What is a Sales Funnel and how does it Work in 4 Stage?

What-is-a-Sales-Funnel-and-how-does-it-Work-in-4-Stage

This article is about a sales funnel – a marketing model that helps you plan and keep track of your sales & marketing processes in order to maximize sales and revenue. Read on to learn what a sales funnel is, how it works and how to create one yourself.

Table of contents

  • What is a sales funnel?
  • How does a sales funnel work?
  • What are the 4 sales funnel stages?
  • How to expand the sales funnel?
  • How to create a sales funnel
  • Create your first sales funnel for free

A sales funnel is a marketing term describing the typical stages your customers go through through the sales process. It allows you to determine and reflect on the actions taken by your customers at each stage of the buying cycle. Using a sales funnel, you can design a great customer experience throughout the customer journey.

The idea of ​​a sales funnel dates back to 1898 when E. St. Elmo Lewis developed a purchase funnel or purchase funnel - a marketing model that illustrates the theoretical journey of the customer from when they attract customers. customers until the purchase of a product or service.

Since then it has been given different names (i.e. purchase funnel, sales funnel, marketing funnel, conversion funnel) but the model remains the same, meaning it is:

  • universal: it can be applied to virtually any business in any industry
  • timeless: times change but the idea stays relevant

In e-commerce, for example, we use the term conversion funnel to describe the customer's journey from the awareness stage (typically driving traffic to a website through paid advertising in search engines and social media ) through to the conversion stage, when a website visitor becomes a customer.

You can also call it a sales funnel because it allows you to plan all your sales and marketing and communication initiatives for your business model.

Whether you're selling a physical product, an ebook, or an online course, a sales funnel helps you create a clear roadmap to revenue. It helps you focus on the most important areas of e-commerce:

  • lead generation
  • lead nurturing
  • sales
  • and customer satisfaction

Use the sales funnel to plan sales and marketing campaigns, find areas for improvement, and increase your revenue.

To dive deeper into this topic, consider reading our comprehensive guide to funnel marketing.

How does a sales funnel work?

The sales funnel provides a canvas for outlining and optimizing your sales process so you get more business.

The model presents the customer journey as a series of stages from awareness to purchase. You can generate more sales by planning your marketing communication through the steps.

What are the 4 stages of the sales funnel?

The original purchase funnel describes 4 cognitive stages a customer goes through during the process of buying a product or service: Awareness, Interest, Desire, and Action. This sales funnel stage model is often referred to as the AIDA model.

sales-funnel-stage
The AIDA model by Smart Insights

Step 1: AWARENESS

When you promote your product or service to potential customers.

At this point, your main goal is to reach your target audience. Especially people who haven't heard of your business yet, but can benefit from using your product or service.

The tools that people typically use at this stage are:

landing page

A landing page is a simple website designed to help you achieve a clear goal, like adding new contacts to your email list or selling a product. A landing page should contain the most important information and main benefits of using your product or service. There should be a clear call to action for people who care and want to know more.

landing-page-example
A landing page showcasing the Calisthenics School Virtual Classroom Nutrition Course

A landing page designed to invite people to join your contact list is also called a signup page or squeeze page and is one of your most important list building assets.

If you want to learn more about using these types of pages in your lead generation campaigns, here's our beginner's guide to squeeze pages, which also includes great examples and tips.

Signup Form

The basic tool to turn website visitors into email subscribers. There are different registration forms for different needs, e.g. embeds, popups or lightboxes. In sales funnel terms, a signup form is a portal from awareness to interest stage. People can express interest in your offer by subscribing to your email communication.

sign-up-form-example
A pop-up window on the Magic Spoon website inviting visitors to enter the contest

Facebook and Instagram Ads

You can set up targeted Facebook and Instagram ads and reach new audiences.

If you have a well-segmented contact list, you can use the email addresses of your current customers to create a lookalike audience - Facebook users who share similar characteristics with people on your contact list. This way, you can use Facebook's algorithm to find the people most likely to become your customers.

You can learn more about other useful targeting options and ad design best practices in our Facebook advertising tutorial.

Google Ads

Using Google search ads, you can reach people who are actively looking for a solution that your product or service could help them with.

Identify the terms that your target audience would likely type in when searching on Google and show them your offer. You can also refine targeting by providing negative keywords, i.e. those that are not relevant to what you are offering.

Here's more information on how you can create Google search ads in GetResponse and how to do it effectively.

lead magnet funnel

A magnet lead funnel is an automated way to generate leads for your business. It lets you set up a campaign consisting of paid ads promoting a landing page that offers a relevant sign-up incentive, a series of follow-up emails, and analytics that show you key stats in time. real.

 

lead-magnet-funnel-works
Dashboard presenting a lead magnet funnel

While you can create these types of funnels with various tools, this particular visual is from the lead magnet funnel tool available in GetResponse.

