Glossary of important Sales Terms

Hey folks, I keep hearing from newbie sales professionals that they get stunned hearing some new sales jargon every day and are sometimes left blank when they get asked about those from their bosses.

So, Here is the compilation of some Important Sales Acronyms that came to my mind instantly.

Let us try to understand each of these terms in detail:

MQL - Marketing Qualified Lead

Usually, new leads arrive on top of the Marketing funnel as a result of Marketing efforts or campaigns.  It is then validated by the Marketing team on whether they are worth sending them to the Sales team for further one-to-one prospecting by deal closure. 

SQL - Sales Qualified Lead

It refers to the leads who have been validated by the sales team that they are qualified enough to be pursued further for deal closure. SDRs usually discuss with the leads and ask a few sales qualification questions to qualify them for the next steps. MQL is transferred to the sales teams to qualify them as SQL.

MRR - Monthly Recurring Revenue

This is primarily applicable for a business operating Subscription or SaaS-based pricing model. Once a subscription is confirmed by the customer, it becomes a recurring revenue. Hence MRR refers to the repeatable revenue generated by the business every month. If you want to calculate MRR for your subscription business, you can use this free MRR Calculator.

ARR - Annual Recurring Revenue

Similar to MRR, ARR is also applicable for businesses having a subscription pricing model. It refers to the repeatable revenue generated by the business every year.

CLTV - Customer Lifetime Value

CLTV refers to the average revenue a customer will generate or is expected to generate over the complete duration of his relationship with your company. If you want to calculate the CLTV for your business, you can check out this free Customer Lifetime Value Calculator.

CAC - Customer Acquisition Cost

As the name suggests, CAC refers to the cost of acquiring a customer in the initial stages usually to pursue him to make his first purchase with your company. If you want to calculate the CAC for your business, you can check out this free Customer Acquisition Calculator tool.

NPS - Net Promoter Score

NPS is an industry-recognized benchmarking score to measure your customer engagement and loyalty. You can learn more about NPS in detail here. If you want to calculate the NPS for your business, you may check out our free NPS calculator with a sample NPS survey here.

CRM - Customer Relationship Management

Customer Relationship management is the refers to the strategy an organization undertakes to manage their relationship with its customers. Overtime CRM has been considered synonymous with CRM Software which are usually tools and technologies which enables the organizations to execute their CRM strategy and vision. If you want to use CRM for your business, consider checking out ToolsonCloud Sales CRM.

You may learn more about CRM from here: Frequently asked questions about CRM 

SDR - Sales Development Rep

SDRs are usually the inside sales representatives whose primary responsibilities revolve around Prospecting and Lead Qualification. Once a lead is qualified they are usually handed over to Account Executives. Read more about SDRs here.

ACV - Annual Contract Value

This term is mostly used in SaaS Sales metrics. Annual Contract Value refers to the annualized revenue a client account is going to generate for you over one year. 

Note: ACV is different from ARR (Annual Recurring revenue)

BDR - Business Development Representative

A Business Development Representative (BDR) is a sales professional who focuses on the top of the sales funnel. They find new clients, do cold outreach, and qualify leads. Then, they book meetings for account executives who close the deals.

CCR - Customer Churn Rate

Customer Churn Rate (CCR) is the percentage of customers who stop using a company's product or service during a specific time frame. It is calculated by dividing the number of lost customers by the total number of customers at the start of that period, then multiplying by 100

CTA - Call To Action

A call to action (CTA) is a prompt such as a button, link, or short phrase used in marketing to tell the audience what step to take next. Common examples include "Buy Now", "Sign Up" or "Learn More". CTAs turn casual readers into active leads or buyers.

FAB - Features, Advantages, Benefits

FAB stands for Features, Advantages, and Benefits. It is a popular marketing and sales framework used to turn product facts into a clear, persuasive message that connects with buyers by explaining not just what a product is, but why they should care.

RFP - Request for Proposal

A Request for Proposal (RFP) is a formal business document that an organization creates to announce a new project and invite outside suppliers or vendors to submit competitive bids. It outlines the project scope, goals, budget, timelines, and how the final vendor will be chosen.

RFI - Request for Information

A Request for Information (RFI) is a formal business process used to collect written data about the capabilities of different suppliers or vendors. It is an early, exploratory step in procurement to learn what the market offers before asking for price quotes or formal proposals.