What is a Sales Funnel? And How will it Ignite My Business

Creating the right type of sales funnel for your business can help you to dramatically increase your lead generation and sales while at the same time automating your marketing and freeing up time you don’t have anyway. This guide will explain what a sales funnel is and how you can apply it to your business.

Here’s what we’ll look at:

 

What is a Sales Funnel?

A sales funnel is just a fancy marketing term for how you get someone to move along the path from knowing nothing about you to becoming a customer.

For many businesses, sales funnels are more like sieves. They are a hodgepodge of spreadsheets, hand-written notes, missed appointments, and forgotten follow-ups.

But what if you had a sales funnel in place that consistently brought in leads, weeded out the tire-kickers, and moved the buyers along to purchase? A better funnel also turns those buyers into repeat customers and generates referrals.

Sales funnels can involve live salespeople, but often these days sales funnels are completely automated. An automated, online sales funnel is like a salesperson who works 24/7, 365 and never complains, never asks for a raise, and never takes a vacation. I don’t know many business owners who wouldn’t like one of those.

Why is a sales funnel important to your business?

Sales funnels are important for any business for a number of reasons.

  • Save time & money: An automated sales funnel will function like a live salesperson that runs 24/7. Often in a small business, the main salesperson is also the owner, and their time is stretched thin. By putting in place an automated sales funnel, they can remove much of the time-consuming sales process and spend just a few hours per month monitoring and optimizing their funnel. Or outsource its creation and management entirely.
  • More leads for your sales team: If you have salespeople in your business ask them if they would like a reliable, consistent source of quality leads every week. The right kind of lead funnel can do just that.
  • Increased size of transaction: You can add upsells right into your funnel and increase the size of your average sale with next to no effort.
  • More store traffic: Certain types of funnels can even drive more traffic into your physical store with coupon offers.
  • Improved ROI on advertising: If you’re currently running ads, whether online or off, sales funnels can get you better results for that spend. By pushing that traffic into a funnel built to nurture and convert them instead of to a static landing page, or worse your homepage, and hoping for the best. This allows you to spend more money on advertising, confident that you are getting a strong return, and outmaneuver the competition.

The stages of a sales funnel

The most common definition of a sales funnel contains four stages: awareness, interest, decision, action. And it looks something like this:

Awareness: This is the stage where someone becomes aware that you exist. They may hear about you from your advertising, social media, even a referral.

Interest: Once they know about you, they move onto the next phase where they learn a bit more and decide that you might be someone who can solve their problem. During this phase they’ll typically be doing research, talking to friends, gathering information to find the best solution.

Decision: Once they have all their data, they evaluate and find the businesses best positioned to solve their problem. Whether that problem is selling a house, hiring a consultant, or buying some cupcakes.

Action: This is where the rubber hits the road. They have decided that you can solve their problem, but they still have to take an action or nothing happens. You can still lose a deal right here if you don’t have the right tools in place.

This is a standard definition of a funnel. There is a model that I actually prefer called the Marketing Hourglass. It takes people through, what I believe are a more accurate, seven steps: know, like, trust, try, buy, repeat, refer. You can read more about this funnel here.

When I work with clients to create a sales funnel that is the model I start with. We build the funnel and all the elements within it to address where the prospect is in the Marketing Hourglass.

What type of sales funnel does your business need?

There are many different types of sales funnels and which type you need will depend on your business. You may even want more than one type of funnel for different purposes.

To figure out which kind of funnel you want to create, think about what you want the funnel to do. As I said, there are many different kinds of funnels, but they fall broadly into four categories:

  • Lead Funnels: These funnels are specifically for generating leads and getting contact information from your future customers.
  • Buyer Funnels: These funnels are designed to actually sell a product or service within the funnel. They’ll often include upsells, downsells, shopping carts, etc.
  • Event Funnels: These funnels are for generating signups for events like webinars, online classes, etc.
  • Other Funnels: There are loads of other funnels that don’t really fit into the categories above. It could be a funnel to prevent the cancellation of a service or a funnel to get subscribers.

