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The Stages Of A Sales Funnel Explained

Post by
Yash Shah
Last updated :
June 2, 2023
 | 20 min read
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Table Of Content

What is a sales funnel?

A sales funnel depicts the consumer path from initial awareness to making a purchase and beyond. It is a marketing model that depicts the steps that prospective customers take before completing a purchase. Stages of sales funnel begins with initial awareness of the product or service and conclude with the actual purchase. Awareness, interest, decision, action, retention, and re-engagement are the six stages of the sales process. 

A sales funnel's objective is to assist organisations in understanding how potential customers progress through the various stages of the customer journey and optimising each stage to attract prospects, boost conversions, and drive revenue development.

Businesses with effective sales funnel may discover areas for development and make strategic changes to optimise the customer journey. Agencies can achieve their company goals by studying each stage of the customer journey in the sales funnel.

The sales cycle or traditional marketing funnel has six different stages, each with its own set of challenges and opportunities. In this blog, we'll go through each of the six sales and traditional marketing funnel stages and offer tips and tactics for raising conversions at each stage.

A good marketing strategy and sales plan must include a sales b2b funnel. It provides a framework for understanding the path that prospective customers travel before purchasing, and it may help businesses optimise their marketing and sales activities to increase conversions and revenue.

Understanding the six parts of a successful sales and marketing funnel is essential for generating growth and meeting business objectives, regardless of whether you're a business owner, marketing, or sales professional. In today's blog, we shall discuss and go over each level thoroughly.

The stages of the sales funnel are easy to remember by the acronym AIDA: Awareness, Interest, Decision, Action, retention and then there is re-engagement. These six steps depict your prospective buyer persona or customer's attitude.

Why are sales funnels important?

From initial awareness to purchase, the small business owner's go-to-business sales process provides agencies and small business owners with a visual representation of the client journey.

Businesses can  Improve conversions by studying each stage of the funnel. By analysing each stage of the funnel, organisations may find areas for improvement and make strategic changes to optimise the customer's journey, resulting in a higher conversion rate.

By boosting their conversion rate agencies can funnel potential customers, drive revenue growth and meet their business objectives.

Businesses can enhance their marketing strategy and sales tactics by following and analysing consumer activity at each funnel level. An effective sales and marketing funnel enhances the performance of sales teams, generates growth, and improves customer satisfaction and service

Because you don't want to send the wrong message at the wrong time, each stage necessitates a different approach from you, the marketer. It's similar to a waiter asking you what you want for dessert before you've ordered drinks and appetizers.

The stages of sales funnel are a visual representation of the stages that a potential customer goes through as they move from being aware of a product or service to becoming a paying customer. It is often made up of a consumer's actions.

Understanding the sales funnel is essential for agencies for several reasons:

Identify possibilities for improvement: 

By knowing the various sales funnel stages, organisations may discover possible customer loss points and adjust their marketing and sales processes to boost conversions.

Improve your marketing and sales efforts: 

Businesses may optimise their marketing and sales efforts to target potential consumers at each stage of the funnel, by creating content, after thoroughly understanding the entire sales cycle.

Increase revenue: 

By optimising the Stages of sales funnel, agencies can improve the number of clients who buy, resulting in higher revenue and business growth.

Evaluate consumer behaviour:

The sales funnel is a framework for studying customer behaviour that allows organisations to understand their target customers'' requirements and preferences better and modify their marketing and sales efforts accordingly.

As a result, understanding the sales funnel is essential for companies seeking to better their marketing and sales activities, optimise client experiences, and ultimately drive revenue development.

Making an efficient sales funnel is an important step for every successful organisation. A sales funnel is the path a customer takes from their first point of contact with a brand or product until they make a purchase. To design a successful sales process, it is essential to comprehend the steps of a sales funnel.

Let's take a closer look at each stage of the sales funnel

Awareness

The awareness stage is one of the earliest stages of the sales process in which the target customers or potential buyers learn about the existence of a product or service. Target customers are not actively searching to purchase at this point but are becoming acquainted with the brand and the product or service offering.

A prospect learning about your company for the first time is an example of a prospect beginning the awareness stage. Perhaps they saw one of your ads, read your blog, discovered your website through a Google search, or overheard a colleague discussing your product or service. This is the point at which you first pique a consumer's interest.

