Sales Funnel: What is it and how is it used?
The sales funnel is a series of steps that a visitor goes through in an online store from the moment he enters, until the completion of the order.
It's called a funnel because the closer a customer is to the order, the narrower the funnel. If you've heard the phrase "many go in, but few go out", well, that's a funnel.
The conversion rate plays a very important role. Most online stores in Romania have a conversion rate of no more than 1%. Most online stores are mediocre and the biggest culprit is "professional" built eCommerce platforms. Anyone can create an online store, but not everyone can create an online store that sells!
The purpose of the sales funnel is to find out where visitors are stuck and improve things there, if possible. The 99% of the owners of online stores do absolutely nothing, because they don't know what to do (there are many technical details).
Let's see, next, what the sales funnel is about:
What is the usefulness of the sales funnel?
Like I said, this sales funnel is actually a series of steps a visitor takes from the moment they enter your online store until they complete their order (if they ever get there).
Many customers get stuck at certain steps (the reasons can be very varied), so they give up and leave (possibly looking for another store).
Therefore, a sales funnel is actually a "problem detector".
Having a sales funnel for your online store can be useful for:
- The stage where most visitors give up
- Marketing efforts that correspond to each stage in which a client is.
- The marketing tactics you need to duplicate and where you need to go.
What is a sales funnel?
The sales funnel visually represents a person's journey from the moment they interact with your store, such as reading a blog post, to the moment they make a purchase. Sales Funnels they include different stages that correspond to different points of this trip.
The first visit can be anything: a blog post, a direct product page, etc. The largest part of the funnelcaptures the largest group of people who might be interested in what you are selling (they found you on Google, for example, how you found this article).
As you engage with these visitors through direct communication or marketing activities, they work their way down the funnel until they either give up or buy the product you're selling. The better/optimized the conversion rate, the more effective it will be!
Simplified Sales Funnel
A simplified funnel could include awareness, consideration, and conversion (loyalty is actually customer loyalty through marketing campaigns, etc. - it's much easier and cheaper to sell to existing customers than it is to attract new customers to our online store) ).
A more segmented funnel might include awareness, interest, consideration, intent, evaluation, and purchase. Some prefer a reverse funnel that tracks loyalty and support. It's up to you how you want to segment it: you can go the simple way with three sections or split it into 10. The more segmented, the more precise, obviously.
The sales funnel is segmented based on the data you collect over time.
Why does an online business need a sales funnel?
There are successful entrepreneurs who have not created a sales funnel even once in their life.
We have to understand from the beginning that what we are talking about here are concepts generated by marketers, some use them to give the impression that they are professionals, others use them mechanically under the idea of "that's how it is done". Concepts (whatever they are) are actually a bunch of opinions and conclusions! Although, reality and concepts are two completely different things!
So you can use these sales funnels to guide you, but be very careful if you see them as more than they really are: tools.
Sales funnels encourage increase
Funnels provide a much clearer way to organize marketing tactics and make it easier to understand which tactics work for each stage of the funnel. For example, you may find that TikTok videos work great for creating awareness about a business, but they don't do much to drive actual conversions (orders). This allows for more strategic growth: you'll duplicate what works and give up what doesn't.
Development of better relationships with clients
Setting up a funnel helps you better understand your target audience and what customers need to:
- Feel confident and excited to complete.
- Place an order in your online store.