Sales funnels, click funnels, ad funnels, inbound marketing funnels…
What is this stuff and why do you need it?
The answer can be quite confusing, because people use the word “funnel” in too many ways.
Some people use the word “funnel” to refer to their website, or a set of landing pages.
Some people use the word “funnel” to describe their strategy to increase email opt-ins.
And others, don’t use the word “funnel” at all, because they don’t have one.
Regardless of where you currently sit, the marketing industry has complicated the use of the term “funnel” and that is why we’re creating this post to simplify sales funnels for beginners.
Today, we’re going to fully explain:
- What sales funnels are
- Show you a sales funnel that converted us
- Go over the elements of a sales funnel
- Types of sales funnel
…and everything you need to know to begin creating your sales funnel.
As a business owner, we can tell you – if you do not get your sales funnel down to a science, you risk the potential growth of your business.
At our agency, we talk to business owners every single day. And, in most cases, the people we talk are interested in one thing and one thing only – sales.
Interestingly enough, most of the people we talk to do not have sales funnels.
In other words, they do not have a clearly defined process to increase sales in their business.
A lot of people we talk to owe their business success to things like “word of mouth” and “referrals”.
Hearing this makes us happy and scared for the people we talk to.
We’re happy because if your business is growing through word of mouth and referrals, we know you have a great product that people truly enjoy.
If you have people advocating for your product, then it clearly means your business has proof of concept and is a viable business.
On the other hand, we’re incredible fearful for people who rely solely on this to grow.
Because without a sales funnel, you are essentially operating your business without a predictable engine to generate sales in your business.
You just don’t know what’s in store for you tomorrow – if you will have customers or not. Or whether or not you will have work for your employees.
This presents a significant business risk.
Without a sales funnel in place, selling becomes very challenging and tends to be “lucky” at best.
So let’s mitigate this risk by breaking down sales funnels to its core and giving you the essentials you need to get started.
What are Sales Funnels?
A sales funnel is simply the journey a customer takes in order to purchase your products or services.
The simplest way to understand sales funnels is to look at a funnel. No, not a sales funnel.
Like an actual, physical funnel.
A funnel is traditionally use to channel liquid-like substances into a small opening.
It is very wide at the top, and narrow at the bottom.
Now, if we add sales to the front of the word “funnel”, then this process refers to channel consumers into buying customers.
Just replace “liquid-like substances” with people, with the end goal being them pulling out their credit card and buying from you.
The higher people are in your funnel, the less-likely they are to buy from you.
These are normally people who are aware of your business or simply interested in the topic your business is engaging in.
The lower people are in your funnel, the more-likely they are to buy from you. These are people who are specifically interested in buying your product or service.
Now, fundamentally, a funnel is very wide at the top, and narrow at the bottom. This is true regardless of if your selling a product, or baking a cake.
This is funnel feature is important for you to know, because what this really means for sales funnels is that only a small percentage of people who enter your funnel will actually buy from you.
We repeat – only a small percentage of people who enter your funnel will actually buy your products or services.
This is why sales funnels, or any funnel for that matter, is wide at the top and narrow at the bottom.
Therefore, in order to increase your sales, not only do you need to have a sales funnel, but you need to have enough volume of people in your sales funnel in order to crank-out sales.
The more people you have inside of your sales funnel, the more likely you are to convert new customers.
Many of the people we talk to that are not seeing sales either:
A) do not have a strong sales funnel to begin with, or
B) do not have enough people in their sales funnel to convert customers
So now that you know what sales funnels are, let us show you a sales funnel that converted us.
Sales Funnel That Converted Us
So a few years ago, a sister company to LYFE Marketing, called LYFE Accounting – a full-service accounting firm for small businesses, was established
Ironically, as we were getting started, we ran into several Facebook ad by a man named Andrew Argue.
In his ads, he talked about how to offer the valuable accounting services.
So, we clicked the ad, and we arrived to his landing page.
Now, as you can see in the landing page, there is no menu and it appears to be a standalone page.
There is only one call-to-action, which is to sign-up for his free training.
He does this because we assume he does not want our attention to get diverted to something else which may result in the failure of moving us down his funnel.
Obviously, we see what’s going on but do not care – because we truly only want the value he was exclaiming in his Facebook ad.
So we enter our information into his form. And it immediately redirect us to the free training.
As you can see, the free training is “Step 1 of 3” in his process of converting us into a customer.
In other words, he assumes that people who watch his full training will be more likely to want his programs.
Step 2 of his funnel is for us to enter in our information to “apply” for his program.
Obviously, using words like “apply” implies that there is some level of scarcity in the program, which is a great tactic to motivate people to move further down his funnel.
And finally, step 3 of his funnel was for us to schedule an appointment. As soon as we completed the form, we were redirected to schedule a call.
Now, he can put his best sales rep on the phone to close us.
On that phone call, he told us that his programs start at about $5000 and up.
And at that time, we’re thinking okay – a little bit more than we’re expecting to spend.
So we tell them thank you, and decide to hold at that time.
But of course – he didn’t stop there.
At this point, he knows we’re at the bottom of his funnel.
And ever since that appointment, we’ve received hundreds, if not thousands of valuable emails and countless retargeting ads to motivate us to purchase.
And after 2 years of endless emails, phone calls, social media interactions, we eventually bought 2 educational programs, which was extremely valuable.
As you can see, a well-thought sales funnel works.
And when you can automate it in this manner, you essentially develop a predictable sales engine that can grow your business.
So now that you know what sales funnels are, let’s talk about the steps inside of sales funnel.
Steps Inside of Sales Funnel
There are a few basic steps inside of any sales funnel.
Let’s dive into each of these steps.
People must first be aware of your business to ever consider your business at any point of their life.