The awareness stage's purpose is to attract both prospective customers and existing customers and introduce them to the brand and its services. Businesses can begin to establish a relationship with potential consumers and take them farther down the sales process by offering valuable information and building brand recognition with previous customers.

There are a number of strategies that can be used to attract potential consumers at the awareness stage, including creating content and sharing material via blog posts, social media posts, paid advertising, and other channels to attract potential customers and increase brand awareness is a crucial component.

To increase visibility of website visitor blog content, you can create content that can contact potential customers through focused advertising campaigns on search engines, social media, paid ads, on your own landing pages, and other channels.

Working with influencers to promote the local business, and reach a larger target audience. Obtaining media coverage through press releases and interviews also helps increase brand awareness.

Of course, how and why those people move down the marketing and sales funnel stages is dependent on your own sales and marketing abilities. Leads in the middle and lower sales and marketing funnel stages are the ones you should pay the most attention to because they have progressed from awareness to interest.

Interest

When customers reach the interest stage of the sales and marketing funnel, they are conducting research, compare prices, and consider their options. So for that, you have to educate them about your product then they will start coming to you once you educate them on the product/service you offer and why you are better than the competition.

This interest manifests itself in them voluntarily submitting your forms, clicking on your ads, and otherwise providing you with their information.

Here are some ideas to attract consumers: Blog posts, email campaigns, lead magnets, free trials, and chatbots

  • Examples of interest stage tactics include:
  • Offering a free trial of a software product to allow potential customers to test the product's features.
  • Providing a downloadable e-book that provides valuable information related to the brand's offerings.
  • Sharing case studies that demonstrate the success of the brand's products or services with actual sales process steps with examples.
  • Highlighting customer reviews and testimonials on the brand's website or social media channels.
  • Sending targeted email campaigns that provide more information about the brand's offerings and address common questions or concerns.
  • Your main goal here is to inform customers and qualified prospects that you have a possible solution, possibly one of several. The purpose of the interest stage is to increase potential consumers' understanding of the product or service and their desire to purchase it.
  • Businesses can bring potential clients farther down the sales process stages and closer to making a purchase by offering valuable information and highlighting the benefits of the product or service.

Desire

The third stage of the sales lifecycle is the desire stage, in which potential buyers have formed a significant interest in a product or service and are considering making a purchase.

Customers are analysing the benefits vs the costs at this stage to see whether the product or service is a good fit for their needs.

Now customer has developed an express interest and a desire for your product however he or she might be considering two or three alternatives.

Businesses can employ a range of strategies to guide potential customers toward a purchase during the desire stage, such as:

  • Personalisation:
  • Businesses can provide personalised advice or solutions based on the needs and preferences of the customer.
  • Social proof:
  • To develop credibility and trust, a brand can highlight favourable reviews, testimonials, and case studies.
  • Competitive pricing:
  • Brands can offer competitive prices or discounts to entice customers to buy.
  • Limited-time offerings:
  • Using limited-time offers or promotions to create a sense of urgency can always help generate sales.
  • Upselling and cross-selling:
  • Businesses can also offer complimentary items or services that add value to the customer's purchase, known as upselling and cross-selling.

This is the time to make your most competitive offer. It could be a free trial, a coupon code, or a bonus product. In any case, make it so enticing that your lead can't wait to take advantage of it.

Retention

You now have a customer on board with your company. This stage necessarily focuses on keeping both existing customers and new customers satisfied in order to convert them into repeat customers and brand advocates. Word of mouth is a powerful force, and no one can use it more effectively than a satisfied customer.

The fifth stage of the sales cycle phases involves consumers who have made a purchase but are still weighing their alternatives and comparing various products or services to see if there is a better option on the market. Customers could be comparing the pricing, features, and benefits of several options at this point in order to make an informed decision.

To keep customers happy, you must assist them with all possible solutions to all aspects and problems related to what they purchased from you. Essentially, for customer satisfaction, you want them to remain interested in your product/service. You can accomplish this by sharing valuable content, such as:

  • Emails
  • Special Offers
  • Surveys/Outreach and follow-ups
  • Product usage guides
  • Technical assistance literature

Re-Engagement

The re-engagement stage of a sales and marketing funnel is an essential step in converting prospective consumers into paying customers and repeat purchases. The goal at this step in marketing funnel for sales rep is to reconnect with potential consumers and qualified prospects who have previously expressed interest in your product or service but have not yet purchased or taken any further action.

