Effective Sales Funnel Management
Do you work on effective sales funnel management? This question is more than actual for you as an entrepreneur because your sales funnel is not something that can be set and forgotten if you want to bring you the results that you want to achieve.
As you already know, your sales funnel is an important tool in your pocket simply visualizing how your customers will move through your sales process until they become like a first customers from potential customers and repeat customers who will continue to buy again and again from your company.
So, effective sales funnel management is important for your company. You will need to ensure that the customer movement process is implemented without any obstacles and that your sales funnel is in a continuous improvement mode which means always working to increase the number of customers for your company, the number of repeat customers, and the average amount of money that they will spend in your business.
Here are some steps that you will need to implement on a constant basis if you want to endure effective sales funnel management in your company.
1. On a Regular Basis Analyze Measures of Your Sales Funnel
One of the first things you need to do on a regular basis regarding your sales funnel is to measure everything around and in your sales funnel. I have already talked about the most important metrics of your sales funnel, and they are:
Number of customers entering the funnel
A number of potential customers will become part of the process in the first stage of your sales funnel. This simply means answering the question about how many people are at the begging of your sales funnel. As you know, if you have a larger number of potential customers at the beginning of the process, you will have a larger number of real customers if conversion rates in the sales funnel remain the same.
Conversion rates between stages
Conversion rates inside sales funnel between different stages and overall sales funnel conversion rate. The first question is what is the overall conversion rate that you can get if you divide the total number of customers in a specific time you have by the total number of potential customers at the beginning of your sales funnel.
For example, if you have 1,000 potential customers at the begging, and only 100 of them buy something from you, your overall sales funnel conversion rate will be 10%. The second question is again about conversion rates, but conversion rates between all stages in your sales funnel. For example, if in the stage of awareness you have 1,000 customers from whom in the stage of interest pass 400 potential customers, the conversion rate between awareness and interest will be 40%.
The average amount of sales from one customer. This metric is important and in large part will be based on what you are doing inside your sales funnel. Better sales funnel management will help you to increase this number, and it will mean increases in income and profitability for your company.
Sales funnel duration process
Duration of the sales funnel process. The quickest sales funnel process will bring you quicker customers conversion and quicker repeat buying from the same customers. So, one of your tasks is to always work on improvement of the time in which an average customer will stay in the process. On the other side, you need to be aware that always your customers will respect you much more than if you have a very large sales process full of unnecessary action steps.
2. Increase Conversion Rates Between Sales Funnel Stages
The second thing that you need to do continuously when you already know the most important metrics is to start improving conversion rates between stages in your sales funnel. When you improve these conversion rates you will improve the overall conversion rate. Let’s look at some example where overall sales funnel conversion rate is 6%:
- Let’s say that you have 1,000 potential customers at the beginning of the process at the stage of awareness. If in the next stage, stage of interest you currently have 500 potential customers, which means your conversion rate between awareness and interest is 50%. Now if you make improvements that will bring only 10% improvements to this number, then this conversion rate between awareness and interest will be 55%.
- Next, when you have 550 potential customers at the interest stage, then with the current conversion of 40% between interest and desire, you will have 220 potential customers with a strong desire for your products and services. Now, if you again improve this number by only 10%, then the conversion rate will be 44% and the number of potential customers at the stage of desire will be 242.
- And if your current conversion rate between the desire and buying stage is now 30%, around 73 customers will buy your products and services. Here, the overall sales funnel conversion rate will be 7.3%. But, again if you improve the conversion rate between the desire and buying stage by only 10% and it will be 33% instead of 30%, you will have around 80 customers who will buy your products and services which are 8% of the overall sales funnel conversion rate instead of now 6%.
So, work on improvements of in-stage conversion rates if you want to improve the overall rate.
3. Decrease Time of the Between Sales Funnel Stage Conversion Rates
Your job as an entrepreneur is to ensure that:
- Your sales funnel will be always full.
- The potential customers will move quickly from stage to stage.
So, effective sales funnel management will need you to work on improvements in the productivity of the process which means that you will get more customers in the quickest time.
To succeed in this, you will need to analyze your whole sales process and for each step to ask the following questions:
- Do I really need this step in my sales process?
- What do I get from this step, and how does it influence a customer’s behavior?
- Can I simply remove this step?
- Can I make some automation regarding this step?
As you can see, you look at possibilities to remove, improve, or automate some of the steps in your sales process to increase the overall productivity and be sure that you can transform more customers from potential customers in the shortest time.
4. Develop and Implement an Action Plan That Will Bring Improvements
And as the last thing in sales funnel management that I propose you do is to start developing an action plan that will bring improvements. Usually, it can be a working procedure that will ensure that you and your staff members will work on continuous improvements.
If you want, you can download a sales funnel template that will help you with these tasks.
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