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What is a sales funnel and how does it work

What Is a Sales Funnel and How Does It Work | Simple Guide

It doesn’t matter how long you spend browsing Amazon’’s home and kitchen section, you’re not going to find a sales funnel. Sales funnels aren’t going to make you a master mixologist or even a competent chemist. However, running a company without one is a lot like trying to get a drink into a small-mouthed bottle. Without a decent funnel your beverage or your business might just go down the drain.

A sales funnel is like a lot of concepts. You could be using one without knowing exactly what it is. Unfortunately, if you aren’t using it correctly, you and your company won’t achieve its full potential. So what is a sales funnel and how does it work?

All About That Funnel

Simply put, a sales funnel is a strategy that transforms browsers into buyers. The best way to picture it is to imagine an actual, physical funnel. Funnels are tapered. The largest portion is at the top. In a sales funnel, this is where you first meet potential customers. At the very bottom, where a funnel is at its narrowest, are your actual sales.

When you first start running your business very few people know about your product or service. So you work hard to generate buzz. You think about your brand. You post on social media and launch a professionally designed website. Most importantly, you spend serious time considering what the customer really wants. Or, you can think along the lines of Steve Jobs who said, “Our job is to figure out what they’re going to want before they do. I think Henry Ford once said, ‘If I’d asked customers what they wanted, they would’ve told me a faster horse.’ People don’t know what they want until you show it to them.”

A good answer to what is a sales funnel and how does it work, is to imagine you own a brick-and-mortar boutique. Outside most people just pass by –– never entering your store or your sales funnel. A few people windowshop while some actually come in. They might try something on or just wander aimlessly. These potential customers are at the very top of the funnel. They are the ones most likely to answer, “I’m just looking” to pretty much any question you ask.

This is where many novice entrepreneurs make a big mistake. They try to turn the funnel into a tube, hoping to squeeze in the most resistant customers through sheer effort as if potential buyers were so much toothpaste. Trust me, being forced into a tube is no fun. Just ask Veruca Salt from Willie Wonka & the Chocolate Factory! Being on the receiving end of a high-pressure sales pitch can be just as unpleasant.
Light at the End of the Funnel

So how do you get new customers to travel further into the funnel? Gently. The sales funnel can be broken down into four steps: attention, interest, desire, and action. You got their attention with your stylish boutique, branding skills, or website. Now you peak their interest with a free enticement. If you’re a financial advisor, you send them a sample newsletter. A blogger might do a single piece of free or spec content. A clothing store could offer a free tote or a lower-priced tee shirt. This lets the customer get to know you. Further down the funnel you offer something more valuable, like a webinar. This increases their desire, even if you haven’t made a sale. The old cliche about communication being key is really true here. You want to keep those communication channels open. If they signed up for a newsletter, make sure to publish consistently. If they follow your social, offer free tips for others in your field or discounts to buyers.

The final step is conversion. This is where you close the deal. Just as it’s much easier to pour a quart of milk into a gallon container using a funnel, it’s easier getting someone to part with their hard-earned cash when you guide them through a sales funnel. In the end they aren’t just putting their trust in a product or service but in you.

That’s why correctly using the sales funnel not only builds your brand and increases your number of customers but it can also create loyalty. You don’t even need a kitchen.

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