When businesses are analyzing their sales funnel, what they're trying to do is to better understand each phase in their buyers' journey to identify what strategies they can accomplish two things:
- Size – If marketing can attract more prospects then its plausible that the opportunities to grow their business will increase given that conversion rates remain steady. In other words… if I attract 1,000 more prospects with an advertisement and I have a 5% conversion rate, that will equate to 50 more customers.
- Conversions – At each stage in the sales funnel, marketing and sales should be working to increase the conversion rate to drive more prospects through to a conversion. In other words, if I attract that same 1,000 more prospects but am able to increase my conversion rate to 6%, that will now equate to 60 more customers.
What Is A Sales Funnel?
A sales funnel is a visual representation of the number of likely prospects that you're reaching with the sales and marketing nurturing of your products or service.
Both sales and marketing are always concerned with the sales funnel, often discussing the prospects that are in the pipeline to define how they may be able predict future revenue growth for their business.
With digital marketing, the alignment between sales and marketing is critical. I love this quote from one of my recent podcasts:
Marketing is talking to people, sales is working with people.
Your sales professional are having valuable discussions with prospects on a daily basis. They understand the concerns of their industry as well as the reasons why your company may be losing deals to competitors. Along with primary and secondary research and analysis, marketers can utilize that information to feed their digital marketing efforts… ensuring that a prospect at every stage of the funnel has the supporting content to help the prospect convert to the next stage.
Sales Funnel Stages: How Digital Marketing Feeds Them
As we look at all the mediums and channels we can incorporate into our overall marketing strategy, there are specific initiatives that we can deploy to increase and improve each stage of the sales funnel.
Advertising and earned media drive awareness of the products and services that your business has to offer. Advertising enables your marketing team to utilize look-alike audiences and target groups to advertise and build awareness. Your social media team may produce entertaining and compelling content that's shared and drives awareness. Your public relations team is pitching influencers and media outlets to reach new audiences and build awareness. You may even wish to submit your products and services for awards to drive awareness with industry groups and publications.
How are people interested in your products or services showing interest? Nowadays, they're often attending events, participating in industry groups, subscribing to helpful newsletters, reading articles, and searching Google for problems that they're seeking a solution for. Interest may be indicated by a click-through on an advertisement or a referral that brings a prospect to your website.
Considering your product is a matter of evaluating the requirements, the cost, and your company's reputation along with your competitors. This is typically the stage at which sales begin to be involved and marketing qualified leads (MQLs) are converted into sales qualified leads (SQLs). That is, likely prospects that match your demographic and firmagraphic profiles are now captured as leads and your sales team qualifies them in their likelihood to purchase and be a great customer. This is where sales is incredibly talented, providing use cases, providing solutions, and knocking down any concerns from the buyer.
In my opinion, the intent phase is the most important from a timing standpoint. If it's a search user looking for a solution, the ease at which you capture their information and get your sales staff to pursue them is critical. The search they used provided the intent that they're seeking a solution. The response time to assist you is also critical. This is where click-to-call, form responses, chat bots, and live bots are making an enormous impact to conversion rates.
Evaluation is the stage at which sales collects as much information they can to put the prospect at ease that you have the right solution. This could include proposals and statements of work, price negotiations, contractual red-lining, and ironing out any other details. This phase has grown with sales enablement solutions the last few years – including digital signage and documentation sharing online. It's also important that your business have a great reputation online as their team that's building consensus will be digging in and researching your company.
A seamless purchase process is as critical for an ecommerce check-out for a consumer good as it is for an enterprise company. Being able to easily bill and collect the revenue, communicating the onboarding experience, sending shipping or deployment expectations, and moving the prospect into customer must be easy and well-communicated.
What Doesn't The Sales Funnel Include?
Remember, the focus of the sales funnel is turning a prospect into a customer. It's doesn't typically go beyond that despite modern sales teams and marketing teams being responsive to customer experience and customer retention needs.
It's also important to note that the sales funnel is a visual representation of your organization's sales and marketing team's efforts… it's not reflective of the actual buyers journey. A buyer, for example, may move back and forth within their journey. For example, a prospect may search for a solution to integrate two products internally.
At that point, they find an analyst report on the type of platform they're seeking and identify you as a viable solution. That kicked off their awareness despite them already having intent.
Don't forget… buyers are moving more and more to self-service processes in evaluating their next purchase. Because of this, it's critical that your organization has a comprehensive content library to support them in their journey and to drive them to the next step! If you do a great job, the opportunity to reach more and convert more will happen.