Why You Need to Build a Funnel
Common ground for all salespeople, regardless of the channel they’re in, is that they need to let their boss know what’s going on. I had one boss who asked, “What are you working on?” so often it was like the catchphrase from a TV sitcom.
Those check-ins cover an entire spectrum. There’s the less formal (more common in small companies), where the boss just wants to know what you have coming up while they keep an eye on their cash flow. In larger organizations, it’s more structured. Members of the sales team are expected to give more detailed status reports, detailing the Who, What, When, Where, Why and How of their deal funnel.
Regardless of the size of your sales team, having a structured approach for tending to existing and prospective clients is a key part of creating revenue. Central to that is having a method for tracking those existing and prospective clients and their decision-making process.
That’s where the sales funnel comes in. Why call it a funnel? Because it creates a visual for the process. Prospective deals, both from existing and potential new clients, arrive at the upper top. As they get closer to being actualized, they roll their way around and down the funnel until they reach the spout at the bottom: Closed, signed and ready to be fulfilled.
It’s useful to think of it as a funnel because the sales cycle is not always linear. Some clients take more time to close, and others less. Those deals will orbit around the top of the funnel longer before they start to make their way to the bottom. Conversely, there are those deals that literally drop in your lap; you take a phone call or reply to an email and the deal is signed before you even have a chance to update your notes. Those are great when they happen, but you can’t expect to live like that. Most deals you’re going to have to do some work for.
In the case of large projects, and especially when dealing with institutional clients, there are complex factors at play that can make a prospective project take forever. I have one such prospective project that corporate inertia has held in the same spot for six months. It happens.
The point I’m trying to make is that different prospects will move through the process at different rates. They may or may not move through every phase, or even in the same order. Your funnel begins with qualification. Qualifying your leads is essential to determining their needs, budget, authority and timeline.
It’s important to understand the client’s timeline. That’s why methodically following up is important: The client operates on their timeline, not yours. You need to track the clients whose timeline is longer so that you don’t forget about them — more importantly, they don’t forget about you.
Clients’ acceleration to closing times vary vastly, and this is highlighted in the middle of the funnel. The key to managing this is follow-up and communication. Whether it’s a week, six months or longer, stay on top of your clients.
The goal is to manage your prospects along the way until they reach the point where they’re ready to be closed. Things happen, and when a prospect falls through for reasons you can’t control, still keep track of them. Be sure to reach out periodically to see how they’re doing, as there’s always next time.
The other day I was talking with my colleague about one of our strategic partners. We have a regular call to coordinate our work on areas of responsibility that we share. It was month-end and he was asking for updates on some of the projects we’ve been working on so he could finish his activity report and send it to his boss. That brought up the topic of sales funnels. I have some accounts whose sales team has carefully plotted out sales funnels, and I have others who are, let’s just say, more spontaneous.
If you’ve got a spontaneous approach to tracking prospects and your revenue is growing, well, congratulations. It’s hard to argue with success. That said, implementing a systematic approach means none of your prospects are going to slip through the cracks. If that means more deals and more revenue, then that’s even better.