Maintaining a competitive presence in today’s hyper-paced e-commerce environment is almost impossible to achieve without a strategically built and maintained sales funnel.

A sales funnel is the step-by-step road map you create to draw potential customers into becoming long-term, loyal customers. It’s a process that begins when a potential customer becomes aware of your ability to fulfill a need they have. It continues as they “close” the initial deal with you and beyond, as you keep them coming back for more.

Every single point of contact between your business and the customer is a crucial step in your funnel. Each has the potential to earn you a new customer or lose one. The more you understand your customers, the better you can optimize your funnel to retain as many as possible.

Building a sales funnel is not just a technique for capturing new customers either, as you will see here. Your customers (old and new) will always be in some stage of a sales funnel you design for them.

Ultimately, building a successful sales funnel is about understanding your customers’ needs and behavior. Once you get that down, you will be able to grow your reach.

What Is A Sales Funnel & How Does It Function?

The funnel analogy is an easy one to visualize- at the top of the funnel it’s all about awareness. The opening is wide, and your efforts should aim to appeal to a broad, thoughtfully defined audience initially. Often the audience you will reach at this stage is in the information gathering stage of the buyer journey, and if you don’t persuade them to enter your funnel, you will likely lose the opportunity to convert them to a customer.

As we move down towards the middle of the funnel, you’re taking advantage of your audience’s interest in you and attempting to build trust in your products and services. This is the critical stage where you prove what sets you apart from your competition.

As you work down your funnel, you’ll notice it naturally begins to narrow. That happens as less-serious prospects lose interest or motivation to continue and “drop out” of the funnel.

There are plenty of reasons a customer might drop out of a funnel. If a high number of people are dropping out at the same stage, you’ve likely found a “hole” that requires fixing (more on this later).

Regardless, a narrowing funnel is natural and not necessarily cause for alarm. Remember, you’re not trying to sell something to every single person out there. Instead, you are trying to identify the right prospects who need your services now (or in the future) and keep them engaged until they can convert a sale.

As you get to the bottom of your funnel, you are left with your most committed and engaged prospects. They have signaled their intent to make a purchase, simply by sticking with you to this point. At this stage, they are just about ready to commit to a purchase but haven’t locked it in just yet. Here it’s essential to carefully consider any final concerns your customer may have and address those directly.

Once you reach the very bottom of the funnel and make the sale, the funnel begins to reset and repeat itself. Now that you have established a new connection, what would it take to keep that customer coming back again in the future?

The answer to that question depends on your business, your goals, and your customers.

The Four Stages Of A Sales Funnel

At each stage of the funnel, your customers will have to decide whether they want to continue to the next step or not. The more frictionless you make the path from the top of the funnel to the bottom, the more customers you will be able to convert and retain over time.

In every funnel, there are four distinct stages that you will need to identify. At each stage, you are addressing/ assessing someone’s level of interest and taking strategic action.

Stage 1: AWARENESS

This is the very top of the funnel and the stage at which you want to cast a wide net to a select audience. Tools such as targeted ads and keyword-optimized webpages & products are invaluable for getting your business seen by the right prospects or showing up in their google search efforts. You want to capture as many relevant eyeballs as possible here. 

One of the most powerful tools we’ve found in practice is writing highly optimized content to answer common questions related prospects would be typing into Google during the information gathering stage – we then use a carefully selected lead magnet to get them to trade their email address, in exchange for a valuable guide, coupon, etc. for the product / service they are interested in.

In addition to gathering their e-mail information, you now have the ability to re-market ads to them, based on their interest you learned of through their click behavior if your site is set up with pixels for re-marketing. 

Stage 2: INTEREST

Here, a customer considers you among the options for solutions to their needs. They’re possibly considering other options as well, but you have gotten their attention. Now you have an opportunity to make an impact. Strong product/ service descriptions, customer testimonials, or informative blogs/ videos are the ticket to the kingdom here.

This stage is really about building confidence in your offerings. It’s a chance to show why you are the best option for this customer to choose from.

This is why gathering an email is so important. You can control the interaction, and test what moves customers along the funnel. We’ve found clients who had funnels often led-off with a coupon code early in the funnel. However, it’s more beneficial to offer genuine customer testimonials early-on and more information to keep building on the journey. The coupon code has a use, but it should be further along the journey – otherwise, it can turn customers off. This is especially true the larger the investment is.

Stage 3: DECISION

By this point, the customer is likely ready to make a decision. If they’ve stuck with you thus far, your odds are good, but the deal is not yet done. This is where you want to start dazzling them with offers and incentives, if possible.

You also need to remove any final roadblocks that may be preventing a customer from making a sale. High shipping costs, slow delivery schedules, or vague return/ exchange policies are often the culprit if you notice many customers dropping out at this stage. We always do A/B tests to experiment with changes to see what results in higher conversion rates.

Stage 4: ACTION

At the very bottom of the funnel, you have addressed all of a customer’s concerns and successfully made a sale. Congratulations, but you’re not done yet! Now that you have established an initial connection with your customer, it’s time to follow through and continue the cycle.

Setting automated order follow-up emails allows you to provide support, capture new reviews, and provides a personal touch. Encouraging/ Incentivizing them to sign up for email and rewards programs ensures they stay on your radar and have a reason to come back.

 How To Build A Successful Sales Funnel

Building a successful sales funnel results from understanding who your audience is and what motivates them.

1. Look at the Data:

You’re probably already sitting on a wealth of usable data. Whether you’re looking at website analytics, email open/click rate or social media engagements, the numbers you need are there – and they tell an important story. What are your most popular pages/ products? Most popular links-clicked? What are people searching for on your site, and where does that take them? How long are they spending on each page, and when do they leave your site?

While seemingly minute, these metrics paint a detailed picture of the customer experience you have provided. It’s also crucial to identify any “holes” in your funnel and patch them right away. For instance, are there any pages where a high number of visitors are leaving your site? If so, why?

For example, if many people are dropping out early in the funnel, you might consider that they are being incorrectly directed to your business. They’re looking for something that’s being confused with a different thing that you offer. This could also be a sign that the user experience needs improvement and clarity. This would be a glaring hole in STAGE 1 of your funnel that needs to be addressed right away.

2. Landing Pages & Site Navigation:

Odds are that your traffic is coming to you from multiple sources. Understanding the path your customers have taken to find you is key to knowing what they’re looking for in the first place. Creating specific landing pages that directly address these pathways helps short-cut their search to finding a solution. The more direct & straightforward you can make the pathway from first-impression to sale, the more likely you will be to capture that sale.

3. Keep In Touch:

As we’ve mentioned a few times at this point, the sales funnel doesn’t end with a transaction. The overall goal is to build a network of relationships with your customers. To understand who they are as a whole and as unique groups within that whole. Once you have established this relationship, you have the access and ability to keep it going.

The more you encourage your customers to stay involved, make referrals, post reviews, and get rewarded, the more you can grow the return on your investment made in these customers.

What Does It All Mean?

There are many paths that one can take along the road to building a bustling online presence. When deciding which is best for you, it’s helpful to consider how you would design your customer experience in a physical, brick-and-mortar environment. It’s essential to provide a unique and memorable experience- yes. But it is arguably more important to make sure your customers feel comfortable and encouraged to engage as they interact with you. By carefully analyzing your data and customer behavior, you have the massive opportunity to build a sales funnel that expertly caters to these requirements. And once they’re in your funnel…well, the rest is up to you!