What is a Sales Funnel?

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What is a Sales Funnel?

I’m sure you are familiar with the term “sales funnel”. But, are you implementing this concept in your daily sales and marketing initiatives? I have seen so many companies just guessing at how to guide their customers down their funnel. This may work for a while, but at some point, it will fall short. In order to create a successful sales strategy, you will have to work hard and align your marketing and sales teams with your funnel in mind. Lucky for you, this article has everything you need to know about sales funnels and how to use them.

Well, What is a Sales Funnel?

A sales funnel is a visual representation of how you acquire leads, and turn them into paying customers. Below is a basic example of a funnel. and you can see there are four main stages: awareness, interest, decision, and action. There are more complex versions, but this example is a good starting point. As you can see, the awareness stage is much larger than the action stage. That’s because you will have a lot more leads who have heard of your company, whether it be from an advertisement, word of mouth, etc, than the number of leads who actually convert into paying customers. 

What is a Sales Funnel?

Why is a Sales Funnel so Important?

Whether you are B2B or B2C, you will have a sales funnel. Following a sales funnel is a great way to better understand your customers. This will ultimately result in more paying customers. Understanding your sales funnel will help your business set and achieve goals, understand how long it takes for your leads to convert, and help your company manage the cost of your sales and marketing. With all of this knowledge, you will be able to better serve your customers. In addition, increase the total number of customers that you are able to convert. Both sales and marketing teams will need to understand your customer journey and work together to achieve your company’s goals.

Marketing vs. Sales

Oftentimes your marketing team will be responsible for the awareness and interest stages with social media ads, Google Ads, SEO, SEM, and more. While your sales team will be responsible for decisions and actions by answering their questions, meetings, follow-ups, etc. However, this isn’t always the case. There can be a lot of overlap between departments depending on your business and what services you provide. Now, let’s jump into the steps of a sales funnel with sales and marketing examples.

What is a Sales Funnel? Marketing vs Sales

Awareness

The awareness stage is by far the largest stage in terms of leads. Like I mentioned before, marketing is responsible for creating awareness for your company. This can involve a variety of tasks. The most common awareness initiatives are social media campaigns, SEM like Google Ads, and SEO like blog articles, and a strong website presence. As the name implies, the goal of these marketing campaigns is to create more brand awareness and get your brand name out there. By doing this, you will start to introduce your company and educate prospects on why you are the best option for them.

Interest

Next, we have the interest stage. In this stage, your leads will be familiar with your company and understand what you do. However, they are not yet sold. They may be looking around at your competitors, checking out review sites, and getting other opinions. This stage can be tricky, as it is difficult to lead your prospects further down your sales funnel. When your customers are in the interest stage, they may be visiting your website for the first time. You can see how many people are visiting your website for the first time in Google Analytics. Marketing teams typically use remarketing tactics, lead generation software (we talk about this more later!), and promotions to help convince leads to choose your business. Remarketing is my personal favorite, as a way to keep customers engaged and interested. When a lead visits your website, you can use Google Ads or social media ads to target them and what they have shown interest in on your website. Click here for a full guide on remarketing.

One of the most unique ways you can interest your customers is by using website personalization software. This type of software allows you to give your customers a customized view of your website based on their company name, industry, location, size, and more. For example, if a marketing firm visits your website, you can show them case studies of other marketing firms you have worked with, use cases on how to use your product, and a specific call to action that they will have a hard time refusing.

Decision

After your customers have taken an interest in your company, they will come to the decision stage. In this stage, prospects will have to weigh out all of their options between your competitors, different packages that you may offer, or if they are going to take another route. Your sales team is an essential part of the decision stage, especially if your product has a large price tag. Your sales team will encourage them to take the leap through demos of your product, meetings, answering any final questions, and following up after they have done these tasks. Some of these tasks may also be done in the interest stage depending on your company and strategies. However, oftentimes the decision stage is the first point of contact you will have with your leads. This stage is difficult because you have to show your prospect how your business can benefit them and why you’re better than your competition. All while being personable and not sounding like you’re in it for the money. Once you have successfully done this, your prospects will take action.

Action

In the diagram at the beginning of this article, you can see that the action stage is by far the smallest stage. This is because the number of prospects that turn into paying customers is much much smaller than the number of total leads that you start within the awareness stage. As you may have guessed, this stage is when your leads convert into paying customers. It takes a lot of hard work to get to this point, and it’s very rewarding when all of your efforts pay off. However, once a lead has converted into a paying customer, your job is not done. Your sales team should still check in on your leads to ensure they are happy and getting the most from your product/service. If you don’t follow up, you risk losing your customer due to their frustration of not understanding your product/service.

