During the Renaissance and the Industrial Eras, funnels also found their place among allegories. An inverted funnel was used to depict chaos or jest. In our times, the funnel’s been flipped back to its normal position and being used as an allegory for something serious: business.
Funnel Management involves the streamlining of an organization’s vertical into a funnel-like — or an inverted-pyramid like — structure. Depending on the role of these verticals, these funnels are segregated into tapering sections, depicting the sequence of processes that they comprise of. Funnel Management usually finds more application in verticals whose output have a Pareto Principle-like correlation. Sales and marketing are some of the verticals in which organizations tend to deploy these solutions.
For the sake of clarity, further references in the context of Funnel Management will be made from a sales perspective.
Dissecting The Funnel
While many organizations have their own classifications for the stages of a Sales Funnel, all of them are broadly covered by these three categories:
1. Awareness: The top of the funnel, or the broad end, which comprises awareness and discovery. Potential leads have reached out to your organization after coming across inbound promotions (Social Media, SEO, Landing Pages, et al) or outbound efforts (Mailers, Cold Calls, etc.). At this stage, the customer is being educated about your product, and has been looped in by your Customer Relationship Management vertical. In simpler words, he or she is discovering you.
2. Consideration: The middle of the funnel, or the tapered end, which comprises evaluation at the customer’s end. The customer has been educated about how your product fits into his or her needs. Efforts are directed on impressing upon individuals the benefits of your product (through guides, webinars, competitor comparisons and other initiatives), and differentiating yourself from the competition.
3. Decision: The bottom of the funnel, or the narrow end, which comprises lead finalization and closure. In this stage, the customer has decided to go ahead with your product, and your representatives go ahead with on-boarding procedures. While the outlining of this stage might imply a 100 per cent conversion rate, extraneous or uncontrollable factors tend to bring that number down.
The idea behind putting in place a Sales Funnel is streamlining of processes, which can lead to enhanced lead generation and retention. Dale Carnegie’s values place emphasis on relationship building. In this context, companies can also make use of Sales Funnel feedback to prioritize customers, and accordingly invest resources.
Such a structure also helps organizations track crucial metrics, such as rates of lead-creation and lead-conversion, transitory conversion probability between Sales Funnel phases, and time invested in each stage.
The Human Touch
At the end of the day, a Sales Funnel is a tool, one whose potency is defined by those who implement them. While a clear-cut understanding of the actionables that each stage of a funnel involves is key, it is also important to know the interpersonal dynamics that drive them.
The essence of Dale Carnegie’s Five Cs For Sales — Connect, Collaborate, Create, Confirm, and Commit — is to strengthen customer relationships. But they also hold water in the context of a Sales Funnel. Abiding by these values while implementing each stage will not only have a tangible effect on output metrics, they will also reflect in the kind of customer relationships that these funnels eventually help build.
As one of Dale Carnegie’s crisply-worded sales philosophies goes: relationships drive sales. So,
1. Focus on long-term results during the Awareness phase.
2. Listen to truly understand your customers during the Consideration phase.
3. Position yourself as a true partner during the Decision phase.
Doing Funnel Management, The Right Way
Apart from keeping in mind the basics that have been elaborated above, here are a few things that should be avoided while deploying a Sales Funnel:
a. Delay in Sales Cycles: Protracted conversion cycles can lead to Funnel leakage: the loss of a customer during processing. Companies should keep a close eye on the conversion times, and try to not deviate from the median.
b. Irregular Lead Distribution: If there are discrepancies in the way sales personnel are assigned leads in the Funnel, it could again lead to leakage. Investing in a Lead Distribution software that fits your business model is the way forward.
c. Lack of push in Awareness & Consideration phases: Since the Decision phase is usually considered as critical, the first two stages of the Sales Funnel could get a short shrift on the resource or personnel front. It’s crucial for companies to ensure that there are no such skews in the Funnel.
Not all leads may get converted into sales. But it is important to remember that constant, funnelled engagement with customers will always continue to be key for the long run.