If they aren’t aware of your business, you’re in trouble.
You can increase your awareness through digital marketing activities like SEO, content marketing, digital advertising, and so on.
In the example we provided, Andrew uses Facebook ads to increase awareness.
Secondly, people must engage with your business. Engagement is necessary in order to establish a true connection with the people who are now aware of your business.
Engagement builds trust, credibility, and positive emotional triggers that influence people to buy from your business.
You can increase your engagement through adding value to your audience.
This is most commonly done through content creation like videos, blogs, or anything that helps your audience. This value exchange moves them closer down your funnel.
In the example we provided, Andrew uses video and webinars to engage people.
You can sell to people who are deeply engaged with your business, and chances are, you will have a better chance at converting this group of people than complete strangers.
This is why this funnel works so well in the first place. Engaged users have higher conversion rates than unaware, unengaged audiences.
You can convert your engaged audiences through email marketing, retargeting ads, and through your website.
In the example we provided, Andrew heavily used email marketing and retargeting ads.
And lastly, you have advocacy.
This is when your products and services delight your customers and they become advocates of your brand – spreading more word of mouth and awareness of your business.
In addition, they will be more likely to convert on upsell opportunities that exist in your company.
The simple fact that we are referencing Andrew, without any ties to his business, shows you that advocacy works.
Now, there are different types of sales funnels. So let’s discuss this.
Different Types of Sales Funnels
The steps above are consistent for any sales funnel, but the quantities and methods you use within your business will depend on your unique business.
For example, Andrew has probably sent us over 500 emails inside of his sales funnel.
Does this mean your business needs 500 emails inside of your funnel? Probably not.
The funnel methods you deploy will depend on your: business type, price of your products, and sales cycle.
Let’s start with business types.
A. Business Types
There are many business types, but to keep this post simple, we’d categorize the type of sales funnels into the following:
- eCommerce product sales funnel
- service sales funnel
- brick & mortar sales funnel
For example, here is an example of an eCommerce sales funnel used by Boom by Cindy Joseph that resulted in over $40,000.00 in sales.
For context, they sell beauty products. They used Facebook and Pinterest ads to create awareness and drove traffic to a blog post.
The blog post engaged them by providing beauty tips. And the post eventually linked to their store and product pages.
Now because their products are relatively inexpensive, they can move people down their funnel without requiring email opt-ins to view valuable content and without sending 500 emails.
However, this does not mean email is not needed.
Email is still very effective, and they still try to encourage people to join their email list through discounts and other tactics.
Though, we doubt that they send emails in the same frequency or manner as the Andrew example.
Ultimately, the type of business you have will influence how you customize the specific steps to move people down your funnel.
Now let’s talk about pricing.
When it comes to pricing, typically the more inexpensive your products are, the less steps you need to motivate people to buy.
As a rule a thumb, the higher your product or service cost, the more value you are going to have to create to motivate people to buy from you.
Value can come in high quality or quantity, but ultimately, it is up to you to determine the appropriate ways to create value to motivate purchases.
In addition, your sales cycle and the time it takes people to buy is also very important.
If it takes a long time for people to buy your product, then you will need to add that time lapse into your sales funnel and plan to communicate with your leads during that time period.
For example, we have a client we work with that sells trucks to landscape contractors.
He has trucks that costs tens of thousands of dollars, and as a result he knows that it is going to take a ton of time to convert any leads he receives.
So over the last few years, we’ve ran Google ads, social ads, and other organic digital marketing to increase the leads.
Once he receives a lead, his team speaks to them, but they already know the deal won’t close on the first call.
So he continues to sending several emails over the years to stay in front of them. And the best part is, all of it is automated!
Anyway, when you craft your sales funnel, start with thinking about your customers journey.
Think about what makes them interested in your products.
And what obstacles deter them from buying from you, as well as the time it takes to overcome those buying resistances.
When you craft your sales funnel with this in mind, you increase your odds of success.
In our opinion, it’s more psychology than anything. You need to understand what is really going on in your customers’ mind at every stage in your funnel.
When understood, and implemented successfully, you will have a predictable system to increase your sales.
What You Need to Build Your Sales Funnel
Now, let us give you what you need in order to start building your sales funnel.
1. Mapping it out
We personally like to use a free website called Funnellytics. This helps us map out every single step in our sales funnel.
You can also use good, old-fashioned pen and paper.
2. Create landing pages
There are a ton of tools out there, but the most common are LeadPages, ClickFunnels, and Kartra.
At this present time, we use LeadPages for most of our clients.
3. Create content
This includes content on your blog, landing pages, and email drip campaigns. This is the hardest part, but the most important.
Without great content, you will be unsuccessful at moving people down your funnel.
4, Generate traffic
Use SEO, social media, email marketing, and digital advertising to get in front of people.
As we’ve said earlier, most people fail at increasing their sales simply because they do not have enough people in their sales funnel.
Build a healthy amount of people in your pipeline and tweak your sales funnel as time goes on.
Now that you know what to do, let’s summarize this post so you can get to work!
Today, we defined “What is a sales funnel”?
A sales funnel is simply the journey a customer takes in order to purchase your products or services.
We then went on to define the steps that EVERY sales funnel should take.
Every sales funnel must have a process to make people aware, interested and engaged, and convert people into sales.
If you fail at any of these items, your sales funnel will not work.
Then, we discussed how to customize your sales funnel
Your sales funnel should ultimately be customized by your customer needs, business type, price point, and sales cycle.
And finally, why is a sales funnel important?
Your sales funnel is important because without it, you do not have a predictable way to grow and scale your business.
That’s it for today folks!
And if you need more assistance, ask our digital advertising specialists how we can help your business reach more qualified leads, generate new customers, and produce sales through your digital marketing sales funnel.