What Is a Sales Funnel? In-Depth Guide

What Is a Sales Funnel

To describe in short, a sales funnel is a consumer-focused marketing model that illustrates the process of customer journey toward the purchase of a good or service.

Sales funnel isn’t a new term in the digital marketing industry.

Various marketing gurus have come up with different definitions of the concept.

Nevertheless, you can derive the same meaning from all the numerous definitions.

Let’s look at what’s a sales funnel.

Sales Funnel Meaning And Definition

A sales funnel is a marketing term used to describe the process a customer goes through before buying a product.

Think of it as the pathway a prospect takes to become a fully paying customer.

It is also called a customer funnel, marketing funnel, purchase funnel, and sometimes a conversion funnel.

These terms describe a consumer-focused marketing model used to illustrate a potential customer’s theoretical journey towards a good or service purchase.

Much like a normal funnel, a sales funnel narrows as you go down.

Its basic concept is to convert your prospects to buyers.

Sales Funnel Model

St. Elmo Lewis is among the first visionaries who came up with the idea of a sales funnel.

He developed the concept to describe the step by step process that begins when a product attracts a customer to the point of making a purchase.

Sales Funnel

The model, famously known as the AIDA model (Awareness → Interest → Desire → Action), consists of four stages:

  • Awareness – the consumer becomes aware of a category, product, or brand (usually through advertising)
  • Interest – the consumer becomes interested in learning about brand benefits & how the brand fits with the lifestyle
  • Desire – the consumer develops a favorable disposition towards the brand
  • Action – the consumer forms a purchase intention, shops around, engages in the trial or makes a purchase

Many types of sales funnel models exist, but AIDA is the most recognized.

In some variations, there are even seven steps instead of the usual four:

  • Awareness
  • Interest
  • Evaluation
  • Decision
  • Purchase
  • Reevaluation
  • Repurchase

Any business aims to generate revenue and boost profit.

A sales funnel helps you actualize the goal of your venture by creating a precise roadmap to revenue.

It enables you to focus on your business’s most essential aspects, determining your conversion rate and income generated.

These include lead generation, lead management, sales, and customer relationship management (CRM).

Sales Funnel Process Explained: How Does It Work?

A sales funnel begins when a customer visits your website through a link, maybe from social media or a Google search.

To entice your customers, you must first get their attention.

Therefore, a good sales funnel arouses curiosity to the potential customers.

You can achieve this by advertising your products without giving away too much information.

Russell Brunson, a successful sales funnel expert, suggests telling clients what the product isn’t rather than what it is.

The goal is to pick your customers’ interest and lead them further down your page for more information.

Every sales funnel has a lead magnet, also known as the highlight of the whole process.

A lead magnet is what captures the clients’ attention.

It can be information or an actual product which a business offers in exchange for information, typically a name and email address.

Once your visitor fills out the form, they become a lead. Hence the name “lead magnet”.

This allows you to market to the customer outside the website by offering special coupons, information on sales, and exciting offers.

In return, leads come back to your site.

What Are The Main Sales Funnel Stages?

To create a good sales funnel, you have to understand the structure of a sales funnel.

It predominantly consists of four phases:

  1. Awareness
  2. Interest
  3. Desire
  4. Action

These four stages are a visual representation of the process of turning a lead into a customer.

The idea is that marketers use all means to capture as many leads as possible and then slowly develop them by making a purchase.

This is achieved by taking them down the funnel.

Sales Funnel Stage #1: Awareness

Awareness - Sales Funnel StageAwareness is the first level of the sales funnel.

At this point, customers are drawn in through marketing campaigns carefully created through extensive consumer research.

It can also be through referrals or even Google research, not only marketing campaigns.

This is the window of grabbing your potential customer’s attention.

The prospect becomes aware of your business and the service or product you offer.

Lead generation usually takes place during the Awareness phase by collecting a customer’s information.

From here, the prospect is nurtured further down the funnel.

In this stage, there are strategies marketers and businesses use to achieve awareness. These include:

  • Paid Ads. These are used to reach new audiences across various platforms. Paid internet and Google ads are quite common these days. Therefore, you can easily secure a marketing space with ease.
  • Content Marketing. Consumers are always thirsty for knowledge. Content marketing is a great way to build brand awareness. You can use content such as articles to drive traffic to your site through Search Engine Optimization (SEO).
  • Referrals. These are usually through word of mouth or link sharing. Referrals are a good way of increasing brand visibility.

Sales Funnel Stage #2: Interest

Interest - Sales Funnel Stage

The interest phase begins once leads are generated.

Here, customers learn more about your company, its services and products, and any useful information that might help customers decide.

This phase aims to help the customer make an informed decision by feeding them with more information about your business.

At this point, marketers can establish who is engaged in communication and the type of information that makes them responsive.

This allows them to make necessary adjustments aimed at further captivating the customer’s interest.

The interest stage is entirely dependent on how well you can hook your prospects to your content.

This is achieved by carefully developing your story, what your company is about and what it has to offer, and ultimately how the speed at which you deliver this information.

Strategies used at the Interest stage of the funnel include:

  • Email Marketing. An email marketing campaign allows your partners to get to know you and your business better and understand the products or services you’re selling. An email drip campaign introduces your brand and outlines the benefits of using your products or services.
  • Push Notifications. Web push notifications enable marketers to deliver quick and distinguishable messages to people who opt-in.
  • Webinars. These enable interaction with your audience through question and answer (Q&A) segments, surveys, and chats.