Step 2: INTEREST

When certain people actively express an interest in what you have to offer.

At this point, your job is to provide your audience with all the crucial information about your product or service. They need to know if and how they can benefit from your offer.

By observing contact activity, you will see who is and who is not engaged in communication. You'll be able to see what information they find most useful and segment your contact list accordingly. Thanks to segmentation, you will send much more relevant communication.

The tools that people typically use at this stage are:

Engagement rate

The contact card shows all your contact information. One piece of information you find particularly useful is the Engagement Score – a tool that identifies and scores your contacts' activity based on their interactions with your emails.

engagement-stage
An example contact card view

After creating engagement-based segments, you can start using them to send more targeted emails. You can decide to win back your contact's interest or just keep their engagement high.

Marketing Automation

You can use marketing automation to create workflows that will automatically send emails and assign tags based on user behavior. You can use tags to determine the type of content that interests your audience the most.

marketing-automation-dashboard
A pre-designed workflow template to welcome new contacts available in GetResponse Marketing Automation tool.

Facebook Pixel

The Facebook pixel allows you to track landing page visitors. You can see what people like and create personalized remarketing campaigns based on your landing page visits.

Define Custom Audiences based on the pages they visited or not to get the most out of your social advertising budget.

If you are not completely familiar with this concept, here is our complete guide on how to use the Facebook pixel in your marketing campaigns.

Email Marketing

Plan series of emails that introduce your brand and clearly present the benefits of using your products or services. Create content that educates your audience and helps new contacts make an informed buying decision.

Here's an email drip campaign from LandCafe.pl (e-commerce selling artisan coffee beans) that expertly guides contacts through the stages of a sales funnel. The campaign is made up of 6 emails that show:

  • where does LandCafe.pl coffee come from
  • why you should choose their coffee
  • characteristics of coffee from different parts of the world
  • the difference between single origin coffee and a blend
  • how to grind coffee and what to use
  • how to read LandCafe.pl product labels
  • a coupon email that triggers sales
email-marketing-campaign

Check out the case study for details on the email marketing campaign that drove 54% sales and check out this guide if you want to learn more about email drip campaigns.

Push notifications

Use push notifications to stay connected with your website visitors. Web push notifications don't require an email address, so you can send quick, hard-to-miss messages to everyone who signs up after visiting your site.

Learn how to create web push notifications in GetResponse.

Webinars

Webinars are a great tool for engaging with your audience. First, you can reach out to people who have expressed interest in a particular topic and ask them questions that will help you create a webinar they really want.

During the webinar, you can use surveys, chat, and Q&A mode to engage attendees and discuss topics in real time.

After the webinar, you can send follow-up communication to keep in touch with people who joined you live and send valuable information to those who registered but missed the event.

You can record your webinars and use the recording to create on-demand webinars that people can join when they have time. Adding high-quality VOD content to your sales funnel will definitely make it more efficient.

In this article, you'll find more information about how webinars work and the different types of content you can use in them.

Step 3: DESIRE

When your audience knows your product or service is the perfect match for their needs.

At this point, your audience has all the necessary information about your product or service. They know if this is exactly what they were looking for. If the answer is yes, they can move on to the next step.

The tools that people typically use at this stage are:

Segmentation

Segment your contact list and group contacts who have already received all the information needed to decide whether they want to buy your product or service. This is the segment that should be instigated to action.

Step 4: ACTION

The time of purchase.

This step is for people who know your product or service is what they need. Now is the time to let them know there is no need to wait - the perfect time to buy is now.

The tools that people typically use at this stage are:

Commercial emails

Send a commercial email to convert your contacts into customers. You can influence sales with early bird campaigns, flash sales, holiday sales and discounts. The main goal is to convince your audience that now is the best time to buy.

Abandoned cart series

Many people treat the shopping cart like a wish list, adding the products they like so they don't forget. They also add products to cart to check total price and shipping details.

Create an abandoned cart workflow to remind them of the products they left behind. For higher conversion, you can schedule a series of 3 emails sent after 1 hour, 1 day, and 3 days.

Remarketing

Track your landing page visitors to advertise to them later. Define Custom Audiences based on the pages they visited or not to get the most out of your social advertising budget.

You may also like:

1. Free sales funnel template that’ll boost your sales

2. Beginner's Guide to Lead Generation

3. How to create a high-converting social media sales funnel

How to widen the sales funnel?

As your business grows and leans more into recurring purchases, you can expand your funnel by adding additional steps. The more complex version of the funnel might look like this:

1. Awareness - when potential customers become aware of your product or service (described above).

2. Interest - when they actively express an interest in what you have to offer (described above).

3. EVALUATION - when prospects review competitors' solutions and compare their offers to yours.

Provide a comparison with your competitors. Not only will you deliver the type of content your audience is looking for, but you'll also learn a lot about your competition. The information you collect will help you identify your strengths and weaknesses and better position yourself in the market.

