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The Ultimate Sales and Marketing Glossary
- Always Be Closing (ABC)
- This is one of the main rules for a salespeople. This means that everything a salesperson does should be aligned with the ultimate goal - closing the sale. Every word, move, call and detail in the appearence should move the salesperson one step closer to the sale.
- Account in sales has the same meaning as client.
- Active Listening
- This is a communication technique aimed at increasing understanding and improving communication between the listener and the speaker. This is a vital skill for sales and business people. When listening activly one pays attention to everything the speaker does including selection of words, intonation and body language. Also, active listener constantly shows that s/he listens and understands what the speaker says.
- Added Value
- This is the improvements or additional value that a company adds to its products and services before offering them to its clients. The value added may be tangible or intangible.
- This is a set of actions that organizations take in order to introduce, promote and sell their products and services.
- This is an acronym that discribes the stages an observer of an advertisement can go through. The aim is to retain the maximum amount of observers on each stage. The stages are:
- A - attention. Grabbing the observers attention.
- I - interest. Arousing an interest in the products and services advertised.
- D - desire. Generating a desire to have the product or the service advertised.
- A - action. Leading the observers to actions to buy the offered product or service.
- Bad Leads
- This is a type of a lead that is not serious about wanting to learn more about your offers and to buy from your company. Asking the right questions on the early stage helps to qualify bad leads before investing too much efforts in them.
- This is a set of four valuable pieces of information that a salesperson needs to clarify when qualifying prospects. The 4 aspects are:
- B - budget. What is the prospect's budget?
- A - authority. Does the prospect have authority in the company to make a buying decision or to influence one?
- N - need. Does the prospect have a business need that you can solve?
- T - timeframe. When the buying decision may be made?
- Benefit Statement
- This is a statement that describes a feature of a product or service and connects the feature to the benefit that the feature will give your customers. FAB model shows how the benefit statement can be used for more effectiveness.
- Bottom-of-the-Funnel (BOFU)
- This is the last part of the sales funnel where evaluation, trial and buying decision are made.
- Buyer Persona
- This is a representation of the most typical customer of your products and services. Buyer persona can be developed using marketing research and real data. It is used to get a better understanding of your target market needs and its behavior and to better tailor all your marketing and sales activities. Buyer persona should be as detailed as it is possible and it may include customer behavior, needs, demographics, etc.
- Buying Criteria
- This is a set of criterias based on which prospects evaluate the products and services. These criterias might include factors associated with:
- the product and its features,
- the manufacturer and its credibility, and
- the salesperson or the saleschannel and its trustworthiness.
- Buying Decision Process
- This is the five-stages process that customers go through from the need recognition to the post-purchase behavior. The stages of the process are:
- Need recognition. Internal or external factors trigger the recognition of a new need.
- Information search. The customer searches for the information about how the need can be solved.
- Evaluation of alternatives. Different alternatives available are evoluated.
- Purchase decision. On this stage the customer makes the purchase.
- Post-purchase behavior. If the product or service satisfied the need it is likely that the customer will buy the same product again.
- Buying Signals
- These are different types of signals that indicate that the customer is ready to buy. Signals can be verbal and nonverbal. An experienced sales rep can notice buying signals based on what and how the client asks, or based on the client's body language.
- Call Center
- This is a room or a building in which specially trained people handle large numbers of calls. Call center can be a department of a big organization or it can serve many smaller companies on the outsourcing basis.
- This is a technique that is usually used in cold calling. During a canvassing call you ask prospect for some information rather than trying to sell something. This reduces the probability of rejection of the call and allows you to collect prospects for the future calls. In this case people are more likely to talk and answer your questions then they are during a cold call. Moreover, this technique allows you to get valuable insights about your target market that can be used in your company.
- Churn Rate
- This is a percentage of customers or subscribers who decided to discontinue using your services. When calculating the churn rate for a period of time you should not include any new subscribers that started using your services during this period of time.
Churn rate = customers lost during the period of time / customers at the beginning of the period.
- Close / Closing
- This is a sales term meaning making a sale. This the most important part of the sales funnel.
- Closed-Lost Opportunity
- This refers to prospects that were in the sales funnel, but didn't buy anything. It is very important to analyze what caused the losses and to keep the contact to use the opportunity again.
- Cold Calling
- This is a sales technique where salesperson makes unsought calls or visits in order to offer and sell goods and services.
