Only sales glossary you need

Annual Recurring Revenue (ARR) is the predictable revenue a subscription-based business expects to earn in a year from its existing contracts or subscriptions. Think of it as the ‘steady heartbeat’ of a SaaS or subscription company.

Average Contract Value (ACV) is the average annualized revenue earned per customer contract. It helps SaaS companies understand the size of their typical deal, set sales targets, and align go-to-market strategy around either high-volume/low-value deals (SMB) or low-volume/high-value deals (enterprise).

BANT is a sales qualification framework created by IBM in the 1960s. It helps sales teams assess whether a lead is worth pursuing by checking for four things:

A bottom-up sales strategy focuses on end users and individual contributors as the entry point. The product is adopted by teams organically — often through self-serve trials, freemium models, or viral loops—before expanding to the broader org and eventually reaching decision-makers. This approach works well for PLG (product-led growth) models, where the product sells itself through usage and user love.

Channel partners are third-party organizations or individuals that sell, market, implement, or support a company’s product or service, often in exchange for commissions, discounts, or co-marketing support.

A channel strategy is a unified plan that outlines how a business reaches its customers and drives revenue, through direct, indirect, and digital channels. It spans everything from marketing campaigns and digital platforms to third-party sales partners and system integrators.

A Chief Revenue Officer (CRO) is the strategic unifier of all revenue-generating functions in a company, typically including sales, marketing, customer success, partnerships, and RevOps. The CRO’s mandate is simple in theory, complex in execution: maximize predictable, profitable revenue across the entire customer lifecycle.

Command of the Sale is a sales methodology developed by Force Management. It’s designed to help sales teams align with buyer priorities, articulate value clearly, and maintain control of the sales process.

A compensation plan is a structured framework that defines how employees are financially rewarded for their contributions, including base salary, variable pay, commissions, bonuses, accelerators, stock options, and non-cash incentives.

CAGR (Compound Annual Growth Rate) is the smoothed annual growth rate of a metric (like revenue, ARR, valuation, or user base) over a period of time, assuming it grew at a steady rate each year.

Configure, Price, Quote (CPQ) is a category of sales tools and processes that help companies: Configure complex products or service combinations, price them accurately with all discounts, add-ons, or approvals, and generate quotes fast, error-free, and in compliance with company policies.

Conversion Rate Optimization (CRO) is the process of systematically improving the percentage of visitors or prospects who take a desired action — signing up for a trial, booking a demo, upgrading a plan, or completing a purchase. In SaaS, CRO bridges marketing and product, making sure that traffic and pipeline translate into revenue.

TCO (Total Cost of Ownership) refers to the complete, end-to-end cost of purchasing, deploying, and maintaining a product, system, or service over its useful life.

Cross-team sales enablement is the practice of aligning sales, presales, marketing, product, customer success, and other GTM (go-to-market) functions to collectively equip reps with the content, context, and tools they need to close deals faster.

A Customer Success Manager (CSM) is a post-sale relationship owner responsible for ensuring a customer achieves their desired outcomes using your product or service. The CSM sits at the intersection of product adoption, business impact, and retention, not just checking in, but actively orchestrating long-term value.

Customer churn is the percentage of customers who stop using your product or service within a given period. In SaaS, churn is a window into product-market fit, customer success effectiveness, and the sustainability of your revenue engine.

DAU (Daily Active User) measures the number of unique users who engage with a product or service within a 24-hour window.

Deal acceleration is the intentional removal of friction from the buying process, especially in the middle and final stages of the sales cycle, so that high-intent buyers can move forward confidently and efficiently.

Deal velocity is the rate at which qualified opportunities move from the first conversation to closed‑won. A practical way to think about it: how quickly your pipeline turns into cash without sacrificing deal quality.

Deferred revenue is income a company has received but not yet earned. In SaaS, this usually happens when customers prepay for subscriptions.

A discovery call is the first in-depth conversation between a sales rep and a prospective customer. The goal is not to pitch, but to learn — about the buyer’s needs, pain points, decision-making process, and whether there’s a real fit.

A due diligence questionnaire (DDQ) is a structured document that a potential customer, investor, or partner sends to verify your claims. On the surface, it’s a checklist. But in enterprise SaaS, it’s more like a stress test, a preview of how your company operates under scrutiny.

