Sales funnel: what is it and how to use it in your business
There are many ways to improve business efficiency - there are classic ones that everyone knows about, and specific ones that each business finds for itself. Let's talk about the classics. A sales funnel is a marketing model that clearly demonstrates the path a consumer takes from a potential to an actual buyer. It has several stages, and each one brings you closer to the deal. Accordingly, by analyzing the sales funnel, you can see at what stage leads leave and adjust the entire process of interaction with customers.
How to use a sales funnel?
The very concept of "funnel" suggests that there can be a lot of potential buyers, but only a small part of them will reach the end and complete the transaction. And this rule is true for all segments of online commerce without exception. It doesn’t matter if you sell cheap silicone cases or luxury real estate, there will always be more participants at the very beginning of the funnel than at the end.
However, this pattern does not mean at all that you can abandon the analysis of the sales funnel. By collecting statistics and tracking each stage, you will receive the following information:
- How effective are sales in general?
- when most of the customers leave the funnel;
- Why is this happening;
- which of the stages of the sales technique need to be changed or replaced so that the losses are less.
Keep in mind that only interested and ready for your offer consumers pass through all stages of the funnel. Therefore, if a “cold” audience comes to the site, then the percentage of losses on the way to the goal will be very large.
How to warm up an audience?
In order for the deal to take place, the audience is warmed up. There are three levels of “readiness” for a customer to buy:
- Cold visitors for the first time on your resource, they don’t know anything about it, they came to look;
- Warm people are already familiar with your brand ideas, products or services, but have not yet made a purchase;
- The hot ones are already ready to make a deal and are looking for the most profitable offer.
Experienced marketers know that you need to spend time warming up first. This will allow you to make a commercial offer to those who are already ready to spend money, and not to those who ended up on your resource by accident.
To warm up potential customers and bring them closer to buying, companies use blog articles, video reviews, and expert articles. Sometimes it's worth directing ads to this introductory content so that potential customers can get to know the brand or see your expertise. It turns out a warm-up like in karaoke - visitors, in order to start singing, must first muster up the courage.
It can take a long time for a cold lead to turn into a hot lead. It all depends on what price segment you work in and what you sell. If it is a smartphone, then 3-5 days or even less may be enough, and if your product is an expensive motorcycle or sports car, then it may take six months or more until the client understands that you, as a seller, can be trusted.
Funnel device. What to look out for
There are mandatory attributes of a sales funnel, without which it is impossible. Here they are:
- Application or lead is a potential buyer who agrees to receive your newsletters and notifications. Of course, the newsletters should contain useful and, if possible, non-commercial information. To get leads, you can use the e-mail subscription form or a chat bot, it all depends on the site.
- Engagement, gradual and smooth. When there is already a lead, he needs to offer a product. To do this, create a small mailing list of several involving letters. But this should not be a commercial offer - in letters, the emphasis is on the information component, on the benefit for the client. All information that demonstrates the value of your brand will need to be veiled in a description of a successful case or in instructions for solving a problem.
- The starter is an enticing product with a low cost, the first purchase that helps to get a positive experience from the interaction. It is thanks to the starter that customers learn to trust your company, evaluate the level of service, professionalism of employees and the quality of the product itself. If expectations are fully consistent with reality, then you can be congratulated on getting another loyal customer.
Only after the consumer has used the starter, it is possible to provide him with a full-fledged commercial offer for basic goods and services.
However, the successful completion of the transaction is not the end of your interaction. You don't want clients to leave after the first contract, do you? You should use Upsell and offer products and services that complement the main offer.
And don't forget: even those who left the sales funnel at some stage may also become your customers in the future. Therefore, they should not be forgotten. You can use the downsell technique and make an offer in a different price category. The more points of contact between your business and the client arise, the higher the likelihood of a deal. Therefore, implement all stages of the sales funnel: this will help to almost double the profit of the business!