In this article we look at what sales funnel software is and how it can help you manage your sales process. Once you have sales funnel software, you can also get a good idea of your expected revenue from closing deals.
What is Sales Funnel Software?
Sales funnel software helps you manage the sales process to convert leads into customers. How does it work? First you systematize your sales process into several sequential stages. These stages are defined based on your sales process. The sales stages could include for example: Awareness, Interest, Decision, Action. Leads enter into your sales funnel at the top and move down the funnel as they progress through your sales process. At the bottom they come out of the sales process as customers and closed deals. The analogy of a funnel reflects the likelihood that some leads will drop out along the way and only those that get through every stage become customers.
What are the Typical Sales Stages?
Everyone has different terms for their sales stages. However, the sequential stages all have some step or qualification that the lead goes through on the way to becoming a paying customer. The four standard stages are defined as follows:
In this stage, a lead has some awareness of your products or services. Finding these leads can be done in a variety of ways. For example, they could have responded to one of your ads, or they could have gone to your website, or they could have received one of your blast emails and downloaded the content or you could have purchased leads from one of many lead generation services. This stage represents the top of the sales funnel.
Once you have identified leads that could be interested in your products or services you need to qualify them. On paper they might be companies that could be interested in your products or services. However, you need to find out if they really are a good fit and if they are looking to buy the products and services you offer. Typically, one of your salespersons or business development reps will contact these leads to determine whether they have any interest in your products and services. This is sometimes referred to as qualifying the leads. Qualified leads are sometimes referred to as prospects.
Once you have a qualified lead, your salesperson will work with the prospect. Your salesperson will highlight the benefits of your products and services relative to alternatives. The salesperson will also provide additional information if needed and will try to address any hesitation or objections of the prospect. In this stage, your salesperson may offer demonstrations of the products or services, free trials if appropriate and/or come up with special pricing options to try to get the prospect to decide to buy.
Once the prospect has been “sold” on your products or services, the next stage is to close the deal. Often this is not as straightforward as you would hope. Sometimes prospects that say they’re ready to move ahead get cold feet when it comes time to pay for the products or services. This means that the salesperson needs to keep communicating with the prospect to overcome any hesitation. Also, the sales process should make it as painless as possible for the prospect to complete the purchase. If the prospect does complete the purchase, you should try to upsell them to purchase something else as well. If the prospect, for whatever reason, decides not to move forward with the purchase you should move the prospect into a nurture campaign. Nurture campaigns continue to communicate with prospect periodically so that your products and services remain top of mind when the prospect is ready to move forward.
Systematizing the Sales Process
Once you have mapped out the stages in your sales process, you need to make sure that all the people involved in the sales process understand the different stages and their roles. One of the most important contributors to successful sales is having a well-defined sales process and tracking to ensure that leads and prospects are moved from stage to stage systematically. Using some sort of visual cue to designate the sales stage for each lead or prospect can be helpful to salespersons managing multiple prospects. Tracking follow up is done using CRM (Customer Relationship Management) software to record interactions.
As leads or prospects drop out of the sales process, they need to be moved to email campaigns that periodically communicate with them. Through this periodic communication, you’ll be able to bring these leads back into the sales funnel when they’re ready.
Once you have a well-defined sales process you can assign probabilities of getting to a closed deal to each stage. For example, a new lead might have 5% probability weighting, a qualified lead might have a 20% weighting, a prospect that has received a demo might have a 40% weighting, a prospect that has received a second demo might have a 60% weighting, and so on. Then by calculating the value of each deal multiplied by the probability weighting assigned to its sales stage, then summing this up for the whole sales pipeline gives you an indication of the possible sales. However, you need to make sure that all salespersons are continually updating their pipelines. If the sales pipeline has a lot of deals with sales stages that are not updated properly, or lost deals that are not pulled out, the sales pipeline revenue forecast will not be useful.
To improve your conversion of leads and prospects to customers you need to systematize your sales process into defined stages. Once you have a well-defined sales process, sales funnel software can help you track progress towards closing deals by stage. This allows you to measure a salesperson pipeline by expected deal revenue. Contact us to learn how Accolent ERP Cloud-based software provides the tools to build and maintain your sales funnel and manage sales pipelines.