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Article 23 min read

The ultimate sales glossary: 100 sales terms to know

You’ll want to learn these key sales terms so you don’t miss a beat.

By Donny Kelwig, Contributing Writer

Last updated May 19, 2022

If you’ve ever taken sales training of any kind, you know that mastering sales vocabulary is shockingly difficult. Many sales terms sound interchangeable when, in fact, they mean drastically different things. And with an enormous number of sales words thrown around casually or used incorrectly each day, it’s no wonder even sales experts get confused sometimes.

That’s why we compiled a list of the 100 most useful sales terms every salesperson needs to know. Let’s dive in.

A few basic sales terms


Customer accounts, also called customer profiles, are created the first time a customer buys a product or service from your business. These accounts contain important information about the customer, including purchases, interactions, contact information, and preferences.

Business-to-business (B2B)

Business-to-business (B2B) refers to sales that happen between one business and another. These transactions can be with partners, distributors, suppliers, or clients. Many B2B companies sell to individual customers, too, but they often have separate departments for both, as B2B sales are more complex with a longer sales process.

Business to customer (B2C)

Business-to-customer (B2C) refers to sales that happen between businesses and individual consumers. B2C sales include your typical purchases from various stores—clothing, furniture, groceries, and everyday essentials. Compared to B2B sales, B2C sales are usually more spontaneous and generate a lower profit per sale.


A lead is any potential customer who expresses interest in your company’s products or services. Leads can be inbound (the customer reaches out to you) or outbound (you reach out to them). Most companies focus their efforts on outbound leads through marketing strategies, social sales, and ad campaigns.


A prospect is a lead that has interacted with someone in your company. This distinction allows your sales team to identify who needs initial outreach and who is officially at the beginning of the sales pipeline. If you need help remembering, think of a prospect as a prospective buyer: someone in the store looking at products. Leads are outside the window thinking about coming in.

Sales metrics sales terms

Annual contract value (ACV)

Annual contract value (ACV) is the average revenue generated for a particular customer per year. ACV is primarily used in B2B businesses or in subscription-based B2C businesses where customers make regular, repeated purchases. While ACV can be useful in calculating expected annual revenue, it’s more frequently used to figure out how long it takes to recoup the costs of acquiring that customer.

Annual recurring revenue (ARR)

Annual recurring revenue (ARR) is the amount of money a business expects to earn over one year—from all its customers, not just one. ARR significantly helps with accurate long-term planning and future pricing considerations. Note that ARR only includes repeat purchases, not first-time customers.

Churn rate

Churn rate is the percentage of customers who stop buying from your company in a given time frame. This metric is calculated by dividing the number of lost customers at the end of the time period by the total number of customers at the beginning of the period.

Closing ratio

The closing ratio is a sales metric used to measure sales agent success. It compares the number of closed deals to the number of prospects the agent interacted with. A closing ratio can also be used to predict future sales or make strategy adjustments. For instance, if the best agents in the company are averaging a 5-percent closing ratio, it’s probably not a reflection of their work ethic.


A conversion is any prospect that moves to the next step in the sales pipeline. Conversions can refer to sales, but they can also refer to prospects setting up a meeting to discuss pricing. In that case, the meeting is the conversion metric.

Conversion rate

Conversion rate is the percentage of prospects that completed the desired action. Just like conversion, the conversion rate can refer to a sale. But it can also refer to a non-transactional process, such as a prospect signing up for a company’s emails.

Customer acquisition cost (CAC)

Customer acquisition cost (CAC) refers to the amount of money spent on the process of acquiring a customer. CAC includes marketing expenses, sales rep pay and commission, and work hours dedicated to wooing that customer. For a company to be profitable, the amount of money coming in from the customer needs to exceed the amount spent on attracting that customer.

Customer lifetime value (CLV)

Customer lifetime value (CLV) is an educated prediction of how much money an individual customer will give your company over their lifetime. CLV differs greatly between companies due to churn rate, average profit, price of goods, rate of repeat purchase, and length of the customer lifecycle.


Sales forecasting is the process of predicting future sales so your company can make budgeting, supply, and marketing decisions. Forecasts come from a variety of factors, including past profits, industry trends, supply chain status, and sales rep success metrics.

Key performance indicators (KPIs)

Key performance indicators (KPIs) are numerical measurements that reflect how a business or individual employee is performing. KPIs are normally set as goalposts, not requirements. Common KPIs include annual growth, conversion rates, number of cold calls made, and number of products sold.