Enterprise-ready generative AI refers to generative AI systems built with the security, scalability, compliance, and integration capabilities required for use in large organizations. Unlike consumer-grade tools, enterprise-ready solutions safeguard sensitive data, adhere to regulatory standards, and connect seamlessly with business systems like CRMs, collaboration platforms, and document repositories.

Expansion ARR (Annual Recurring Revenue) is the additional recurring revenue generated from existing customers, usually through upsells, cross-sells, seat expansions, or usage-based growth.

Full-Time Equivalent (FTE) is a standardized unit that represents the workload of a single full-time employee over a specific period (usually a year). It’s used to quantify total labor capacity regardless of how many part-time, contract, or temporary workers are on staff.

A GTM strategy (Go-To-Market strategy) is the blueprint a company uses to launch a product or service into the market and drive customer acquisition, revenue, and adoption. It defines who you're selling to, what you're offering, how you’ll reach them, and how you’ll win — across sales, marketing, customer success, and product.

Information silos happen when teams, tools, or individuals hoard data, intentionally or not. In fast-moving B2B environments, this creates a dangerous lag between what someone knows and what someone else needs to know to close a deal.

Knowledge automation is the use of AI and technology to capture, organize, and deliver information automatically, reducing the need for manual searching or repetitive tasks.

At its core, Lifetime Value (LTV) tells you this: How much money will a customer bring into your business over the entire time they remain your customer?

A loss leader is a product or service that is intentionally sold at a loss (i.e., below cost) to attract customers, with the goal of generating larger, more profitable downstream purchases.

MEDDIC is a B2B sales qualification framework designed to help sales teams focus on high-quality opportunities and close deals more effectively.

Monthly Active User (MAU) is the number of unique users who engage with a product or service within a 30-day period.

Monthly Recurring Revenue (MRR) is the predictable, repeatable revenue a business expects to generate every month from active subscriptions or ongoing contracts. It is a core metric for subscription-based and SaaS businesses, helping track financial health, forecast growth, and measure the impact of GTM initiatives over time.

Net Dollar Retention (NDR), also known as Net Revenue Retention (NRR), measures how much revenue you retain from existing customers over a period, after accounting for expansions, contractions, and churn. It’s one of the clearest indicators of product value, customer satisfaction, and long-term revenue durability.

A no bid letter is a formal communication sent by a vendor to respectfully decline participation in a Request for Proposal (RFP), Request for Quotation (RFQ), or similar procurement process. While it may appear to be a routine message, a no bid letter is often a strategic move to preserve relationships, protect internal resources, and focus on more aligned opportunities.

On-Target Earnings (OTE) refers to the total expected annual compensation for a sales or quota-carrying role if the individual hits 100% of their goals (usually their quota).

Opex, short for Operating Expenses, refers to the ongoing costs required to run a business’s core operations on a day-to-day basis.

A Product-Qualified Lead (PQL) is a potential customer who has experienced value inside the product itself and shows buying intent based on usage.

Pwin, or Probability of Win, is a quantitative estimate, usually expressed as a percentage, that reflects how likely a sales opportunity is to result in a successful win.

Quote-to-Cash (QTC) refers to the entire end-to-end business process that starts when a prospect receives a quote and ends when the company collects payment.

A reduction in workforce (RIW) refers to the strategic elimination of roles or positions within an organization, typically as a cost-saving or restructuring measure. It is not the same as performance-based firings or individual terminations. Rather, it’s a business decision aimed at aligning headcount with current or projected financial realities, strategic priorities, or market conditions.

Remaining Performance Obligation (RPO) refers to the total contracted revenue a company is obligated to deliver in the future-based on signed customer agreements.

Renewal rate measures the percentage of customers (or revenue) that choose to renew their subscription at the end of a contract period. It’s a direct signal of product stickiness, customer satisfaction, and the strength of customer success programs.

A Request for Information (RFI) is a formal document that organizations use to explore the market before they commit to a solution. Think of it as the buyer’s research phase: they’re not ready to buy yet, but they’re deciding how they’ll buy, and whom to trust with next steps.

