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What Is a Sales Funnel?

Posted by Sean Huckstep | November 21, 2019

Understanding and controlling your sales funnel is crucial to success.

 

 

What Is a Sales Funnel?

While managing a business, owners may come across sales jargon. One of the common questions we get is, “What is a sales funnel?” The next question many business owners have is whether or not their company has one. All companies have a sales funnel, whether they create one intentionally or not. A sales funnel describes the route customers navigate, from when they first become aware of a company and its products to when they actually make a purchase. 

The 4  Sales Funnel Stages

As they travel along this route, customers move through several stages. As they progress through the funnel, fewer and fewer prospects make it to the next stage. This is what creates the imagery of the funnel. Here are the main stages you should take control of when creating your sales and marketing campaigns.

  1. Awareness: Customers must first know a business exists to buy from it. Focusing on marketing will help boost awareness. One of the most common methods companies rely on is optimizing their website so that customers find them when they look up queries related to the company’s products or services. Roughly 79% of Americans shop online, so it’s more important than ever to pay attention to SEO.
  2. Interest: Having a searchable website or an easy-to-find store in town only gets people to the front door or the homepage of the website. To generate real interest, companies must provide content that customers can use during their comparisons and research. Note that pushing a sale too early at this point could cause them to view the content as biased and jump ship. Keep it informative and helpfuls.
  3. Decision: This is the point when the customer is ready to make a purchase. However, your company may not be the only one they’re considering. Keep in mind that some customers respond best to good offers. This may include free shipping, free samples, free installation, or other discounts. Others may focus specifically on the quality, irrespective of the price, and may evaluate the offers based on specs. Study your target market and your most successful customers. How did they approach the decision making process? What worked best for them? Then use that information to improve your offering.
  4. Action: The final step involves actually purchasing the product or service. This is where many businesses lose the opportunity to truly capitalize on a sale. Instead of nurturing existing relationships, they run off in search of new ones. Remember that it can cost up to 25 more times the company resources to attract a new customer as to keep an existing one. Happy customers may also refer your business to others, so try to maintain a balance. Mapping your existing customers in SalesRabbit is a great way for canvassers to focus on those relationships and integrating them into their outside sales approach.

How To Improve Your Sales Funnel

Now that you understand what a sales funnel is, you may be wondering how to improve it. How do you get more people to make it all the way to the fourth step and boost your bottom line?

  1. Smart Sales Prospecting: We often get asked, “What does prospect mean?” In sales, it depends on the context in which it is used. It may refer to a prospective buyer, i.e. someone at stage three or higher in your funnel. The act of sales prospecting, however, involves actively looking for those buyers. Companies often do this through outbound calls or door-to-door sales. You will want to use tools that help you be more efficient as you work in outbound environments.
  2. Improve Website SEO: Forbes estimates that 82% of shoppers with smartphones do online research even when purchasing a product in-store. In addition to this, 45% of customers read online reviews to see what previous buyers think of the product and service. This is why it’s so important for companies to increase the content available about their products and services while optimizing it for high rankings in searches.
  3. Rely on Human Element: Did you know that 73% of customers prefer to skip the robocall phone-tree so they can speak directly with another person? It’s important not to overlook the human element of the customer experience, whether customers are in your store or online. Make it easy for current and prospective buyers to reach customer service or sales reps.
  4. Sales and Promotions: A big part of roping customers in is coming up with a compelling offer. Always try to give people an offer they can’t refuse. When it comes to door-to-door and in-store sales, sales reps may need some leeway to provide deals that are not advertised. Reps will also need to gauge customer behavior to see what may best appeal to a particular person.
  5. Know Your Market: One of the best ways companies can improve their conversion rates and boost sales is to know their target demographic. Marketers often recommend using personas to sum up and personalize the features of particular segments you serve. The better you know your customers, what they want, why they want it and the offers they prefer, the easier they are to communicate with and sell to.

Sales funnels play an important role in building and growing a business. While every company has one, the funnels with high conversion rates are handcrafted to find and keep as many prospective buyers as possible. SalesRabbit can help. Check out our sales app and request a demo today.

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