When you’ve worked in the world of selling for a long time, you become desensitised to sales acronyms and terminology that is commonly found in the industry, however, it should also be recognised that every day, new people are joining the profession, or applying sales skills to their business for the first time.
Because of that fact, I want to lay out some of the most commonly used acronyms within sales, to try and demystify the ‘dark art’ of selling.
To be clear, this is not an exhaustive list, as new ones are created every day, as well as different countries (and companies) having their own nuances, but these ones below are core, pretty much everywhere.
If you have a sales acronym that’s keeping you puzzled, just ask and we will help find out what it is and then add it to the list!
So here we go!
AIDA – Attention, Interest, Desire, Action
This is one of the early models to better understand how to sell, by laying out the four stages that a buyer goes through before committing. While a lot of new models have evolved, the simplicity of AIDA remains true and is a great way to take an unqualified prospect, through to a customer.
ARR – Annual Recurring Revenue
The same as Monthly Recurring Revenue (MRR), but with a much wider view of the annual measurement. Revenue that is committed year-on-year, that allows organisations to plan and grow much more easily.
B2B – Business to Business
A simple term that demonstrates what a company is and who it sells to. In this instance, you are a business that sells to other businesses.
B2C – Business to Consumer
This identifies Businesses that sell directly to Consumers. An example of this is a retailer who sells clothes.
B2B2C – Business to Business to Consumer
To complicate matters these acronyms can come in various forms. This is a business, that sells to another business, that in turn sells to a consumer. You get the picture.
CAC – Customer Acquisition Cost
How much you are spending to acquire a customer. This might be the marketing spend on a customer acquisition campaign. £200 spent, 4 clients won = £50 CAC.
Alternatively, if you’re looking at outbound telesales, then you might want to include the sales person’s commission as the company’s acquisition cost.
Other costs might include creative costs, bonuses, technical costs, production costs and salaries to name a few.
COB – Close of Business
“I need that proposal sent by COB”
CRM – Customer Relationship Management
Arguable the backbone of any sales organisation. The CRM (if used effectively) contains all of the customer contact information, conversation history, brand engagement metrics, sales pipelines and so much more.
CRMs vary from DIY spreadsheets or database tools such as Airtable, to off-the-shelf tools like Pipedrive or Hubspot. all the way through to fully customisable software companies like Zoho or Salesforce. There are MANY other options, but these are some commonly used tools.
CTA – Call To Action
Typically used in written form, a call-to-action is a question, instruction or gesture that encourages your prospect to take action (do something).
On a website, it might be a button that says “Book your free assessment”
In a proposal email, an example might be “Is Wednesday or Thursday better for you to follow up?” – It encourages a response or action.
FAB – Features, Advantages, Benefits
One of the most underrated and commonly ignored frameworks for communicating the value of your products or service.
FAB = The feature: What it does. The Advantage: How it helps. The Benefit: Why they need it.
KPI – Key Performance Indicators
Specific metrics that salespeople hold themselves to account with. These might include the number of phone calls made, meetings held, proposals sent or the value of a pipeline.
MoM – Month on Month
Sales made/Meetings booked/proposals sent in February versus sales in January. How have you performed MoM? Applicable for the business, teams and individuals.
MQL – Marketing Qualified Lead
A new lead has been found and qualified by a marketing team. In some instances, the marketing funnels will see this lead through to purchase themselves, but in others, it will be passed to a member of the sales team to move through the sales process.
MRR – Monthly Recurring Revenue
As it says on the tin. This is a measure of the amount of revenue that is contractually committed to your organisation on a monthly basis. This model typically fits SaaS businesses of Coaching. Anything that has a rolling subscription with a minimum commitment.
Achieving a strong MRR enables founders and teams to get visibility on future revenue, as opposed to tractional businesses or those working on a project fee basis.
OKR – Objectives and Key Results
A framework for businesses to set goals/objectives and filter down throughout the relevant departments in order to measure the results. Sales teams may have objectives to win a specific number of clients in a particular industry or a number of pre-identified accounts.
OTE – On Target Earnings
The amount of money that a salesperson can earn if they hit their targets over the course of the year. Typical means the base salary + commission plan. Some commission plans are set up for uncapped OTE, which means a salesperson can earn large sums of money based on over-achievement of sales activity.
RFP – Request for Proposal
A process that enables organisations to tender for work. It usually contains details about a specific project so that people can respond to the RFP with a proposal. It is a way to solicit work, but also to differentiate between existing suppliers.
ROI – Return On Investment
Typically used in sales when monetising a conversation and demonstrating that a prospective customer might yield a return on their investment into the product and/or service. £1 in, £3 out = 3x ROI.
SLA – Service Level Agreements
This is what you have said you will do when you will do it by, and what happens if you don’t do it.
It helps customers understand what to expect from you before they engage with your company.
SPIN – Situation, Problem, Implication, Need
Another sales model, although this time from a book called Spin Selling by Neil Rackham. The model enables salespeople to take prospective customers through a consultative sale. In this style, questioning is considered far more important than simply going for the close. We agree!
SQL – Sales Qualified Lead
A lead that has been identified and qualified by a member of the sales team. To qualify a lead might be to ensure the contact details are correct, and there is a need to engage with the organisation, although these definitions vary between sales teams.
WIIFM – What’s In It For Me
If you keep in mind that your prospects or customers should always be asking this question of you, your service or product, then you will be able to communicate much more effectively.
Selling is not about you, it’s about your prospect. Understand them and meet their needs. Don’t start with how great you are and make sure they know what’s in it for them.
If you made it to the bottom of this list in one hit, then congratulations!
Don’t let the terminology spook you, its the actions and activity that matter. You’ll get to grips with this in no time!
Just shout :)