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

on Inbound Marketing May 18th, 2020

 

You have a great product to offer. You try certain marketing strategies to attract customers. A few people show interest, but they do not 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 the key to inbound marketing.

What is a Sales Funnel?

sales funnelIn 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.

More helpful reading:

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

Guiding customers through the sales funnel is not easy. It is possible to lose people at the end stages. Some people do not even go past the first stage.

Because of this, it’s important to come up with a sales funnel that fits your company. Not only does it provide a framework of producing customers, but it also improves your business.

While a great sales funnel is vital, keep in mind that after-sales service is just as important. Remember, providing wonderful service can produce regular customers.

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