The Sales Funnel concept has been around for a few years but I took it and tailored it to meet the needs of my own teams very effectively. Essentially, it is designed to assist salespeople in managing their sales time more effectively, subsequently translating that time into real money.
It is also a time-management tool, which will help them to accomplish the following essential selling tasks:
- Collating their numerous sales objectives into three categories or levels of the Sales Funnel.
- Monitoring each sales objectives progress as it moves from one level into the next.
- Setting priorities for working on the objectives in each level of the Funnel to ensure they do not neglect any one of the three.
- Dedicating time to the objectives in each level of the Funnel in a way that is appropriate to their specific situation.
- Forecasting future income, based on how their objectives are moving through the three levels of the Funnel.
Sales Funnel is conceptually divided into three distinct parts, or levels, which correspond to the three different types of selling work.
To enable salespeople to utilise the Funnel concept efficiently they must first sort their sales objectives into these three levels:
Above the Funnel - Prospect & qualify.
In The Funnel - Cover the bases.
Best Few - Close the order.
Above the Funnel:
The pre-requisite is that they have data that suggests a fit between their products & the prospects needs, all of this type of work requires qualifying.
In The Funnel:
The pre-requisite here is that all the opportunities have been qualified and at least one buying influencer has been met. They then need to "cover the bases" i.e. identify all the buying influencers and ensure each one is contacted by the person best qualified to do so.
It is important that the salesperson understands the response mode of each buyer, identifies the results each buyer needs in order "to win" and ensures they understand that the proposal will serve his/her individual criteria.
Finally, at this stage of the cycle, they need to continually reassess the sales picture and eliminate areas of perceived weakness within their bid using the principle of capitalising on their strengths.
Logically, the pre-requisite here is that they have all but eliminated luck & uncertainty as factors in the final buying decision. -this can of course be subjective!
The tasks involved are end-tasks, like overcoming last minute objections, agreeing terms and conditions and signing orders etc.
As sales professionals they must be able to do all three kinds of work, but obviously they will have several possible orders that they are working on at the same time. Since they will all be at different stages of completion, they will not be doing the same kind of work on all of them at the same time.
By following this system they could potentially reduce the normal sales cycle by 50%!
Using Sales Funnel over time, helps to plan time required ahead of time.The eventual objective in utilising the Sales Funnel concept is to be able to move the various sales opportunities down the Funnel at a steady and predictable rate. This in turn will mean that income and achievement level is steady and predictable.
To achieve this, there is a need to work on two interrelated tasks:
- Setting appropriate priorities for the three kinds of selling work which need to be done.
- Allocating limited selling time so that the three kinds of work always get completed on a consistent basis.
The simple rule of thumb is: "Every Time You Close Something; Prospect or Qualify Something Else"
Finally, Let Us Not Forget Good Old Villfredo Pareto And His 80/20 Rule:
The sales that a salesperson completes today were made possible only by activities performed in the past. Equally, it's what they do today that will create their future sales results. Because there is a time delay between activities and results, salespeople have an opportunity to improve their sales results by undertaking sales productivity planning and implementing an effective prospecting system.
Generally, since 80% of sales are generated from 20% of customers, 80% of salespeople's time should be focused on 20% of their most important customers/prospects.
The Sales 2.0 Confrerence has just wound up in San Fransisco and I am wading through a mountain of information that is coming back - two interesting facts, that will affect how we develop our Sales Funnel:
Companies are losing 10% of their sales due to lack of insight into their sales activity and their target market. ~ Gartner Group
Sales cycles are 20 - 30 % longer. ~CSO Insights
Both Jill Konrath and Nigel Edelshain have been there this week, and I will pass on their thoughts next week.
Tomorrow: Some downtime at last! I am off to Cambridge to meet with No 1 son, and catch up with all his news - and he with mine.
As ever, have a great weekend yourself, and be sure to join me on Monday - JF
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