How to Improve Your Sales Funnel

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Yesterday’s post was all about sales funnel analysis. It is the necessary lead up to today’s post, so if you didn’t get a chance to read it already, quickly do that now.

What you should have now is a full look at your sales funnel, with audience sizes for each layer or level, and conversion rates going from each level to the next.

Using that as your baseline, now you need to identify which transition you want to improve. Do you want to get more people from Intent to Purchase? Purchase to Loyalty? Awareness to Interest?

You might ask, how do I pick one? The truth is, most marketers over time will focus on all levels of the funnel. But you want to start where you see the most opportunity. Where is your conversion rate lowest? Where are most people falling out of the funnel?

If it’s a toss-up, flip a coin. Know that you can’t go wrong. If you improve one level of the funnel, it should improve the overall performance. Then you move on to the next level and keep going until you’ve hit them all.

Once you have decided which level you are looking to affect, now it’s time to decide what to do to improve it. Make a list of all the things you do today that impact the conversion rate at that level of the funnel. At the bottom of this post I will list some examples for each level.

Once you have your list of what you do today, make a list of changes, new processes, and other ideas you think will improve performance. Assign a cost to each one, and an expected outcome. Then prioritize them based on the expected return on each activity. For example, if one idea will cost you nothing to put in place and you expect it to improve conversion rate by 1%, that would likely go at the top of your list.

Then execute those ideas at the top of your list and measure the impact that they have. I know it sounds like I’m simplifying a complicated process here, and I am. But at a high level, that’s all you have to do.

Some ideas for each level of the funnel:

  • Grow UNQUALIFIED PROSPECTS through new products, new features, or new uses for your products, thereby growing the target market
  • Grow AWARENESS through social media outreach, PR, and advertising
  • Grow INTEREST through email marketing and an improved website experience
  • Grow CONSIDERATION through special offers and promotions
  • Grow INTENT through outbound and inbound sales processes, discounts and deadlines, and promotional literature
  • Grow PURCHASE through sales people and coaching, pricing plans, contracts and checkout process improvement
  • Grow LOYALTY through membership programs, exclusive offers, email, surveys, and customer service improvements

How to Analyze Your Sales Funnel

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Last week we took our first look at your sales funnel. Here are the different levels we used, from top down:

  • Unqualified Prospects
  • Awareness
  • Interest
  • Consideration
  • Intent
  • Purchase
  • Loyalty

Your company or industry might use variations on those terms, but for the most part the meanings and buckets will be the same.

So once you have a clear picture of your funnel, the next thing you need to do is begin to analyze it. How do you do that?

You start by assigning numbers to each level. How many people are in the pool of unqualified prospects? How many are in the awareness stage? And so on.

It might be difficult to get to exact numbers for each one, but you should have a sense, based on your own internal metrics and tracking.

You should know how big your target market is. If you got every single person in the market to purchase from you, how many people would that be?

You should know how many people came to your website, filled out your forms, became a sales lead, and purchased. And you should also know how many customers came back and made a repeat purchase. Adding a little bit of art to this science, you will end up with good estimates for each level on the funnel.

When you write those numbers down, you can do some quick math to see what percentage of people from each level make it down to the next level. This is your conversion rate at each stage.

For example, let’s say you have a total market size of 1000 people. That’s what you write down next to Unqualified Prospects. And you’ve judged 500 people to be in the awareness stage or beyond, meaning they have had some exposure to your brand. So you have an awareness rate of 50%.

Calculate that percentage throughout the funnel and you will have a complete look at the effectiveness of each stage of the sales process.

Tomorrow, we’ll take that analysis one step further and talk about how to use those numbers to improve your sales funnel.

Know Your Funnel

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When marketers talk about funnels, we’re talking about the process that takes a person from not ever having heard about our brand to becoming a paying customer. You’ll often hear it referred to as a sales funnel, and it has a number of steps.

It can take many forms, depending on your business and industry, but generally it looks like this:

  • Unqualified prospects make up the largest group, this is your target market, all those people you might turn into customers.
  • Awareness is the second level down, where some percentage of that top group has now heard about your brand or product somehow.
  • Interest comes one step further, where some group of those in the awareness bucket have now taken an action to investigate your offers.
  • Consideration is next. Here, not only are they interested, but they are actively weighing your brand against your competitors.
  • Intent is the next level down the funnel, where they have chosen you as the company they wish to purchase from.
  • Purchase is the final level at the very bottom of the funnel. There, the final sale has been made.

I would argue that marketers take the funnel a step further, adding loyalty as a stage when those who make a first purchase come back and make another.

Regardless whether or not your funnel matches the one described above, the important first step is outlining it. Once you know your funnel, you can start to fill in the numbers necessary to do a full funnel analysis. How many people are at each stage, what are your conversion rates, and where can you make changes to get more people further down the funnel.

Market To Mondays – Part 8

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Welcome to the latest edition of our new weekly blog series, Market To Mondays. Each week, we will introduce you to a new group of people you should market to. We’ll tell you who they are, why you should market to them, and how you might get started.

Last week’s group was The Press.

Today’s Group = Unconverted Leads

Does your company generate leads? Do people give you their information before they actually sign up or purchase your products? Do you buy lists and sell to them? Is there an application process that precedes a new customer acquisition?

If so, you probably have a standard lead funnel that most of those leads progress through on their way to ultimately purchasing your product. This is the sales funnel. And the nature of funnels is such that not all leads make it through to the end.

It would be wonderful if they did. But since they don’t, unsold or unconverted leads become an audience of people you can market to.

You may argue. You may say, “But they made it all the way through the sales funnel already and they didn’t bite, so why would I continue to waste my time marketing to them when I could be trying to sell to newer, better leads?”

You’re correct. These are clearly lesser leads than those in the sales funnel now. But if you can develop some very simple, low cost ways of following up with the old leads, you can increase your sales in a big way.

But how?

Email is your best bet in this selling scenario. The easiest, least time-consuming, lowest cost thing you can do is place all of your unsold leads into an email list. Call it “Old Leads”, or “Crap Leads”, or whatever you want to call it, as long as you have it.

Once you have it, and you begin to add those folks in who didn’t bite, start creating content for them. This content should be very basic, and your intention is to just keep in touch with them. Don’t let them forget who you are, and that they were once interested in what you had to offer.

Then, mix in your discounts. Any discounts you have in your back pocket, use them. These folks might be some of your most price-sensitive, so by taking more off the price than you might with your newer leads, you may sign some of them up as customers.

At the end of the day, it costs you next to nothing to run this type of email marketing program. So if it adds a few sales you might otherwise have thrown in the trash, why wouldn’t you do it?

What group should we cover next? Now accepting submissions for audiences that we will cover in an upcoming “Market To Mondays” post. Submit your ideas via our contact page or in the comments section below.