What is a Sales Lead

A sales lead is the identity of a person or entity potentially interested in purchasing a product or service, and represents the first stage of a sales process. The lead may have a corporation or business associated with the person(s). Sales leads come from either marketing lead generation processes such as trade shows, direct marketing, advertising, Internet marketing or from sales person prospecting activities such as cold calling. For a sales lead to qualify as a sales prospect (or equivalently to move a lead from the process step sales lead to the process sales prospect) qualification must be performed and evaluated. Typically this involves identifying by direct interrogation the lead's product applicability, availability of funding, time frame for purchase. This is also the entry point of a sales tunnel or funnel.

Once a qualified lead exists, additional operations may be performed such as background research on the lead's employer, the generally market of the lead, contact information beyond that provided initially or other information useful for contacting and evaluating a lead for elevation to prospect, the next sales step.

If a sales lead eventually makes a purchase, this is called conversion. The ratio of sales leads that convert is often referred to as the conversion rate, a way to measure the effectiveness of a sales process, sales team, or sales person.

Cinematic reference: the boiler-room salesmen in the movie Glengarry Glen Ross refer to wanting to get "the good leads" which will close more easily (result in closed sales, i.e. a financial transaction).

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