A Request for Proposal (RFP) is a formal document issued by a buyer to evaluate and compare potential vendors for a specific product, service, or solution. Unlike an RFI, which gathers broad information, an RFP signals that the buyer knows what they want and now they’re looking for the best-fit partner.

A Request for Quotation (RFQ) is a procurement document used by buyers to solicit detailed pricing and commercial terms for a clearly defined product or service.

Revenue attrition refers to the loss of recurring revenue over a given period due to customer churn, downgrades, or canceled contracts. It’s the inverse of revenue retention and a key metric for understanding how much revenue your business is losing - either from customers leaving or spending less.

Revenue marketing is a strategic approach where marketing is directly accountable for driving measurable revenue outcomes not just leads or brand awareness. It aligns marketing efforts with the sales pipeline, focusing on generating qualified pipeline, accelerating deal cycles, and influencing closed-won revenue.

Revenue operations (RevOps) is a strategic function that unifies sales, marketing, customer success, and finance operations into one cohesive system focused on driving predictable revenue growth. It aligns people, processes, data, and tools to improve efficiency and accountability across the entire revenue funnel.

Revenue per employee (RPE) measures how much revenue a company generates divided by the number of employees. It’s a rough indicator of efficiency and scalability.

Revenue retention is the percentage of recurring revenue a company keeps over a given period—after accounting for customer churn, downgrades, and contractions. It reflects how well a business retains and grows its existing customer base.

A SPIFF (sometimes spelled SPIF or SPIV) is a short-term incentive layered on top of standard commission. It could be cash, a gift card, or even a weekend getaway; the point is speed. SPIFFs are tactical levers designed to drive immediate behavior change.

SWOT analysis is a strategic framework used to evaluate a company’s Strengths, Weaknesses, Opportunities, and Threats. It’s a simple 2×2 matrix but often surfaces insights that shape positioning, go-to-market strategy, or even product roadmap decisions.

A Sales Kickoff (SKO) is an annual or bi-annual event that brings together the entire revenue organization, typically Sales, Marketing, Customer Success, Sales Engineering, Enablement, and RevOps, to align on company goals, celebrate wins, sharpen skills, and energize teams for the year ahead.

A Sales Qualified Lead (SQL) is a prospect that has been vetted by marketing or sales development and deemed ready for direct engagement by a sales representative. It means the lead has shown sufficient intent, fit, and readiness to enter the sales process.

Think of a sales cadence as the rhythm of your outreach. It’s the sequence of touches via emails, calls, LinkedIn pings, or even gifts, that a rep uses to connect with a prospect over a set period of time.

The sales cycle is the total time it takes to close a deal, from the first meaningful contact with a prospect to a signed contract. In SaaS, it’s usually measured in days or months, and varies widely based on deal size, ICP, and sales motion.

A sales decision maker is the individual (or group) within a prospective customer’s organization who has the authority to approve, reject, or escalate a purchase decision. They are the final stop, or the key gateway, in the buying journey.

Sales enablement is the process of equipping sales teams with the content, tools, training, and insights they need to engage buyers effectively and close more deals. It focuses on giving reps easier access to the right information at the right time—whether through playbooks, product knowledge, or technology—so they can spend less time on admin work and more time selling.

A sales engineer (SE) is the technical counterpart to a sales rep, fluent in both customer pain and product depth. Their job is to connect the dots between what the buyer needs and how the product can deliver it. Where AEs drive the commercial conversation, SEs handle the credibility layer: architecture, integration, scalability, security, and workflows.

A sales forecast is an estimate of future revenue based on pipeline, historical performance, and market conditions. In other words, it is a structured view of what deals will likely close in a given time period (month, quarter, year).

Sales hit rate is the percentage of deals won compared to the total number of deals pursued. It tells you how often your sales team converts opportunities into closed-won revenue.

Sales objection handling is the process of identifying, addressing, and overcoming a buyer’s concerns during the sales cycle. These objections might relate to price, timing, product fit, competition, or internal priorities and how a seller responds can make or break the deal.

Most SaaS companies have a sales process. Few have an optimized one. At its simplest, sales process optimization is about finding and fixing the leaks in your funnel and making the path from lead → closed-won shorter, smoother, and more predictable.

