Every job has its own jargon and acronyms. But revenue organizations might have more acronyms than most. If you work in sales, marketing or RevOps, you probably hear dozens of sales process acronyms every day - ARR, ABM, ERP, CAC, ABC, BDR, SQL, ZAP, CLM, etc... (okay maybe a couple of these aren't real, but the rest are).
So, what do all those acronyms mean? We've compiled a list of all the terms that comprise the discipline of revenue operations, with definitions and context - a comprehensive RevOps glossary. Update: As of May 2021, we've created an even more comprehensive RevOps glossary here. The post below still has tons of great information, but you should check out the new glossary too.
This is not another “what is revenue operations?” post, however. If you’re looking for a refresher on what revenue operations (aka RevOps) is, check out this Gartner research about defining revenue operations or this HubSpot post about why your company needs revenue operations.
So without further ado, here are all the revenue terms, sales process acronyms, and definitions.
- Account: The totality of information your company has about a prospect or customer, which includes their contact information, products they use, and all interactions and transactions with your company. Account information is typically stored in a CRM.
- Account-Based Marketing (ABM): High-level coordination between marketing, sales, account management, and customer success to gain or grow customers at the account level (not the individual contact or lead level). With ABM, the idea is that the highest value customers are companies, and to keep and grow a customer, you need to win an entire account, not just one or two people who work there.
- Account Executive (AE): A sales specialist who is in charge of one or more accounts, and interacts directly with prospects to demonstrate products and facilitate new business acquisition.
- Account Manager (AM): A customer-facing employee who oversees one or more customers’ accounts with a company. The Account Manager is often responsible for account renewals and upgrades.
- Annual Recurring Revenue (ARR): A calculation of the subscription-based revenue a company generates in a year.
- Average Contract Value (ACV): A calculation of the average revenue amount for an individual customer in a given time period.
- Base (aka Base Salary): The non-variable portion of a salesperson’s performance. This base salary does not change with performance.
- Billings: The total value of collected payments for committed sales contracts.
- Bookings: The total value of signed or committed sales contracts.
- Business Development Representative (BDR): An entry-level sales specialist who focuses on finding or qualifying new prospects, establishing early prospect relationships, and populating the sales pipeline with new leads for AEs. In some cases, BDRs set calendar appointments for AEs after qualifying a new lead.
- Chief Revenue Officer (CRO): A member of a company’s executive team who is responsible for the company’s revenue growth, and oversees revenue generating departments, including sales and marketing.
- Churn: The loss of a subscription customer due to cancellation or account expiration without payment.
- Cohort: A specific group of subscription customers who subscribed or renewed during the same time period. For example, a cohort may include all new customers who signed up in a particular month. Cohort analysis is used to gauge renewal and retention health.
- Commission: The variable portion of a salesperson’s compensation that is based on performance.
- Compensation Plan (aka Comp Plan): The compensation structure for a salesperson or team. That typically includes a base salary, variable compensation like commissions, and other incentives. The goal of a comp plan is to set expectations for sales effort and performance.
- Configure, Price, Quote (CPQ): The process of generating pricing and packaging quotes for customer orders, usually enabled through software.
- Contact: An individual person associated with an account, usually an employee or point of contact at a prospect or customer company.
- Contract Lifecycle Management (CLM): The process of developing a customer throughout their lifecycle with your company, from awareness to purchase to product usage to advocacy.
- Customer Acquisition Cost (CAC): A calculation of the total sales and marketing cost to acquire a new customer.
- Customer Relationship Management (CRM): A system for tracking customer data and interactions with your company. Typically this is enabled through technology such as Salesforce, and is considered the primary source of truth for an account.
- Customer Success (CS): The department in B2B organizations that focuses on paying customers, with the goal of improving customer satisfaction and building stronger relationships, ultimately reducing churn rate and increase LTV.
- Customer Success Manager (CSM): The customer-facing employee who supports customers as they move from sales prospects to active users of a product. The CSM is typically responsible for customer satisfaction and product usage.
- Deal Desk: A centralized location (physical or virtual) where members of sales, finance, legal, marketing, and customer success discuss and make decisions about non-standard or complex sales deals.
- Decision Maker (DM): The person or persons responsible for purchasing decisions at a customer or prospect’s company. This may not always be that account’s primary POC.
- Demand Generation: The division of a marketing organization dedicated to generating new business demand for a product, typically measured in terms of inbound leads produced, marketing’s contribution to new business acquisition revenue, sales accepted opportunities, or something similar.
- DevOps: The collaboration of software development and IT operations throughout the various stages of the product development process.
- Enterprise Resource Planning (ERP): A software application that manages business processes across organizational functions like accounting, sales, project management, procurement, and risk management, so data can be collected and shared, giving leadership visibility into and control over business processes.
- Gross Revenue Retention (GRR): A calculation of the percentage of revenue generated from customer renewals, but does not include expansion revenue. It’s a measure of effectiveness in customer retention.
- Go to Market (GTM): A company’s full sales and marketing strategy for how they sell their products. This includes plans for pricing, positioning, sales motions, and more, and typically involves stakeholders from across a company's revenue organization.
- Inside Sales: The modern way of conducting sales using telecommunications. Typically seen in comparison to field sales, inside sales refers to remote selling enabled by advances in technology and digital transformation, where a salesperson likely never meets a prospect in person.
- Lead: An individual or company that has shown an interest in your product or service; a potential customer.