Reaching out to these potential consumers via email, social media, or other forms of communication is characteristic of the re-engagement stage of customer journey. The aim is to remind them of the advantages of your product or service and to persuade them to act.

It's essential to remember that the re-engagement stage isn't only about making a sale. It's also an opportunity to connect with new customers and gather input that might help you better your product or service.

The re-engagement stage is an important part of any successful sales funnel. You can enhance conversion rates and build your business by effectively engaging with potential consumers and giving them the information and incentives they need to take action.

Reach out to happy customers. Get them to come back.

  • Feedback Calls
  • Referral programs
  • Re-engagement email campaigns

After all, a 5% increase in your retention may result in up to a 95% increase in your profit.

Managing sales funnels with CRM software

CRM (Customer Relationship Management) software can be an extremely effective tool for controlling your sales funnel. Here are some examples of how CRM software can assist:

  1. Lead Management: 

CRM software can help you handle your leads more efficiently by tracking and categorising them based on where they are in the sales funnel stage if at the top of the funnel, either middle of the funnel, or the bottom of the funnel. This helps determine which leads are the most promising and prioritising them easier.

  1. Sales Pipeline Management:

CRM software can give you a visual picture of your sales pipeline, allowing you to know which deals are in each stage of the funnel. This makes it easier to track each deal's progress and identify bottlenecks or areas for improvement.

  1. Contact Management: 

CRM software can help you manage your contacts more successfully by centralising all their information. This allows your agency to keep track of interactions with each contact and tailor your sales approach to their needs and preferences.

  1. Workflow Automation: 

CRM software can streamline procedures like sending follow-up emails or organising meetings, allowing your sales team to focus on higher-value activity. This can accelerate the sales process and increase efficiency.

  1. Reporting and Analytics: 

CRM software can provide complete sales funnel reporting and analytics, allowing you to track critical metrics of customer success like conversion rates qualified leads, and deals. This makes identifying areas for development and optimising your sales process easier over time.

As we see CRM software can be beneficial for your agency. Like Clientjoy which is a SaaS product that helps Agencies and Freelancers manage their Leads, Proposals, Clients, Invoices, and Payments in a single place. It is a platform that helps 13K+ Agencies & Freelancers in 90+ countries acquire & retain happier clients.

Create your own sales funnel

Now that you are aware of how the different stages of the sales marketing funnel works, you can create your own marketing funnel. Keep these tips in mind when creating your own marketing funnel:

Define your target market: 

Identifying your target consumer is the first step in constructing a marketing funnel. Determine your target customer or audience's demographic, psychographic, and behavioural traits.

Create awareness: 

After determining your target audience, the following stage is to raise awareness of your product or service. This can be accomplished through a variety of marketing channels, including social media, content marketing, paid advertising, and public relations.

Create interest: 

After you've raised awareness, the following stage is to create content to pique people's interest in your product or service. This can be accomplished by offering your audience useful information and resources, such as blog entries, videos, and other social media posts.

Lead nurturing: 

After generating interest, it's time to take care of your leads. This entails establishing a connection with your audience via email marketing, participation in email campaigns, social media, and other channels of communication.

Convert Leads into clients: 

The last stage is to turn your leads into paying customers. Targeted sales tactics like discounts, time-limited promotions, and free trials can help with this. Retaining consumers is the next stage after converting leads into paying clients. Excellent customer service, loyalty programs, and constant contact can help with this.

Remember when creating a marketing funnel, it's important to continually monitor and optimize each step of the marketing funnel to improve conversion rates and maximize ROI. By following these steps, you can create an effective marketing funnel that will help you attract, convert, and retain customers.

Getting a sales funnel back on track

Your sales funnel can be your sales team's best success source. However, if you notice that:

  • Your lead conversion rate could be better than the overall number of leads.
  • The sales process is taking a lot longer than required. 
  • Many leads lose interest or stop responding.

