90+ Sales Terms Explained: The Ultimate Sales Glossary

90+ Sales Terms Explained: The Ultimate Sales Glossary

If you're in sales, then you know that there are a lot of terms and phrases that get thrown around.

And if you're not in sales, then you've probably heard some of these terms and wondered what they mean.

Whatever your case is, this article will explain over ninety sales terms — so by the time you’re done reading, you'll have a better understanding of what's going on in the world of sales.

90+ Sales Terms Explained

A

A/B Testing

A/B testing is a method of marketing research where you show two different versions of something to two different groups of people (group A vs group B) and then see which version performs better.

For example, you can run these tests with websites, where you might show group A the current website design and group B a new design, to see which one gets more people to sign up or make a purchase.

Account-Based Marketing (ABM)

ABM is a strategy B2B companies use to target and connect with key accounts. And these "accounts" are often specific departments within a company, or an entire company itself.

The end goal of ABM is to create personalized campaigns that will resonate with each account and ultimately increase B2B sales.

Account Executive (AE)

An Account Executive is responsible for achieving monthly sales quotas through direct client interaction, prospecting, presentations, and product demonstrations. Usually, an AE must maintain a high level of activity to generate a sufficient pipeline of opportunities to meet quotas.

For example, they might be responsible for making 20 phone calls per day, meeting with 5 prospective clients per week, and so on.

Account Mapping

Account mapping is a visual representation of the decision-makers in a company and how they are connected to each other. It is often used in sales and marketing to help identify buying committees and key influencers within an organization.

Account Mapping Sales Term

After-Sales Service

After-sales service is the provision of additional services to customers after they have purchased a product.

For example, if a customer purchases a car, the after-sales service would be the servicing and maintenance of the car. And if a customer purchases a computer, the after-sales service could be the warranty and technical support.

AIDA

AIDA means Attention, Interest, Desire, and Action. It's a framework businesses use to market and sell a product successfully.

First, you get their attention, then you interest them in what you're offering, then you create a desire for it, and finally, you get them to take action and buy it.

Always Be Closing (ABC)

ABC is a sales strategy that emphasizes the importance of closing deals. The idea behind ABC is to maximize every opportunity presented by a potential customer and ensure that no time or effort is wasted on activities that won’t lead to sales.

Annual Contract Value (ACV)

ACV is the total monetary value of a contract over the course of a year. For example, if a customer pays your business $5000 per month, their ACV would be $60,000.

Annual Recurring Revenue (ARR)

ARR is the amount of revenue a company makes on a yearly basis from its recurring customers. Businesses often use this metric to predict future revenue growth and assess the health of their business.

Annual Recurring Revenue Sales Glossary

For example, if a company has 5,000 customers and sells its product for $59 per month, its ARR would be 5000 (customers) x $59 x 12 (months) = $3.54 million.

Average Order Value (AOV)

AOV is a measurement of the average amount of money that your customers spend per order. You can use this number to track customer spending habits and optimize their marketing and sales strategies accordingly.

AOV calculation: Total Revenue / Number of Orders

For example, if your store had $10,000 in sales from 100 orders last month, your AOV would be $100.

Average Revenue per User (ARPU)

ARPU is a measure of the revenue generated by a company per user. There are a few different ways to calculate ARPU, but the most common is Total Revenue / Total Number of Users.

B

B2B

B2B means business to business, describing businesses selling to other businesses. A good example of a B2B business is an automobile company that sells its cars to dealerships.

B2C

B2C means business-to-consumer, describing businesses selling directly to consumers. A good example of a B2C company is Amazon—as they sell products directly to consumers through their website and apps.

BANT

BANT is an acronym for Budget, Authority, Need, and Timing. These represent the factors potential buyers often consider before making a purchase.

BANT Sales Term

Ballpark

Ballpark is a term used to describe the approximate cost, value, or range of something. For example, if you're asked how much you think a new car costs, you might say "it's in the ballpark of $20,000"—meaning that it costs somewhere around that amount.

Below the Line (BTL) Sales Promotion

BTL is a sales promotion technique that involves activities designed to generate consumer interest and awareness about a product or service. Common BTL activities include in-store promotions, point-of-purchase displays, sampling, and coupons.

