Learn about sales funnels, including what they are, the sales funnel process, the benefits of sales funnels, how to build a sales funnel, and examples of sales funnels.
In order to grow your company, you need a reliable way to acquire new customers, which means building and optimizing your sales funnel. But what does the term sales funnel really mean, and where should you start? Read on for tips, examples, and best practices.
What are sales funnels? Sales funnel definition
A sales funnel is the process through which you turn prospects into buyers. The funnel consists of a series of steps or stages, that move the prospect from being unaware of your product or service to eventually making a purchase.
Sales funnels are often confused with the buyer’s journey, which is the same process from the buyer’s perspective. The funnel is something your company controls, while the prospect is in charge of their own buyer’s journey. Great salespeople understand the difference and overlap between these two distinct processes.
The sales funnel process: Sales funnel explained
There are many different sales funnel models, but the most basic process consists of five key stages: Awareness, Interest, Evaluation, Decision, and Purchase.
- Awareness: How are you getting your name out there in front of prospective customers? Most B2B companies will employ a mix of paid advertising, content marketing, and cold outreach to build brand awareness.
- Interest: To generate interest, sales reps might engage with prospects on social media, build relationships over email, or conduct a follow-up call. Lead scoring is also an essential part of this process because it allows salespeople to focus on the most qualified prospects.
- Evaluation: At this stage, the prospect is considering your solution against competitors and weighing their options. Case studies and other social proof can be especially powerful during this phase.
- Decision: The prospect decides to move forward, and negotiation begins.
- Purchase: The prospect accepts your proposal, and the deal is closed.
Occasionally, prospects can become stuck in the decision-making stage. They need prompting to take action. This is why the follow-up is so crucial–80% of sales require five or more follow-up calls before the prospect decides.
The benefits of sales funnels
Whether you’re aware of it or not, your business already has a sales funnel. On a basic level, this is the process you use to turn prospects into leads and paying customers.
Although funnels are often created by accident, it pays to become more intentional about your sales process–especially as you begin to scale your business. Once you begin to build a sales team, it’s important to have a standardized process in place to move leads through the funnel.
Documenting this process allows you to see the entire sales funnel at a glance. You can measure your success through conversion rates, see what’s working, and pinpoint what needs improvement. For example, you may realize you have no structured follow-up process and warm leads are being lost or simply forgotten.
Building an intentional sales funnel will elevate your customer experience and accelerate your revenue growth as you begin to close those gaps.
How to build a sales funnel
Build the foundation
Repeatable processes are necessary for long-term success. Using a CRM software, make sure you’re able to track your sales team’s activities, along with where each lead is in the pipeline. Ensure that key metrics are being tracked and analyzed, and document your core processes in a sales playbook.
Turn your salespeople into specialists
Top-of-funnel activities like cold calling require a very different skill set than closing. Hire different people to perform each task; Sales Development Reps (SDRs) can take care of outreach while Account Executives (AEs) or managers handle closing. This allows every salesperson to focus on what they do best.
Tailor your content
As a prospect moves through the sales funnel, they will continue to seek out information to help with their buying decision. Sending relevant content to the prospect at each stage can help move them closer to a decision.
Choose content strategically based on where the prospect is on their journey. For example, if they’re hesitating to make a decision, you could send a case study that showcases how you helped a past client overcome a similar problem.
Get to know your customers
No one wants to buy from a robot. Call scripts and email templates are a great starting point, but you should also encourage your sales team to improvise. Train your reps to ask lots of questions and truly listen to the prospect’s answers.
You can also interview or survey past customers. These responses will help you better understand what your buyers are looking for and how you can better structure your sales funnel to meet their needs.
Align your marketing and sales teams
According to research from Gartner, 27% of B2B buyers perform independent research before making a purchase. This means the content that the marketing team creates inevitably becomes a part of the sales process, whether the sales team is aware or not.
When building your sales funnel, make sure both functions understand it’s going to be a collaborative process. Everything will run smoother if sales and marketing work together.
Optimize and adjust as needed
No matter what model you base your sales funnel on, there’s no one-size-fits-all approach. Keep track of the data and over time, you’ll learn what works well, what doesn’t, and what information your prospects are looking for in each stage. Then you can adjust your sales process accordingly.
Another way to spot weaknesses in your sales funnel is to calculate the conversion rate between each stage; it will help you see what’s going well and where you’re losing people with a lower-than-optimal conversion rate. Equally as important, keep track of which stages have the best conversion rates, so you can double down on what’s working well.
Sales funnel examples
There are many different models of the B2B sales funnel. One of the most common sales funnel examples is AIDA, which consists of four key stages: Attention, Interest, Decision, and Action. Here’s an example of what that could look like for a B2B company:
- Attention: A decision-maker learns about your product via cold email.
- Interest: The buyer begins researching various options, comparing your product to its competitors, and analyzing the pros and cons of each. They book a meeting with your sales team.
- Decision: The buyer decides to purchase your product and receives buy-in from other key decision-makers.
- Action: They buy the product.
The drawback of this model is that it doesn’t consider the buyer’s thoughts and decisions after the sale. For this reason, some companies prefer to include additional stages. Here’s an example of what that might look like for a SaaS business:
- Attention: The prospect sees an ad that captures their attention.
- Interest: The lead is nurtured through email campaigns, and they book a demo.
- Consideration: The lead requests pricing information and reviews a proposal.
- Purchasing decision: The deal is won or lost.
- Renewal: Upsells, cross-sells, and subscription renewals.
Optimizing your sales funnel is critical to scaling revenue. If you need help streamlining or documenting your sales process, reach out here to book a free discovery call.