Lead, Prospect, Customer & Opportunity: The Sales Lifecycle Terms Explained

Introduction

Mixed terminology derails handoffs and muddies forecasts. If your team can’t agree on what a lead vs prospect is—or when to open an opportunity—your pipeline quality, conversion rates, and forecast accuracy all suffer. This definitive explainer gives you crisp, plain‑English definitions, binary stage gates, and practical CRM examples you can implement today. Inside: quick definitions, a side‑by‑side comparison table, a simple lifecycle diagram, and a sales‑ready FAQ you can paste into your playbook.

60-Second Primer (Plain-English Definitions)

Lead: A captured person or account with potential interest; not yet qualified.

Prospect: A lead that fits your ICP and shows meaningful interest/intent (i.e., qualified for sales engagement).

Opportunity: A qualified deal in progress with Amount, Stage, and Close Date captured and an agreed next step.

Customer: A closed‑won opportunity; now in the post‑sale lifecycle (onboarding/adoption/expansion).

Lead vs Prospect (The Actual Difference)

Upgrade criteria

• Fit: Meets ICP firmographics/technographics (industry, size, tools, region).

• Interest: Demonstrated engagement (opens, replies, site visits, demo request).

• Intent: Buying signals/triggers (active project, pain, use case, timeline).

• Owner: Marketing/SDR qualifies; AE validates before deeper discovery.

• Next action: Personalized conversation that advances to discovery.

Table 1. Lead vs Prospect (side‑by‑side)
Caption: Comparison table for “lead vs prospect”.

Lead vs Opportunity (When to Create an Opp)

Create an opportunity only when the following are true:

• Problem confirmed + use case aligned: Stated pain maps to what you solve.

• Access to buying group: Identified champion and a path to authority/economic buyer.

• Rough budget/timeline surfaced: An investment window and priority exist.

• Meeting(s) with AE scheduled: A concrete next step on calendar.

Forecast guardrails
No opportunity should be created (or kept open) without:

• Amount (credible value range)

• Stage (aligned to exit criteria below)

• Close Date (anchored to the buyer timeline)

Mini stage‑gate checklist: Problem confirmed • Champion identified • Authority path known • Budget/timeline estimated • Next meeting booked • Amount/Stage/Close Date populated in CRM.

Lifecycle Overview (End-to-End)

Flow: Lead → Prospect → Opportunity → Customer

Handoffs: Marketing/SDR → AE → CS

Stage gates: Binary, verifiable, and documented in CRM notes and fields.

CRM Reality Check (Salesforce/HubSpot Pattern)

• Leads/Contacts/Accounts: Use to capture and qualify people and companies.

• Convert when stage gate is met: Create Contact + Account and, if applicable, open an Opportunity.

• Key fields to operationalize:

  • Lead Status: New → Working → Qualified → Disqualified (with reasons)

  • Opportunity: Amount, Stage, Close Date, Next Step, Primary Contact

Practical tip: Add validation rules so an Opportunity cannot be saved without Amount, Stage, and Close Date. Add required picklists for Disqualification Reason to keep recycle loops clean.

Opportunity Stages (Keep It Generic)

Use lightweight, universal stages with binary exits.

1. Qualification
   Exit: Problem confirmed; champion identified; authority path known; next meeting scheduled.

2. Discovery
   Exit: Stakeholder map drafted; success criteria and evaluation plan agreed; date for solution review set.

3. Solution/Proposal
   Exit: Proposal/quote sent and receipt confirmed; mutual close plan documented.

4. Commit
   Exit: Business terms agreed in principle; procurement/legal path locked; target close date reconfirmed.

5. Closed (Won/Lost)
   Exit: Contract signed or loss reason captured; opportunity archived with final notes.

Two Quick Scenarios

Inbound SaaS
Ebook download (lead) → ICP match + reply to nurture (prospect) → discovery validates problem + timeline; champion engaged (opportunity)

Outbound
Cold list (lead) → multi‑signal engagement (reply + site visit + tool match) (prospect) → multi‑threading + technical fit confirmed; AE meeting set (opportunity)

Conclusion

Clear, shared definitions and binary stage gates create cleaner pipelines and better forecasts. Document the gates, enforce required CRM fields, and train your team—so leads become prospects at the right time, and opportunities are opened (and forecast) only when they’re real.