From marketers to salespeople they feel guilty of not only using jargon but also using these words mutually. It happens— but, to be the best in your industry and ensure you know your stuff, you need to have a clear understanding of your processes and what they mean for your business.
For example, take your sales pipeline and your sales funnel. They sound similar, and they serve similar purposes — but they are very different things. Let’s explore what each of them is, what they do, and discover the differences to ensure we know exactly what we are talking about to secure the best results.
What is a Sales Funnel?
A sales funnel is the process that turns a cold prospect into a hot lead. The sales funnel is a visual representation of your prospect’s journey from the first contact until the purchase is completed.
If you see the structure of the sales funnel then at the top it is widest which shows the awareness that is low and at the bottom, it is narrower where the awareness is high. As prospects progress through the funnel, unqualified leads who are not a good fit for your offer drop out, and qualified leads move to the next stage.
Stages of Sales Funnel
- Awareness – At this stage, the prospect is looking for resources to better understand the problem.
- Consideration or researching solutions – They’ve defined the problem and are looking for possible solutions.
- Decision – The prospect has defined the problem, knows about the existing solutions, and is ready to make a decision.
What is a Sales Pipeline?
A sales pipeline offers a holistic picture of your sales process. A pipeline in sales enables your sales team to organize and manage the entire sales process. With a pipeline, marketing teams and sales reps can guess revenue by identifying the stages where opportunities lie and predict how many prospects will become customers during a defined timeframe.
When the prospect completes a stage of the pipeline, they move to the next step until they become customers. In some cases, a prospect may skip several stages in your pipeline and move from initial contact to interacting with a decision-maker in your company. Just as the sales cycle and process differ across companies, your sales pipeline should be unique and representative of the buyer’s journey.
Stages of a Sales Pipeline
- Prospecting: Use lead-generation techniques to fill the pipeline with opportunities.
- Qualifying Leads: Ask questions to make sure the lead has the need, budget, and authority to buy soon; if they do, they become a prospect.
- Sales Qualified Meeting: Schedule for a telephone or in-person meeting to begin the conversation.
- Make an Offer: Send the prospect a detailed quote laying out what will be provided, at what cost, and the timeframe.
- Finalize Proposal: Negotiate with the prospect of the sale.
- Closing the Deal: Agree on and sign the final contract with the now-customer.
- Deliver the Product: The customer receives the items for their promo need.
Why do you need a sales pipeline?
The Harvard Business Review states that companies with effective sales pipeline management have an average growth rate of 15% increase.
1- Targeted Resources Allocations
It becomes very easy and efficient to allot resources when you know which pipeline stage the prospect is at. Sales managers are the ones who make decisions about new goals, opportunities, and individual targets that require more resources to close or those that need more overlooking.
2- Improved Tracking
With a sales pipeline, team members can track pipeline deals in real-time throughout the year’s sales cycle. The data helps managers to understand the volume of new and duplicate business the team generates. It also decides if you need to hire additional sales reps to meet demand and if you’ll meet your sales goals for the year.
3- Accurate Sales
The company needs a tool to determine, quarterly and annually, revenue on a month-to-month basis. A sales pipeline shows areas of your sales that are close to the portion and weak points that are far behind. The data helps you determine holes in your pipeline so you can adjust your sales strategy and reach your financial goals.
Let’s understand more this concept by an example:-
When a sales rep says a ‘lead’ is stuck in the pipeline, that means they understand that a prospect needs a little force to move them to the next stage. It could be a proposal or initiating contact. But a prospect doesn’t “get stuck” in the sales funnel because the funnel stages represent how successful or unsuccessful a prospect converts from the point of initial contact to decision making. If you want to identify drop off points through year-to-year, the sales funnel shows where deals fail and help your sales team brainstorm solutions.
Sales Pipeline VS Sales Funnel
It’s important to know whether your sales strategy will benefit from one option or integrating both. The choice you make depends on what your sales process needs. For brands with a high-value product that requires a complex sales process, a pipeline streamlines your efforts. A pipeline helps new sales reps to quickly understand your sales strategy and track opportunities that may take longer to progress.
But if your company focuses on B2C or you have a shorter sales cycle, a funnel could be a better fit for your team. Focusing on conversion rate helps team members to identify and reduce problems while establishing a metric of success for each stage of the funnel. For instance, if you notice lower conversion from the lead qualification stage to the proposal stage you’ll want to review your process for lead qualification.
Conversely, if you have trouble booking meetings with qualified leads, you may need to adjust your sales qualifiers. Increase your efforts through activities like content marketing to drive more qualified leads into your sales pipeline rather than general prospecting. So, now you have understood whether the Sales pipeline or Sales Funnel will give benefit to your business.
But can you use the sales pipeline and sales funnel together? Yes, you can integrate the sales pipeline and sales funnel for sustainable business success. If we put the sales pipeline and sales funnel together they will offer valuable insight into how your sales strategies can evolve for higher conversion and close rate. Using both sales visualizations enable the sales team to identify if your sales process needs more steps or less. Sales reps can squeeze the sales process to include multiple stages such as product demos, reviewing proposals, identifying decision-makers, and having more sales meetings with leads.
This leads us to another big question. How do you combine both a sales pipeline and sales funnel?
A sales CRM simplifies the process for you. The built-in lead gen tracker automates the movement of leads through the pipeline. You can also track performance at each stage of the pipeline, monitor growth, and adjust the sales process when needed.
FunnL is one of the best and fastest growing B2B sales qualified meeting generation firms, transforming sales funnels and supporting businesses at every stage of the pipeline.
Transform your lead generation. Maximize your B2B website. Modify your sales process. Book your Sales Qualified Meetings today! Contact us!