What Is A Sales Funnel? (Stages, Examples, Simple Definition)

on Blog July 18th, 2023

You have a great product to offer. You try certain marketing strategies to attract customers. A few people show interest, but they don’t purchase.

You decide to tweak your strategy. Inquiries start to pour in, but no sale has been made. You start to wonder where the problem lies.

You might actually be failing at converting leads to customers, and it’s key to successful inbound marketing.

What is a Sales Funnel?

In businesses, it is important to understand the stages that customers go through before purchasing. This process is called a sales funnel. It is a powerful tool, because It helps increase sales production.

Sales funnel varies from one company to another. It is determined by the product or service offered. For instance, a real estate company’s sales funnel can have five stages.

Stage 1: Leads

Anyone is considered a lead. It is a family member, a relative, a friend, and a stranger. Basically, leads are endless.

Real estate agents usually find leads among people they know. Then, they move on to people they do not know. They look for leads at a grocery store while waiting in line at the checkout counter, on the internet, through referrals, and many more.

Once they find a lead, the lead moves on to stage two of the sales funnel.

Stage 2: Prospecting

Prospecting, or finding a prospect, is the process of qualifying leads.

Every real estate company has a target market. If a lead fits any of the criteria of the target market, he becomes a prospect.

Prospecting can be done through phone calls, e-mails, and face-to-face meetings. The agent will ask questions to determine if the lead qualifies as a prospect. Once qualified, the prospect can move on to the third stage of the sales funnel.

Stage 3: Selling of Product/Service

This step plays a vital role when converting prospects to buyers. It is also where the agent’s skills come into play. Often, qualified prospects refuse to purchase for two reasons: the product or service itself, or the seller’s skills.

Surpassing this stage requires good product knowledge and sales skills. If a seller wants an increase in potential buyers, he must constantly work on his skills. His prospect can then move on to the next stage.

Stage 4: Decision

This is the part where the prospect decides whether or not to purchase. It is also where the seller decides if he should give the prospect time to think, or if a push is needed to make a sale.

A lot of factors must be considered before taking an approach. The right approach can direct the prospect to the final stage of the sales funnel.

Step 5: Action

At this stage, the prospect is ready to purchase. He now becomes a customer.

Start Creating Your Sales Funnel

Ready to get started on creating your sales funnel? Check out our blog post How to Create a Sales Funnel.

Or read through a few foundational topics before you get started:

Why Engineering Sales Funnels Is Critical for Improving Revenue Results

Every marketing manager should know that a well-engineered sales funnel provides the prospective buyer with clarity as to the steps they’ll need to take in order to buy from you or your business.

Engineering a sales funnel is like having a well-engineered bridge; it’s built for tens of thousands of cars to cross and able to withstand the worst weather for a long time.

A sales funnel is used to give the marketing team direction in helping attract new visitors to your website’s content.

1. Attract Prospective Customers Who Are Looking

There is a variety of educational-style content you can post on your website that clearly communicates to readers and peaks their interests.

  • This stage is typically called the awareness stage because, during it, buyers will become aware that there is a potential solution for the challenge they have.
  • Marketing does a lot of work to attract prospective buyers to your business

2. Convert Searching Prospects into Interested Buyers

Make it simple for prospective customers to understand you are able to deliver what THEY are searching for.

  • The steps people take is called the conversion path. We use Lucidchart to map out conversion paths.
  • Typically, prospects evaluate what you are offering by downloading interesting content or viewing certain pages, with the objective of taking an action on one of those pages.

3. Close Business with Interested Buyers

This part is sometimes referred to as the ‘bottom of the funnel’ and includes the following steps.

The steps in the sales process Fannit takes its prospective customers through are as follows:

  • Decision – this means the prospects provide us with enough information to write up a service agreement. This is where the negotiation takes place.
  • Connect Call – hello! Let’s get acquainted with one another.
  • Discovery Call – what is your business and how do you make money? Tell us everything.
  • Planning Call – what are your revenue goals and how are we going to achieve results?
  • Contract Review Call – what is the plan and do we have the right budget?
  • Kick Off Call – let’s get started!
  • Buy or Purchase step – when the service contract is signed
  • Sales on-boarding – these are the tasks required to successfully bring on a new client and make a great first impression

This process gives us the chance to gather all the right information from the prospect. It also gives the prospect an opportunity to share their goals and concerns, timing, and potential budget.

