Teamleader Blog Article

What is a sales funnel and how can you use one?

What is a sales funnel and how can you use one?

To ensure the survival and growth of your business, you need new customers. A sales funnel helps you follow up on leads and sell swiftly.

What is a sales funnel?

Sales funnel what and why

A sales funnel is the overview of all steps that contribute to selling your product or service.

Your sales funnel helps you gain insight into:

  • How many leads are in each stage of your funnel.
  • How many conversions you see in each stage.

This helps you reveal:

  • Whether you hit your targets.
  • Which phases require more attention.

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What does a sales funnel look like?

From the first touchpoint with your business until the actual purchase: a lead passes through multiple phases of your sales funnel. The journey differs for each business, depending on your target audience, sector and the products or services you offer.

In general, however, each sales funnel consists of four key moments, often referred to as micro conversions.  These four moments contribute to your ultimate cause: selling. When people talk about conversion, they mostly refer to sales. Basically, all micro conversions in your sales funnel lead to a macro conversion.

Important conversion points in your funnel

Sales funnel conversion points

  • A lead gets in touch with a product or service for the very first time. He or she struggles with a certain issue, and is looking for a solution.

Example: you own a clothing store. Someone walks past, sees the window of your shop, and realises: I could use a new pair of trousers.

  • That lead will then start looking for a way to solve his problem. He or she may become interested in your offer.

Example: your potential customer comes in and looks around your shop. He seems fond of three pairs of trousers.

  • Your lead decides to use one of these solutions. Specific information, such as pricing, options and opinions of happy users guide him in making this purchase.

Example: this person then decides to try out those pairs of trousers. You offer your assistance and inform him that one pair is still available in a different colour. Your potential customer uses a smartphone to find the brand online and compare prices.

  • Your lead then takes action by buying - and is now your customer.

Example: your potential customer finds a pair that suit him well, and discovers your offer is the cheapest. The decision is made: this person will buy your pair of trousers.   

How do leads move through your funnel?

Each sales organisation has a sales funnel... but not everyone thinks about its structure. Would you like to sell more? That also means you should pay more attention to how you're selling. A sales funnel helps you structure your sales tactics.

  • Inform your website visitors, e.g. by offering informative blogs and brochures on your website. People appreciate being helped throughout the buying process. Your website is often the first point of contact with your business: make sure visitors can quickly find what they're looking for.
  • Use marketing to fill your funnel. Finding leads is not always easy, but you can make your life easier by creating a clear website and making sure visitors give you their contact details.  
  • Use online forms to collect those details. Allow visitors to download brochures, request more info or a quotation in exchange for their name and email address. Keep it simple and concise, so they don't lose interest.
  • Qualify your leads. After a download or request, your lead shows clear interest in your company and moves to the next stage in your sales funnel. Is there a match? Some companies qualify based on acquired data, others tend to call their leads.
  • Avoid a 'flat funnel', only focusing on macro conversions. Define which micro conversions are essential in your sales funnel and which steps your leads should complete to move to the next phase.

What is the difference between marketing funnel, sales funnel and customer journey?

The customer journey doesn't end after purchase. If you want to keep your customer, you'll need to invest in that relationship afterwards as well. The path a customer takes from A to Z, that is the customer journey.

Are you confused by big words like customer journey, sales funnel and marketing funnel? It's actually quite simple.Customer journey rocket

  • The customer journey consists of all contact moments a customer ever had with you. From the first talk with your business to the moment you win over a lifelong fan.
  • The sales funnel contains all actions that lead to purchase, which is often linked to active efforts of your sales team.
  • The marketing funnel helps you attract leads. In other words: it precedes the sales funnel. A lead becomes a prospect, or sales-qualified, as soon as they undertake action: for instance by calling you or by requesting a quotation on your website. In essence, the marketing funnel serves to fill up your sales funnel.

Improve your sales process with a sales funnel

A sales funnel grants you insight into who your customers are, what they need and which methods work best to convince them of your product or service. Identify the different micro conversions preceding a purchase, and stimulate your leads to take action. By combining all these insights, you'll be able to vastly refine your sales process. 

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