The term ‘sales funnel’ is an important concept for all types of businesses. Your sales funnel is what leads customers to purchase your products or services. As they pass through the funnel, they transform from random prospects to qualified leads and, finally, to buyers. As the funnel narrows and prospects get to your sales team, they are already primed to make a purchase. YAY!
What Is a Sales Funnel and Why Is It Important for Your Success?
The sales funnel is a sieve that leads prospective customers through your sales process. It casts its net wide and then gradually weeds out unqualified prospects that are not likely to buy your product.
As the term ‘funnel’ suggests, it’s wide at the top (the entry point) and narrow at the bottom (the point of purchase). At the top, a sales funnel attracts casual website visitors through a special offer that lures them in. You then use marketing techniques to offer them other deals. This gives you a chance to gather information about your prospects and further qualify them.
Why Use Sales Funnels?
Sales funnels are important for a number of reasons. First, they make the sales process more efficient. Since only qualified buyers get to the end of the funnel, your sales team doesn’t waste time dealing with uninterested prospects who are just kicking tires.
A great sales funnel helps to make your sales process more predictable. Sales are never fully predictable, but when your sales process is organized in a standard, systemized way, you can arrive at a good estimate of your ROI.
Finally, a sales funnel helps you track different metrics at different points of the process. It’s organized into clear steps so that when there’s a problem within your funnel, you can troubleshoot and tweak accordingly.
An Example of a Sales Funnel
Here’s an example of a sales funnel in action. Imagine that you own a business that sells supplies and information about rooftop gardening. You create a blog about green roofing that includes a form on the sidebar where visitors can sign up for your list and receive a free eBook on the topic.
Once a visitor downloads the book, you begin marketing to them through emails, offering them exclusive content, helpful tips, and special offers. The offers gradually increase in price, leading them to your main product, a comprehensive collection of rooftop gardening tips with a fairly high price tag.
At first, visitors read your blog for information about rooftop gardening. At that point they may just be considering the feasibility of starting their own garden. Those who sign up for your list are truly interested, and the ones that jump on the email offers are seriously looking for a way to start a rooftop garden. The people in this segment of your list are the most likely to buy your kit, and therefore you begin marketing the kit to them.
Your Sales Funnel is a Filter
An important concept to remember about the sales funnel is that you don’t need to appeal to everyone. You only need to focus on those who are truly interested in your product. When you lose subscribers, this is a good thing (as long as it’s not too many) because you don’t waste your time with those who will never buy. That’s the magic of the sales funnel in action. 🙂
The Key Components of an Effective Sales Funnel
For a sales funnel to work, a few key elements must be in place. First, you need to consider the offers you make. These offers should gradually increase in size and ticket price, as you weed out those who aren’t interested in buying your product.
Second, you must decide the ways in which you will keep in touch with your prospects and further qualify them. Through your offers and communications, you should be able to get your prospect list down to only the serious buyers.
By the time you get to the end of your funnel, you should have a list of loyal customers who you can sell to again and again, assuming you nurture that relationship.
What Should You Offer?
There are a variety of different ways to go about making your offers. The most common include:
• Opt-In Giveaways
An opt-in giveaway is a freebie usually offered in exchange for the person’s name and email address. This is the entry point to your sales funnel. The potential customer wants the free product, so they ‘opt-in’ by giving you their name and email address. You can then begin marketing directly to them through email.
• Front-End Offers
Front-end offers are paid offers that work just like freebies, but can actually be more effective. The key is that even though you charge for your offer, you keep the price very low. Charging for the product helps weed out the folks who just want a freebie and aren’t interested in ever opening up their wallets at all. If they’re willing to spend even just a dollar on a small product, you know that they have the potential to be serious buyers in the future.
• Subscription Products
Subscription products are low-priced but more profitable for you because you charge a monthly fee to subscribers. It is much tougher to get people to pay for a subscription though, so the content you’re offering has to be really unique and valuable. But if these clients are willing to pay this monthly fee, they’ll be much more likely to buy your high-ticket items.
