What is a business sales funnel and how to optimize it

October 16, 2015

A sales funnel is also known as a sales process or a revenue funnel. It refers to the purchasing process that businesses lead their customers through when buying products or services. A sales funnel is divided into a variant of steps, which can differ dependent on the respective sales model of a company. Most commonly, the sales process is divided into the following seven phases ( :

  • Awareness Phase: where prospects are made aware of the solution’s existence
  • Interest Phase: prospects begin to demonstrate an interest in the service or product through the conducting of research
  • Evaluation Phase: Prospect companies or prospects examine the solutions of competitors as they move towards making a purchasing decision
  • Purchase Phase
  • Reevaluation Phase: in business to business sales it is quite common for contacts to be involved which will require renewal. As a customer begins to become familiar with a respective offering and as the contract renewal nears, a customer will enter into this phase. This is when the customer will decide whether or not to move forward with the renewal.

A sales funnel is wonderful way in which to visualize the progress in which leads become customers. The following will advise you as to how to properly manage your sales funnel so that it does not begin to clog.

Sales Funnel Management

Success, as it pertains to sales, consists of finding prospects that are prepared to become paying customers. It can, unfortunately, become quite difficult to plausibly identify the right consumers to focus your efforts due to the relative few prospects as well as the overall size of a customer pool. This is why the management of your sales funnel is ideal and expressly needed.

In the most basic sense, the sale funnel is no more than an attempt at visualizing concept in which qualified consumers are located and then separated from the pack. This is accomplished by adhering to a certain set of steps and stages as well as the casting of a wide net in the beginning. Over time, it is important to weed out prospects that are unlikely to pay off. At the conclusion of the funnel, the sales team for your company will be able to focus their efforts on prospects that contain the highest level of likelihood of purchasing.

Sales funnel management that is expressly effective is capable of allowing a business the ability to optimize its efficiency as it becomes able to decrease cost. This will eliminate the possibility of time being wasted on prospects as well as leads that do not appear to have a firm commitment. A proper sales funnel will in turn facilitate the gathering and tracking of important data due to the implementation of levels and steps within the funnel itself that are expressly well-defined. This will result in the easy charting of the progress of a prospect and any issues or problems that arise are able to be swiftly identified, localized and resolved.

Moreover, a pliable sale funnel is a fairly imperative cog within the mechanism that is your business. However, you will need to know what to do when your funnel no longer benefits your sales process and begins to slow down processes. It needs to be kept firmly in mind that either a sales funnel that is overtly short or one that is too complicated can prevent a free flowing funnel which will result in a loss of plausible prospects.

The key to retaining a functional sales funnel is to eliminate redundant processes and steps while retaining highly needed steps that permit customer to progress.

Eliminate Unneeded Elements within the Funnel

There should never be a point in which leads or prospects move sideways within your company’s sales funnel. Do note that some may need to move to a previous step, but this movement should be no more than a brief occurrence in regards to their forward motion towards a purchase. You will need to keep firmly in mind that the express intent of the sales funnel is to produce revenue. With that being said, those that are not swiftly moving towards the end of the funnel are doing nothing more than wasting effort and time that could be utilized in far better ways.

You will need to eliminate any obstructions within the funnel that could possibly sow down its functionality. This can be accomplished by asking your company’s sales team the following: “Why aren’t our sales 5 to 10 times better than they are currently?” The answers to this query will help to identify problems that may be causing clogs within the funnel. Be aware, that some problems may be due to issues with marketing or an inability to reach the customer’s decision maker.

Do NOT Cut Corners, Cut Steps

Steps that are missing or incomplete can cause a lead to quickly become a breakdown within the sales funnel as a whole. Should plausible prospects not be able to move easily and smoothly transition between levels. With that being said, your focus should be on the express removal of steps that do not appear to be serving any discernable purpose within the funnel.

A prime example of an unnecessary step are memberships. Businesses that require customers to sign up for a membership before being able to complete their purchase add an unneeded step that is a time consuming customer deterrent.

Make Sure Sales Receives Qualified Leads

An issue that deserves consideration is that of what to do with which of the leads end up in the hands of your company’s sales team. Most commonly, marketers feel that their sole responsibility is to focus on procuring leads regardless of their quality. According to reports, an average of 61% of business to business marketers hand sales teams all of the leads that they gather although only an estimated 7% are actually viable (

The delivery of unqualified leads causes a sales team to waste valuable time and energy on prospects that are far from promising. This can be resolved with your company training marketers as to how to distinguish between qualified and non-qualified leads. When the very best leads are handed off to your sales team, the sales funnel is able to function much better resulting in increased profitability.



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