Sales Funnel Stage #3: Desire

Desire - Sales Funnel Stage

This is often the most challenging stage.

It is where you finally get the customer to decide whether to buy your product or service.

Apart from using storytelling and copywriting, you also have to incorporate enough customer reviews and testimonials.

The desire stage is the best time to push your best and most attractive offers, i.e., free shipping and bonuses.

The key to making the decision phase work is to create an irresistible offer.

Some of the strategies you might use to boost your success rate in the Desire phase are:

  • Segmentation Segment your contact list and form a separate group for customers who have received adequate information about your product.
  • Retargeting Ads. Retargeting ads are used to keep the awareness and interest levels of the customer high. They remind your visitors about the products and services you’re offering even after leaving your site.

Sales Funnel Stage #4: Action

Action - Sales Funnel Stage

The final stage of the sales funnel is the Action stage, where a customer makes a purchase.

The goal is to convert one sale into 10, 20, and so forth.

Having a customer reach the bottom of the funnel doesn’t signify the end of the sales journey.

Your focus should be on customer retention.

Russell Brunson, the mastermind behind ClickFunnels, suggests upselling as a means of optimizing the action stage.

Upselling is when you offer additional related products or services to customers.

It can also be used to improve the customer’s experience.

The key to upselling is offering the client more products than what they need.

Below are proven ways of making the upsell process work for you:

  • Keeping the buyer loop open. This is a crafty way of reeling in hyperactive buyers. It also helps you increase customer engagement rate and improve the flow of information.
  • Create an offer wall. An offer wall ascends buyers up to your value ladder. The offer wall is a section of your website that offers more products and services that your customers might be interested in.
  • Offer an order form bump. An order form bump is a section after the checkout page that adds another attractive offer to your client before completing the checkout process. It’s an extremely effective way of boosting sales.

For example, if you’re selling an actual book, you can offer an audio version of the book in your order bump.

Main Sales Funnel Types

1. Conversion Sales Funnel

Conversion Funnel is a technical term used to describe the consumer’s path via an advertising or search system through a website that converts to a sale.

Its main components are similar to those of a Sales Funnel except for an additional level called the traffic source.

At this phase, the customer finds the traffic sources, which may be through SEO, Pay-per-click (PPC), or referrals.

A modern Conversion Funnel has multiple entrance channels.

Therefore, you can access it at any stage of the funnel.

2. Marketing Sales Funnel

This model is used for advertising products and services to potential buyers.

It follows the same format as the contemporary sales funnels.

Examples include the free consultation funnel, the cross-sell funnel and the service upsell funnel.

3. eCommerce Sales Funnel

The eCommerce sales funnel consists of four stages:

  • Acquisition
  • Activation
  • Desire
  • Purchase

The acquisition stage involves directing traffic to your business or website. The next step is activation.

It involves the prospect going through your site to see what you offer.

It’s relatively similar to the interest phase in a sales funnel.

The activation stage leads customers to take action.

Activation can be done by reading your blog, subscribing for email notifications, or simply browsing through your product section.

The third step is the Desire phase.

It is estimated that 96% of the people who visit your site aren’t ready to purchase yet.

The desire stage seeks to change this narrative by gently nudging prospects to products they might like.

Last but not least is Purchase.

It’s the end goal of the eCommerce funnel where the prospect finally turns into a buyer.

Online businesses usually use the model.

Types of eCommerce funnels include:

  • Paid traffic conversion funnel
  • Inbound marketing funnel
  • Organic social media funnel

4. B2B Sales Funnel

The B2B or the Business to Business sales funnel refers to the series of events that a business follows as it attempts to sell to another company.

It comprises four stages, each corresponding to the stages of a customer’s journey down the funnel.

  1. Awareness Phase – the customer, finds out about your business and becomes a prospect.
  2. Consideration – it involves lead generation. ( Closely related to the Interest stage in the Sales Funnel model)
  3. Decision – here, the customer decides whether to make a purchase, based on the information provided in the Consideration Phase.
  4. Purchase and Customer Retention – the customer finally buys the product, but it doesn’t end here. The process also involves customer retention.

5. Lead Generation Sales Funnel

A lead generation funnel consists of the systematic approach of generating leads.

Lead generation is often ignored, despite being among the essential aspects of the marketing process.

It consists of three stages:

  1. Lead Capture. It involves engaging your audience with information about the product or service that you offer. It is designed to capture the prospect’s interest.
  2. Lead Qualification. The process involves establishing whether the lead is ready to make a purchase or needs further nurturing.
  3. Lead Nurturing. It involves engaging and conversing with the customer. It is an essential component of a Lead Generation Funnel because it gives you insight into the right kind of message to offer. The ultimate goal of this stage is turning the prospect into a paying customer.

6. Webinar Sales Funnel

A Webinar Sales Funnel is a marketing and sales tool used to convert leads to buyers.

The objective of this model is to generate leads and eventually convert them to sales.

What makes a Webinar Sales Funnel successful?

An estimated 72% of consumers prefer watching a video rather than reading an article.

This means you generate more leads by running a webinar than by offering readable resources.

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