• One-Time Offers
One-time offers are great because they allude to a level of urgency. These are offers telling the visitor that once they click away, the offer expires. In other words, they have to sign up and/or buy immediately or they will lose their one and only chance.
The way a sales funnel works is that the front-end offers are low-priced (or free) and low commitment. In contrast, your back-end offers gradually increase in price. These pricier back-end offers are what really qualify your prospects and tell you who your serious buyers are.
Keeping in Touch
It’s important to keep in touch with your prospects. They shouldn’t only be hearing from you when you’re trying to sell them something. The follow-up emails you send to subscribers on your list should always offer them helpful content. The purpose of these emails is to stay on their radar and build a relationship with them.
The first step in doing this is the ‘thank you’ page. This is a small detail, but it’s extremely important. After signing up for your list or purchasing the initial front-end product from you, redirect your customers to a page that simply thanks them for signing up and/or making a purchase.
You can also use this opportunity to make them another offer. You can use this opportunity to present a one-time offer or an upsell. Either strategy will help you to further qualify prospects. You know you have a serious buyer if they immediately take you up on that second offer.
Sales Funnels and SEO (Search Engine Optimization)
Remember the shape of the funnel – wide at the entry-point and gradually narrowing toward the main target purchase. Because you want to cast your net wide, the landing page where you make your initial offer should be search engine optimized in order to direct as much traffic as possible to your website.
Ideas for Your Sales Funnel
All sales funnels have the same basic shape and characteristics – wide at the entry point and gradually narrowing as the prospect moves through it. Each funnel is similar, but no two are exactly the same. You have many options when it comes to working out the specifics.
Researching a Variety of Ideas
Before you start thinking about the specifics of your sales funnel, there is some important research that must be done. Start by taking your product idea and making sure there’s a market for it. No matter how enticing your offers or how well-crafted your funnel, you won’t succeed if there isn’t a hungry crowd eying the products you are offering.
You should begin by doing keyword research to see if people are searching for what you’re planning to offer. You can conduct more detailed research by looking at products in your niche and niches that are similar to yours. This can be done through product marketplaces such as Amazon.com. You can see if people are actually buying products related to your niche. You can also find out about the potential of your market by looking at similar products offered by your competitors.
Your Competitors’ Funnels
It’s always good to investigate the sales funnels of your competition. The point of this investigation isn’t so much to get ideas as it is to find weaknesses within their sales process. You need to offer your prospects something unique that your competitors do not offer.
The best way to do this is to sign up to your competitors’ mailing list and see how they market from the point of view of a prospective customer. You should also take advantage of some of their offers to see what you’re up against. You’ll be able to assess not only their sales funnels, but also the quality of their products and service.
Brainstorming for Your Funnel
Once you discover your market and the approach of your competition, start brainstorming what you’ll do with your own sales funnel. First of all, brainstorm potential offers. Knowing what your competition is offering will help you target what the market could really use. What kinds of products would help you qualify these potential buyers? You might consider freebies, small-ticket offers for the front-end, medium and large-ticket offers for the back-end, and one-time offers.
You’ll also need to identify your traffic sources. Traffic sources include things such as search engines, social media, forums, blogs, content directories, press releases, information products, and anything else that will drive traffic to your landing page.
Planning Out Your Sales Funnel
After your brainstorming, lay out your sales funnel in a visual way that allows you to see the big picture. You can do this by using tools such as mind maps, spreadsheets, timetables, and/or diagrams. (I use a sketchbook.)
A good sales funnel is solid, well-planned, and detailed, but you also have to be flexible. Once you put it into action, be sure to carefully track your conversions to identify the strongest and weakest spots in your funnel. Troubleshoot and find ways to strengthen the weak points while replicating the strongest ones in order to improve your sales funnel.
Let’s put this into action for your business….
(1). If you have a sales funnel, compare the amount of sales you’ve made from your sales funnel vs. products you’ve sold through other methods.
(2). Think about sales funnels you’ve been filtered through yourself, what types of funnels did you like?
(3). And lastly, start researching and planning a sales funnel for one of your offers.
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