Each customer goes through a series of stages of the sales funnel, starting from the moment they meet the seller and until they make a purchase. It is a flexible tool foronline business promotionwhich is actively used in both B2C and B2B sectors.
The sales funnel will help not only to track, but also to correctly adjust the entire process until the moment the deal is concluded. It also allows you to study the conversion at each stage. Let’s consider how such a mechanism works and what stages it includes.
What is a sales funnel?
The term “funnel” itself has been used for many years. For the first time this concept was applied by the American marketer Elias St. Elmo Lewis back in 1898. A sales funnel is also called a mental or consumer funnel. The generally accepted trading principle is based on it, as well as the decision-making process itself to buy a certain product or order a service. A sales funnel is a segment of a customer’s journey from the moment of acquaintance to the purchase itself.
The funnel includes a number of sequential stages. The characteristics of the product, as well as the conduct of the activity, will have a direct impact on the behavior in the funnel of the buyer himself.
Sales funnel stages according to AIDA
According to the generally accepted model of consumer behavior called AIDA, one can not only understand, but also structure the behavior of buyers directly in the funnel. This is precisely what helps to increase the number of customers. Such a model may be suitable for a business, but the stages themselves will depend largely on its specifics.
According to the generally accepted AIDA model, a sales funnel consists of the following stages:
- awareness or awareness – at this stage, a person learns about the existence of the company. This is possible thanks to advertising, a link in a search engine, etc .;
- interest or interest – arises when viewing a catalog, site, terms of purchase, delivery;
- desire – desire – the stage at which the product is added to the cart and the desire to purchase already arises;
- action is an action itself, which can be placing an order, calling, subscribing to a newsletter.
At each of the stages passed, the number of people will be reduced. Visually, it resembles a funnel, hence the name. For example, about 10,500 people visited the site. It would be great if everyone went ahead and made a purchase, but this is not always the case. Only 50% of potential buyers will be interested in such an offer, the second half will definitely not like something: delivery terms, website design, assortment, etc. Only 2,400 people will get into the basket, but about 300 people will actually make a purchase. At the moment of transition from one stage to another, micro conversions are performed – certain user actions, for example, viewing a page, switching to a certain product. The number one task is to leave as many people as possible at each stage, so it is worth considering online website promotion, purchase conditions,
What are the features for online stores in the sales funnel?
The funnel will include the following stages: visiting the site, choosing a specific product or service, adding it to the cart, and completing the purchase. It will be easy to understand these steps if you consider the example of buying from an online bicycle store:
- Awareness: Victor wants to buy his son a bicycle for his birthday. He enters the selected page of a specialized bicycle store 5 days in advance.
- Interest: Victor saw an advertisement with a promotional offer – buying ledosiped, you can get a bell and wings as a gift. Son I will definitely like such a gift, so father goes to the section of children’s bicycles and starts choosing a suitable model.
- Desire: Victor knows how tall Maxim is and his requirements for leadingosiped… He looks at the payment and delivery terms and sends the blue bike with front shock and rim brakes to the cart.
- Action: Victor completes the order, makes the payment and waits for the package.
This picture really describes the standard sales funnel that is formed when buying from an online store.
Sales funnel in the CRM system
The CRM system is in demand among many companies, as it helps to control and plan work, while visually displaying every step of the relationship with the client. To figure out exactly when customers leave, you need to compare the data available in CRM with all stages of the sales funnel.
In the funnel, you will see the number of completed or canceled trades, the profit from a particular trade, as well as the conversion rate (the ratio of open trades to actual sales). You can also track the amount of time spent on meetings, telephone conversations.
In a CRM system, a sales funnel may look like this:
- initial contact (via mail, website, phone);
- sending special offers for the client;
- coordination of the arisen questions;
- make a deal;
- payment for a product or service.
Another example of a funnel:
- the client was taken from a cold base;
- the first contact occurs (letter, call);
- a certain interest is formed;
- necessary negotiations are underway;
- a contract is concluded;
- paid purchase.
If you set up CRM correctly, you can detail every step of communicating with customers, collect and group data, generate a visual report and build a funnel step by step. The system allows you to get a detailed report for the required period of time, taking into account the amount of sales, the number of applications, and the region.
With the help of CRM, you can provide effective management of the sales funnel, direct and automate the work of managers. As a result, they promptly send the price list and make a call. This helps the customer to make a quick decision and complete the purchase. Another important point is the analysis of reports and results. With the help of the program, it can be performed promptly using tables and graphs.
Sales funnels for B2B
B2B sales in the context of a sales funnel look different, because their goal is not a specific buyer or his needs, but the needs of a business that he directly owns.
The general scheme is as follows: getting to know the product, choosing the required service or product, concluding a contract and closing a deal. For a specific example, the funnel is as follows:
- Awareness: The shoe store has decided to expand its range and work with a new supplier. Additional storage space is required to store new items. In this regard, the manager Victoria started looking for a suitable premises in terms of area and rental cost.
- Interest: After entering the information into the search engine, he gave several options. Victoria went to one of the proposed ones and left a request on the site.
- Desire: Victoria liked the medium-sized room and not far from the office. In addition, the price is quite attractive. This choice will allow you to abandon small warehouses and store all your shoes completely in one.
- Action: Conclusion of an agreement on the basis of which the first batch of shoes is received for storage.
