Sales are what drive your company’s profits, ensuring you can survive in an increasingly competitive marketplace. With the advent of the digital age, the sales landscape looks very different from the pre-internet days. What’s more, it continues to evolve as new technology and systems become available.

In 2021, the global ecommerce market was worth $14.3 trillion, and that number is expected to reach $58.74 trillion by 2028. So you can see why businesses want to focus on keeping their place in the market. To do this, factors such as your choice of live chat software and omnichannel approaches are becoming more important.

However, it still comes down to nurturing prospects through your sales funnel and successfully closing a sale. The two most common approaches to this are sales prospecting and lead generation.

So when it comes to sales prospecting vs lead generation, what are the main differences and similarities? Or more importantly, what benefits will each strategy offer you?


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As the name suggests, sales prospecting is the process of identifying and contacting potential customers who may be interested in your products or services. This is because your products or services could fulfill their needs or solve specific problems they might have.

Your sales team may identify prospects in a number of ways. For B2B sales, you may have identified a prospect as they sell something you make, or they manufacture a product that needs components you produce.

In a B2C environment a sales prospect may be identified by the time spent on your site or on particular landing pages.

Prospecting is the first stage in the sales process and, depending on circumstances, a sale may not happen quickly. Once a prospect is identified, you may arrange a sales meeting or start nurturing them through your sales funnel. You’ll also provide them with more info that allows them to make an informed decision.


Screenshot taken from (Kyrios Digital Group)

Whereas sales prospecting is normally carried out by your sales team, lead generation is usually carried out by your marketing team. They look to generate leads through increasing brand and product awareness.

Your marketing team will have multiple tactics and strategies that can help generate leads. They may look at affiliate marketing and use an affiliate marketing agreement template to agree contracts with third parties. They will also include online and offline advertising to pique the interest of identified demographic targets. For example, advertising on TikTok if the target demographic is much younger.

With lead generation, you are looking to create an ongoing cycle of consistent leads generated through your marketing efforts.

As with leads generated through sales prospecting some may convert quickly whereas others may need longer. You may also generate MQLs (marketing qualified leads) who initiate contact with you, having seen marketing material or information that has piqued their interest.


How to Write a Successful Sales Prospecting Email

Screenshot taken from (fintechlatina)

1. Sales prospecting

Some of tasks involved in sales prospecting include:

  • Identifying your market and working out your TAM (total addressable market) so that you know how many potential prospects you might have
  • Creating buyer personas that profile your different demographic target groups and how your product or service will meet their needs
  • Creating your ideal customer profile and seeing where it fits with different buyer personas
  • Making a list of prospects to take to the next stage
  • For B2B, using platforms such as LinkedIn to identify potential prospects
  • Cold outreach where relevant via phone, email, or other communication channels
  • Organizing sales meetings if relevant
  • Listening to customers and adjusting sales pitches and other approaches when needed

2. Lead generation 

Some of the things you would expect your marketers to be doing to generate leads include:

  • Creating buyer personas that will inform different marketing campaigns and strategies
  • Researching pain points in your sales funnel, on your website, or on other channels
  • Analyzing data to see what types of content different groups prefer
  • Identifying which channels customers favor so that they can focus efforts
  • Ensuring that customer contact data is collected via landing pages or webforms, eg. when someone signs up to a newsletter, mailing list, or webinar
  • Creating efficient lead magnets such as video tutorials, blogs, and white papers. Then sharing those lead magnets via different channels such as email, Telegram groups, social media platforms, and your website
  • Utilizing marketing automation tools such as email apps to send information to potential customers who have supplied their contact details


Prospecting and Lead Generation

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Sales prospecting and lead generation share the common goal of turning potential customers into actual customers. However, there are several differences between them.


Lead generation is more of a long-term strategy and may seem slower than prospecting. Prospecting is designed to produce faster results and is more short term and cyclical (prospect, nurture, convert, repeat).

Target market

Prospecting tends to have a far smaller target group than lead generation. You could think of prospecting as fishing with a rod while lead generation is casting a net and hoping for the best.

Brand awareness

Lead generation can often lead to MQLs, making them great potential conversions. However, with prospects, you are entering the world of the unknown. There is a good chance that those prospective customers have no foreknowledge of your company.

