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<Img 
img="/uploads/Blog_b0169471f4.png"
alt="Sales funnel"
/>

Customers do not always buy as soon as they find a product on a company's website or elsewhere. When it comes to complex and expensive products, consumers take the time to compare and study. For this reason, companies try not to be intrusive and help users go through all stages of decision making step by step.

It is a sales funnel that is used to make the process transparent and simplify analytics. A sales funnel is a concept that describes all the steps a customer takes on the way to a conversion. There are several funnel models: the classic five-step buying scheme, the AIDA model, the SPIN method, and others. The company chooses a model and adapts it to its needs or creates its own version.

In this post, we will explain what a sales funnel is, why use this concept and how to develop it.

## What is a sales funnel and why use it

A **sales funnel**, also known as a **marketing funnel**, is the journey a customer takes from first contact with a business to making a purchase. The model is usually visualized as an upside-down cone and represents all the stages of sales that the client goes through. The top part gets the most [**leads**](MQL-and-SQL). But not everyone gets to the end where the purchase takes place, so the cone narrows to the bottom.

### Why does your business need a sales funnel

- **Highlight weak spots.** When all steps are written and all stages of the sales funnel are tracked, it is easy to analyze and understand where there is a problem in sales.
- **Supervise the work of sales reps and marketers.** The funnel includes marketing tools and sales activities, so it is easy to track the effectiveness of each participant in the process.

*For example, your advertising campaign results in 100 applications per week, but only 5-10 people buy. The analysis shows that the applications are targeted, and most of all clients are “turned back” after talking with the manager. You look into the situation and find that sales reps are not interested in dealing with the client and do not know how to handle objections about the high price. If the company did not have a sales funnel, it would be more difficult to find the reason.*

- **Create controlled sales.** If you know at what stage of decision-making the lead is now, you can make an offer that will satisfy their needs. This approach will speed up the purchase.
- **Analyze sales performance.** You can calculate your sales funnel conversion using the formula. Divide the number of converted customers by the total number of users, and then multiply the result by 100%.

<Img
img="/uploads/sales_funnel_conversion_formula_db6b695bd1.png"
alt="Sales funnel conversion"
/>

In other words, this is the difference between the number of leads at the top and the bottom. The more potential customers reach the purchase, the better the funnel works.

## Sales funnel stages

The classic sales funnel is the AIDA model, which consists of four stages.

<Table>
| **Stage** | **Description** | 
| ------ | ------ |
| **Attention** | The lead contacts the brand for the first time through advertising or direct search on the Internet. |
| **Interest** | The lead is interested in the product, for example, they subscribe to the newsletter, click on the links or ask questions. |
| **Desire** | The lead understood that he needs the product, and now they are looking for options for a profitable offer, such as discounts, free shipping, etc. |
| **Action** | The lead places an order. |
</Table>

<Img
img="/uploads/classic_sales_funnel_8977a756a3.png"
alt="Classic sales funnel"
/>

The other type is the marketing funnel, which repeats the five stages of sales.

<Table>
| **Stage** | **Description** | 
| ------ | ------ |
| **Approaching the customer** | The first contact between a sales rep and a potential client or automatic first message. It is important to make the right impression and motivate a person to continue communication. |
| **Discovering customer needs** | The sales rep asks the client questions about their needs. Then the manager draws a conclusion and offers a suitable solution. |
| **Pitching** | Present your solution. Based on the discovered needs of the client, talk about the features of the product and its benefits. The sales rep presents only those features that are important to the client. |
| **Handling objections** | The sales rep answers the buyer's questions and works out objections. For example, doubts about the cost or quality of the product. |
| **Closing the deal** | The customer is ready to buy and is interested in payment methods or installments. The task of the sales rep is to switch the client to the completion of the purchase: pay, order delivery, and so on. |
</Table>

In brick-and-mortar retail stores, all five steps are done in a conversation here and now. However, if your company operates in the digital space, the online sales funnel consisting of such stages is not always fast. Sometimes the process includes phone calls, messaging, and sending files.

Another option is the SPIN method. Its author, Neil Rackham, said that classic five-step sales models are not effective for large and complex deals, such as B2B. According to SPIN, at each stage managers work with different types of questions that identify the customer's problem, clarify and lead to a purchase.

<Table>
| **Stage** | **Description** | 
| ------ | ------ |
| **Situation** | Open-ended questions to clarify the situation in which the customer is now.  |
| **Problem** | Questions to identify problems and hidden needs. |
| **Implication** | Questions that demonstrate the possible negative effect if the problem will not be solved. |
| **Need-payoff** | A type of “what if” question that guides the customer into the future; questions like these show how a customer's life would change if they fixed a problem with your product. |
</Table>

Each company chooses the model that best suits its needs, and transforms the stages, adjusting them to the business processes.

