For small business owners, nothing is more important to their bottom line than making sales. Through the internet, sales no longer rely on in-person interactions.
They can take place anytime, anywhere, even outside business hours. And they’re growing…fast.
Revenue generated from eCommerce stores and online sales is estimated to grow more than 7.8 percent each year. For small businesses, this means that owners need to watch and control their sales pipeline and sales funnels.
Though the two terms sound similar, they’re actually completely different and it’s vital that you understand how each one works to maximize your online sales and growth.
Here’s what you need to know.
The Basics of the Sales Pipeline
The sales pipeline refers to the process of transforming a new lead or prospective customer into someone that purchases your services or products.
Your sales reps use the pipeline to guide their actions to help close deals. Here are the typical steps.
The Qualification Process
During the qualification process, the sales rep identifies leads that could benefit from your products.
Meeting with the Client
Once they determine the client can benefit from your services, the rep then meets with them to discuss the client’s needs in detail.
Drafting a Sales Proposal
After learning about the client’s needs, the rep puts together a list of services that will solve the client or customer’s problems. During this period, they’ll explain the cost of the services as well as how each service can solve the client’s particular problem.
Closing the Deal
Assuming the client approves of the proposal, the sales rep will then be able to close the deal and complete the sales pipeline.
The entire process can be completed by your eCommerce website automatically. The only difference is that the customer drives much of the pipeline process with their actions.
The lead successfully turns into a client. And, hopefully, a repeat one at that. To evaluate performance and see how much money you’re making in the process, you’ll need to run a sales pipeline report.
This report will give you insight into how much your customers are spending during each stage of the process.
If you run an eCommerce store, the pipeline report will also show you where your customers got stuck or abandoned their carts. This will help you adjust your sales strategy.
How the Sales Funnel Differs
Think of the sales funnel as the journey your customers make along the buying process.
At the beginning or top of the funnel, you have the most prospective customers. They’re searching for services similar, if not identical, to yours.
As the funnel narrows and customers move onto the next phase, the number of interested customers decreases. This is because some may back out or discover after further research that your products don’t fit their needs.
The bottom of the sales funnel is where the deals or sales are made. It typically narrows from the middle of the process, but the customers that make it through actually purchase your product.
The funnel gives you insight into the conversion rate or rate of success for all customers currently in each stage of the sales pipeline.
How They Work Together
You can’t have a successful sales pipeline without a sales funnel. The funnel gives you a tool to help solidify your sales process.
If any stage is showing lower-than-projected conversion rates, you can start to look at ways to improve.
It could be as simple as adjusting your presentation to make it seem like your clients are getting an even better deal or coaching an employee to better explain your services.
A Great Website Improves Your Sales Pipeline
Whether you prefer to focus on the sales pipeline or the sales funnel, the easiest way to see success is by focusing on your website.
With the right tools in place, you’ll be able to track performance at each stage of the sales pipeline, take care of customers, and monitor growth with ease. Contact us today to see how we can help you grow your business.