Open your CRM. Are you feeling a bit lost? Perhaps it’s because the platform you’ve chosen isn’t the right fit, or simply because the terms used aren’t part of your everyday vocabulary and you’re struggling to make sense of it all.

In fact, most CRM terminology originates from the marketing and sales departments, and anyone without extensive experience in these fields can easily confuse a lead with a contact or even with an opportunity.

Below, you’ll find an explanation of the 10 most common terms used in CRM solutions, so you can finally navigate your platform with confidence. Bear in mind, however, that depending on the CRM solution, some terms may be used in a slightly different sense; the key, ultimately, is to remain consistent so that you can organise your marketing and sales strategies effectively.

Where relevant, we will also distinguish between B2C (business-to-consumer) and B2B (business-to-business) contexts.

PROSPECT

This is sometimes referred to as a ‘target individual’, meaning people who are not yet ‘qualified’ – that is, whose interests and motivations regarding our products and services have not yet been sufficiently identified to turn them into ‘leads’. These are generally lists of email addresses categorised by socio-professional group, which are acquired as recipients for our marketing campaigns.

LEAD

A lead is a person who has shown some interest in the content received during marketing campaigns, or in our products and services. A lead is therefore a qualified prospect. Why is it important to distinguish between ‘prospects’ and ‘leads’? The number of leads is a fraction – usually up to 10 per cent – of the number of prospects. We will invest more effort in leads, running more intensive and targeted campaigns, as they are much more likely to become ‘prospects’, whilst prospects will be set aside.

PROSPECT

With a prospect, we take another step towards becoming a customer. Generally speaking, a lead is qualified and converted into a prospect once they have expressed an intention to buy, to find out the price, or to obtain much more detail about the product or service. In the B2C sector, this involves a request for a quote or a quotation made by an individual, whilst in the B2B sector, it is generally the point at which the evaluation process begins, involving demonstrations, proof of concept, analysis of the specifications, etc. depending on triggers specific to each business.
In the B2B sector, this is often the point at which one identifies the various people involved in the company’s selection process, specifying the role they play in this process, thereby enabling the sales strategy to be refined.

CONTACT

The contact is, of course, a person. However, in the B2C sector, this term is generally reserved for individuals once they have become customers, having made a purchase. In the B2B sector, as it is generally at the prospect stage that the company comes into the picture (since ultimately it is the company that makes the purchase, not the individuals themselves) it is also at this stage that the term ‘contact’ is used to refer to the employees of that company involved in the sales process.

CONVERSION

Conversion marks a change in status. The term ‘conversion’ is commonly used to describe a website visitor who proceeds to make a purchase by filling their basket and then paying, but there are also other conversions within the sales cycle: from ‘interest’ to ‘lead’, from ‘lead’ to ‘prospect’, and from ‘prospect’ to ‘customer’, all of which signify progress towards the act of purchase. CRM systems generally offer automated processes or procedures to facilitate this conversion when certain criteria are met; the transition to a higher status triggers more intensive activities and mobilises more resources, such as appointments, demonstrations, etc.

OPPORTUNITY

The concept of an opportunity is useful in sales cycles that are lengthy or involve several sub-stages. This is why it is so prevalent in the B2B sector, where transactions are usually not decided by a simple click on an e-commerce site or an in-store purchase.

However, it can also be relevant in the B2C sector when it comes to significant purchases involving lengthy decision-making cycles, such as buying a house or a piece of high-value jewellery.

An opportunity is a key concept for the salesperson, as they are constantly managing several opportunities of varying value and timeframe, with different probabilities of success, sometimes within the same company and involving different contacts (individuals)… In this context, it is easier to understand the value of this concept in CRM systems, as it helps to organise activities around an opportunity and to assess the business potential that is likely to materialise in the future.

OFFER OR QUOTATION

This is, of course, the document through which a financial and commercial proposal is submitted. This can be done very simply in a B2C context, such as a tradesperson’s quotation, for example, or it can take the form of a detailed proposal comprising numerous items and services, accompanied by complex terms and conditions with options, as in a typical B2B scenario.
In CRM systems, the offer or quotation can be created and submitted in place of an opportunity (a common scenario in B2C) or during the final stages of an opportunity; in the latter case, there are often several offers or quotations during the negotiation phase.

ACTIVITY

This is a generic term covering all planned or past actions, such as: telephone calls, meetings or visits, tasks, and even emails and documents. These activities can generally be managed in relation to any piece of information: relating to a prospect (e.g. ‘I need to call this person on such-and-such a date’), an opportunity (e.g. ‘prepare the proposal based on previous discussions’) or even a customer complaint.

Activities have statuses: planned, in progress, pending, completed or cancelled.

Ultimately, it is these activities that bridge the gap between the sometimes somewhat theoretical concepts defined earlier and the day-to-day reality within the company as it interacts with its customers.

360° VIEW

The much-talked-about 360° view of customers refers to the CRM solution’s ability to consolidate, within a single tool, all the information relating to a lead or contact that is available within the company. This enables the company to gain a better understanding of its leads and customers, with the aim of anticipating their needs as far as possible, or quite simply to serve them better on a day-to-day basis.

Achieving a genuine 360° view of customers within the CRM can sometimes be challenging, as this type of information is usually scattered across numerous systems: the ERP system for purchased products or services, invoicing or accounts for any disputes, electronic document management for contracts, not to mention email for the countless messages that increasingly contain critical information.

SEGMENTATION

Segmentation is an essential aspect of any marketing activity, as it simply involves selecting subsets of leads or contacts from the entire pool managed within the CRM. It is easy to see that the richer and more up-to-date the information managed in the CRM is – in other words, the more the 360° view of the customer becomes a reality – the more data you’ll have to target contacts very precisely, sending them the right messages or offers at the right time, thereby maximising the chances of triggering a purchase or sparking the recipient’s interest.

Now that you’re fully up to speed with the key CRM terms, get in touch to discuss your projects and work with us to develop your marketing and sales potential!