## How to build a sales funnel

There are no universal methods, so brands not only adapt existing marketing funnel models for themselves, but also develop their own. Some models also include after-sales service, upselling and cross-selling.

Let's create a custom sales funnel in six steps:

### 1. Collect data

Collect information about the audience that should be included in the list of leads. Determine the channels through which customers come. Find out how customers behave on different resources, as well as what their needs and objections are. Next, plan a funnel for a specific audience, and not for all customers at once. Choose one of the existing models, exclude the steps that are not important for your company and add the missing ones.

### 2. Define a goal for the funnel

Specify what conversion rate you would like to receive from the funnel and also rates for intermediate stages. The model is divided into top, middle and bottom. Specify how many users are expected to reach each stage.

### 3. Think through the steps of the funnel

Define actions at each funnel step. For example, at the beginning it may be the launch of an advertising campaign. The middle is a call from the sales rep or an email reminder of the purchase. At the end, you can offer free shipping or bonuses.

### 4. Create content for each step

For automatic funnels, the content can be email templates. If sales reps lead customers through the funnel, prepare scripts, materials that they will send to customers for a detailed acquaintance with the product.

### 5. Set up a sales funnel

Marketing funnel can work:

- manually through the sales staff;
- semi-automatically — email marketing services, phone services and other automation platforms are responsible for some of the stages;
- automatically — a marketer only controls and optimizes.

You will have to use [**special services**](/features/analytics) to set up semi-automated and automated sales funnels. In the future, this will save time for your employees and speed up communication with the client.

### 6. Run the funnel, analyze and optimize

Once the funnel is up and running, it is important to monitor and improve it. Regularly measure performance at each stage and quickly respond to changes. Only in this way the model will bring the expected income. To optimize your funnel, you need to get feedback from users on the sales process and analyze the stages of the funnel.

## Sales funnel example

The user visits your site, adds the item to the cart and immediately checks out. This is an example of a simple funnel, but this rarely happens. Often the path to purchase is longer and more difficult. Here is an example of such a funnel.

The user:

1. Gets to the company's website through contextual advertising. 
2. Views a product, for example, an autumn jacket. 
3. Subscribes to an email newsletter that informs about promotions and brand news. 
4. Receives an email with an offer for the autumn collection. 
5. Follows the link and adds the item to the cart, but does not check out. 
6. The company sends a reminder email about the product in the cart and the user buys.

## How to automate your sales funnel using Altcraft Platform

The platform supports [**omnichannel marketing**](omnichannel-vs-multichannel), so it collects information about different stages of the sales funnel in a single profile. Let's take a look at how to automate the customer journey from the example above.

1. You set up and run contextual advertising through Google Ads.
2. Jane visits your site and leaves her email. Her contact details are included in the Altcraft Platform database. The subscription to the resource is added.
3. The platform launches an automatic series of welcome emails.
4. Jane receives an email with a promotional code. She reacts and adds the item to the cart, but does not check out.
5. Altcraft Platform starts an [**abandoned cart**](how-to-reduce-cart-abandonment-rate) email scenario.
6. Jane becomes interested and buys. The funnel ends.

The entire process of moving a user through the sales funnel is automated through workflows and other Altcraft Platform tools. Sending messages through different channels — Email, SMS, Push, WhatsApp or Telegram — can expand the possibilities of your business and make the customer journey completely clear and controlled.

<Img
img="/uploads/abandoned_cart_scenario_607a42d15b.png"
alt="Abandoned cart scenario"
src="Abandoned cart scenario"
/>

The Funnel report is used to track the process performance. The report displays metrics for all actions within the strategy. It is possible to visualize all the steps of the sales funnel: the number of customers and the percentage of conversion.

<Img
img="/uploads/sales_funnel_in_altcraft_platform_d15cdd4757.png"
alt="Conversion funnel in Altcraft Platform"
src="Conversion funnel in Altcraft Platform"
/>

## Conclusion

A sales funnel is a model of a customer's journey from the first meeting with a brand to purchase. Using this approach, you will make sales transparent and controlled. The company begins to control each stage of the transaction, monitor the work of the sales department and find weak spots.

Building a sales funnel is possible using the AIDA, SPIN models, five classic sales steps and others. There is no universal solution, so companies also create their own models. To do this, you need to collect customer data, define goals, make a plan for each stage, prepare content, set up a funnel, and continue to optimize after launch.

This post explains what a sales funnel is, why use the concept, what funnel models exist, and how to build your own marketing funnel.

Блог.png

A sales funnel is a concept that describes all the steps a customer takes on the way to a conversion.

Why Businesses Use a Sales Funnel and How to Build It

Sales Funnel: Definition, Models and Stages

<Img
img="/uploads/conversion_funnel_1f41a22aa2.jpg"
alt="Conversion Funnel: Stages and Optimization"
/> 

Conversion funnel analysis isn’t the most discussed digital marketing topic. But it may be one of the most important.