Lead scoring

Lead scoring is a ranking system that prioritizes leads by their potential value to the business. This helps sales reps identify which leads are the most likely to buy the product. Top-ranking leads are in a financial position to purchase the product, would benefit from the product, and actively need the product.

Monthly recurring revenue (MRR)

Monthly recurring revenue (MRR) is the same concept as annual recurring revenue (ARR) but is measured on a monthly scale. This term is almost exclusively used by subscription-based companies

Net Promoter Score® (NPS)

NPS is a metric used to assess customer loyalty. It’s measured via a survey that asks customers how likely they are to recommend the business or product to someone they know. Respondents select a number between 0 and 10, and their answer places them into one of three categories: promoters (repeat, satisfied buyers), passives (satisfied but wouldn’t necessarily recommend the product), or detractors (dissatisfied and wouldn’t promote). Companies want as many customers as possible to be promoters.

Profit margin

Profit margin measures a company’s gross profit relative to its revenue. To calculate profit margin, divide your gross profit (sales minus all expenses) by your revenue for a given time period. Then, multiply that result by 100 to get a percentage. You want your profit margin to be high.


A quota refers to the number of sales a rep is expected to achieve over a specific time frame (usually a month). Quotas are used as ideal numbers for reps so they have a sales goal to work toward. However, it’s rare for every sales rep to meet their quota, so it shouldn’t be used as a marker for company profit.

Sales performance management

Sales performance management is a set of sales processes created for maximum efficiency. Good sales performance management involves understanding sales rep compensation, quotas, and lead delegation, and then using that knowledge to shape how the sales team works.

Sales pipeline coverage

Sales pipeline coverage is a ratio that measures how full the sales pipeline is compared to the quota you want to achieve at the end of a given time period. This gives reps and managers a better picture of growth and quota possibility. If there aren’t enough leads coming in, then reaching the quota isn’t possible and strategies must be adjusted.

Value chain

Value chain refers to the value your company brings to the market. Value can be measured in many ways, but generally, companies try to be either cost-effective (extremely low cost) or benefit-effective (extremely high benefit). The more value a company offers, the higher its chances of success.

Sales strategy sales terms


ABC stands for “always be closing.” It’s a sales strategy that reminds reps that every step they take in the sales process is one step closer to closing the deal. Though it’s not a universally accepted strategy (different customers react differently to tactics and every rep needs to adjust accordingly), it is a nice reminder of the end game when things feel frustrating.

Account-based selling

Account-based selling is a sales strategy where the entire company focuses on converting a few high-value leads rather than casting a broad net. This isn’t a long-term strategy, but it can be extremely useful if a company wants to use a high-profile client as a marketing pull for lower-profile customers.

BANT framework

The BANT framework is a checklist used during lead qualification.

B = Budget: Can the lead afford the product?
A = Authority: Is the lead a decision-maker with the authority to buy the product?
N = Need: Does the lead or their business need the product?
T = Time: Is this lead likely to purchase the product in the next sales cycle?

Leads that check all four boxes are extremely qualified and should be nurtured.


Benefits refer to how a product solves a prospect’s problems. Benefits should not be confused with features; benefits are the positive outcomes of features. For instance, time saved is a benefit, while automation is the feature that causes that benefit. When selling, reps highlight benefits, then describe how the product results in those benefits down the line.

Cold calling

Cold calling is the process of making an unsolicited phone call to a qualified lead in the hopes of turning them into a prospect. Cold calling is universally acknowledged as a difficult strategy, but it can produce results. It’s also a fast and personal way to contact numerous leads in a short amount of time.


Cross-selling is the act of selling an additional product or service to a customer. It occurs when a sales rep discovers that a prospect or client can benefit from more than one solution. For example, a rep for a mattress company can persuade a prospect to buy new pillows with their new mattress. In this case, the rep can potentially increase the value of the sale by directing the prospect to a different product within the same company.

Direct sales

Direct sales are sales that don’t require a middleman. The products are sold directly to the consumer from the seller. Direct sales has become synonymous with multi-level marketing, but they’re not the same. Multi-level marketing is direct sales through distributors who work as independent contractors for a larger company.

Discovery call

A discovery call is an initial conversation a lead (soon-to-be prospect) has with a sales rep. This can be a cold call or a scheduled call based on an information request. The discovery call is crucial in determining the prospect’s pain points and setting a positive tone for the relationship.