Big Ticket Items

In sales, big-ticket items are high-priced products or services that have a significant impact on your business. These items are usually large and require a significant investment on the part of the buyer.

Bottom of the Funnel (BOFU)

BOFU refers to the final stage in the customer's journey where they are making their purchasing decision. At this stage, they are heavily considering your brand and are either comparing you to your competitors or ready to make a purchase.

Business Intelligence (BI)

Business intelligence is the process of gathering, storing, analyzing, and providing access to data you can use to improve business performance. In other words, BI is all about using data to make better business decisions.

For example, a retail company might use BI to track sales data and customer behavior in order to make decisions about inventory, store layout, marketing campaigns, and more.

Buyer Journey

A buyer journey is the steps your ideal customer takes on their way to becoming a paying customer. It’s basically their buying process.

For example, a customer might first become aware of your product or service through a blog post or social media mention. They might then visit your website to learn more, and eventually decide to make a purchase. That's one example of a buyer journey—but there are many possible variations.

Buyer Persona

A buyer persona is a fictional, generalized representation of the individuals who are involved in purchasing your product. Creating a buyer persona helps you better understand them so that you can market to them more effectively.

For example, if you’re a B2B software company, your buyer persona might look something like this:

Name: Sarah; Title: Marketing Manager

Company: Small- to medium-sized business

Location: San Francisco, CA

Needs/Challenges: Sarah needs to increase the company's website traffic in order to generate more leads.

Buying Intent

Buying intent is the level of interest and motivation that a consumer has when considering purchasing a product or service. Sales and marketing teams often use it as a metric to gauge how likely a prospect is to convert into a paying customer.

C

Challenger Sales

Challenger Sales is a selling technique developed by Matthew Dixon and Brent Adamson. The basic idea behind Challenger Sales is that the best salespeople don't just sell products, they challenge their customer's assumptions and help them see reasons why they need to change.

For example, a Challenger Salesperson might say to a customer, "I know you're happy with your current supplier, but have you considered that this other product is 20% cheaper and just as good?" This type of statement challenges the customer's assumption that they are getting the best deal possible and provides an interesting reason to switch to the new product.

Churn

Churn (or churn rate) is the metric used to measure how many customers or subscribers discontinue using a company's products or services during a time period. It's usually expressed as a percentage and calculated by taking the number of lost customers or subscribers, divided by the total number of customers or subscribers:

Churn Rate Sales Term

C-Level or C-Suite

C-level or C-suite refers to a company's most senior executives. The most common C-level titles are the chief executive officer (CEO), chief financial officer (CFO), chief operating officer (COO), chief information officer (CIO), and chief marketing officer (CMO).

Closed-Lost

Closed-lost is a term used to show that a deal has been officially lost.

Closed-Won

Closed-won describes the status of a lead or opportunity that has been successfully converted into a sale.

Closing Ratio

Closing ratio is a measure of how successful you are when it comes to converting prospects into customers. It is calculated by dividing the total number of sales closed by the total number of sales opportunities. A high closing ratio signals that a business is effectively turning leads into customers, while a low closing ratio may indicate that the sales process needs to be improved.

Cold Calling

Cold calling is the process of making phone calls to potential customers who do not know you and have not previously expressed an interest in your products or services. And the goal is often to get them to buy your product.

Cold Emailing

Cold emailing is the process of sending emails to people you don’t know to build a relationship or sell them something.

Consultative Selling

Consultative selling is a sales technique where a salesperson seeks to understand the customer's needs and provide solutions that address those needs. The goal is to add value, demonstrate expertise, build trust, and put them in a frame of mind that's receptive to your product or service.

CRM

CRM (customer relationship management) is a system for managing a company's interactions with current and future customers. It often involves using CRM software to record and track customer interactions.

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Cross-selling

Cross-selling is the practice of selling additional products or services to an existing customer. For example, a SaaS business might cross-sell professional services such as data migration or workflow setup to customers using their platform.

Customer Acquisition Cost (CAC)

CAC refers to the costs associated with acquiring new customers.

Customer Acquisition Cost Sales Glossary

For example, if a company spends $100,000 on marketing and sales efforts in a year and gains 300 new customers as a result, its CAC would be $333.34.