Funnel analysis helps you ensure that you are successfully moving prospects, leads, and customers forward as their relationship with your brand deepens. Each category of contact has its own conversion actions, such as subscribing to your email marketing list. These different actions are all considered within your digital marketing conversion funnel.

Your funnel conversion rate – also known as the sales funnel conversion rate or digital marketing conversion rate – is one of the most important metrics you can track and improve over time. It tells you how much raw traffic from each audience segment is taking the next steps necessary to ultimately become a customer.

But no simple conversion funnel template is enough on its own to understand how it all comes together.

With every small tweak in conversion funnel optimization, you make more money from your existing traffic. Once your digital properties are established, funnel optimization is often the activity that will get you the most bang for your buck. Let’s take a closer look at funnels, funnel metrics, and how to optimize conversion funnels.

## What Is a Conversion Funnel?

Funnels function to organize and conceptualize your goals for each stage of the [**buyer journey**](stroim-customer-journey-map), moving your new traffic from the prospect stage to the lead stage and finally the customer stage. 

A standard digital marketing funnel comes in three stages. At each stage, the contact needs more sophisticated content to take the next step. With that in mind, a large amount of traffic may enter the funnel, but only a small amount will reach the bottom, where the conversion from lead to customer takes place.

## The Stages of a Conversion Funnel

A standard digital marketing conversion funnel has three stages:

<Img
img="/uploads/example_ceadbbe5c2.jpg"
alt="Conversion funnel example"
/> 

### Top of the Funnel (ToFu)

All the traffic received by your website and your digital properties begins at the top of your conversion funnel.

At the top of the funnel, most visitors have just identified a problem. They need further information so they can understand the issue they’re facing. They have no idea what solutions may be relevant to their situation or the remedial steps they might need to take.

To serve prospects at the top of the funnel, you want to be sure you have plenty of “evergreen” content. This is general content that introduces subjects pertinent to most of your first-time visitors. Buyers use it to gain basic knowledge about the problem they have encountered and why it might be happening.

ToFu content has an important role to play in ensuring you are highly visible for search queries relevant to your business. The conversion goal of ToFu content is usually to get those early visitors to subscribe to your [**email marketing list**](how-to-build-an-email-database). This conversion is achieved by offering a high-quality piece of content, a lead magnet.

### Middle of the Funnel (MoFu)

In the middle of the funnel, the prospect has developed into an unqualified lead.

Joining your email marketing list is a way for prospects to raise their hand and indicate they have real interest in your content. However, you don’t yet know enough about them to be sure that they will be the right customer for your business.

Where ToFu content serves a general educational purpose, MoFu content is much more specific. Its aim is to help the newly minted lead develop buying criteria around the solution that will put an end to their problem. It does not propose a specific solution, but instead provides guidance on what all good solutions must include.

### Bottom of the Funnel (BoFu)

By the time they reach the bottom of the funnel, a lead should be well qualified. The right leads are [**almost ready**](communication-building) to be passed off from marketing to sales. Much of the buyer journey is over, and the lead is looking at a small handful of potential solutions – if you’ve done everything right so far, then yours is positioned to succeed.

BoFu content includes things like videos and product demonstrations. This content answers leads’ questions about whether your solution will work well within their specific business context. They are no longer looking for which solution is best, but which one is best for them.

## How to Optimize a Conversion Funnel

Conversion funnel optimization requires sound analytics [**data**](data-driven-marketing). That's why using a [**marketing automation**](what-is-marketing-automation-and-how-it-affects-business-development) platform is a good way to go. With such platforms, you will easily collect all data in one place and calculate the conversion rate for your specific audience. For example, in Altcraft Platform you can customize the conversion goals of each stage in the funnel, including things like a subscription or visit to a certain screen on your mobile app. Develop customized conversion funnels that match your unique business needs!

A conversion funnel is a visual representation of the stages in a buyer's journey, from the moment they visit your website until they make a purchase.

conversion funnel.jpg

Conversion Funnel: Stages and Optimization

How the Conversion Funnel Works From Top to Bottom

uzum-case.png

Reduced push notification opt-out rates, increased OR, saved working hours

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The open rate for automatic Viber messages is around 60%, and MAU growth for the year is +19%

All user information is systematically collected in a unified customer data platform

Distributing messages across various communication channels: email, SMS, push notifications, messengers

Promo codes, bonuses, and points for building long-term customer relationships

You can create and edit any HTML template, as well as save your own custom blocks

Personalized distribution of messages to clients through communication channels

Conducting experiments and optimizing marketing strategies

Tracking the effectiveness of marketing campaigns to make informed decisions

Connecting external systems to the platform and synchronizing data with company databases

Creating questionnaires, surveys, and feedback forms of any level of complexity

The ability to communicate with your clients anytime and anywhere

Increasing user awareness of your company's offers

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Personalized mailings

A/B/n Testing

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