What is a Sales Funnel?
A sales funnel is a visual metaphor for the path taken by a potential customer as he or she moves towards becoming a customer. Learn More Here!
A sales funnel is a visual metaphor for the path taken by a potential customer as he or she moves towards becoming a customer. Frequently used by sales and marketing organizations, the sales funnel helps companies understand and visualize their sales process and measure overall conversion success between each step of the funnel.
A sales funnel is shaped like an inverted pyramid, similar to real-world funnels, to which the metaphor alludes. The width of each part of the funnel reflects the audience size, with the top of the funnel being the widest and the bottom being the smallest.
At the top of the funnel are website visitors, networking event connections, conference attendees, and the bottom of the funnel is usually a sale or conversion event. The goal of marketing sales in this model is to get as many prospects in at the top of the funnel and convert them into customers.
The goal of every Sales Funnel should be the same. Goal – Permission based marketing strategies to create relationship opportunities.
Permission based marketing strategies to create relationship opportunities.
Marketing And The Sales Funnel
The sales funnel is fueled by marketing activities that generate awareness and build demand for a product or service.
Moving a customer through the funnel is a carefully orchestrated set of activities designed to raise awareness and educate the prospective customer on the benefits of your offering.
As you might be aware, lead management is a complex process. No wonder that businesses struggle with it. Some common mistakes lead management mistakes include:
- Aiming at the wrong audience.
- Too many low-quality leads.
- Your website’s look dissuades users, or it lacks clear call-to-action.
- Following up on leads too late.
Although it might differ per source, generally lead management comprises of four key activities:
- Lead identification.
- Lead generation and tracking.
- Lead processing.
- Lead nurturing.
Over time, customers move down through the sales funnel – from initial contact to final purchase – as they learn more about your product and express interest in it.
As the funnel narrows at each stage, prospects drop off so that fewer and few potential customers left. The objective of an efficient sales and marketing process is to improve the conversion rate at each stage of the funnel so that more customers make it through the full funnel.
There are many ways to move your prospects through your funnel. Squeeze pages, lead magnets, drip campaigns and the old fashioned phone call. You should be very sensitive to the medium your future clients would prefer.
Types Of Funnels
Sales funnels vary widely by industry. The B2B sales funnel for an enterprise software company can last several months or more, while the sales funnel for a B2C ecommerce website may be just a few minutes long. Some funnels have multiple phases, while others only have two or three.
For example, a typical sales funnel for an ecommerce site might start with website visitors at top, people who add items to their cart and people who visit the checkout page in the middle of the funnel, and customers who complete the transaction at the bottom.
The entire customer journey for the ecommerce funnel above could take place in a matter of minutes, as a customer visits the site, adds items to their cart, and completes their purchases.
This can be contrasted with an enterprise B2B sales funnel which can takes place over the course over several months, with website visitors entering in at the top of the funnel, becoming leads by filling out a form, being nurtured through an e-mail campaign, then eventually reaching out to a salesperson to sign a contract.
These overarching funnels can also be broken up into smaller funnels, zooming in closer to each stage of the funnel and looking at each specific action that the user takes to move from one stage to the next.
Understanding The Sales Funnel
Understanding the concept of sales funnels is important because it’s a useful model for visualizing the customer journey from initial awareness all the way through conversion. The sales funnel provides a useful framework through which you can analyze your business and identify areas for improvement.
For example, an ecommerce site might model their visitors in a funnel, and identify that there is a large dropoff in users between visiting the shopping cart and actually completing the transaction. Using this data, the company can then form hypothesis as to why this is the case and test ideas for improving conversion rate, such as reducing form fields, establishing trust with seals, or offering limited time offers.
By testing these ideas through controlled A/B tests, the company can work to improve the conversion of lead to prospect to qualified client.
Source. State of Inbound Report 2017
Optimizing Your Funnel
A/B testing software programs such as Optimizely (thank you for content shared in this blog) can help you during all phases of the sales funnel. You can set up tests within minutes and start optimizing your website, landing pages, sign up forms, email newsletters and more.
By fine-tuning these key customer touch points with Ghost Post, you can maximize yield in each part of your sales funnel, helping you increase revenue right away.
Naturally, the question arises: how to generate more high-quality leads?
There are many ways, but usually, companies provide compelling content or a great offer in exchange for user contact information. We all have filled in a form with our primary (and sometimes not) contact information when signing up somewhere: that’s where we become a lead.