What is a Sales Funnel?

sales-funnelWhat is a Sales Funnel?

A “sales funnel” acts as a sieve to direct qualified purchasers through the sales process, while filtering out less-qualified visitors along the way. At the top of a sales funnel is a mixture of qualified and unqualified prospective customers. Less-qualified purchasers drop away at each step of the evaluation and purchase process. The bottom of funnel, the smallest part of the funnel, contains the most qualified prospects.

Example: You can use “software” as a PPC (pay per click) keyword. Prospective customers will cover the gamut, but are not as likely to have an interest in a niche software application. The keyword “software” is simply too generic. This would be the widest part of the sales funnel.

If you use “bookkeeping software” rather than simply “software“, you will filter your prospects better, and visitors entering the site through your ad or keywords will have a genuine interest in bookkeeping software. This would represent a much narrower part of your sales funnel.

Using the advertisement “bookkeeping software for Windows” will narrow the base of potential customers even further, and this might represent the smallest, most narrow, and possibly the final segment of your sales funnel.

The trick to a well-working sales funnel is to have good targeting and filtering, while not losing any potential customers in the process.

Why Qualify Prospects?

Qualifying potential customers in advance allows staff and resources to be devoted only to those customers who have a genuine interest and/or need for your product or service. The sales funnel removes those who are not really interested, so you don’t end up spending much of your valuable time and resources on them.

A clear marketing message is critical to a healthy sales funnel. If the marketing message is not focused enough, then the sales funnel will become “clogged” with unqualified prospects, requiring you and your staff to spend time sorting them out.

The first step in a sales funnel is to filter unqualified prospects so that you can maximize the potential of all the people involved in the sales cycle. Those customers who reach the thinnest part of the funnel are the best prospects, and the ones most likely to buy your product. Using a good sales funnel allows you and your staff to concentrate your best and most valuable “closing the sale” efforts on only those customers that make it to that level.

Why should software developers go through the trouble of qualifying potential customers? Quite simply, because filtering and targeting customers will save both time and money.

Sales Funnel Image:

sales funnel

Post a Comment

Your email is never published nor shared. Required fields are marked *