Funnels are the backbone of any Business endeavor. Tracking the right funnel is essential to ensure you calculate the correct metrics and, ultimately, increase conversions.
In the end, it's all about conversions. If you can't convert visitors into users or users into buyers, then there's no point in having a website.
The sales and marketing funnel is a framework that can be used to help you identify your company's sales and marketing strategies. It also allows you to see how well those strategies are working.
It's important because it helps you make decisions about where you should focus your efforts, how much time and money you should spend on each part of the process, and what kind of ROI (return on investment) you're getting for your efforts.
Read More: To successfully navigate your business, you need to analyze the right metrics. Every SaaS growth team should measure these Sales KPIs to stay on top of the game
A funnel is a simple tool to visualize your customer journey from being a visitor to a paid customer.
If the user archetype happens to be b2b, the stages in visualizing the buying journey can be articulated in a B2B Funnel.
Every company has its own sales stages defined in the CRM, but a typical funnel has the following three stages-
For one to make a context of the funnel, it has to be demarcated with the time period of the entire funnel.
What does that mean for you? If you're in the business of selling software, it means that you have time—84 days' worth of time—to make your case and convince customers that your product is right for them. That's a lot of time!
It also means that if you can't close a deal within those 84 days, then something has gone wrong. It could be that your product isn't as good as you think it is; it could be that the customer isn't ready to make a move yet.
Either way, there are ways to troubleshoot the situation so that next time around, you can close more deals faster than ever before!
The funnel helps in giving a quick snapshot of conversions and drop-off’s at which stage of the entire buying journey.
For a Founder, this gives a picture for one to align the stakeholders on arresting the drop-off and improving the conversion rate by looking at the stage level.
If you plan to build a sales funnel, you should do it right. Let’s look at the modus operandi of anaylsing and tracking the conversion funnel.
This is how a typical funnel looks like-
Visitor -> Leads -> Mql -> Sql -> Deals Created -> Deals Open -> Deals Closed( Won or Lost)
The list of prospects who move in each stage are captured for a particular time range.
If you're looking for a sales funnel that's going to work, your best bet is to make sure it's more than 30 to 45 days long.
Why? Because the sales cycle is long enough to display relevant information for each step of the funnel.
In fact, a funnel that's shorter than 30 days probably won't make sense.
For example, you cannot visualize a funnel for the last month, as a single month rarely encompasses the entire buying journey.
Related: Are you looking for a sales software to help you close more deals? Our sales stack offers a list of the top sales tools to fill your pipeline with qualified opportunities.
When you're tracking conversion rates, it's important to make sure you're tracking the right steps in your funnel.
During your review meeting, you fire the dashboard and open the sales funnel for the last 30 days. You see that you have got 42 won deals which have a decent 5.3% conversion from SQL, and hover to the top to see a huge 2594 prospects with a 2.4% conversion from a large set of visitors.
You may give the team a big round of applause for the high conversation rates.
Even though the dashboard looks pretty good, the number doesn't convey behind the scene stages. There is no diligent calculation of the conversion rate based on the actual numbers over the time period.
One of the 42 deals won need not necessarily be from the same cohort listed in SQL, MQL, prospects, and visitors. There are possibilities that the deal won is from last year.
So, the key question is, how do you track prospects during each journey stage?
To visualize the buying journey, you might miss out on the actual cohort of visitors during the time range captured in the entire funnel.
If you analyze the funnel from January to March 2022 - We could typically see the above user “Y” getting captured as a converted prospect during this period which is not quite true.
You would report the Deal Won from “Y” during these three months funnel who has become a lead in the previous time period, i.e., in December 2021.
It would help if you bifurcated the prospects as cohort/ non-cohort or mapped or unmapped within the given time period to understand the marketing activities bringing the right leads.
Cohorting allows you to see how different groups of people interact with your marketing efforts over time. You may want to know what percentage of people who saw an ad became customers within 30 days.
Or how many people who clicked on your Facebook ad became customers within 60 days? The ability to answer these questions helps you understand what kind of content resonates with specific groups of people so that you can tailor future campaigns accordingly.
Mapping allows you to link prospect data together so that it can be used for more than one purpose at once. For example, if someone downloads a whitepaper from your website but doesn't purchase anything, there's no way for us to map this person.
When it comes to conversions, having the right data available at the right time can makes all the difference in optimizing your sales funnels. And once you have everything set up correctly and have your key data in place, it's time to start analyzing that information.
This can open up new opportunities that might otherwise be missed if you take too long to uncover the optimizations.
Do you want to know where your business is losing its customers? If so, put the power of funnel dashboard reporting in your hands with Dataflo. Evaluate your campaigns' performance through Dataflo’s Funnel Dashboard, which allows you to track leads, deals created, or the number of visitors that turned into deals won for a given period.
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