearly defined, cascading actions that make a sale happen rather than prioritizing closing the deal(results-based selling).

An approach like this helps reps stay organized and motivated by giving them control over how much time they spend on certain tasks and allowing them to set short-term objectives.

For example:

(See also: consultative selling)

Annual contract value (ACV)

Annual contract value, or ACV, is a measurement that shows how much an ongoing customer contract is worth by averaging and normalizing its value over one year.

You can use ACV to gauge the dollar value of customer accounts that involve monthly subscriptions, different pricing plans and multi-year contracts.

(See also: annual recurring revenue)

Annual recurring revenue (ARR)

Annual recurring revenue, or ARR, is a metric that shows the amount of recurring revenue a business generates from its subscription accounts.

ARR is particularly useful for measuring sales performance within a SaaS (software as a service) business. However, calculating this metric can be extremely complex depending on your business model.

For example, you may have a vast number of customers with different subscription terms.

(See also: annual contract value)

B2B (business to business)

B2B describes the relationship between a buyer and seller in which both parties are businesses.

For example, Pipedrive provides sales customer relationship management (CRM) and pipeline management software to other companies to empower their sales teams, so we operate a B2B sales model.

(See also: B2C)

B2C (business to consumer)

B2C describes the relationship between a buyer and seller when the seller is a business and the buyer is an individual consumer.

For example, Netflix sells its streaming service to individual users and operates a B2C model.

(See also: B2B)

Buyer persona

A buyer persona is a semi-fictional representation of a business’s ideal customer based on market research and existing customer data.

Inbound marketers use buyer personas to define their target audiences so they can create content that reaches and resonates with best-fit potential customers.

Sales reps can use the same profiles to qualify leads (e.g., “This website visitor matches the demographic profile of our ideal customer, so they’re more likely to be interested in buying and are worth spending time on”).

Buying criteria

Buying criteria are pieces of information a consumer needs to make a buying decision.

While all buyers have their own criteria, this type of information generally includes answers to questions such as:

• What is the product?

• Why should I buy it?

• How will it benefit me?

• How much does it cost?

• Why should I buy it from your business?

Buying process (also called a buying/buyer/customer journey)

The buying process (or customer journey) is a sequence of steps a buyer takes to become a customer.

While theories vary in detail, most buying processes follow a similar pattern:

1. Problem recognition

2. Information search

3. Evaluation of alternatives

4. Purchase decision

5. Purchase

6. Post-purchase evaluation

As with customer lifecycles and sales funnels, the stages of the buying process help salespeople understand what their prospects might be feeling and looking for at any time.

With this information, salespeople can better position their product as the right choice.

(See also: customer lifecycle)

Buying signal

Buying signals are cues that convey a potential customer is ready to buy.

For example, a prospect may ask about the small print specifics of a subscription plan or sign up for a free plan.

Churn rate

Churn rate measures how many customers stop using a product or buying from a business.

To calculate customer churn rate, divide the number of customers you lose in a certain timeframe by the total number of customers at the start of the same period. Multiply the result by 100 to get a percentage.

For example:

1. 20 customers lost in March ÷ 250 customers on board at the start of March = 0.08

2. 0.08 x 100 = a churn rate of 8%

Closed opportunities

Closed opportunities are won or lost deals that mean a lead has reached the end of their sales cycle.

Whether the lead becomes a customer or decides not to buy, the opportunity has concluded.

Tracking this metric ensures reps won’t waste time with people who have already purchased or are not ready to buy.

Cold calling

Cold calling is an outbound sales technique where reps make first-time calls to prospective customers who haven’t expressed interest in their product before (but do match the ideal customer profile or ICP).

While the recipient of a cold call might not be aware of the brand contacting them, a good sales representative will qualify prospects first by making sure they fit their business’s ICP.

Consultative selling

Consultative selling is a “buyer-first” sales approach that prioritizes customer relationships over selling a particular product.

A salesperson using consultative selling will focus on their customer’s needs and biggest pain points before they try to provide a solution.

Doing so means the solution they put forward (and how they frame it) is relevant and personalized.

(See also: activity-based selling)

Conversion

In sales, a conversion is when a prospect becomes a lead or a lead becomes a customer.

