How to Build a B2B SaaS Sales Funnel

Regardless of whether you have formalized the structure of your company's sales funnel, your company's growth is dependent on it. At the most fundamental level, your sales funnel is fed by leads, which then pass through definable stages in the sales process until the lead closes to become a customer. A company generates many more leads than it actually converts to customers, decreasing the number of leads as they pass through the funnel.

The Top of the Sales Funnel:

Detailing your company's sales funnel helps your sales team focus on the right actions. The most important task to focus on is how to get as many leads to the next stage of the funnel as quickly as possible. Rather than focus on how many people clicked on your email, focus on how many leads were moved from unknown to known. This shift in priorities shifts the problem-solving focus. Rather than figuring out how to get more people to click on an email (which doesn't directly impact the number of new customers), your team will strategize to reduce time and friction within a particular funnel stage and thus minimize the number of leads lost in that stage. This metric will affect your company's bottom line.

Reviewing lead performance through a defined sales funnel also helps a company maximize the potential of the leads generated. When bookings fail to meet targets, a company doesn't necessarily need to jump to generate even more leads. Instead, there may be bottlenecks and inefficiencies within the funnel that can be identified and then addressed with the help of the funnel structure and tracked metrics. With an efficient and optimized funnel in place, a sales team can then add more leads to the top of the funnel with the expectation that those resources will be fully optimized.

The Impact: Formalizing your company's sales funnel defines the swim lanes for your sales team. By setting definable stages in the funnel, expected conversion rates, and time frames for each stage, your team has created a process and expectations to guide their activity. They also have a keener understanding of how they can impact a lead as it moves through the process. Finally, the sales team can regularly review team and individual performance compared to objectives to see what areas need improvement.

The Goal: To create a sales funnel specific to your company. This will be used to educate and train your sales team, manage your sales pipeline, identify leaks and opportunities in your funnel, and ultimately, optimize your conversion rate.

Golden Section Assist:

Background

A sales funnel has three fundamental stages: Awareness, Consideration and Decision.

1. In the Awareness stage, a buyer becomes aware of a problem and looks for a solution. A lead is only truly a lead if he is aware of his problem and looking for a solution; if he is not, then he won't be motivated to pursue your solution. The Awareness stage also includes the buyer becoming aware of your specific solution.
2. In the Consideration stage, a buyer is considering whether your solution will answer his constraints (effectiveness, workflow, authority, time, money, etc). Discovery, demos, site visits, and proposal delivery are common sales activities during this stage.
3. In the Decision stage, a buyer takes all the information they have previously discovered to make a decision. Contract delivery, review, and negotiations are common sales activities during this stage.

Steps

Answer the following questions to create your Sales Funnel.

1. What are the basic stages of engagement with prospects? Look through your company's sales process to identify your generalized stages.
2. Typically, a company will begin with some form of lead generation, followed by qualification.
3. Proper qualification is very important to maintaining your sales team's efficiency and productivity. A mature company won't compromise their efficiency pursuing leads that are unlikely to close. Time is a limited resource, and it is best spent pursuing leads that have the highest likelihood of close.
4. Given the identified stages of engagement, what general activities define these stages for your company?
5. What are the specific tasks that need to be accomplished during each stage?
6. What is a specific, measurable milestone that flags when a lead is ready to move to the next stage in the funnel?
7. Here it is crucial to select a very concrete milestone indicator. One of the key benefits of a sales funnel is preventing prospects from idling at any one stage too long and growing cold. When it is clear that a lead has moved to the next stage, and therefore needs to be approached with different information and deliverables, then you're much more likely to maintain momentum.
8. How long should it take for a lead to move through each stage in the
9. You can use historical information to judge the time required to progress through a particular stage and tweak it to force process improvement.
10. The benchmarks you create here will help the sales team keep the sales process on target to maintain momentum with individual leads and also to meet forecasted conversion targets.
11. What is the conversion rate from each stage to the next in the
12. Again, historical data can be used to estimate these rates, which then can be adjusted to stretch the sales team.
13. Comparing actual numbers to the conversion rate benchmarks chosen will help identify bottlenecks within the funnel.