Once you define what you are trying to achieve, you can choose the type of funnel that best suits your needs.

How do you build an automated sales funnel?

Once you determine your goal and figure out what kind of funnel you need, there are two phases to creating your sales funnel:

  1. Getting your plan in place
  2. Building the elements

Getting your plan in place involves getting very clear about your ideal client who will be the target of your funnel. You must map out how you will engage with your ideal customer throughout the funnel, or customer journey.

When I work with clients, I go through a series of planning steps to make sure everything is in place before I even think about designing pages or writing emails. Here’s what that process would look like for building a lead funnel:

  1. Determine your product/market fit with your ideal client
  2. Create a lead magnet, something free that ads value and that someone will give you their email address to download
  3. Develop a “try” offer to
  4. Create your core offer that will engage your ideal client
  5. Design your email nurturing sequence
  6. Create your landing and thank you pages
  7. Identify and build your traffic sources

Once you have completed the planning, the second phase is building the actual funnel. Landing pages, thank you pages, lead magnets, email copy and sequences, social media and/or Google ads, etc.

Again, before I start building the actual elements, I like to visually map the funnel. Here’s a sample of what one of those maps might look like:

What is a sales funnel

Visualizing a sales funnel will help you to understand the flow before you start to build individual elements.

 

Building the elements

A basic funnel is going to require 4 things

  • Ads to drive traffic into your funnel. These can be Facebook ads, Google ads, even print ads.
  • A landing page to capture that traffic and convert them (either into a lead, an attendee, or a customer). If your goal is to capture a lead, then your landing page will have a form prospects can submit. If your goal is a sale then you will build the purchase process into the landing page.
  • A Thank You page to be used as an opportunity to upsell and move them along into the next phase of the customer journey (sometimes you don’t have a next step and it’s just a thank you)
  • An email sequence to nurture and engage your prospect, upsell them, and nudge them along the path, or just deliver what was promised.

Those are the elements of a basic funnel. They can get much more complex with multiple upsells, A/B testing, retargeting ads, and other more advanced elements. For a more detailed walkthrough of the actual building part, read this post.

It also doesn’t speak to the importance of setting up tracking so you can monitor the funnel’s performance and adjust as needed.

Tools for building your sales funnel

There are a ton of tools out there that can make building your own funnel easier. Some are all-in-one like ConvertKit, ClickFunnels, or ActiveCampaign.

You can also build landing pages on your existing website, or with a program like Unbounce or LeadPages. Any email marketing service provider will be able to manage your email sequence, and likely integrate with your website or landing page builder.

My Funnel Building Stack

When I build funnels for clients, these are my go-to tools (I do not have any affiliate arrangements with these companies, I just really like them):

  • Funnelytics – for visualizing, mapping, and monitoring funnels. This is pricey but if you’re building a lot of funnels, or funnels for big ticket items it might be worth considering.
  • LeadPages – for building landing pages. Sometimes I don’t want to build landing pages on my or a client’s website and this tool makes it fast and easy to create them, plus they have a lot of great templates and built-in analytics.
  • ActiveCampaign – for email sequences. AC is, in my opinion, the best email service provider out there. They make it so easy to create and manage email sequences and manage your email lists. You can also build landing pages using AC, but I like LeadPages a bit better for that. Still, you could save some money by doing it all in AC.

Once things are built, you are going to need to install Google Analytics and your Facebook pixel on the pages you build so you can accurately track and optimizes your funnel. If you don’t already have these elements set up on your website, that should be your step 1. Go do it now.

And that, my friends, is how you build a funnel to ignite your growth.

One last thing I’ll say is that it’s not all set it and forget it, though. You will need to keep an eye on things and make adjustments. You may find your ads are not working and have to tweak those. Maybe you’re getting lots of traffic to your landing page, but no one is converting. You’ll need to test whether it’s the page set up or the offer itself.

It will take a bit of time to get things just right, but once you do you will wonder how you ever managed without sales funnels in your business.

If you’d like some help, or to discuss building a sales funnel for your business, get in touch with me and I’d be happy to chat about it.