Quality control 

While there is that unknown element, you do have more control over who you are targeting with sales prospecting. For example, if you were a B2B SaaS company promoting signature tools, then you could identify suitable prospects via LinkedIn.

Value sales 

Leads produced by sales prospecting can often be better prospects than those produced by lead generation. Even an MQL produced by a solid campaign needs to be checked for viability. With sales prospecting, you already have a good idea that they will have an interest in your product or service.

Tailored marketing

While prospecting is usually a two-way conversational activity that involves (often lengthy) discussions between you and the prospect, lead generation is more of a one-way activity. The potential customer sees your marketing campaign and then develops an interest in your product. There may be some discourse later but in the initial stages, it’s only about the marketing.

Bespoke messaging

Prospecting can be very focused on aspects such as personalization. Your sales team has identified a particular target and will look at why your brand is a good fit for that person. That can mean personalizing any material they send the person. Whereas lead generation usually requires a much broader approach.


Three Biggest Challenges for Lead Conversion

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Although both techniques work in very different ways, they are both designed to produce a steady flow of sales for your organization. However, you should not focus on only one or the other. Instead, your sales and marketing teams should work closely together to acquire new customers.

After all, both teams want the same thing: more customers, more sales, and company growth. Now, smaller businesses may not have both marketing and sales teams. If you’re a small business or a startup, you may want to consider entering into an agency agreement to increase your reach, but the principle remains the same: working together towards a common goal.

For example, one of your sales team contacts a prospect by email. The first thing that person is likely to do is to look at your marketing material on your website or social media pages as well as reviews of your brand/products. After that, they may then contact the salesperson who sent them the email. Without a strong marketing strategy, many sales teams would fail to get over the initial hurdle.

So, while your marketing efforts may be the driving force behind lead generation, it can also offer huge benefits to your sales prospecting. And, your sales team could provide vital information to your marketing department so they can produce more targeted campaigns.


Not everyone has a limitless budget, so you may be wondering whether to choose sales prospecting or lead generation as your primary tactic. There is no straight answer as every organization has different needs, goals, resources, and so on.

That’s not to say that favoring one should mean excluding the other. If, for example, you focus most of your efforts on sales prospecting, you would still be doing some lead generation through your website and any social media platforms you use to add to those efforts.

Why spend money on sales prospecting then? Surely your website and social media content will drive customers through your pipelines? Again, this depends on your business model and your goals.

There are some scenarios where sales prospecting has an edge over lead generation. These include:

  • Where the sales cycle may be lengthy and multiple decision makers may be involved in any purchasing decision
  • If the sales process is complicated – that could mean multiple meetings or one-to-one calls and video calls, product demos, providing complex product specs, or having to tailor quotes to a client’s needs
  • You are providing high-value products or services

All of these scenarios require the more personalized service that sales prospecting provides.

Lead generation may be more beneficial to organizations that fall in the following categories:

  • Your target demographics are wide-ranging and your products or services have wide appeal
  • The product sells itself without human input and you want to see rapid growth tied to sales figures

In these scenarios the broader and more general approach of lead generation will see better results for your company.


Screenshot taken from (rain group sales training)

When trying to decide between lead generation and sales prospecting there is no solid answer to which tactic is better. Just as there isn’t when thinking about issues such as choosing new branding or deciding if a distribution agreement will help with growth. It all comes down to your company’s individual needs and goals.

However, instead of choosing between sales prospecting and lead generation why not try combining the two to expand your reach, attract new customers, and see your sales increase.

Sales Prospecting vs Lead Generation - Key Differences and Overlaps - pin

Author’s Bio:

Yauhen Zaremba – Director of Demand Generation

Yauhen is the Director of Demand Generation at PandaDoc, all-in-one document management software for almost all document types including this PandaDoc postnuptial agreement template. He’s been a marketer for 10+ years, and for the last five years, he’s been entirely focused on the electronic signature, proposal, and document management markets. Yauhen has experience speaking at niche conferences where he enjoys sharing his expertise with other curious marketers. And in his spare time, he is an avid fisherman and takes nearly 20 fishing trips every year.

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