September 9, 2020

What's the difference between a Lead Vs. a Prospect

If you work in marketing, then you have probably heard the terms “lead” and “prospect.” The two are both different names companies use when speaking about people that are either interacting with your sales team, engaging with your marketing information or visiting your website.

It may seem that the two terms can be used interchangeably, but they actually both have different meanings and are intended to be used differently by your teams. 

Understanding the difference between the two types of people will help keep your sales and marketing teams aligned as well as help offer individuals the best experience possible when interacting with your company before becoming a customer. 


“To me, a lead to me is someone whose [contact] information you have,” says Guido Bartolacci, Head of Demand Generation for New Breed. “You know who they are, but that’s it.”

You may know who this person is because they have browsed your website and submitted a very lightweight form that asked for their email address and are in your system, but you have no idea whether or not they are truly interested in becoming a customer down the line. You could have collected this person’s information from social media, a face-to-face interaction or a mutual connection. 

Regardless of how they came into your system, there will need to be more discovery to be done to determine if that person is a good fit and your sales team should reach out. 

Download the Essential Guide to Demand Generation


A prospect is essentially a lead that has been qualified and deemed worthy of sales outreach or interaction. 

“A prospect doesn’t necessarily always demonstrate interest in your company, but due to some qualification process, you know as a sales or marketing team that they are worth pursuing,” says Guido.

In other words, they have been qualified to some degree by your company whether that was done through an automated system or manually by marketing or sales. Regardless, you know that they are someone that you could potentially see as a good match for your company in terms of the service or product you provide. 

Prospects can be sought out by your sales team and chosen because they already know that they fit your ideal customer profile and your product or service, or they may have still come to your site and filled out a form and are qualified after converting and giving you their information. 

Leads Vs. Prospects 

“Essentially, the main difference between a prospect and a lead is that qualification step, regardless of whether it happens before reaching out to a contact or after they have converted,” says Guido. 

Prospects and leads can enter your system in many different ways. Your website is one of the most common examples of this. If someone submits a form on your site that was a very top of funnel offer, like a checklist, and you now have their email address and their first and last name, they are a lead. 

In this example, they are not a prospect yet because you have not done any qualification to determine whether or not they are a good fit for your company and could possibly turn into a customer. 

If your sales team goes in and does research on that lead and finds out that they are exactly the type of customer that is a good fit for your product or service, then you can now say they are a prospect because sales has deemed them worthy of outreach.  

Another example of the lead versus prospect differentiator is if you are attending a trade show. Both leads and prospects could be generated at that show. If someone hands you a business card at the show after little to no speaking, and you go back to your office the next day and enter all of those cards into your CRM, those are now leads. 

Those contacts are not prospects unless you have already done some level of qualification during or after the show to understand how interested in your product or service they really are in order to qualify or disqualify the lead. But, if any of those contacts had in-depth conversations with you at the show and shared enough information about both their business and their need for your product or service, you could deem them prospects. 

Download the Essential Guide to Demand Generation

Why Does it Matter? 

The qualification of prospects and leads may seem minor, but it's a critical element of how your marketing and sales teams share information and nurture contacts to become customers of yours. 

Without setting clear expectations and definitions of these terms, your marketing team may not understand what stage a lead is in or whether they should be getting marketing nurture content or direct sales follow up. Clear identification will also help marketing and sales prioritize the right leads at the right time whether that is for marketing emails or sales outreach

Not only does defining these terms for your teams build alignment, but it also helps with reporting on the team level and for the entire revenue department. 

“Being able to report on all stages of contacts that interact with your company is critical for spotting areas for improvement in the entire journey of individuals who enter your company’s funnel,” says Guido. 

But the first step to clear reporting is to ensure your teams are in agreement upon the individual stages in that journey and who is responsible for which stage of interaction. 

The most important part of identifying these stages correctly though is by far making sure anyone who interacts with your company, whether a customer or not, has the best experience possible, and that only happens when teams are working to the best of their ability and their processes are aligned to support that. 

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Weslee Clyde

Weslee Clyde is an inbound marketing strategist at New Breed. She is focused on generating results using inbound methods and is driven by the customer experience. When not at the office, you can find her binging a docu-series on true crime or perfecting her gluten-free baking skills.


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