For any business, every prospect that ends up making a purchase goes through a process called the sales funnel. The process begins from the moment they learn about the business’s products and services and ends with them buying the said product or service.
A sales funnel has different stages every customer and prospect goes through, and to effectively convert leads into sales, it is essential for businesses to build a proper sales funnel, understand how to successfully manage it, and optimize it for minimizing potential loopholes that get in the way of customers making a purchase.
In this article, we explain what a sales funnel is and why it is a must-have for every business. Then we will dive into the stages of a sales funnel, and how to build a sales funnel for a streamlined sales process.
Lastly, we explain the sales funnel using an example, and as a bonus, we have included easy-to-use PowerPoint and Google Slides templates that can be used to create and present a sales funnel.
What is a Sales Funnel?
Simply put, a sales funnel is the process that each prospect goes through to become a customer of any business. It has different stages depending on the business model, and each stage of the sales funnel takes prospects one step closer to converting into a buyer, as they decide whether or not to make a purchase.
Every business can be modeled with a sales funnel, whether it is a brick-and-mortar store, an eCommerce website, or a services business. Sales funnels are also for both B2C and B2B businesses, where marketers aim to understand the journey of their customers and analyze how they can optimize it to build the demand for their products or services.
This multi-stage process is termed a sales funnel because it begins with attracting many prospective customers and then narrows down to a few that actually convert into buyers by going through the ToFu, MoFu, and BoFu stages.
What are the Different Types of Sales Funnels and Models?
Since a buyer’s journey for business is a distinct multi-stage process, there are different types of sales funnel models with added stages to the purchase process and provide the right type of engagement to customers.
The simplest and most popular sales model is the AIDA model, which stands for Attention, Interest, Decision, and Action.
It was revised by Arthur Frederick Sheldon where he added a 5th. step called “Satisfaction” for the purpose analyze the emotions of customers after buying the product or service.
While McKinsey’s Loyalty Loop added the Loyalty stage to the AIDA model to evaluate post-purchase experience by analyzing resales.
Other types of sales funnel models include the Forrester Model, the Heinz Marketing Bowtie, the Conversion funnel, JB Media Group’s sales funnel, and RAIN Group’s buying process which are mostly made for analyzing the B2B customer journey.
What is the Purpose of a Sales Funnel?
A sales funnel illustrates the journey a customer takes from start to finish. It helps marketers analyze why some prospects convert while some lose interest along the way, drop out, and don’t make a purchase.
Having a proper sales funnel in place helps to make a funnel analysis, and identify possible holes from where the prospects start losing interest, allowing marketers to optimize and increase conversion. A conversion funnel analysis can help digital marketers and professionals to understand which areas of the funnel can be optimized. By improving the non-converting areas through conversion funnel optimization, the conversion rate can be improved, and ultimately generating more revenue to the business.
Optimization of a sales funnel can sometimes be simple, like changing the ad copy, while at other times, marketers might need to do a complete overhaul of their sales strategy. Aligning the sales pitch and sales presentations with your target audience can also help toward optimizing the sales funnel. This is especially important in B2B selling.
Moreover, sales funnels are not static and need to be evolved over time to meet customer needs and deliver the right message at the right moment to turn more prospects into buyers and returning customers. For this purpose, marketers combines sales funnel analysis with other techniques, like cohort analysis. This way, marketers can map KPIs by sales funnel stages & different cohorts..
The AIDA Model — Stages of a Sales Funnel
Customers either make a purchase or don’t but they usually pass through the four main stages called AIDA, which stands for Attention, Interest, Decision, and Action.
1. Awareness
When people first get to know the products and services offered by the company is the awareness stage. This is generally done by marketers through different advertising strategies, such as paid media, paid social campaigns, influencer marketing, referrals, or content marketing. Here, you try to capture a cold audience, and that’s why this is often identified as the cold stage of the sale funnel.
2. Interest
When a prospect starts taking an interest after getting to know the company’s products and services, they are at the interest stage of the sales funnel. At this stage, prospects usually research to learn more about the company and its products and services. They might even compare the products with competitors to determine which is best.
3. Decision
Next is the decision stage, where prospects start evaluating price ranges, get in touch with sales representatives, or even set up discovery calls with an intention to make the final decision.
4. Action
Lastly, after careful consideration, prospects take the action of either making a purchase or declining the company’s offer. This is often referred as the hot stage of the sales funnel, where a hot audience is captured.
How to Build a Sales Funnel?
1. Research and Understand the Target Audience
The first and most important part of building a sales funnel is researching and understanding the target audience of the products or services the business offers.
Marketing is not done to everybody but rather to a specific group of people who are a good fit for what the business is offering. Answer questions about the target audience and know their pain points, fears, frustrations, goals, desires, aspirations, and know their behaviors to learn how to create awareness of the products and services effectively. Address how the offering can solve their problems and increase their satisfaction.
2. Build Buyer Personas
As the target audience becomes clear, it is necessary to build buyer personas from the data gathered. Analyze how they react to the businesses marketing media to refine buyer personas and effectively create strategies to persuade them to make a purchase.
Depending on the product or service category, the business might require multiple funnels since the target audience doesn’t generally fit into a single category. Buyer personas vary, and therefore, it is best to personalize the marketing materials for different personas to make the messages relevant and effective.
3. Develop Awareness Strategy
After building personas, an awareness strategy needs to be developed to let the target audience know what the business offers. A holistic traffic strategy is necessary; whether the business is a B2B or B2C, a brick-and-mortar store or an online store, people need to be lured into the top of the funnel so they can learn about the products and services.