Sales productivity measures the efficiency and effectiveness of a sales rep (or team) in converting time and effort into revenue-generating outcomes. It captures how much revenue, pipeline, or progress a rep delivers relative to their time, activity, or cost.

A sales quota is a predetermined revenue or activity target assigned to a salesperson, team, or region over a fixed time period (usually monthly, quarterly, or annually). It’s a baseline expectation of performance and the foundation for commissions, performance reviews, and forecasting.

Sales velocity measures how quickly revenue flows through your sales pipeline. It combines deal volume, deal size, win rate, and sales cycle length into a single metric that answers: “How much revenue can we expect to generate in a given period, and how fast?”

Sales-led GTM means your growth engine is driven primarily by sales reps, not by self-serve product adoption. Reps prospect, run discovery, demo, and guide buyers through evaluation, often supported by SDRs, marketing, and solutions engineers.

A security questionnaire is a standardized document or set of questions that organizations send to vendors during the procurement or vendor evaluation process. Its purpose? To assess the vendor’s security practices, data protection policies, and risk posture, ensuring they meet the buyer’s compliance and IT requirements before any deal is signed.

A Service Level Agreement (SLA) is a formal commitment between a SaaS provider and a customer that defines the expected level of service. It typically covers uptime, performance, support response times, and remedies if standards aren’t met.

A Statement of Work (SOW) is a formal document that outlines the scope, deliverables, timelines, and responsibilities for a project or engagement between a vendor and a client.

Technical query resolution is the process of responding to detailed product-related questions from prospects or customers, often during the sales cycle. These queries typically revolve around features, integrations, scalability, compliance, architecture, and security and require deep technical knowledge to answer accurately.

Time to Value (TTV) is the length of time it takes a customer to realize meaningful value from your product after purchase or signup.

A top-down sales strategy targets senior decision-makers and executives early in the sales process. The goal is to secure buy-in from the top, then influence the rest of the organization. It often involves longer sales cycles, larger deal sizes, and more strategic conversations focused on business outcomes, ROI, and organizational impact. This strategy is commonly used in enterprise B2B sales, where purchases require executive approval and cross-functional alignment.

Total Addressable Market (TAM) represents the maximum revenue opportunity available for a product or service, assuming 100% market share in a given market segment or category.

Total Contract Value (TCV) is the total revenue a customer contract is worth over its entire duration, including recurring charges and any one-time fees (like onboarding or setup).

A Unique Selling Point (USP) is the distinctive value or benefit that sets your product, service, or brand apart from competitors. It’s the reason a buyer chooses you over everyone else-and ideally, why they stay.

Value-based pricing is a pricing strategy where the price of a product or service is determined by the perceived value it delivers to the customer—not by production costs or competitor pricing. It’s rooted in understanding what your solution is worth to the buyer in terms of outcomes, efficiency, revenue impact, or cost savings.

A virtual sales engineer, now more commonly referred to as an “AI sales engineer”, is an AI-powered ‘teammate’ trained to handle technical, product, and compliance questions during the sales cycle.

Weighted pipeline is a method of forecasting sales where each deal in the pipeline is assigned a probability of closing, and that probability is applied to the deal value.

BAFO stands for Best and Final Offer. It’s the stage in a procurement process where the buyer asks shortlisted vendors to present their most competitive proposal, usually after initial bids or RFP responses.

Win rate optimization is the ongoing, data-driven effort to improve the percentage of deals that result in closed-won outcomes, relative to the total number of qualified opportunities created.

To win the bid means to successfully secure a deal or contract by outcompeting other vendors in a formal or informal procurement process-often involving an RFP (Request for Proposal), RFQ (Request for Quote), or tender.

Win-loss analysis is a structured process that examines why a sales opportunity was won or lost. Traditionally, this meant post-decision interviews with prospects and internal stakeholders. Today, modern SaaS teams increasingly rely on specialized tools that automate the process by capturing CRM data, call recordings, buyer emails, and deal signals. These platforms surface patterns and insights without requiring manual interviews.

Year-over-Year Growth (YoY Growth) measures the percentage change in a specific metric-such as revenue, users, ARR, profit, or sales, when compared to the same period in the previous year.