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The sales funnel isn’t dead but it’s incomplete (and here’s why)

Blog post by on April 3, 2013 Editor's Pick 1 Comment

It’s become trendy to say that the traditional sales funnel analogy/concept/model no longer applies. That it’s a relic from a long-gone age. That it isn’t a realistic way to think about or manage your sales process.

The sales funnel model isn’t perfect, but it never has been. A good funnel (in real life) is efficient, but a sales funnel leaks. It always has. Just because a deal doesn’t close today (or this month or quarter) doesn’t mean it’s dead forever.

I’ve heard the sales process described as a cloud, an amoeba, and a bowtie.

But if you’re trying to find the perfect analogy, you’re missing the point. The sales funnel, as a concept, is still highly relevant for 80%+ of organizations that need a way to separate suspects from prospects, leads from opportunities, qualified-but-not-ready-to-buy prospects from those that will close this month.

For organizations that have no sales process, or have a chaotic or messy or inconsistent sales organization, the funnel is still perfectly acceptable.

But it’s incomplete. So if you still use the funnel, keep this in mind:

The funnel isn’t linear or one-directional
Prospects don’t start at the top and go to the bottom. They start wherever they want to, and oftentimes go back up before they make their way back down. Qualified opportunities go dark and become leads again. Organizations that were close to buying go through a reorg, and you start from scratch. It’s not pretty, clean or linear. That’s just reality, but you can create processes, follow-up strategies and more with that chaos and multi-directional nature in mind.

Prospects don’t always start at the top
Referrals in particular might come in and start immediately as short-term opportunities. And how do you handle repeat purchases and upsells? Not a clean funnel process, but that doesn’t really matter.

“Unconverted” leads don’t go away
This might be my biggest problem with the funnel as a concept. Let’s say you assume five percent of leads become opportunities. That doesn’t mean that 95 percent of leads will never buy. It just means they aren’t going to buy now. Unfortunately, still today, most sales organizations work in a very binary process. Are you going to buy or aren’t you? Because if you aren’t, you’re dead to me. That, ironically, is a “true” funnel analogy, but it’s a pretty dumb way to ignore guaranteed future transactions.

The bottom of the “funnel” is really the beginning, not the end
It’s never been a funnel. It’s always been more of a bowtie, and that’s especially true with recurring-revenue business models. Get the deal closed, and you still haven’t realized anywhere close to the lifetime value you’re expecting or hoping for. The sale may be at the bottom of the sales funnel, but it’s the middle of the sales bowtie, and the second half of that bowtie is the most important part. Onboarding, early customer success, retention and loyalty, extending lifetime value, upsell and cross-sell, referrals. All critical components of maximizing the true potential of what started as a first sale.

Republished with author's permission from original post.

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One Response to The sales funnel isn’t dead but it’s incomplete (and here’s why)

  1. Failly April 5, 2013 at 8:45 am #

    In order to complete your relevant vision (non linearity, …) and to go beyond (integrate the compexity in the consumer of decision maker “journey”) I suggest you some metaphorical variation around conversion funnel :

    7 metaphorical variations about customer conversion funnel
    http://fr.slideshare.net/dfailly/7-metaphorical-variation-about-customer-conversion-funnel

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