4. Decision: When your offer is shortlisted and it's time to negotiate before the final decision is made (described above).

5. Purchase - the moment of purchase, when a prospect becomes a customer (described above).

6. RE-EVALUATION - the customer has been using your product for a while.

From time to time, your customers look for other solutions that meet their needs. However, if they are happy with your product and the overall customer experience, they won't feel the need to look for an alternative solution.

You can stay in touch with your customers and solicit their feedback proactively by creating a post-purchase follow-up workflow. Wait a bit and send emails to customers asking for feedback. This way, you'll create a feedback loop that will help you steadily improve your products and customer experience.

reevaluation
An email from Target asking for a product review

7. REDEMPTION – when a customer repurchases your product or service.

Plan the right time to remind your customers of your business. Analyze how your customers use your products or services and plan follow-up communication accordingly.

For instance. If you sell coffee and you find that your customers usually buy products for a month, you can send a reminder 3 weeks after the purchase. If you run a bakery, you can email more frequently to share your weekly delivery schedule.

A fragment of a newsletter form Proof Bread with their weekly delivery schedule

Redeeming can be an ideal step to try:

Upsell – Persuading customers to purchase a more expensive, upgraded, or premium version of the product or service with the goal of achieving a larger sale and increasing Customer Lifetime Value (CLV).

Cross-selling – persuading customers to purchase related additional products or services based on the customer's interest in one of your company's products or their purchase.

This step can tell you a lot about the overall state of your business. Satisfied customers are ready to buy from you again without the need to research competitors. That's why retaining an existing customer can cost five times less than acquiring a new customer.

By expanding your funnel with post-purchase stages, you can examine both customer acquisition and retention. You have an overview of your business and keep track of all important measures.

You should use the different stages of the funnel as a model for your marketing and sales communication. Monitor results and optimize your actions to generate more sales in less time.

How to create a sales funnel

Creating a sales funnel is easy if you have the right tools. Here's how to create sales funnels using GetResponse.

1. Use the conversion funnel

The easiest way to create a sales funnel is to use the GetResponse Conversion Funnel feature. It allows you to promote, sell and deliver your products online. Here's how it works:

Create your store (or connect an existing one)

Choose stores and products from the menu. Create your store simply by choosing a name and a motto.

store-creation-getresponse

Add products to your store

Select the type of product you are going to sell from the available options:

  • Downloadable file (like an ebook)
  • Online course (like video training or email series)
  • Service (like a photoshoot or website design)
  • Physical product (like a book or T-shirt)

Create a sales funnel

Choose the funnel from the menu and press the Create funnel button. You now have 2 options to sell your product:

  • full sales funnel

The full sales funnel gives you the following tools: registration page, email, sales page, upsell page and confirmation page. You can also add paid ads on Facebook and Instagram at the top of the funnel to reach your target audience.

full-sales-funnel
The full sales funnel is a template for a sales process
  • Quick sales funnel

The Quick Funnel only gives you the essential tools: Sales Page, Upsell Page, and Confirmation Page. However, you can also add paid ads on Facebook and Instagram at the top of the funnel to reach your target audience.

quick-sales-funnel
The quick sales funnel is reduced to essential tools only

2. Use of integrated online marketing tools

Use online marketing tools like e.g. email marketing, landing pages, webinars, marketing automation, and paid ads to create a great customer journey.

Here is an example from Ravenol Polska. The company is hosting a series of technical webinars for auto mechanics and mechanics. Let's walk through the process and see what tools they used at particular stages of the sales funnel.

Awareness 

  • Email: a promotional email to their contact list with a link to the webinar registration page 
  • Social media promo: partners promote the online training via their social media channels in order to reach new audience 

Interest 

  • Email: an email introducing the presenters and providing a description of the online training 
  • Landing page: a landing page with a webinar description and a registration form. 

Desire 

  • Survey: in order to take part in the online training you need to register by filling in a survey 

Action 

  • Webinar: attendees take part in a live webinar where they can interact with presenters via chat 
  • On-demand webinar: registrants who can’t join the live event, can watch the webinar recording at their convenience

image
A diagram presenting the tools used to run the Ravenol Professionals online training program

Create your first sales funnel for free

Plan your customer journey based on the information in this article and use the GetResponse Forever Free account to put your ideas into practice.

I recommend you start with a landing page where people can sign up for a newsletter. Then create a series of emails that will provide your contacts with the information they need to purchase your product.

If you put in the work and create all of your items in the first week, you can sit back and see the results after 10, 20, and 30 days. Good luck!

Source:  What is a Sales Funnel and how does it Work?

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