Customer Lifetime Value (CLTV)

Customer lifetime value (CLTV or CLV) represents the total value of a customer relationship with a company.

Customer Lifetime Value (LTV) Sales Terms

D

Demand

Demand refers to the quantity of a good or service that consumers are willing and able to buy at a given price over a given time frame.

Delivery

In sales, delivery is the process of transferring ownership of goods or resources from one person or organization to customers.

Demo

A product demo is an interactive marketing or sales presentation where you show your product or service in action to an engaged audience. A demo can take many forms, but often includes a guided tour of the product's features and benefits, and is usually followed by a Q&A session.

Discovery

Discovery (or a discovery call) is the first stage in the sales process where a sales rep works to understand a customer's needs. This stage is important because it allows the salesperson to determine whether there is a potential fit between the customer's needs and the company's products or services.

Discount

A discount is a reduction in the price of a good or service. Companies often offer discounts to encourage customers to purchase more or to switch to a different product or service. They could also offer them as an incentive for early payment, or to reward customers for their loyalty.

E

Early Adopter

An early adopter is an individual who is among the first to buy new products or services.

Economic Order Quantity (EOQ)

EOQ is the optimal quantity of inventory a company needs to order at a time. The EOQ model takes into account the fixed costs of ordering and storing inventory, as well as the variable costs of each item.

End of Quarter

End of a quarter in business contexts means the end of a three-month period, typically referring to one of the four quarters in a fiscal year.

F

Field Sales

Field sales is a type of direct sales that involves physically interacting with potential customers in order to promote a product or service.

Firmographic Data

Firmographic data is information about a company you can use to identify and target them as potential customers. This data can include things like the size of the company, its industry, and its location.

For example, let's say you sell a product that is most popular with small businesses in the tech industry. You can use firmographic business data to target small tech companies in your marketing and sales efforts.

Forecasting

Sales forecasting is the process of analyzing past sales data and estimating future sales revenue. Forecasts are normally based on historical data, industry trends and averages, and current pipeline status.


Fortune 500

Fortune 500 refers to a list compiled by Fortune magazine ranking the top 500 U.S. public and privately held companies for their fiscal year end results.

Franchise

A franchise is the right to sell a company's products or services in a particular territory. It's a license that a party (franchisee) acquires from another party (franchisor) to allow them to conduct business under the company's name.

G

Gatekeeper

A gatekeeper is a person who controls access to a decision-maker. Gatekeepers are often administrative assistants, receptionists, or other support staff.

I

Ideal Customer Profile (ICP)

ICP is a description of the exact type of customer you are looking for at your business. When you know who your ideal customer is, you can better target your marketing efforts to attract them.

Inbound Sales

Inbound sales is the process of proactively attracting customers to your business, usually through online channels—as opposed to manually reaching out to them. Common inbound sales activities include content marketing, search engine optimization (SEO), and social media marketing. Inbound sales leads will indicate interest by filling out a form on your website or providing their contact information in exchange for a resource, at which point the sales team can start working to sell them your product or service.

Inside Sales

Inside sales is the process sales representatives use to engage customers and close deals without physically meeting them in person. Inside sales teams, in most B2B companies, use a variety of strategies, tools, and techniques to find and engage customers.

J

Just in Time (JIT)

Just in time is a production strategy that strives to improve productivity and reduce waste by manufacturing products only as they are needed for sale or use.

K

Key Performance Indicators (KPIs)

KPIs are a type of performance metric that is used to measure, track, and compare progress against predetermined goals. Common sales KPIs are opportunities, revenue numbers, sales volume, lead volume, profit margin, website traffic, conversion rates, and email open rates.

Key Performance Indicators in Close CRM

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L

Lead

A lead is a person who has shown interest in your product or service. And you can attract them in many different ways, like through your website, custom landing pages, in-person interactions, or even through word-of-mouth.

Lead Generation (Lead Gen)

Lead generation is the process of getting people to show interest in your product and getting their contact information by filling out your contact form, scheduling a call on your calendar, or requesting a free trial.

Lead Nurturing

Lead nurturing is the process of developing relationships with leads that aren't quite ready to buy your product or service. They've likely followed you on social media or subscribed to your newsletter, so you'll just need to keep the conversation going with them until they're ready to make a purchase.