You can try the following:

Analyse Your Data: 

In order to pinpoint the areas where your leads are fading, you must first analyse the data from your sales funnel. This will enable you to identify the funnel step that requires improvement.

Review Your Messaging: 

Make sure your messaging is clear and pertinent to your target audience by reviewing it. Make sure your value offer speaks to your prospects' concerns and is convincing.

Get Your Landing Pages Optimised: 

You should optimise your landing pages for sales. Make sure they have an eye-catching design, are simple to use, and have strong calls to action.

Simplify Your Forms:

Reduce the amount of required fields on your opt-in forms by simplifying them. Long forms may put off potential customers, which results in missed leads.

Improve Lead Nurturing:

Your lead nurturing plan should include personalized and pertinent material that informs, engages, and persuades your prospects. To send relevant communications to your leads at the appropriate moment, use email marketing automation software.

Answer Common Questions And Concerns: 

Take note of the frequent objections and worries that your prospects have, and use your messaging, content, and sales presentations to answer them.

Implement Retargeting advertisements: 

Retargeting advertisements can be used to entice visitors who left your site without making a purchase to return. These advertisements may inspire people to revisit your funnel by reassuring them of your company, its goods, or its services.

Offer Top-Notch Customer Service:

 To keep your current consumers and make them into brand ambassadors, offer them outstanding customer service. Happy clients are more inclined to recommend your company to others, which can increase your lead generation.

You can fix a sales funnel that is losing leads by following the above steps, which will also gradually increase your conversion rates.

Measuring sales funnel success

You should give certain metrics to each customer journey stage as you construct your funnel. Depending on the evaluation stage and on the channel or approach you're utilising, the precise measure will change, but here are some suggestions:

Start tracking their progress using software like Google Analytics. These metrics can be compared month to month. You have an issue if you see a drop or contrast in the numbers.

For instance, you might get a lot of website traffic but no one signing up for your email list. You will then be aware that there might be a problem with the Interest stage. You can try strategies like the following to increase conversion:

  • retargeting website visitors with a recruitment pitch.
  • Boost the copy in your email sign-ups.
  • Enhance the sign-up incentive you're providing.
  • Increase the visibility of the sign-up box.
  • Adding additional sign-up choices.

The process of funnel analysis and improvement never ends. However, that is what marketing is all about. You'll discover methods to enhance your sales funnel helps your outcomes if you keep trying new things.

Final Thoughts

Understanding and optimising the sales funnel is critical for business success because it allows you to find areas where you can enhance conversions and income. Analysing each level of the sales funnel helps allows you to discover where potential customers are leaving and make changes to optimise the customer journey.

This can include developing more effective advertising, improving the user experience of your website, or providing incentives to entice users to make a purchase. You may increase your total sales performance and promote business growth by optimising the sales process stages.

When you create your sales funnel, your work is not finished. In fact, this is the starting point for everything.

Once everything is in place, it is critical to track your progress. Select your KPIs first, then create a measurement program.

If you want to get better results, you must collect data, analyze it, and improve your funnel.

You must determine your own strengths and weaknesses. Are you good at closing but get agitated when it comes to raising awareness? Are you an expert in your field but unable to close a sale?

Such inquiries, and keyword research will assist you and your sales reps in determining where you need to improve your sales funnel. Then concentrate your sales rep and marketing efforts from there.

A healthy business will have a good flow of customers from the top and middle of the funnel, all the way down to the bottom of the funnel at the action stage.

To summarise, knowing and optimising the stages of a sales opportunity is crucial for business and customer success. Businesses may discover areas for improvement and make strategic changes to optimise the customer's journey, increase conversions, and drive revenue growth by studying each stage of the funnel.


About Author

Yash Shah
Co-founder & Chief Executive
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Yash owned and ran a Tech Agency that grew to 55 people team offering SaaS, FinTech and E-Commerce Web & Mobile app Development before founding Clientjoy. He currently serves as Chief Executive at Clientjoy - a platform that helps 16K+ Agencies & Freelancers in 90+ Countries grow their business and manage their clients.

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The rich text element allows you to create and format headings, paragraphs, blockquotes, images, and video all in one place instead of having to add and format them individually. Just double-click and easily create content.

Static and dynamic content editing

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How to customize formatting for each rich text

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