4. Oversee Client Success With Paying Customers

Client success starts with you and your client having the same expectations about what you are trying to achieve together and who is responsible for which work… the list goes on.
Top sales managers typically embrace strategies, tools and tactics used to simplify each stage of their sales processes.

Attract Prospective Customers to the Top of the Sales Funnel

This is the internet’s equivalent of getting people to stop and look at what’s in the window at your (fictitious) bakery store at the mall. Techniques here will vary, but here are some of the most commonly followed marketing tactics.


Content marketing is the foundation to Inbound Marketing and SEO.

Fantastic content educates people with the information they care about when investigating your services and products.

Before we decide what the best content is for our clients, we create a plan after gathering the following information.

  • Industry niche research
  • Competitor analysis and research
  • Site structure
  • URL structure
  • Keyword analysis & research
  • Ideal buyer research
  • Buyer persona definition
  • Key distinctive factors

Content (or sales copy) can be located throughout your:

  • Blogs
  • Service pages
  • Product pages
  • Videos
  • TV commercials
  • Radio ads
  • Paid search advertising

What is your content marketing telling your audience? Is it helping you rank keywords that people are searching that are relevant to what you are selling?

Website Design

The website is your internet salesperson, ready to talk to anyone at any time and from any place in the world who goes out looking for what you offer.

A successful website is made up of different, supporting pieces:

  • Informative home page – Typically, 40% to 70% of visitors go to this page.
  • Security – An SSL Certificate is required by Google.
  • Informative content offers for downloading if people are not ready to purchase services
  • Sales copy that speaks to ideal clients and personas
  • Responsive design; 70%+ of searches are done from a mobile device
  • Web pages that load in the 2sec range
  • Design elements that communicate trust for your brand
  • An engineered user flow that guides users’ eyes, since you only have about 3 seconds to capture attention

Fannit takes a growth-driven design approach to website improvement because we use analytics to tell us how visitors are engaging, just like a good salesperson would.

growth-driven web design strategy focuses on making smaller changes, iteratively, over time to the structure and design of the site because you are constantly learning from how your website is attracting visitors.

Social Promotion

Social promotion is not the same as social media marketing, and here is why.
Inbound marketing requires that your marketing team produce fresh, relevant content and it is typically done entirely through the blog and pages on your website.
The reason you use your blog most frequently is because a blog can be set up to send out emails to Subscribers when a new blog is posted. However, you must also promote that blog content through your social channels.

The best B2B (Business to Business) social channels tend to be LinkedIn and Twitter, although YouTube and Instagram are great platforms for showcasing video marketing and images to give your followers a sense for your business culture – something a lot of people care about. In fact, LinkedIn Lead Gen can be one of the most powerful tactics here.

Search Engine Optimization (SEO)

SEO is a powerful way to attract organic search visitors through Google, Bing, and Yahoo, but mostly Google Search.

It’s important to understand that not all SEO services are the same, but below are some fundamentals:

  • Title Tags
  • H1, H2, H3 on page structure
  • Site structure
  • URL structure
  • Pillar categories
  • Cluster pages
  • Intersite links
  • Blog titles and content
  • Landing pages
  • Images
  • Top ranking content
  • Keyword movement tracking
  • Local Google My Business Listings

We typically are able to generate 48% to 65% of the leads for companies through the Organic Search channel. It all depends on how well other channels are working. You can read more about SEO marketing strategy and TRAP Analysis SEO Audit.

Convert More of the Right Prospects: Middle of the Sales Funnel

Let’s face it, everyone knows they are getting marketed to now, so what encourages people to take action?

Better Calls to Action

A “call to action” (CTA) is simply a button, graphic or text that asks a person to take a step in the sales process.

Some people are ready to take big steps, like Get an SEO Audit if they are ready to talk with us.

Others want to learn more about our services, so they take smaller steps like See Results to get more information on some of the results we are driving for clients.

Calls-to-Action help people down a conversion path toward a deeper understanding of your services and products at THEIR pace.

Here is an example CTA of ours… email us or comment to let us know if you think it looks compelling. What do you think could make it more compelling?

Compelling Landing Pages

Landing pages are the doorways to downloading content or other types of ‘Offers’ like A Guide to Solving Your Biggest Inbound Marketing Problems.

