What is a Sales Funnel

Apr 20, 2022 | Marketing

You’ve likely come across the term sales funnel which is often used in marketing and client prospecting.  Have you ever wondered what it means? The sales funnel refers to the progression of steps in your sales process that your ideal customer takes from discovering what your business has to offer to making a purchase and sometimes even a series of purchases. 

Let’s Look at an example.

You have a brick-and-mortar store where you watch many potential customers walk past your door everyday. A number of them will decide to walk in and browse to see what you’re offering.  Of all those that walk in, a number of them will see products they like and decide to have a closer look.  From this group of viewers, a percentage of them will find products they enjoy or determine they need and will proceed to the checkout to make a purchase. 

This buying process will be similar to the steps future potential customers will take before they make their decision to buy what you’re selling and it makes no difference whether you run a brick and mortar or an online store.   Why then, is understanding your sales funnel so important?

Good question!

So why is a sales funnel important? Well,here’s the deal. Having an understanding of your consumer sales funnel helps you know what potential customers are thinking while at different stages of the funnel and what may be keeping them from making a buying decision.  What potential barriers are stopping them and what can you do to overcome them?  It also allows you to manage your business resources by qualifying those prospects against your ideal client profile which you have identified as those most likely to purchase your goods or services.   

Now That You Know, Why Is This Important?

Because now you can develop marketing strategies geared towards moving the customer towards the next stage of your process by clearing objections until they are ready to make a purchase. This also means developing personalised marketing messages tailored to potential clients based on which stage they are at in the sales funnel and focusing those messages on removing barriers.  With this targeted messaging it’s important to remember that your objective is to move them to the next step in the funnel only and to trust the process you have created. 

The Stages Of The Sales Funnel

When prospects first hear of your business, products, or services, they will go through several stages of decision-making until they can finally make a purchase. Granted, the speed and path of the progression will not be the same for every customer but, they will make their choice sooner or later to continue on or exit based on their need or interest in what you’re selling. 

That said, there are four main stages of the sales funnel. 

The Awareness Stage

Here customers are first learning about your products and services. This can be through social media ads, through your sales team, or through various other marketing campaigns that your business has developed. 

I’ll be honest with you.

The number of leads who move down the sales funnel will depend on how effective your marketing efforts are. 

Okay fine, sometimes customers may go straight into buying a product. These are your unicorn customers that were already researching before they landed on your business.

Most times, however, you will need to wow the customer at the awareness stage to encourage them through the next stages. 

The Interest Stage

Now that customers are aware of your products or services, they will then enter the interest stage. Here they will make competitive research comparisons and weigh the options available to them. So here’s what you need to do. Offer your customers valuable content and information. However, make sure that the content helps your customers make the right choice BUT don’t try to sell to them yet. Doing this would likely scare them away.  This stage is about educating them about your business and the problems you solve.

What happens next? You establish your business as an expert in the minds of customers.  This then helps build brand trust, which helps them move over to the next step. 

The Decision Stage

At this stage in the buying process, the customer is ready to make a purchase. Keep in mind that they could be interested in a competitor’s products as well. So what do you do about it? Remove barriers, showcase your value, add in deals, discount codes, and promos if you want to make an offering more attractive. The goal is to make your products so attractive that customers can’t wait to purchase them. 

The Action Stage

The customer finally buys your product. Not bad, right? It may be the final step in the sales funnel. However, it doesn’t mean that it’s all over. Yes, there’s more! Always make sure you have a customer recognition and retention strategy in place for them to keep coming back for more.  This may include building customer relations by offering after-sales support, reaching out for reviews or letting them be the first to know about special “client-only” presale promotions.  Help them feel special, appreciate them and grow your relationship to keep them visiting and using your products.  

Final Word

Understanding which stage of the sales funnel a customer is in allows you to know exactly what is going on in their minds. This, in turn, makes it possible for you to send marketing messages that are more personalised and tailored to the individual client. This results in more leads going through the sales funnel and more leads means more qualified prospects filling your sales pipeline which means more potential customers and ultimately more revenue for your business! 

 

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