The decision-making algorithm in the B2B segment will be different, so you need to take into account the specifics of doing business. It is helpful for a wider audience to touch upon the problem that your product solves. When a person has already clicked on advertising, it makes sense to demonstrate the functionality of the equipment and technical features. That is, building a sales funnel for the B2B sector has a number of its own characteristics. In the ad settings, one should take into account not only the list of target requests, but also the decision-making algorithm.
Distinctive features of the sales funnel and business process
The sales chain is more complex and extensive. This is due to the sub-processes that arise during its construction. An example of such processes is the development of personal projects, as well as commercial proposals. There are 4 key stages that make up sales:
- Leads generation is the formation of the right traffic.
- Leads development – bringing to purchase.
- Leads converstion – making a deal.
- Client fulfillment – the provision of a product or service.
Each stage involves a series of actions aimed at processing a lead. After the first touch, you again need to interest the client, coordinate all issues with him, bring him closer to the purchase and complete the transaction.
Rules for building a funnel correctly
Depending on the specifics of the business itself, a funnel will be built, it is individual for everyone. But there are a number of general rules that are important to consider:
- The way you drive traffic has a direct impact on the stages of the funnel.
- The scheme can either be the same as the business process or be completely different. In this case, one stage of the funnel can include several points. For example, the stage “Checkout” includes the entry of personal data, delivery terms.
- The transition through the stages should be documented by a specific action on the part of the client.
- The buyer is directed exclusively down the funnel, approaching buying, and not vice versa.
- A repetitive action is possible at different stages of the funnel, but its goals will differ. For example, a commercial offer to a client can be sent more than once. For the first time, this will be general information to interest the client, then prices and product catalog will be needed.
Using these rules, you can build a sales funnel and analyze its stages in the future. With the help of useful content, correct advertising, you can reach your customers much faster. It is easier to promote in an online format if you present your products at a webinar, and then warm up the database with a useful mailing list.
Sales funnel analysis
It is not enough to simply define the stages of the funnel – this is only the first step. Next, you need to analyze all the disadvantages of a marketing strategy. This approach will help increase sales and improve the quality of service. It is a detailed analysis that allows you to find the reason for the client’s departure. This will help to solve the problem in a timely manner and thus retain your customers.
It is necessary to collect as much information about the user as possible and display it in the form of a table or graph. Target actions will differ for different types of funnels. It is the funnel that will show the behavior of visitors at each stage. You can also estimate the conversion. To figure it out, consider an example:
Example # 1. Customers rarely visit the site, so there is very little traffic. It is worth checking how the main acquisition channels in the funnel work. Perhaps you are just looking for a client in the wrong place.
Example # 2 A client spends a certain amount of time on the site, looks at products, but makes no purchase. The reasons for this behavior can be the price, lack of the desired product or trust in the company. To resolve the issue, you can create an updated blog, a page with real customer reviews, hold promotions and publish news.
Analyzing information is easy when it looks like numbers. The key indicator is conversion. It is determined by the number of customers who remained at each stage or as a percentage. Initially, the conversion rate can be calculated using the formula:
Kk = total number of buyers who visited the site / total number of those who passed by. The numerator is easy to determine if you divide the number of receipts by the number of visitors. It will also be useful to count the number of regular customers.
This way you can gradually understand how effective each of the stages of the sales funnel was, but the main thing is to determine exactly in what period of time customers “fall off”, why they do not move on and how to keep them. The results obtained will help to draw conclusions, direct internet marketing in the right direction, and develop a new marketing strategy.
How to work with the stages of the sales funnel correctly?
For the transition to each subsequent stage to be carried out by all users, you need to collect data at each stage, analyze it, and then adapt the marketing strategy to the specific behavior of the target audience. You can try different options, analyze the effectiveness of their work.
Different scenarios for working with a customer will largely depend on the specific stage of the funnel. If this is the first stage, then it is worth getting the user’s contacts – this will help in further work with him. At the second stage, it is important to create a unique offer – this will interest the client, at the third stage, you need to try to bring it to the conclusion of the transaction and subsequently make the client permanent.
It is important to make an offer in a timely manner. Quite often, you can frighten off a customer by offering him too much discount on his first order or being too intrusive. It is necessary to give him time to get acquainted with the goods.
You can competently arrange work with clients at different stages of the sales funnel. For example, in this way:
- The first stage – all contacts (mail, phone, name) and customer data are collected. It is convenient to do this using pop-ups. They can be customized so that the client sees and wants to leave their contact information.
- At the moment when you need to warm up a client, you need to work out leads using email campaigns or personalized pop-ups, where there will be reminders of all viewed products.
- At the stage of sale, we help the client to make a decision to buy; in this, a special offer, discount or gift will be of decisive importance.
- All that remains is to keep the customer to complete the purchase. And even after that, you shouldn’t relax. Then you can please with bonuses, offer related products, make discounts on new sales. Thus, the client will become a permanent one.
If users visited the site no more than seven days ago, it is necessary to increase ad bids and show the site more often, reminding of yourself and using the appropriate message. For those who were on the site a month ago, it will be useful to remind about the products, describe the benefits.
The work on the funnel should be constant, this is how the number of users will not decrease dramatically, and you will reach the required level of income. Each project needs to define its own evaluation criteria, and they must be sufficiently objective and adequate. Consider the complexity of developing a strategy and a sales funnel.
It can be concluded that building a sales funnel has many features that are associated with the phased decision making on purchasing and cooperation. Every business owner wants his company to flourish and generate income. This is possible if the sales mechanism works correctly, and all errors are eliminated in a timely manner.