In marketing, the term broadly describes when the recipient of a marketing message completes a desired action. For example, a website visitor signs up to your email list or provides their contact information.

You can measure the success of sales and marketing efforts using conversion rates. In sales, you could calculate this by dividing the total number of qualified leads by the number of converted customers.

Cross-selling

Cross-selling describes a sales opportunity that involves selling different products to an existing customer.

Cross-selling usually involves products or services that are related to or complement one the customer in question already owns.

For example, an electronics sales rep who sells a mobile phone to a consumer could encourage them to buy a wireless charger or protective case.

(See also: upselling)

Customer acquisition cost (CAC)

Customer acquisition cost, or CAC, measures the total sales and marketing cost a business requires to earn a new customer over a tracked period.

The cost comprises all spending in these areas, including salaries, commissions, bonuses, sales tools and travel expenses.

By measuring and subsequently reducing its CAC, a company can determine and increase its profitability.

(See also: sales metrics, lifetime customer value)

Customer lifecycle

The customer lifecycle is a multi-stage (and repeatable) journey customers go through, from first hearing about a brand to becoming one of its ambassadors.

There are seven stages in a typical customer lifecycle:

1. Awareness

2. Engagement

3. Consideration

4. Conversion

5. Support

6. Loyalty

7. Advocacy

Salespeople and marketers can use the stages of this buyer’s journey to understand their customers’ needs and emotions.

For example, during the consideration stage, a prospect needs information that will help them compare one product to others on the market.

(See also: buying process)

Customer lifetime value (CLV)

Customer lifetime value, or CLV, is a metric that indicates the total revenue a business can expect from a single customer account during a B2C or B2B sales relationship.

To calculate company-wide CLV (you can do it for distinct customer categories with the right data), you’ll need the following information:

Average purchase value

Average purchase frequency

Customer value

Average customer lifespan

CLV

Increasing CLV by improving customer experience (to increase customer loyalty) can make your business more profitable and efficient.

Customer relationship management (CRM)

Customer relationship management, or CRM, describes the technology and processes an organization uses to manage relationships with prospects, leads and customers.

The word “customer” in CRM encompasses many types of relationships.

As well as buyers, sales tools tools like Pipedrive’s CRM help businesses monitor and maintain relationships with:

• Employees

• Suppliers

• Partners

• Brand advocates

• Marketing contacts

• Candidates

Some CRM software includes automation features that help sales managers, account executives and reps automate repetitive tasks such as scheduling follow-up and discovery calls.

Decision-maker

A decision-maker is a person at an organization who has the final say over B2B purchasing decisions.

Sales reps don’t always talk directly to decision-makers when selling and may negotiate with a representative instead. However, they’re worthwhile prospecting targets as long as they have a direct line to a decision-maker.

If possible, communicate directly with decision-makers. Doing so means you can:

• Convey your value proposition without it being diluted or miscommunicated

• Shorten the sales cycle to increase efficiency

Forecasting

Sales forecasting is the act of using historical data to estimate future sales performance over a specific period.

Accurate sales forecasts help reps plan their time and allow managers to set realistic expectations around performance goals and expenses.

Gatekeeper

A gatekeeper is a person at an organization who decides which information gets through to a decision-maker within their business.

For example, a receptionist who screens calls for a procurement manager is a gatekeeper.

Personal assistants and office managers often act as gatekeepers, too.

A great sales rep will have a range of tactics to get past gatekeepers and facilitate more effective and efficient communication with buyers, especially when cold calling and cold emailing.

(See also: decision-maker)

Inbound sales

Inbound sales encompasses the direct sales tactics teams implement to provide value and entice potential customers to get in touch.

For example, in-depth content marketing efforts (such as a whitepaper) can reflect your company’s expertise without you having to pitch it.

Essentially, these are activities a sales team uses to encourage interested prospects to reach out to the company rather than approaching prospects themselves.

(See also: outbound sales)

Incremental sales

Incremental sales measures the value of products or services a business sells during a tracked period beyond what it might generally sell.

For example, a company might monitor incremental sales to determine the impact of promotional activities or new sales tactics.

Inside sales

Inside sales is the process of selling products and services remotely through means such as phone calls, emails and video conferencing.

Inside sales is also sometimes called virtual sales or remote sales.