- Collaborative Selling
- This is selling methodology where the seller helps the buyer to go through a thinking and decision making process from the need recognition to finding of the solution. Usually, the solution is buying proper products and services from the seller because the seller guides the buyer through the process. This technique makes the buyer highly involved in solving the problem and the buyer becomes the owner of the solution.
- Commission in sales means a certain addition to slaesperson's salary based on the obtained level of sales.
- Commodity is refered to a basic good that is almost identical to other goods of the same type.
- Competitive Advantage
- This is an attribute or condition that puts a company into a favourable business position. This may include access to natural resources, cheap labour, geographical position, new technology, high skilled employees, etc. Competitive advantage allows company to perform better than its competitors.
- This is a trade off in sales negotiations. It is possible to try to trade concession for concession. For example, you agree to make a discount of 5% if the customer pays in 7 business days.
- Consultative Selling
- This is a selling technique where the seller acts as a consultant for the buyer. During the meetings and conversations the seller tries to identify needs of the customer's company and suggests how his products and services can solve the needs.
- Consumer Behavior
- This is a study of behavior of organizations or individuals associated with selecting, buying, using and disposing of products and services.
- Conversion means that a visitor of the website has taken action desired by the company. The desired action can be different for different companies. Usually it is a subscription, download, share, sign in, or call.
- Conversion Path
- This is the path that follows a visitor from enering the website to the page or action that is desired by the company. Many analytics services help to analyze the path and make changes to improve the conversion rate.
- Conversion Rate
- This is the percentage of visitors to a website who take actions desired by the company.
Conversion rate = Number of conversions / Number of visitors.
- This is the technique used in selling and refers to offering additional products and services to existing customers. For example, if the customer buys a cell phone the seller may offer a case for this phone. Read more about cross-selling tips and tricks.
- Customer Relationship Management (CRM)
- This is a practice of recording, managing and analyzing of all company's interactions with current and future customers. The goal of a CRM system is improving relationships with clients through different channels.
- Customer Retention
- This is a set of activities undertaken by a company aiming to reduce loss of customers. Customer retention is a continuous process that should be done on each stage of sales cycle.
- This means closing a sale.
- This is the member of the customer's company who makes the decision about buying your products and services. It is important to understand who is the decision-maker on the early stages of the sales funnel and to focus your efforts on influencing the decision-maker.
- This is a sales term meaning all the products and services that will be provided under a sales contract. Deliverables may be tangible or intangible.
- Demographic is a term used in marketing and it means the market segmentation based on age, race, gender, income, habits, job, education, lifestyle, religion and other characteristics of the potential customers. This market segmentation allows a company to better understand its target market and tailor its products and services accordingly.
- This is a type of promotion where a product and its features are demonstrated to potential customers.
- Discovery Call
- This is the first call to a potential customer aiming to understand if the customer is truly interested in your products and services and if the in-person meeting is warranted. Discovery calls allow you to minimize the probability of unnecessary meetings that require a lot of your efforts.
- This is the process of spreading the products and services in order to make them available for the business and individual customers. Distribution occurs with use of distribution channels that pass the products and services to the end consumer.
- Ethical Selling
- This means complying with the rules of ethics that are explicitly or implicitly developed for the industry or the company. For example, it is ethical not to include hidden fees that your customers are not aware of in pricing of your products and services.
- Features, Advantages, and Benefits (FAB)
- This is a model of the statement that explaines why the customer should buy your products and services. Here is the model explained:
- Features - This is the description of the attribute the product or service has.
- Advantages - Here you describe the advantage that the feature gives.
- Benefits - Lastly you emphasize the positive outcomes of this advantage for the customer.
- Field Sales
- This means selling the products and services outside of the office.
- This is a sales term meaning a person who controls access to something or someone in the company.
- Hard Sell
- This is a sales tactic where a salesperson pressures clients in order to make the sell. Often it is considered unethic as hard selling makes customers to make hasty decisions.
- This is a person who has the power to influence buying decisions using her or his relationships, authority, or position.
- Introduction Letter
- This is a letter that is used to introduce you or your company to someone else.
- Just-In-Time (JIT)
- This is a business concept of optimizing a supply chain where company tries to minimize its stocks by organizing delivery supplies when they are required.
- Key Account Management (KAM)
- This means conducting, managing and improving the company communications with big customers. Business with such customers can significantly impact your company and it is wise to treat them individually and work on developing long-lasting reletionships.
