Perhaps you’ve been told in the past that you need many potential clients for your business. Maybe someone else told you that you should focus on prospects, because those are the people most likely to buy from you. You might have been left wondering: What’s the difference between a potential client and a prospect?
When considering a potential client versus a prospect, they are quite similar. In general terms, a potential client is someone who has engaged with your business in a lower-level, one-way manner. Conversely, a prospect has engaged in a two-way communication or put in more effort, indicating a higher likelihood of becoming your customer. It all boils down to the probability of them making a purchase from you.
What Is a Sales Lead?

A potential client is defined as a person who has minimally engaged with your business. They might have the potential to be a lifelong happy customer, but it’s also possible that you may never sell anything to this person.
Here are some examples of how you can generate potential clients:
- Meeting someone at a live event
- Someone visiting your website and opting for a free ebook download
- Someone reading your blog post and subscribing to your newsletter
- Someone following you on social media
- Someone receiving a cold call or email from your company
What Is a Prospect?
A prospect is a customer who has shown genuine interest in your products or services. They will have engaged with you in some significant way and also match the profile of your target customer.
Here are a few scenarios that would qualify someone as a prospect:
- They filled out a contact form on your website
- They comment on your social media posts
- They open your emails and respond to your calls to action
- They start a trial of your product or service
A prospect is someone who has taken notice of your business and is interested in learning more. They are ready to actively engage with you, so it’s important to set up marketing systems to guide those prospects through your sales funnel until they become customers.
Lead vs Prospect: Which Is Better?
It’s good to capture potential clients for your business, but your goal should be to quickly assess these potential clients and determine if they could also qualify as prospects. This way, you can focus more energy on nurturing prospects as the expected benefit is greater.
Think of it this way: you might have hundreds of potential clients in a single quarter, but if none of them progress in the buyer’s journey and make a purchase, then that number holds no value. On the other hand, you might only have 15 qualified prospects in the same amount of time, but they’re more likely to all make a purchase. In this scenario, it’s better to have 15 highly qualified prospects than 100 unqualified ones.
Not all potential clients are equal, and revenue growth often comes down to prospecting versus lead generation in your business.
Directing Your Efforts Towards Prospecting vs Lead Generation
If you think of every person who interacts with your company as falling into a funnel, potential clients are at the top of this funnel, and many of them will stay there forever. What you want are people moving down the funnel to the point where they emerge from the bottom as paying customers.
How to Approach Qualified Prospects in Your Sales and Marketing Activities
When someone first interacts with your business, learn as much as you can about them.
When a website visitor signs up for your email list, track how they arrived at your site, which links they clicked, and which signup form they submitted. Record as much as you can about their preferences.
Track Your Customer Journey
Pay attention to what you did to get someone to join your list and also to the upcoming interactions you have with them. Again, a key distinction between a lead and a prospect is that a prospect never takes further action beyond the initial sign-up. If they continue to interact and engage with your marketing efforts, they’re good candidates to qualify as prospects.
Consider Your Buyer Persona
If you’re selling a higher-priced product or service, don’t focus your marketing efforts on people who aren’t ready to pay that price.
If you only want to work with larger companies, target individuals who make decisions in those larger companies. Don’t put your efforts into independent entrepreneurs or people working for smaller firms.
Tracking your potential clients and nurturing them into becoming prospects might seem like a big effort, but a powerful CRM with sales and marketing automation can actually do the heavy lifting for you. If you’re interested in segmenting potential clients versus prospects in your business and automatically keeping track of each individual, investing in a CRM with sales and marketing automation is a smart move.
Track Contacts Across All Stages of the Sales Funnel
If you’ve been looking at your email list and trying to classify potential clients versus prospects, it’s time to set up tools that will help you figure it out.