Lead Scoring

Lead scoring is a method used by sales and marketing teams to prioritize potential customers or leads based on how many interactions they've had with your brand and how likely they are to turn into customers.

Letter of Intent (LOI)

A letter of intent is a formal document expressing an intention to do something, especially between two parties. It typically contains provisions regarding the business relationship between the parties involved and is often used as a precursor to a more formal contract.

M

Marketing Qualified Lead (MQL)

An MQL is a lead who you've determined to be more likely to become a customer, based on certain behaviors related to your marketing efforts. This could be someone who clicked on an ad, provided their contact information in exchange for a content resource, or regularly engages with your brand on social media.

Middle of the Funnel (MOFU)

MOFU is the stage of the sales funnel where potential customers are becoming aware of your product or service and are likely developing an interest in what you offer.

Monthly Recurring Revenue (MRR)

MRR is a measure of the sales revenue a business is generating per month. It is a key metric, particularly for subscription-based businesses, as it provides insight into the health of the business and its ability to generate recurring revenue from monthly users.

MRR calculation: product price X the number of monthly customers

N

Net Promoter Score (NPS)

NPS is a customer loyalty metric that measures how likely customers are to recommend your product or service to others.

It's calculated by subtracting the percentage of "detractors" (those who would not recommend your product or service) from the percentage of customers who are "promoters" (those who would recommend your product or service to others).

If the net score shows a positive number, it means that your product or service is doing well and customers are happy with it. A negative score shows that there is room for improvement and customers are less likely to recommend it to others.

O

Omnichannel Sales

Omnichannel sales refers to the coordinated selling of products and services across multiple channels, like email, phone, website chat, social media, and more. With omnichannel sales, these efforts are synchronized across different platforms so the conversation continues seamlessly even as the channels change.

Onboarding

Customer or client onboarding is the process of helping a new customer get started with your product or service after their purchase.

Opportunity

An opportunity in sales describes a potential customer or client who is in contact with your sales team and who's very likely to become a paying customer—because they have a need and have shown an interest in using your product or service to meet that need.

Outbound Sales

Outbound sales (or sales outreach) is the process of actively seeking out and selling to potential customers, rather than waiting for them to reach out to you.

P

Pipeline

A sales pipeline is a visual representation of the sales process from start to finish. It's typically used by sales managers to help them understand where their deals are in the sales process and to identify any potential roadblocks or bottlenecks—so they can take action to keep the pipeline moving.

Sales Pipeline Sales Term
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Prospect

A prospect (or sales prospect) is an individual who'd likely have an interest in your products or services because of certain attributes they have.

Prospecting

Sales prospecting is the process of researching and identifying potential customers (prospects) with the goal of selling to them.

Q

Qualification

In sales, qualification (or lead qualification) is the process of determining whether a prospective customer has the budget, authority, need, and willingness to buy your product or service.

Qualified Lead

A qualified lead is a lead that has been deemed likely to result in business by both marketing and sales teams. A qualified lead typically exhibits certain characteristics like scheduling a call or submitting your contact form.

Quota

A quota is the specific amount of sales a salesperson is expected to achieve in a given period.

R

Referral

A referral is an act of sending business to another person or company, usually in return for a commission—or for free. Referral sales is a strategy that reps may use to generate new sales leads from existing customers.

S

Sales Cycle

A sales cycle is the process potential buyers go through before buying from a business. It's also the process the business uses to sell its product or service to customers. And for many (if not most) businesses, a sales lifecycle consists of four main stages: prospecting, outreach, closing, and follow-up.

Sales Development Representative (SDR)

A sales development representative generates new leads and meets quotas for their business. They may also be responsible for qualifying leads, managing a sales pipeline, and reporting to a sales manager on their progress.

Sales Enablement

Sales enablement is the practice of providing the tools, templates, information, and support that salespeople need to be more effective and successful in their roles. This can include everything from training and education to technology and data.

Sales Funnel

A sales funnel is a process that businesses use to identify and qualify potential customers, and then guide them through the sales process—with the goal of eventually closing the sale.

Sales Operations

Sales operations describe the processes and resources that are necessary to sell a product or service. The sales operations team in a company normally handles the purchase and implementation of tools, setting up automation workflows, outlining sales territories, building incentive programs, and more.