- Sales lead occurs when an individual or a business shows interest in your company offers and provides contact details. Leads should be further qualified into bad leads and good leads, or prospects. Leads can be generated with marketing activities or they can be bought.
- Lead Time
- This is the time lapse between the order placement and the order fulfilment.
- Loss Leader
- This is a product that is intantionally sold at a loss in order to attract more customers and attention and to stimulate more sales of more profitable products and services. This pricing strategy is offen used by stores aiming to draw more customers into the store. The customers have intention to buy the cheap loss leader product and visit the store, but it is very likely that they will buy other products during this visit.
- Lifetime Value (LTV)
- This is the value of all sales that will be made to a customer. This concept suggest that you should try to retain customers because a satisfied customer will buy from you many times in the future and you will get more revenue than from just one transaction. For example, you are a car dealer and someone considers buying a car from you. Then if you satisfy the customer and he will purchase from you again you should consider this customer not as a purchaser of one car, but as a customer who purchases a bunch of cars.
- Margin / Profit Margin
- This is the difference between the product or service selling price and all costs associated with its production. It can be measured as a value or as a percentage:
Margin = Price - Costs.
Margin % = 100 * ( Price - Costs ) / Price.
It is important to differentiate margin from markup especially when dealing with percentages.
- Marketing Mix
- This is a set of vital elements that are needed for successful marketing strategy. Most often Marketing Mix is refered to the 4 P's concept developed by E. Jerome McCarthy's. The 4 P's are:
Companies should pay attention to all of the 4 Marketing Mix elements, because even one weak element can harm the whole marketing strategy.
- Product. This is a tangible good, or intangible service, or a mix of the two that can solve certain customers needs.
- Price. This is how much customers pay for the product. This may include money, time and efforts that customers pay in order to get the product.
- Promotion. This is all communication activities that company uses in order to inform cusumers about the product.
- Place. This is the place where customers can get the product.
- This is the amount by which costs of a product or service should be increased to get the selling price. It can be measured as a value or as a percentage:
Markup = Price - Costs.
Markup % = 100 * ( Price - Costs ) / Costs.
It is important to differentiate markup from margin especially when dealing with percentages.
- Middle-of-the-Funnel (MOFU)
- This is the middle part of the sales funnel where you provide your prospects with more information about your products and services. Usual activities on this stage are demonstrations, webinars, case studies and meetings where potential issues and timeframe are discussed.
- Monthly Recurring Revenue (MRR)
- This is the recurring revenue generated by your sales of subscriptions per month.
- Niche Market
- This is a small segment of the market with specific needs. Sometimes it is better to focus your marketing and sales activities on serving and penetrating a small specific market niche than to try to serve the whole market.
- This is a type of the prospect's question or statement that signals that s/he is not willing to buy your products and services or to continue the conversation. It is important to notice the signals and to find the best tactic to overcome this objection.
- Open / Opening
- Opening is refered to the preparatory actions that a salesperson does before closing the deal. In particular, this is how you approach, respond, communicate and understand your customers. Often how you do the opening has much more impact on the sale success than how you do the closing.
- Package Selling / Product Bundling
- This means combining products and/or services into one and offering it to customers. Often the price of a package is lower that sum of the prices of the items that make the package. This technique can be used to increase sales or to boost sales of new products and services.
- Pain Point
- This is a need or problem that makes customers to buy your products and services. If the buying decision is not spontaneous then it is very important to identify the pain points of your customers in order to better understand them and to tailor your sales strategy accordingly.
- Pattern Interrupt
- This is a sales technique that disrupts your prospect's normal pattern of thoughts or actions. Pattern interrupt is often used in cold calling in order to not letting a prospect to apply objections.
- PEST Analysis
- This a marketing aproach to analysiing the external factors influencing a company and that companies should take into consideration when creating strategies. The four groupes of factors are:
- Political factors. This is how the government actions influence the industry and the company. For example, laws, tarrifs, taxes etc.
- Economical factors. This includes ecomomic factors such as interest rate, exchange rate, growth rate and others.
- Social factors. These are all changes in the demographics of the country and the target market. For example, changes in habits, population, age, occupation, etc.
- Technological factors. This includes all changes in the technolgy that is available for companies in the industry.
- Positioning Statement
- This is a detailed description of your target market and how you would like the target market to perceive your company and its products and services. Positioning statement is used for internal use and can be compared to how your target market perceives your company at current moment of time.
