Difference Between Sales Opportunity and Lead

Lead  is  a qualified prospect who proactively wants to learn more. When I say “qualified”, I mean they’re an ideal individual and/or company to sell to (i.e. they are the type of prospect who typically has a problem that you can solve). When I say “learn more”, I mean that they’ve come to you asking for something. It can be a demo, a question, a white paper, something that proactively engages them in a conversation.

There is a big difference between a lead and a list. Handing your sales team a set of companies and contact information to cold-call isn’t a lead. That’s a list. Coming back from a trade show with a couple hundred names of badges you scanned is a list too. Unless they’ve somehow engaged you proactively, and have asked for a response, it’s not a lead.

Opportunities : In general terms, when a lead progresses to the point where they’re talking to you about a near-term purchase possibility, the lead can become an opportunity. Most organizations I’ve worked with have slightly different definitions of what qualifies as a new opportunity, but most often they have these characteristics in common:

• There’s an agreed-upon timeline to purchase
• A decision-maker is directly involved or is aware of the solution & timeline
• Budget is available or has been identified
• The buyer has agreed to and is working on next steps on their end
• There’s a catalyzing event or urgency driver internally that makes the purchase a priority

If you’ve converted a lead into an opportunity, it means you have an expected close date. It means you’re beyond wishful thinking and prospecting, and have a mutually agreed-upon plan with the prospect to get the thing done, to make a decision one way or another.

How can CFOs be gainfully involved in marketing

CFOs have experience leading finance organizations but they hesitate to inject themselves in sales and marketing conversations. 

Below are 4 areas where a CFO viewpoint will improve sales and marketing performance.

1. Revenue Growth vs. Customer Segment Growth is my revenue growing on pace with the customer segment? is this sustainable source of growth in the years to come?
   
2. Customer Acquisition Cost (CAC) vs. Customer Lifetime Value (CLTV): Look at the ratio of CLTV:CAC. The higher the ratio, the higher the Sales and Marketing ROI. For customers that require more resources to acquire, their CLTV should be higher. If this is not the case, you should not be pursuing these customers.
   
3. Pricing vs. Volume :Plot price relative to volume for each of your customers. What price is a customer paying for 1K units? Is it consistent or is there a lot of variability across customers? If there is a lot of variability across customers, listen to the market. It may be telling you that some customers are less price sensitive than others. Also cut this data by rep. If there is a lot of variability by sales person, you may have a talent/skills issue.
   
4. Sales Rep Comp vs. Territory Growth: sales Rep Compensation is the biggest expense in the sales budget . You should not look at territories by size. Just because a territory is big, does not mean the rep deserves extra compensation for managing it. It’s the growth of a given territory that should determine their compensation.