How Do You Increase Your Leads?

When talking about funnels, it’s common for people to ask, “How do I increase the number of leads I get?”. And that’s a great question! There are a ton of different ways that you can increase the number of leads that your company receives. However, the tactics that you use to increase your leads will greatly depend on your business, as not all businesses will have success using the same tactic. Below I have listed a few ways that we have found helpful at increasing the number of leads we receive, and therefore increasing the number of conversions/ actions.

Set Goals

Goals are one of the most important aspects of your business to ensure you and your team stay on track and are headed in the right direction. A good tip is to make your goals S.M.A.R.T. This acronym stands for specific, measurable, attainable, relevant, and time-bound. By setting goals that follow this, you will know what areas you need to improve upon in order to receive more actionable customers. It’s helpful to set individual goals as well as team goals and refer back to them. For more information on goal setting, click here.

Track KPIs

KPIs, or key performance indicators, allow you to track and analyze your marketing and sales initiatives. This suggestion goes hand-in-hand with setting goals, as goals need to be measurable. All digital marketing initiatives that you run, whether it be social media, SEO, SEM, etc, are trackable. The insight that you receive from your digital marketing is crucial to determining the success of a certain campaign. The metrics that you measure will depend on your business, but there are a few main marketing metrics that your business should be tracking. This includes website traffic, time spent on your website, year-over-year growth, return on investment, and customer lifetime value (CLV). You can use Google Analytics or your CRM to track these metrics and keep your sales and marketing teams working towards mutual goals.

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Software That Can Help You Manage Your Sales Funnel

Whether you are familiar with a sales funnel or not, it can be difficult to manage. Sales and marketing teams can get unorganized, not be working to achieve the same goal, or can get frustrated with a lack of leads. Far too often I see sales teams getting annoyed with the marketing team for a lack of leads, and marketing teams getting annoyed with a small budget. If that sounds like your business, check out this article here. Below I have listed a few software options that can help you stay organized and manage your sales funnel.

CRM

A customer relationship management software, otherwise known as CRM, is one of the best ways for your teams to stay organized. CRMs like Hubspot and Salesforce allow your marketing and sales teams to collaborate on new initiatives and follow up with each other. Email marketing campaigns, social media scheduling, and lead management are just a few ways that a CRM can manage your leads and increase the number of leads who take action. The two I mentioned above are also super easy to get started with and use on a daily basis. Both of their interfaces are simple yet effective, and their customer support is amazing.

Slack

As I mentioned above, it can be difficult to keep all of your teams on the same page. And this is especially prevalent with companies having people work from home, from the office, or a hybrid of the two. Slack is a messaging app that you can add to your computer, phone, or both. With Slack, you can create channels and talk one-on-one or in groups to keep your teams organized. We have found Slack to be a lifesaver in our company. Plus, you can send funny little GIFs to your coworkers!

Visitor Queue

One of the hardest stages to transition from is the interest stage to the decision stage. With so many options out there and so many factors to consider, a large number of leads do not continue past interest. When leads are interested in your company, they will visit your website to do more research. But what happens with the 98% of website visitors that don’t convert? Well, with Visitor Queue, you can contact them and close the deal. Visitor Queue is a B2B lead generation software that identifies the companies that visit your website. This includes their employees and their contact information like email addresses, phone numbers, and LinkedIn profiles. With all of this information, you can reach out to your leads and tell them why your company can solve their problems. Use their website visit details (page views, time on page, etc) in your pitch! Increase your revenue by 10-20% today and start your free trial.

Wrap Up

A sales funnel is an essential part of any business. Every business out there will have a different sales funnel that aligns with their specific business goals and initiatives. But, as you have seen, there is a lot that goes into understanding and improving your sales and marketing initiatives to increase the number of leads and conversions you get. Without a doubt, monitoring your sales funnel with software and strong goals will help you increase the number of clients you are able to convert. If you have any questions about how Visitor Queue can improve your sales funnel and generate more leads, do not hesitate to reach out!

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Written by

Taylor Hamilton

I am the Marketing Coordinator at Visitor Queue. I recently graduated with an advanced diploma in marketing and administration from Fanshawe College. I love spending my spare time outside with my dog Peach! I am a firm believer that there are no secrets to success, only preparation, hard work, and learning from failure.

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