Although having an optimized sales funnel is essential to getting more conversions, most companies never assess its impact on sales.
In this article, we are going to show you the basics of a sales funnel and ways to optimize it.
What is the sales funnel?
The sales funnel is divided into four stages based on the status of each prospect:
- Prospects
- Qualification
- Decision
- Closing (won or lost)
Although each of these stages of the sales funnel reflects the state of each prospect, let's take a closer look at each of them:
Prospects
The prospects stage is the most general and involves the broad identification of potential customers in the general market. The goal here is not to make a sale on day one, but to increase awareness of your brand and that you not only provide a product, but provide a continued service over time.
This stage of the funnel is also known as TOFU or Top of the Funnel.
Qualification
The next stage in the sales funnel is sales qualification. This focuses on examining the leads obtained in the first stage: Are they interested in your solutions? Do they have the budget and decision-making ability to buy your product? Qualified leads help sales teams increase success rates; Unqualified leads can waste time for marketers, sales teams, and customers themselves.
Decision
The decision indicates the part of the funnel where potential customers seek to learn more about your solution and the terms of a deal. At this stage, your sales team should contact prospects and answer any questions they have, as soon as possible.
Both lead qualification and intent fall into the middle of the funnel, or MOFU.
Closing (won or lost)
The last stage of the sales funnel is the close, also known as BOFU or bottom of the funnel. Closing is not always a winner.
It's also worth noting that closing sales is not an end state, but rather the beginning of a relationship. Ideally, the sales team will negotiate an agreement where customers purchase the initial services and come back again and again to renew the contract.
Now that you know the four stages of your sales funnel, we are going to see 8 actions to improve its performance:
- Raising Awareness Through TOFU
The content on TOFU is designed to promote awareness of what your product can do and to encourage potential buyers to contact you. For example, you can post a fancy video along with a link to other content that goes deeper into using your solutions, but you can also use how-to guides, tutorials, and multichannel social media campaigns. - Optimize your content
Content optimization is achieved by using different channels to contact and deliver messages to potential customers, improving the positioning of your brand and segmenting the content for each type of customer.
The goal here is to connect with potential customers and give them a deeper insight into what your brand does and what sets it apart from the competition. - Target Higher Value Leads
To optimize the first level of the funnel, marketers focus on targeting higher value leads based on how they started searching for the information. The value propositions that managed to connect with the best customers will facilitate the task of differentiating which messages to use. - Qualify Leads
Passing all customer interactions to the sales team without qualifying wastes time because unqualified leads are much less likely to convert. It pays to spend time making sure potential customers have the intent and ability to make decisions. - Feed Lead Nurturing
The goal here is to follow up on leads. Interact with all those customers who have clicked on a link, have downloaded content or have made any query. The more effort you put in the early stages, the more likely you are to close a sale and generate income. - Make the most of MOFU
Efforts with customers in the middle of the funnel should be focused on helping them make a decision. To do this, you will have to work with potential B2B customers to determine their specific needs and design the offer that best fits their budget and needs.
The more specific you can be in figuring out key pain points and potential remedies, the better your MOFU efforts will be. - Close the sale and build loyalty
Now is the time to close the sale and secure a contract and service level agreement (SLA), along with negotiating the length of the contract. Depending on your business model, you may offer a free trial or the option to unsubscribe without penalty for the first few months.
Try to exceed your client's expectations and make sure they will renew.
On the other hand, keep in mind that even lost sales can give you valuable information. Instead of blaming a lost sale on bad luck, it's a good idea to run a report to find out where your sales funnel processes performed as intended and where improvements can be made. - Measure the results
If you have optimized your funnel up to this point, it will mean that you will be converting an average of 20% of your customers. Still, don't settle for industry averages and measure your conversion rate and compare it to your history to see if you're headed in the right direction and if you need to make some changes.
Sales funnel theory is simple: Capture broad leads at the top, then refine these leads at each step to drive conversion.
In practice, however, it often requires a lot of time and resources, especially for B2B IT sales.
At PGR+ Marketing & Tecnología we are specialists in the generation of IT leads for B2B companies, and we will be happy to help you focus your marketing efforts on your most valuable potential customers, highlight your value proposition for them and achieve conversions over time.
