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What is a Sales Funnel?
A "sales funnel" acts as a sieve to direct qualified
purchasers through the sales process, while filtering
out less-qualified visitors along the way. At
the top of a sales funnel is a mixture of qualified
and unqualified prospective customers. Less-qualified
purchasers drop away at each step of the evaluation
and purchase process. The bottom of funnel, the
smallest part of the funnel, contains the most
qualified prospects.
Example: You can use "software" as a PPC
(pay per click) keyword. Prospective customers
will cover the gamut, but are not as likely to
have an interest in a niche software application.
The keyword "software" is simply too generic.
This would be the widest part of the sales funnel.
If you use "bookkeeping software" rather
than simply "software", you will filter
your prospects better, and visitors entering the
site through your ad or keywords will have a genuine
interest in bookkeeping software. This would represent
a much narrower part of your sales funnel.
Using the advertisement "bookkeeping software
for Windows" will narrow the base of potential
customers even further, and this might represent
the smallest, most narrow, and possibly the final
segment of your sales funnel.
The trick to a well-working sales funnel is to
have good targeting and filtering, while not losing
any potential customers in the process.
Why Qualify Prospects?
Qualifying potential customers in advance allows
staff and resources to be devoted only to those
customers who have a genuine interest and/or need
for your product or service. The sales funnel
removes those who are not really interested, so
you don't end up spending much of your valuable
time and resources on them.
A clear marketing message is critical to a healthy
sales funnel. If the marketing message is not
focused enough, then the sales funnel will become
"clogged" with unqualified prospects, requiring
you and your staff to spend time sorting them
out.
The first step in a sales funnel is to filter
unqualified prospects so that you can maximize
the potential of all the people involved in the
sales cycle. Those customers who reach the thinnest
part of the funnel are the best prospects, and
the ones most likely to buy your product. Using
a good sales funnel allows you and your staff
to concentrate your best and most valuable "closing
the sale" efforts on only those customers that
make it to that level.
Why should software developers go through the
trouble of qualifying potential customers? Quite
simply, because filtering and targeting customers
will save both time and money.
Sales Funnel Image:
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What is a Sales Funnel?