The main benefit of inside sales is that representatives can form relationships and sell to anyone, regardless of their location.

(See also: outside sales)

Lead

A lead is someone who fits the seller’s ideal customer profile and has demonstrated some intent to buy a product (e.g., engaging with emails or other content marketing materials).

Leads sit between the top of the funnel and middle of the funnel, where reps can encourage them forward using targeted cold calls and emails.

Marketers can promote lead generation and help nurture leads by creating relevant content (including sales enablement material).

(See also: prospect, lead qualification, qualified lead, sales funnel, sales enablement)

Lead qualification

Lead qualification is the process of determining which potential customers are most likely to buy a product or service (e.g., contacts who are likely to buy become qualified leads).

Effective lead qualification enables sales reps to use their limited time efficiently rather than spend it with someone who has no intention of purchasing.

(See also: qualified lead)

Lead scoring

Lead scoring takes qualification a step further.

Here, sales teams assign values (usually numerical “points”) to leads to prioritize those that will be most valuable to the business.

Monthly recurring revenue (MRR)

Monthly recurring revenue, or MRR, is a metric that represents the predictable total amount of monthly income your business generates.

It’s particularly useful for SaaS businesses that have customers signed up for rolling monthly subscriptions.

You can calculate MRR with this formula:

(See also: annual recurring revenue)

Net Promoter Score (NPS)

Net Promoter Score, or NPS, is a metric that measures your company’s current level of customer satisfaction and loyalty.

You can find out your score by asking customers how likely they are to recommend your business on a scale of 0–10.

Onboarding

Onboarding is the post-purchase process of acquainting new clients or users with your product.

It aims to give paying customers the best possible early experience of a product to help create valuable long-term relationships and reduce churn rates.

Outbound sales

Outbound sales are direct sales tactics where reps contact potential customers to entice them to buy.

For example, cold calling people who fit your company’s ICP is an outbound sales technique.

Outside sales

Outside sales (also known as field sales) is the process of selling products and services in person through face-to-face meetings.

While outside sales reps sometimes use an office as a base, they spend most of their time meeting leads and customers in the field, usually at their businesses.

(See also: inside sales)

Pain point

A pain point is a specific problem that drives a business’s prospective customers to search for a solution.

For example, a consumer who keeps losing their keys (the pain point) may search the market for a GPS-tracking keyring (the solution).

The sales rep’s job is to help buyers determine pain points and address them by providing or recommending suitable products.

Pipeline (or sales pipeline)

A pipeline, or sales pipeline, is an organized, visual way of tracking potential buyers through the various stages of their purchasing journeys.

Sales pipelines are often presented as horizontal bars or funnels comprising stages that match the organization’s sales process, such as:

1. Prospecting

2. Qualifying

3. Contacting

4. Relationship-building

5. Closing

(See also: buyer journey, sales funnel, prospecting, lead qualification)

Prospect

A sales prospect is someone who has demonstrated interest in a product or service, shown intent to make a purchase and is open to finding out more from the seller about their solution.

Prospects sit between the middle and bottom of the funnel, where reps can nurture them using personalized communication (instead of more broadly targeted cold calls, cold emails or marketing content).

(See also: lead, prospecting)

Prospecting

Prospecting is an activity where reps aim to find potential customers (leads and others who fit the ideal customer profile) and move them into their company’s sales funnel.

Once there, they can nurture them towards becoming a customer.

(See also: prospect, sales funnel)

Qualified lead

A qualified lead is the most sought-after potential customer.

In other words, it’s someone who has expressed interest in buying a product and also has the budget, authority, need and timeframe (a sales methodology known by the acronym “BANT”) to make a purchase.

It’s important to know the difference between a marketing qualified lead (MQL) and a sales qualified lead (SQL).

An MQL is someone who has demonstrated interest by interacting with a business’s marketing team or output (e.g., by downloading a piece of content) but has yet to enter the sales funnel.

An SQL has been vetted by sales and meets all the above criteria, meaning they’ve entered the lead funnel and reps can nurture them towards a purchase decision.

(See also: lead qualification)

Quota (or sales quota)

A sales quota is a set number or value managers expect a salesperson to meet over a given period, often a month or quarter. Sales managers set quotas for their reps to hit so they can measure and compare individual and team performance.