A feature is an aspect of a product that directly benefits a customer. For instance, mass email automation is a key feature of most marketing and sales software that helps the customer by simplifying large-scale marketing campaigns and saving time on outreach. It’s important to remember that the feature is not the benefit—it simply causes the benefit.

Hard sell

A hard sell is an aggressive sales tactic in which the rep directly challenges the prospect’s objections. This is largely an outdated selling style, but in certain circles, it still pulls in large amounts of revenue. However, most companies now prefer a softer approach.


A markup refers to a price increase for a product or service. It’s usually done to compensate for expensive production costs or dips in revenue and profit. Mark-ups can be risky because they can deter current customers, but they can also save a struggling company from a bad month or quarter.


Objections are any concerns raised by prospects during a sales conversation. Common objections are about the price of a product or the necessity of a product. Many reps use sales scripts to address these objections while still acknowledging the concerns.

Pain point

A pain point is a specific problem for a lead—a problem that can hopefully be fixed by a product or service from your company. Being able to understand and identify customer pain points is a key sales skill for reps. If a customer’s biggest need is ecommerce software and you’re trying to sell them customer service software, you’re unlikely to make the sale.

Positioning statement

A positioning statement is a semi-prepared statement used by sales reps to start conversations with potential customers. A strong positioning statement lets the customer know who the sales rep is, who they work for, and what solutions they offer.


Sales prospecting is the never-ending process of identifying and contacting potential buyers. Many companies have departments dedicated to this task because a strong sales pipeline requires constant movement and new leads. Prospecting tools can greatly help with this process.

Sales enablement

Sales enablement describes the process of providing your sales team with the tools, training, skills, or resources they need to succeed. This includes everything from sales software and mobile access to social media sales training and individual sales coaching.

Sales script

Sales scripts are written dialogues or guidelines used by sales reps while they’re interacting with prospects. These scripts can be extremely detailed and word-for-word, or they can simply be key points for a sales rep to touch on. Sales scripts help keep company branding and sales strategy consistent.


Smarketing is a newer term referring to the alignment of the sales and marketing departments for smoother workflows and consistent branding.

Social selling

Social selling is a sales strategy in which reps and companies use social media as a way to interact with prospects and existing customers. With social selling, social media is typically not where sales take place, but rather a means of communication and lead nurturing.

Soft sell

A soft sell is a strategy in which sales reps take time to build trust with the prospect and work with them to find the ideal solution. Soft sales are extremely popular in the consumer market right now and are used by many sales reps.

Sound bite

Sound bites are small phrases that sales reps use to communicate simple matters to prospects. Usually, sound bites are answers to commonly asked questions or objections that make the rep’s life easier.


Upselling is a tactic in which a rep tries to increase the value of a sale by encouraging a prospect to buy a higher-end version of the initial product they were interested in. Depending on the type of company, upsells may include additional features, more expensive products, or subscription upgrades.

Value proposition

A value proposition is a breakdown of all the benefits provided by a product or service. Sales reps may choose to emphasize or omit certain benefits from this list depending on the prospect.

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Sales job sales terms

Account executive

Account executives are responsible for managing customer accounts. They handle current and prospective clients daily. Account executives are slightly more specialized than sales reps, as they’re frequently assigned to high-profile accounts.

Account development representative

Account development representatives are responsible for creating new sales strategies, identifying potential clients, and understanding market trends. They consult with sales managers to keep strategies current.

Business development representative (BDR)

Business development representatives (BDRs) focus on outbound leads for a company. These are not necessarily individual sales, but rather partnerships that could be beneficial for the company’s future.


Commission is an additional payment that sales reps earn after closing a deal. Commission rates and policies vary from company to company.

Field sales rep

Field sales reps often work outside of an office and travel to potential and current customers to negotiate deals in person. These reps can be B2B or B2C and are highly valued by sales companies.

Inside sales rep

Inside sales reps work from an office and primarily interact with their clients by phone or online communication methods.

Sales coach

Sales coaches work with sales teams and individuals to improve skills and self-confidence on the sales floor. Sales coaches can be in-house managers with additional training or be hired as third-party consultants.

Sales development representative (SDR)

Sales development representatives (SDRs) are inside sales reps who work to convert inbound leads. They’re the primary contact between leads, prospects, clients, and the company itself. Depending on the size of the business, SDRs may also handle outbound leads.

Service level agreement

A service level agreement (SLA) is a contract between sales and marketing outlining each department’s expectations for the other. SLAs ensure alignment and accountability between the two teams.