- Product Mix / Product Lining
- Product Mix is the range of all product lines offered by a company. Product line is a group of related products offered by a company. Usually product mix is measured by its:
- Width. This is the number of lines in the company assortment. In other words, this means how many different customers needs the company can solve.
- Length. This is the total number of products offered by a company. It consists of the lengths of all product lines in the product mix.
- Depth. This is the number of different versions of the products. For example, a t-shirt offered in 4 sizes and 3 colors gives depth of 12 variations.
- Consistensy. This means how closely the products of one product line are related to each other. In other words, how consistenly products from one product line can solve customers needs.
- This is a potential client that is willing to buy your products and services and has a sufficient budget and authority for making the purchase. Read more about sales prospecting methods.
- This is a very powerful sales technique where a product or service bought can be returned after some time without any obligations. The trick is that the money or other costs of returning product become higher and the customer decides to continue using the purchase. For example, a family comes into a pet store and the children ask their parents to buy a puppy dog, but the parents don't think that this is a good idea. A salesperson approches the family and offers to buy the puppy dog with the right to return it in 5 days. The parents accept the offer thinking that they will make their children happy and return the purchase in 5 days. However, the children build bonds with the puppy dog and the parents do not return it.
- Qualified Lead
- This is a lead that is qualified as a sales-ready lead, or a prospect.
- This a required minimum sales target for a salesperson or sales unit that is assigned individually for a specified period of time.
- Referral selling
- This is selling that occurs as a result of someone recommending, suggesting, or referring your products and services. Referring usually happens spontaneously, but companies should try to facilitate this process.
- Sales Cycle
- This is a set of events that usually take place between the initial contact with a client and closing the sale. Sales cycle may be different for different organizations.
- Sales Forecast
- This is the predictions of the company's sales for the future periods of time. Usually sales forecast is made based on sales in the previous periods of time and it is adjusted based on changes that influence sales. It is vital to make accurate sales forecasts because many business decisions depend on the forecast.
- Sales Funnel
- This is the buying process that customers go through from awareness to buying. Sales funnel has three parts: Top-of-the-Funnel (TOFU), Middle-of-the-Funnel (MOFU) and Bottom-of-the-Funnel (BOFU). Based on the behavior of prospects on each stage of the sales funnel company can assess the efficiency of each stage and make changes if it is necessary.
- Sales Pipeline
- The same as Sales Funnel
- Sales Proposal
- This is a written proposal from a seller to a buyer desribing the details of the offer. Sales proposal is usually used when the sales process is complex, the price is high and the product or service is important for the customer.
- Service Level Agreement
- This is a contract between a service provider and a service buyer that defines the level of service that must be provided. Service level agreement can be generic for all customers, or developed for each individual customer.
- This is the process of incorporating the sales and marketing strategy and activities in order to ingrease efficiency of these processes. If done properly, Smarketing can lead to growth of revenue, because the customer experience becomes uninterrupted and the customer satisfaction is increased.
- Social Selling
- This is the type of selling where a salesperson interacts with customers using social media. This may include providing more information, answering questions, sharing content etc.
- Target Market
- This is a group of companies and individuals that the company decided to market and sell its products and services. Target market can be defined as one or several segments of the market.
- This is a process of generating leads, providing orgathering information and other marketing activities done over a telephone.
- This means selling products and services directly to customers using a telephone.
- This a geographical area or segment of the market that is given to a salesperson or sales unit in terms of resposibility and sales activities. Territory planning should be done properly because unbalanced territories may lead to low level of service, underperformance and increase of costs.
- Top-of-the-Funnel (TOFU)
- This is the top part of the sales funnel where all your prospects are coming into the funnel. On this stage the main goal should be to educate the prospects about the need or pain that can be solved with your products and services.
- Trial Close
- This is a selling technique where a salesperson asks customers certain types of questions in order to test whether the customer is ready to buy the offered product or service. Example of the trial close will be: It looks like you like the green version more, don't you?
- This a sales technique where a salesperson offers the customer products and services that have more features and are more expensive than what the customer has intention to buy.
- Vertical Marketing System (VMS)
- This is a system in which the supplier, the manufacturer, the wholeseller and the retailer are working together in order to serve the end consumers better. In general, each of these parties tries to maximize its profit, but sometimes this behavior can harm the performance of the whole supply chain. In order to avoid such accidents the stakeholders discuss and coordinate actions that may influence performance of the whole group.
- Warm Call
- This is an opposite to cold call in that warm call is agreed, scheduled and welcomed by your customer.