By monitoring quotas, sales leaders can reward top performers and identify underperforming reps to plan extra coaching accordingly.

(See also: sales metrics, sales management)

Sales enablement

Sales enablement (a key part of sales and marketing alignment) is the strategic process of creating and providing the tools teams need to sell products effectively.

Both sales and marketing teams develop sales enablement assets, typical examples of which include:

• Blog content and product guides

• Case studies and testimonial content

• Technical documentation for products

• Cold calling scripts

• Pitch templates

Sales funnel

A sales funnel is a visual representation of the entire journey, from a prospect’s first interaction with a business (such as a website visit) to purchasing a product and becoming a customer.

A classic sales funnel has three distinct stages:

• Awareness and discovery (top of the funnel, a.k.a. TOFU)

• Researching (middle of the funnel, a.k.a. MOFU)

• Making a purchase decision (bottom of the funnel, a.k.a. BOFU)

The goal of sales reps and marketers at each is to move prospects onto the next stage.

Read our guide for four free sales funnel templates.

Sales management

Sales management is the process of developing a sales force, training a sales team, coordinating sales operations and implementing techniques and methods that enable a business to reach its targets.

There are three distinct aspects of sales management: operations, strategy and analysis.

You can use sales management software like Pipedrive to oversee each of these.

Sales metrics

Sales metrics are key performance indicators (KPIs) that allow an organization, team or individual to measure sales performance. Examples of sales metrics include:

• Customer satisfaction (usually measured on a scale)

• Sales revenue generated

• Win rate

• Average deal size

• Average profit margin

• Quota attainment

• Customer response time

Sales professionals often have a lot of sales data, but key sales metrics help them understand what’s really happening.

Often, they’ll visualize these metrics on sales dashboards, a common feature of CRM tools.

(See also: customer relationship management)

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Service level agreement (SLA)

A service level agreement contract establishes sets of deliverables one party has agreed to provide another.

These can be between suppliers and customers or internal departments (e.g., sales and marketing).

For example, a lead generation agency may agree to deliver 200 qualified leads every month.

Social selling

Social selling is a lead-generation tactic where sales reps are active in their prospects’ social media spaces.

It aims to build trust so that when an ideal customer needs a product or service that your business sells, they think of you.

Upselling

Upselling is when a rep encourages a customer to purchase a higher-end (and higher-priced) product than the one in question to increase revenue for their business.

For example, a car salesperson responding to an inquiry about a base model car could encourage the prospect to test drive (and ultimately buy) a more expensive model with additional features.

(See also: cross-selling)

Value proposition

A value proposition is a short statement used in marketing materials and sales communications to give potential customers an immediate glimpse of a brand’s offering.

An effective value proposition should highlight a product, service or brand’s differentiating features in a way that addresses potential objections and expected customer needs.

For example:

5 words and phrases that can dilute your sales pitches

While sales-specific language enables reps, managers, marketers and business owners to communicate efficiently, salespeople must also be able to talk clearly with buyers.

Before using a sales term in front of a potential customer, consider what it means practically. For example, a word like “onboarding” has plenty of meaning in a sales context but could go straight over a B2C prospect’s head.

Instead, saying “processes that help you get started” can be clearer.

Using these non-sales-specific words may dilute the impact of your buyer interactions if you use them too liberally:

• “Obviously”. What you’re saying may not be obvious to the person you’re speaking with. Explain the basics in detail to ensure everyone is on the same page.

• “Our competitor”. Instead of repeatedly mentioning your competition, prioritize your buyer’s needs.

• “Discount”. Instead of offering explicit “discounts”, you may want to present a “great deal” to specific prospects or at certain times of year (e.g., Black Friday).

• “Contract”. While binding documents are necessary, “agreement” and “relationship” are both warmer terms to consider.

• “[Your company name]”. Most buyers care more about what you can do for them than who you are. Make all of your interactions about them to show you care about their needs.

Final thoughts

Knowing common sales lingo and definitions can help you, your team and other departments avoid confusion when collaborating.

Whether you’re a salesperson or a marketer, spend time getting a firm grasp of the most essential sales terms definitions. With this knowledge of sales terminology, you’ll be able to communicate more efficiently with colleagues and spend more time selling and creating compelling content.