- Lead Matching (also known as Lead-to-Account Matching): The process of attempting to connect a new lead to an existing account in a CRM. This is usually performed by looking for matches in a new lead’s email address or web domain and an account’s corporate URLs.
- Lead Qualification: The process of determining how likely a new lead or prospect is to convert to a paying customer. This can be done automatically, with lead scoring based on fit with a set of predetermined criteria, or manually, with a person in sales or marketing determining a lead’s fit. Leads are generally qualified by marketing (MQLs), sales (SQLs), or product usage (PQLs).
- Lead Routing: The process of sending new leads or prospective customers to the next step in the sales process. For example, lead routing often occurs when marketing receives a new lead from a campaign and routes that lead to an SDR or BDR for qualification.
- Lead Scoring: The process of assigning a score to a lead or prospect based on its fit with a set of predefined criteria. For example, a lead could earn a higher score if that contact had downloaded a marketing whitepaper or attended a webinar, opened one or more sales outreach emails, visited certain web pages, etc…
- Lifetime Value (LTV): A calculation of the total revenue generated from a customer over their lifetime with a company.
- Monthly Recurring Revenue (MRR): A calculation of the subscription-based revenue a company generates in a month.
- Net Promoter Score (NPS): Typically an 11-point rating scale is used to determine a customer’s satisfaction with a company or product.
- Net Revenue Retention (NRR): A calculation of the total recurring revenue generated from keeping or retaining a customer at renewal. This includes increases in revenue from account expansion, as well as decreases in revenue from downgrades and cancels. This number can be greater than 100%.
- On-Target Earnings (OTE): An employee's total potential compensation if certain performance targets are achieved. That likely includes a base salary, plus variable compensation like commission.
- Opportunity: A lead that is more likely to invest more interest in your business, usually one that’s involved in an active sales process. Some of these may be referred to as sales accepted opportunities (SAOs).
- Pipeline (aka Pipe): The total view of the in-progress deals for a sales rep or team. It typically includes deals in a variety of stages, with information about expected deal value and timing, and likelihood to close.
- Point of Contact (POC): The individual who is primarily responsible for their company’s relationship with a service provider. This is typically the main contact for an account, and the person an AE, AM, or CSM would engage most with.
- Product Led Growth (PLG): Sourcing leads for acquisition and growth from a product’s current user base. Typically a PLG-based sales motion would use certain product usage criteria to identify and qualify customer leads for expansion.
- Product Marketing: The division of marketing focused on positioning the product best for sales. That typically involves messaging, collateral, sales enablement and training, pricing and packaging, acting as a go-between among product, sales and marketing teams to ensure the company is communicating effectively about the product and its benefits, and ensuring feedback about that process is communicated back to the product team.
- Qualified Leads
- Marketing Qualified Lead (MQL): A type of lead generated through marketing efforts, that meets a certain threshold or set of criteria indicating a greater chance of converting from prospect to paying customer when compared to other leads.
- Product Qualified Lead (PQL): A customer who has performed certain behaviors or used certain parts of the product, indicating potential for an account upgrade or expansion.
- Sales Qualified Lead (SQL): A type of lead that meets a set of criteria set by the sales team, indicating a greater chance of converting from prospect to paying customer.
- Quota (aka Sales Quota): A financial target that a salesperson or team must achieve by a certain time period (a month, quarter or year) to gauge effort and effectiveness. Compensation is based on performance relative to quota goals.
- Recognized Revenue: The total value of the revenue generated after the agreed-upon product or service has been delivered and payment completed. Recurring subscription revenue may be recognized on a monthly basis, even if the total bookings might be based on an annual basis.
- Revenue Operations (RevOps): The modern model adopted by B2B companies that aligns the operational aspect of the full revenue organization across sales, marketing, and customer success. This usually encompasses sales operations, marketing operations, and customer operations, alongside a revenue system-level perspective to remove department silos and increase revenue efficiency.
- Rules of Engagement (ROE): Agreed-upon guidelines for sales coverage to prevent conflicts and ensure fair treatment and deal credit. ROE also help when figuring out how to handle non-standard deals and unanticipated events.
- Sales Accepted Opportunity (SAO): A new business lead a member of the sales team has accepted into their sales pipeline. Typically, this is a well-qualified lead with an increased likelihood of closing.
- Sales Automation: The use of technology to automate certain tasks or processes within a sales motion. For example, an Account Executive could automate follow-up to a prospect with software that schedules email sends at designated intervals.
- Sales Development Representative (SDR): An entry-level sales specialist who focuses on finding or qualifying new prospects, establishing early prospect relationships, and populating the sales pipeline with new leads for AEs. In some cases, SDRs set calendar appointments for AEs after qualifying a new lead.
- Sales Enablement: Equipping and training the sales team with the information and means to effectively sell a product or service. This includes training on new features, collateral preparation, guidance on successful sales techniques, and more.
- Sales Engagement: All the interactions between a sales team and prospects, usually referring to the channels (email, phone, presentation) and tactics (cold outreach, regular follow-up) of sales motions.
- Segment: A group of customers or prospects based on a set of relevant criteria for sales and marketing.
- Territory: A group of customers or prospects a particular sales rep is responsible for. Typically territories are based on criteria such as a prospect’s geography, industry or vertical, or company size.
- ZAP: Just kidding, this isn't a thing. We do need to come up with a term that starts with 'z' though, even if it's just to round out this glossary.