Since inbound marketing solutions are about helping educate people and taking them down a path, landing pages on your website focus a Prospect’s attention on a specific topic they are interested in because they clicked on a Call to Action.

“Thank You” pages follow landing pages to present the information that was requested as well as present another potential offer.

This “if you liked that, you also might like this” offering strategy works well IF you really understand your prospects’ Buyer’s Journey and Buyer Personas.

Email Nurturing (Email Marketing)

Email is not just a weekly or monthly newsletter. I know of some companies who say you should email your lists daily.
Email marketing is still a powerful tool for staying in front of your Prospects, especially if your emails contain relevant, thoughtful, and educational content to help your Prospects be more successful at their jobs.

Good emails have the following attributes.

  • Titles that are compelling to prospects
  • Short, but to the point – it’s what THEY care about
  • Send people to your blog and offers – educate them, provide value
  • You contact has opted in

All Blog articles should contain compelling content offers.

Close More Business at the Bottom of the Funnel

A solid sales manager will be focused on what is happening at the bottom of the sales funnel because that is where goals are scored (hockey reference).

To make sales at scale (ha!) you will need to build a system, but first you need to learn how to repeat your sales process consistently over and over again.

Here are a few things that help this effort:

Workflows and Sales Sequences

Workflows and or sales sequences are created with marketing automation tools like HubSpot, Infusionsoft, and others.

The best workflow tools are the ones that enable you to create the logic and automation needed to nurture leads. Below is an example of simple logic for a short workflow.

IF a contact is sent THIS email and they click on the offer in the email, THEN send them to a certain landing page. IF NOT, then wait 5 days, THEN send them THIS other email.

CAUTION: You need to have the right tools in place and a clear understanding of how you want to communicate with your prospects in order to create workflows to nurture your leads appropriately.

Sales Automation and Sales Enablement with a CRM

Customer Relationship Management (CRM) is a term used to describe the software companies provide to their sales staff for the following, and more!

  • Integrated into email and phone
  • Track opportunities
  • Set follow up tasks using sequences
  • Visibility on sales or deal stages
  • Track performance to goals
  • Sales forecasting

Sales Pipeline Management

There are several CRMs on the market. Fannit has experience with HubSpot, HighLevel, Keap (formerly Infusionsoft), Salesforce, and Zoho.

Start with a HubSpot CRM Account: They are FREE!

Keeping Clients Happy and Your Team Motivated to Perform Well Together

Customer Success Management

Here are a few basics of client success over the first year of a relationship.

  • Establish meeting schedule
  • Make sure meeting procedure is clear
  • The impression and experience you give new customers in the first 30 days is critical – read How Fannit Ensures Success with Our Clients. We use a process called IRON.
  • Get early wins and ask for a review
  • Define the roles and responsibilities of those roles. Some people use RACI… More on that in another post.
  • Establish a rhythm as a team – once you learn how to get good work done together, the cadence of the meetings begins to come together naturally
  • Promote good work and give praise
  • Work the issues together to solve the problems as they arise – and they will
  • Get a customer satisfaction score
  • Plan for the future – our clients love it when we get to talk marketing or sales strategy. We even talked to one client about our internal profit sharing model. This is an advanced level relationship stuff and very fun!

Data Analytics to Share With Clients

The very first thing Fannit does is get marketing performance data. We do this to get a baseline of performance.

Implementing marketing that is accountable to performance means being able to measure everything and understand what the numbers are telling you. It also means that your marketing and sales teams know what each number means — revenue is the easy one, start there.

Fannit uses several tools for gathering and interpreting all kinds of marketing and sales performance data:

  • Traffic volume
  • Lead conversion rates by Channel
  • Qualified leads (marketing and sales)
  • Sales conversion rates
  • Acceptable cost per lead
  • CRM Tools
  • Scroll depth on a web page
  • Click heat-mapping to see where people click
  • Domain Rating
  • Backlink Velocity
  • Top key words
  • Best ranking pages
  • And more!

The point is, the Internet and software in use is filled with data, but unless you know what you’re looking for and understand WHY you are looking for it, you are flying blind.

Final Thoughts

In order to engineer a sales funnel you have to think about every step you will be asking a prospective customer to take.

If you are curious about how to build an amazing sales funnel, start with an Sales Funnel Analysis so we can take a look at your existing sales funnel(s).

Looking For Help? We Got You

Our team is ready to help your business create a sales funnel. Get in touch today.