Sales customer sales terms

Bottom of the funnel (BOFU)

Bottom-of-the-funnel (BOFU) prospects are very close to making a purchase decision. They have all the facts they need, they’ve connected with the company, and they’re ready to buy.

Buyer behavior

Buyer behavior refers to the choices consumers make when they’re moving through the sales funnel. Buyer behavior is never consistent and can be influenced by internal factors (needs, mood, etc.) and external factors (economic environment, market prices, etc.).

Buying criteria

Buying criteria are pieces of information a customer requests to see before they make a purchase. These criteria include factual information (such as pricing) and persuasive information (why your company is a better choice than your competitor).

Buying signal

Buying signals are indicators that a customer is ready to buy. Sales reps use these cues to figure out when it’s time to push for a close. Some buying signals include signing up for demos or asking specific contract questions.

Buying intent

Buying intent refers to the odds of a prospective customer making a purchase. Many companies use tracking analytics to keep tabs on leads who research their products and target those with the highest buyer intent.


A consumer is anyone who uses your product or service. It’s important to distinguish between consumer and customer. A customer is someone who gives you money in exchange for the product, while a consumer is someone who uses it. A parent purchasing baby clothes is a customer, but the infant is the consumer.

Customer success

Customer success is the process of making sure customers get the most value out of their purchase from a business. Some companies have departments in charge of this process, which includes everything from customer relations to tech support.


The decision-maker is the person who can sign off on a sale. When you’re reviewing a lead’s authority qualification in B2B sales, you’re often looking to see if they are the decision-maker or if they have direct contact with the decision-maker.

Middle of the funnel (MOFU)

Middle-of-the-funnel (MOFU) prospects are in the middle of the sales funnel. At this stage, the prospect has a relationship with the sales rep and is learning more about the products and solutions.


An opportunity is largely interchangeable with a qualified lead. It refers to a prospect that’s completed the qualification process and shows promise as a customer.

Top of the funnel (TOFU)

Top-of-the-funnel (TOFU) prospects are at the beginning of the sales funnel. They may have expressed interest or contacted sales, but they’re not completely sure what their pain points are or what features they need from a product or service.

Sales software sales terms

Ad-hoc reporting

Ad-hoc reporting is a sales reporting tool that reflects user parameters. Many sales software programs automatically generate certain sales reports (overall quarterly reports, etc). Ad-hoc reports are generated by request and usually answer specific metric questions (for instance, What is the combined conversion rate for sales rep 1 and sales rep 2?)

Business intelligence

Business intelligence is an umbrella term for any tool or process that a company uses to make data-driven decisions. This includes data analysis, KPI comparison, or data visualization.

Cases or tickets

Used interchangeably, cases and tickets refer to any post-purchase customer issues. They are compiled and handled by the customer service team, but all departments should have access to them through company software.

Customer relationship management (CRM) systems

Customer relationship management (CRM) systems are sales software programs that help businesses track every aspect of sales and marketing, from sales metrics to customer profiles. CRMs also integrate with other sales technology software to streamline company activities.

Cloud-based CRM

Cloud-based CRM software refers to any CRM that is capable of being hosted in the Cloud. This makes all relevant data accessible to every user—regardless of their location—enabling inside sales agents and field sales agents to stay on the same page.

CPQ software

CPQ (configure price quote) software is a form of sales automation software. It helps sales agents automate customer quotes and proposals, resulting in faster communication, better accuracy, and an improved customer experience.

Contract management

Contract management is the process of handling contracts with customers, vendors, partners, and employees. Different departments often manage different types of contracts, but they are all considered contract management.

CRM analytics

CRM analytics refers to the analysis of data in a CRM. These analytics can be used to improve sales and marketing tactics.

Enterprise resource planning (ERP)

Enterprise resource planning (ERP) is business software that manages a company’s financials, supply chain, operations, commerce, reporting, HR, and manufacturing. An entire company can be managed with the right ERP, particularly when it’s combined with the right CRM.


Escalations refer to the process of customer cases or tickets being moved to a higher-authority agent or manager. This usually happens when a lower-level member is unable or unqualified to fix the customer issue.

Knowledge base

A knowledge base is an online collection of information about a business. It can include everything from product information to sales scripts to marketing plans. Internal knowledge bases are meant to be used by employees, while external knowledge bases are customer-facing, often in the form of FAQs and product usage information.

