While looking for a sales funnel definition, you may come across several terms. Some terms that you may encounter along the way are: marketing funnel, purchase funnel or sales pipeline. They all basically follow the same principle just like the sales funnel. The system that a sales funnel follows looks like an inverted pyramid, but without the sharp edge at the bottom. Instead, it has a narrow stem.
What the sales funnel illustrates is the journey of a customer from the moment it discovers your website to the point where it is about to make a purchase. Internet marketing experts utilize this funnel to help them convert a lead into sales.
An Explanation of the Shape of a Sales Funnel
One cannot completely comprehend a sales funnel definition without having a clear understanding why the diagram is shaped like a funnel. While marketing managers are still free to create a sales flowchart using the traditional linear chart, they will soon find the sales funnel is much more simple. With its cone shaped diagram, the process is more clear-cut and each stage has a definite flow.
In comparison, a traditional linear chart is composed of a flowchart that has several stages while in a funnel, the top part of the funnel flows to the next stage when it is done serving its purpose. The funnel also does not make use of arrows which points out the next step in the process.
Nevertheless the sales funnel design has also revolutionized in such a way that it now gives importance to social media as part of the marketing process. Social media has indeed changed the way businesses reach out to their potential customers online.
The so called “leads” are placed on the top of the funnel and it goes down to the bottom which is when the sales transaction takes place. The middle part of the funnel can have a variety of factors included, and this will all depend on the size and the strategy taken upon by the business. The idea of having this funnel is to take advantage of the opportunity of having a sale. After finding several leads, comes the part where you need to sift out those who are just looking around and retain customers who are really interested in buying. As you continue to categorize down the funnel, it becomes easier to focus on the needs of the target market.
Steps to Undertake in Creating a Sales Funnel
Thorough research and critical thinking is needed in coming up with a sales funnel for your business. As you gather some important data to help in strategizing the parts of your funnel, consider the guideline below in structuring an effective sales funnel.
- Begin at the Top – The most critical decision one needs to do is what goes on the top of the funnel. It is usually the leads or prospects that must be situated in the wider area of the funnel. These leads are sometimes called awareness. Nevertheless, the only goal here is to draw the attention of people who know nothing about your product.
- Selecting the Qualified Leads from Your Prospects – With a little research and tracking of your list of prospects, you can identify qualified leads. Sending relevant content, tracking a person’s activity, putting in changes when needed, and allowing more time for observing leads has been proven to help in selecting the most qualified prospects that will most likely convert to a closed deal.
- Marketing Strategies and Some Potential Risks – This part of the process involves evaluating the risks in obtaining leads and converting to sales. This is the point where you prepare the leads you have obtained for committing into buying your product. This must be the area in your funnel where you have sifted out those who are still indecisive about buying.
- Sealing the Deal Carefully – The moment your qualified leads show they are keen on buying your product, give them an offer to help preserve their interests. Make sure that you take out any factor that might distract them and prevent them from proceeding down the funnel.
- Structuring Improved Strategies After the Purchase – As you may know by now, a sales funnel definition does not necessarily make people aware that there is a cycle involved. One does not stop when the transaction is sealed. Once a deal is sealed, there could be more room for improvement and there could be parts of the funnel that needs to be replaced, removed or added to make it work better.