What is a Sales Funnel?

The sales funnel is the process that makes cold prospects ready to buy leads (deals). Improving the efficiency of the funnel is a priority for any team.
What is a Sales Funnel?

The majority of companies have not even tried to measure the performance of their sales funnel and optimize it, just as the majority of leads are not converted into deals and sales.

In short, a sales funnel is a visual representation from the first contact with a potential customer (lead) to the purchase. 


Each stage brings the most qualified leads to the next phase, keeping in the previous stage those who have not passed the qualification process. 

New Contacts (Lead) > Qualification > Proposal (Deal) > Negotiation> Sale

The best performing sales representatives know very well the stages of their sales funnel. They manage to scale their sales process, predict their sales and revenues and achieve their goals.

Each company has its own way of managing the sales process and customer contact points. We can distinguish them in three phases:

In this stage, prospects turn into Leads. It’s time for your sales rep, to ask relevant questions and qualify the lead.

Your Leads are now Qualified since you talked to your prospects and they answered questions that help you understand if you can solve their needs.

It is when your Qualified leads go through a Proposal and a Negotiation.

Sales Pipeline vs. Funnel

The Sales Pipeline is often confused with the sales funnel. It’s not a big mistake but it must be said that technically speaking the Pipeline is a part of the Funnel. While a Funnel concerns Leads the Pipeline manages Deals.

A CRM with Sales Funnel (or Pipeline) management functionality has a positive impact on performance. It is not just a customer database, it’s a Pipeline Management tool. It helps define the sales process, identify losses and simplify the conversion process to bring leads to sales.

How a sales funnel affects revenue

A sales funnel helps you communicate the right message at the right time. Imagine that you are buying a car and but you don’t know exactly what you want before seeing what the market offers you (you are not ready to buy yet) and you want to know more about the advantages and disadvantages of certain models, features and prices .

With a precise sales funnel, you can provide the best information and a winning message to your potential customers and accompany your future customer to an informed purchase.

When your prospect begins their market research they will realize how many options they have. Especially in the early stages, customers can more easily switch to another supplier.

Therefore, it is important that you are aware of your sales pipeline to address all their possible questions and concerns in advance and increase their trust in you.

Being quick is important

Move deals to the next stage faster! The longer your sales funnel is, the more you’ll be able to define exactly what it takes to move your prospects down the pipeline. In other words, be careful that the stages are not excessively long.

Manage your sales funnel every day

The more open deals you have, the more likely they will be lost due to lack of time. For this reason, it is essential to implement a CRM system that helps you remember to work on every single deal. A good system will give you a visual overview of what is happening at each stage of the sales process.

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