Lead management

Lead management refers to the entire process of generating, qualifying, and tracking leads. It also includes prioritizing leads in order of buyer intent for the sales team using lead management software.

On-premise CRM

In contrast to a Cloud CRM, an on-premise CRM is CRM software hosted solely on the company’s server. On-premise CRMs are more common for businesses handling large amounts of sensitive information.

Opportunity management

Opportunity management is the process of organizing, delegating, and tracking all the deals in a sales pipeline. This ensures equal distribution and more likelihood of closing. Opportunity management is handled within a CRM by a sales manager.

Sales dashboard

A sales dashboard is a visual picture of real-time sales data that keeps everyone in your company up-to-date on metrics. Sales reps can use the sales dashboard to easily monitor daily, weekly, and monthly goals.

Sales pipeline and sales funnel sales terms

Bad leads

Bad leads are leads that are low-qualified and unlikely to make a purchase. These leads should not be pursued—no matter how few leads the sales team has—because it will probably be a waste of time.

Buyer persona

A buyer persona is a detailed description or fictional representation of the perfect customer. Most companies have multiple buyer personas, depending on their target demographics. Buyer personas help marketing and sales teams shape their tactics to best fit the ideal customer.

Buying process

The buying process is a three-step journey every buyer takes to go from the beginning to the end of the sales funnel. The three steps are awareness (TOFU), consideration (MOFU), and decision (BOFU). Knowing where a prospect is in the buying process lets reps know which sales techniques to use.

Closed opportunities

Closed opportunities are buyer journeys that come to an end, whether positively or negatively. It doesn’t matter if a sale is made or if the prospect decides not to buy—the opportunity is considered closed.


Closed-won refers to closed opportunities that end in a sale.


Closed-lost refers to closed opportunities that did not end in a sale. But it also includes opportunities that simply require follow-up in a few months (for instance, the prospect can’t invest in your solution while they’re under a contract with another company, but they’re still interested).

Conversion path

The conversion path is the process a potential customer goes through to become a lead. This includes customer actions (such as signing up for a newsletter) and marketing actions (like creating enticing calls to action).

Demand generation

Demand generation is the marketing process of creating brand awareness and interest in a company. This includes activities like nurturing programs, content creation, and SEO (search engine optimization).


A gatekeeper is anyone who allows or prevents a sales rep from contacting a decision-maker. This term is used in B2B and B2C sales and includes everyone from assistants protecting bosses to children answering calls they shouldn’t.

Lead generation

Lead generation refers to the process of attracting people to the company so they can become prospects. Common tactics to generate leads include social media sales, email marketing, and optimized web content.

Lead qualification

Lead qualification is the process of evaluating a lead to see if it’s worth pursuing. Every business uses specific criteria to determine if a lead is qualified before passing their information to the sales team.

Marketing-qualified lead (MQL)

A marketing-qualified lead (MQL) is a lead that ticks the qualification boxes for marketing but not necessarily for sales. MQLs are qualified based on engagement with marketing materials, but sales-qualified leads (SQLs) also have to check the boxes for financial stability and decision-making.

Pipeline management

Pipeline management refers to any activities that go into managing the sales team and the sales pipeline. Pipeline management is frequently handled by sales managers and includes delegation, metrics management, and training.

Qualified lead

A qualified lead is a lead that has a high probability of converting into a customer. This means they meet certain requirements that indicate they’re a good fit for a product or service, and the sales team should plan on reaching out to them.

Sales funnel

The sales funnel illustrates the steps of the customer journey. It runs parallel to the sales pipeline (which outlines the sales rep’s journey). The sales funnel is typically broken down into five stages: awareness, interest, evaluation, engagement, and purchase. You can track these stages via a sales funnel platform within your CRM.

Sales process

The sales process is an umbrella term that covers the processes of the sales pipeline, the sales funnel, and the buyer’s journey. Essentially, it is all the steps that turn a lead into a paying customer.

Sales pipeline

The sales pipeline covers the steps each sales rep takes as they guide a prospect through the stages of the buying process. The sales pipeline runs parallel to the sales funnel and should be a repeatable process, no matter what tactics the sales rep uses.

Weighted sales pipeline

The weighted sales pipeline is a sales pipeline broken down by opportunity value. This helps sales reps determine where to direct their focus. A high-value prospect in the TOFU stage might be worth more attention than a low-value prospect in the MOFU stage, even though the second prospect is farther along in the process.

Business improvement terms

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