For awareness, businesses can use rich media like infographics, videos, and advertisements so the target audience can know what you offer and develop an interest. It can also be achieved through word-of-mouth generated by existing customers who have had a delightful customer experience.
4. Build Audience Engagement Strategy
The next step is to create an audience engagement strategy. Here the focus is on generating leads, rather than capturing the sale. For a brick-and-mortar store, this could be a pleasant in-store experience, running experiential spaces, hosting events at the store and any other strategies that lets prospects learn more and interact with the brand.
Meanwhile, for an eCommerce business, visitors need to be directed to a landing with an offer they cannot miss. It should steer them toward the next step of becoming a buyer.
5. Create Conversion Strategy
Here the business needs to focus on getting the prospects to take action and convert into buyers. An incredible offer they cannot refuse will prompt them to hit the purchase button.
This can be done through sales calls, emails, and webinars, while for a brick-and-mortar store, a sales representative can make it easy for prospects to say yes. Pushing the benefits, diminishing their fears, and addressing the prospect’s question is the key here to helping them make a decision.
Easy returns, a money-back guarantee, fast eCommerce fulfillment and delivery, a flexible payment plan, past client testimonials, and customer reviews can help in converting prospects into buyers. In addition to effective conversion strategies, leveraging platforms like LinkedIn can also serve as a potent source of lead generation. By utilizing LinkedHelper.com, a valuable LinkedIn automation tool, businesses can automate connection requests, personalized messaging, and engagement with potential leads.
6. Keep the Communication Going
Lastly, communication with the business’s current customers should be continued through different marketing approaches. Send customers additional coupon codes, ask them for a review of their purchase, involve them in your social media sphere, send them newsletters for new product launches, etc.
Maintaining relationships with existing customers is as important as creating new ones. It needs to be nurtured over time to gain more traction, generate good word-of-mouth and eventually obtain life-long customers through good customer engagement and satisfaction.
Sales Funnel Examples
Example of a Brick-and-Mortar Sales Funnel
Awareness:
Considering a fashion clothing store, the people that learn about the business while walking by the store, through advertisements, or word-of-mouth are at the top of the funnel as they are either attracted and move on to the next stage or just walk by without interest.
Interest:
As prospects walk in they look around to find something they like, develop an interest, check out the product range and eventually move on to the decision phase.
Decision:
After taking an interest, prospects decide if they should actually buy the items they like. They compare options, consider price brackets, and also inquire about discounts, after-sale services, and return and exchange policies to help them make the decision.
Action:
The last step at the bottom of the funnel is action, where the customer either takes their pick of products to the checkout or they walk out and don’t make a purchase.
Example of an Ecommerce Website Sales Funnel
Awareness:
E-commerce websites usually attract visitors through social media campaigns, advertisements, digital marketing, influencer marketing, referrals, and Search Engine Optimization (SEO).
Interest:
Once visitors get to the website, they browse through the product catalog to find something they like, learn more about the products, do research by comparing other options available then move on to the decision stage.
Decision:
This is where businesses need to promote their products through proper after-sale services and discounts customers cannot refuse and prompt them to take action through an effective landing page with an irresistible time-limited offer.
Here informational content via blogs, newsletters and reviews can also be shared with potential customers, so it becomes easier for them to make a decision.
Action:
In the end, all that’s left is taking action, where the customer either hits the purchase button or they leave their cart behind.
Quick List of 5+ Sales Funnel Templates for Presentations
After gathering the necessary data, building a sales funnel can be straightforward with the help of SlideModel’s editable PowerPoint and Google Slides’ presentation templates.
The sales funnel templates are made to define each funnel step in detail and help discuss the sales approach and strategies using appealing elements, captivating animations, and illustrious data charts and graphs. Furthermore, by using 100% editable funnel diagrams, you can save a lot of hours of manual work. Each of the sales funnel templates contains a pre-defined number of sales funnel stages with text placeholders that you can edit and customize.
Here are some of the best sales funnel templates for creating, optimizing, and presenting the sales funnel to the company’s marketing team. All templates below are compatible with Microsoft PowerPoint and Google Slides presentations.
1. 4-Step Timeline Funnel PowerPoint Template
The 4-step timeline funnel lets professional marketers illustrate the business’s sales funnel and define each step with proper data visualization and color-coded diagrams.
2. Simple Multi-step Funnel Slide Template for PowerPoint
A simple multi-step funnel template with a funnel diagram to represent each stage of the sales funnel. This template can be used to demonstrate lead generation, sales and other marketing concepts that define a customer’s journey.
3. 4 Step Color Funnel Design PowerPoint Template
A uniquely designed 3D funnel with 4-step colors is an ideal template for demonstrating a sales funnel. Good for demonstrating customer leads, potential buyers, and conversion rate.
4. 4 Level Semi Transparent Funnel Diagram for PowerPoint
The 4-Level Semi Transparent Funnel Diagram simply depicts each stage of the sales funnel to identify what’s working at every stage to attract customers, keep them interested, and generate sales.
5. Funnel Diagram with Lead Magnet PowerPoint Template
Funnel Diagram with Lead Magnet is a comprehensive template to present a sales funnel to the marketing team, identify possible holes and discuss how each stage can be optimized to increase conversions.
Conclusion
In today’s competitive market, a sales funnel is important for every business to survive.
However, building a sales funnel, and an effective one at that, takes time, and a proper understanding of the market, the target audience, and their behaviors.
Marketers need time to create a sales funnel and optimize it over time by evaluating why some prospects buy and why some fall through the sales pipeline.
Adjusting the sales approach at different stages, experimenting with various sales strategies, and analyzing the results can help marketers figure out what’s working and what needs to be changed to increase conversions and profitability of the sales funnel.
