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tags: A2, Prospecting
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# Lead generation vs. Prospecting
Before anything else, let's get our terminology straight 👇
 
## Leads, prospects, opportunities, and customers
In sales, potential customers are named differently depending on where they are in your sales funnel. **The further they are down the funnel, the more qualified, and therefore the higher the chances of them converting and making a purchase.**

The exact terminology may vary from company to company, but in essence there are 4 categories:

- **Leads** – People for which you have contact information, but you’ve never talked to before. This can be names off a list, referrals, people that interact with your content etc.
- **Prospect** – A lead who said yes! They are interested in what you have to say, but has not yet been qualified.
- **Opportunity** – A qualified prospect. A prospect who has met your qualification criteria and has a high probability of becoming a customer.
- **Customer** - Someone who has paid to use your product or solution.


 
## Lead generation vs. Prospecting
Throughout your sales journey, you will probably come across the terms "Lead Generation" and "Prospecting" quite often. You will also probably hear some people say they're exactly the same, and some people define them very differently.

**In the end, they're different ways to refer to the process of generating leads.** While we are not big fans of restrictive terms and definitions, here's the most widely accepted definition of both terms:

::: info
**Lead generation vs. prospecting**
- **Lead Generation** is usually a marketing term, and it's associated with both inbound and outbound lead generation. It is a long-term strategy to generate leads and is directed towards the top of the funnel. Activities usually include creating content, paid ads, and launching landing pages, which are carried out by the marketing team. If there is no marketing team, SDRs / BDRs will research potential leads online or by visiting events.

- **Prospecting** is usually a specific sales term, and is associated only with outbound lead generation only. It is about identifying and contacting leads. Activities usually include searching for leads, cold/warm emails, and calls and social selling.
:::

Again, depending on the industry, company, and product you deal with, they will likely have different definitions for both. What's important is that you understand the dynamics of your sales funnel, and what your role is within it.
 

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