A sales funnel, although an imperfect model, is a visual depiction of the actual process your business uses to convert prospects into paying customers. It is the steps you take to move your target market from the point that they learn your business exists to the point that they become raving fans of your brand. Unlike a real funnel, your customers never actually fall out the bottom but instead filter back through the top over and over again, hopefully bringing along a few friends in the process.
Analyzing and understanding your sales funnel is a critical step toward maximizing your profit potential. The more you know about how your particular customers behave and make buying decisions, the easier and faster it will be to move them through your sales process; thereby, increasing sales revenue and bottom-line profitability.
The sales funnel has four stages: awareness, demonstration, conversion, and recruitment. Let’s take a closer look at each stage and what you can do to increase profitability as your target market gets pushed through each one of them.
The Sales Funnel
- Awareness. In this stage, prospective customers first learn that your brand exists. They become aware of you, your company, and the products and services you offer. This stage is all about getting on your customer’s radar so you can begin a conversation. In order for the Awareness stage to be effective, you have to know exactly who your target market is and then go where they go and be where they be. Once your target market has been identified, narrowed, and found, you then must use various tools to attract them. These tools are often referred to as lead generators and may include one or more of the following customer attraction strategies:
- networking and other live events
- exhibitor booths (trade shows, expos, etc.)
- direct mail (snail mail)
- email marketing
- commercial ads (tv, radio, social media)
- social media posts
- Demonstration. In this stage, prospects start to realize your value. This stage is all about establishing trust and rapport. People buy from those whom they know, like, and trust. You will need to show potential customers the benefits of your product or service offerings. What makes you the expert in your field? What sets your brand apart from others providing similar products and services? Tools you will use in the Demonstration stage may overlap with those you may use in the Awareness stage as prospects can often be moved through both of these stages at the same time.
- training events
- information sessions
- product demonstrations
- social media posts
- Conversion. In this stage, prospects have seen the value of your products and services and are ready to make a buying decision. Your job here is to simply ask for the sale. This is the most important aspect of customer acquisition; however, too many entrepreneurs fail to do this to close the actual sale. Here you will utilize tools that shift prospects into paying customers.
- buy now buttons
- free trials
- free quotes
- free consultations
- introductory sessions
- sales calls
- Recruitment. In this stage, existing customers are groomed, cultivated, and activated to become a voluntary marketing team for your business. This stage requires high levels of engagement to continue delivering value to paying customers time and time again. The idea here is that customers will be so satisfied with your business that they not only repeat purchases for themselves but also share their excitement with others who also become paying customers. Tools implemented in this stage help transition existing customers into evangelists who recruit new prospects into your sales funnel for you.
- brand ambassadors
- loyalty programs
- incentive clubs
- referral programs
- customer appreciation sales
- customer spotlights
- birthday, holiday, and anniversary mailers
An effective sales funnel is vital to the financial health of your business. Your sales funnel should move prospects through the most efficient and fastest route to becoming a paying customer and raving fan of your brand. Take a moment to build, review, and/or revise this important business process now. Download our SALES FUNNEL WORKSHEET to fix your funnel today.
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