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The Difference Between a Sales Funnel and a Sales Pipeline

To most people Sales Funnel and Sales Pipeline are two sides of the same coin. Both refer to a strategy for turning prospects into customers.

Personally I like to think there’s a difference between a Funnel sales strategy and a Pipeline sales strategy. The choice of whichever is appropriate depends upon both “sales model” – how it works in your business -and “sales philosophy” – how the individual sales guy likes to work.

Sales Funnels

Sales Funnel people are the ones playing the numbers game. For example in my first computer industry job I was told for every 100 phone calls I should expect to get 10 demonstrations and for every 10 demonstrations I would get one sale. It was simple – the more calls, the more sales. So the funnel goes from 100, to 10, to 1. Sales Funnels are typically based on activity rates – do more things and hope some of them work. Nice thought, but it’s never worked for me.

Sales Pipeline

Sales Pipeline people are the ones playing the process game. They have a fixed process through which prospects turn into customers. For example as a sales manager I implemented a Qualify, Propose, Negotiate, Close process. Sales Pipelines are based on doing the right thing at the right time, because that’s been proven to work. And I’m a Pipeline guy.

Funnel to Pipeline

Another way to look at the difference is a strategy where the Sales Funnel feeds the Sales Pipeline. This is the most sophisticated model and probably the best for high value B2B sales. In this model the Sales Funnel will contain Territory, Targets and Suspects. Once the Suspect becomes a prospect he/she moves from Funnel to Pipeline.

In FOB3 we can accommodate all three strategies. For the Funnel we can use Tags to classify companies in groups, record dates and details of last contact, set actions for next action. For the Pipeline we have Sales Pipeline Management with process, sales plan, milestones and actions.

Put the two together and we have our Sales Funnel with a seamless transition into Sales Pipeline.

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Join The Conversation

  • Oct 18 Posted 7 years ago kentbond

    Hi Steve,

    Thanks for making the distinction between “Sales Funnels and Sales Pipelines”. From my experience, most CRM Software packages, when reporting on sales pipelines, generate a graphic of a sales funnel. Nice J

    Moving on; building a sound sales funnel or sales pipeline, in both cases, a feature rich CRM Software package makes this much easier.

    We have put together a website of top web based CRM software packages for review. This is a great place for your readers to test the differences between a sales funnel and a sales pipeline.

    Thanks,

    Kent Bond

    www.crmsoftwarefreetrial.com

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