The Difference Between a CRM Lead and an Opportunity

Many times we are asked: “What is the difference between a CRM lead and an opportunity?” If you are asking yourself exactly this questions, then I will try to explain it in a very simple and easy way. Imagine yourself being a fisherman who is about to conquer the high seas looking for fish to catch!

“Fish to Sales” terminology

You, the fisherman, have a fishing rod and are about to set to sea in order to find fish. Your goal is to find Nemo, who is your happy customer. In order to find Nemo, you will have to follow a specific procedure, which can be compared to your sales steps. Below you can find same basic “fish to sales” terminology that will help you to understand the difference between a CRM lead and an opportunity:

• Fisherman = You
• Fishing Rod = Your Product or Service
• Sea = Your Sales Territory
• Nemo = Your Happy Customer

What can you find in the sea?

Each fish in the sea represents one potential contact. Moreover, if a fish swims with other fish, then this group or pod of fish represents an account. Since there are always “Plenty of Fish in the Sea”, you can say that your sea is full of fish (contacts) swimming in many pods of fish (accounts). However, only few of them can eventually be your Nemo or sales opportunity!

• Contact = Fish
• Account = Pod of Fish

Now it’s time to find Nemo!

Any individual fish or pod of fish in your sea represents one lead. Your Nemo will not be the first or the second fish that you catch. At the beginning, you will have very little information about the Nemo you would like to catch. You will start to examine your fish and create some criteria as to how Nemo should look like. In other words, you are qualifying your fish.

• Lead = Any Fish in The Sea.
• Opportunity = Nemo

The process of examination and adding the criteria represents your sales pipeline strategy. It’s always true that:

“Without a commitment to pursue working together (something that results in this company potentially buying from you) there is no opportunity.” – Anthony Iannarino

At the end of your examination ie. of your sales process, you will either let the fish swim back into your sea (lost opportunity) or you will put Nemo into your aquarium (won opportunity).

• Won Opportunity = You have found Nemo
• Lost Opportunity = You have not found Nemo

So, what is the difference between a CRM lead and an opportunity?

A Lead – is a contact or an account with very little information. It could be just a person who you might have met at a conference. You will need to retrieve more information regarding this lead in order to create (qualify) an opportunity in your sales pipeline. A old sales rule says: “If you have never contacted your contact, it’s a lead.”

An Opportunity – is a contact or an account which has been qualified. This person has entered into your buying cycle and is committed to working with you. You have already contacted, called or met him and know their needs or requirements. The old sales rule says: “The opportunity is a deal that you have the possibility to close!”

“Think about the difference between a lead and an opportunity as an evolving process i.e. each lead needs to be qualified to an opportunity. There will always be plenty of leads in your sales territory, but only few of them will qualify to become real sales opportunity.”

We have successfully build Pipeliner around this sales pipeline technique. Do not hesitate to try Pipeliner and use it as your lead and opportunity management system.

Please let us know what in your opinion are the biggest differences between a CRM lead and a sales opportunity.