Sales Pitch

A sales pitch is a short, persuasive speech or message that is typically used to convince an audience to buy a product or service.

Sales Process

A sales process is a system that is used to manage sales interactions with customers and prospects. It usually involves steps like prospecting, contact management, opportunity management, deal management, and activity management.

Sales Qualified Lead (SQL)

A sales qualified lead is a potential customer who has been vetted by the sales team as being ready to buy. Usually, they've formally asked about the company's products or services and are now looking to make a purchase.

Segmentation

Segmentation is the process of dividing an email or contact list into smaller groups so you can send more personalized messages to each group. Common attributes you can use for segmentation include things like geography, age, gender, interests, industry, or past purchase history.

Sequence

A sales sequence or cadence is a series of touchpoints with a lead over time. The goal—move them through your sales pipeline and convert them into paying customers. This may include touchpoints via email, text message, or phone calls.

Service-Level Agreement

An SLA is a contract between a service provider and its customers that specifies the details of the services to be provided. It often outlines details like the duration of the service, availability, and response time, as well as penalties for failing to meet the agreement.

Small to Medium-Sized Business (SMB)

An SMB is typically a company with a small- to medium-sized workforce. Most people characterize small to medium businesses (SMBs) as organizations with less than 1000 staff members and below $1 billion in annual revenue.

Social Selling

Social selling is the use of social media platforms (like Facebook, LinkedIn, and Twitter) to interact with prospects and customers in order to generate leads and grow sales.

Software as a Service (SaaS)

SaaS is a software distribution model in which applications are hosted by a provider and made available to customers over the Internet. SaaS is typically delivered on a pay-as-you-go basis, or via a subscription.

Solution Selling

Solution selling is a sales technique where you narrow in on a customer's problem and then offer them a solution that your product or service can provide—in a way that's tailored to their specific needs.

SPIN Selling

SPIN selling is a sales methodology developed by Neil Rackham, the author of the best-selling book SPIN Selling. The key idea behind SPIN selling is that there are four important questions to ask for any successful sales interaction:

  • Situation questions: to establish the buyer's current situation, needs, and objectives
  • Problem questions: to understand the buyer's specific challenges and problems
  • Implication questions: to highlight the potential consequences of the buyer's challenges and problems
  • Need-payoff questions: to establish the value of solving the buyer's challenges and problems.

Stakeholder

A stakeholder is an individual or group that has an interest in the success or failure of a company's products or services.

T

Talk Track

A talk track is a sales script or series of questions that help to keep a conversation with a prospective customer on track.


Target Account Selling (TAS)

Target account selling is a B2B strategy that zeroes in on prospects by focusing on factors like deal value, ideal customer persona, industry, revenue sources, pain points, buying signals, and budget. And the goal of all that targeting is to generate and close more business with fewer but bigger customer accounts.

Top of the Funnel (TOFU)

Top of the funnel describes the stage where customers are just becoming aware of a problem they have and are starting to search for solutions.

Touchpoints

Touchpoints are the points of contact between you and your customers. Every time a customer comes into contact with your business, a touchpoint event is created.

Triggers

A sales trigger is an event in the world of a potential customer that creates an opportunity for you to contact them as a prospect. An external trigger may include a new round of funding, mergers, or a hiring push. These triggers may make it a better time for outbound sales reps to reach out to the company.

On the other hand, triggers can also be events where a lead shows specific interest in your product—such as clicking on an ad, downloading a resource from your blog, or engaging with a chatbot on your website.

U

Unicorn

Generally, a unicorn is a privately held startup company with a current valuation of US$1 billion or more.

Upselling

Upselling is a sales technique where a seller encourages a buyer to purchase more expensive items, upgrades, or other add-ons in an attempt to make a more profitable sale.

V

Value Proposition

A unique value proposition is a statement that describes what makes your company or product different from your competitors. It should be clear, specific, and relevant to your target customer.

Know Your Sales Terms

The world of sales can be confusing, especially if you're not familiar with all the terminology. So we hope this comprehensive glossary of over 90 sales terms will help you better understand the sales process, and assist you in your career as a sales professional.

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