The Meaning of Sales Funnel

Just thinking to write about Sales Funnel, I remember a Seth’s Godin book “Permission Marketing” in which he explains the Sales Funnel. The book was in Amazon for one full year in the first 100 bestseller. This is a short video in which Seth explains Sales Funnel, in a non-technical manner.

Soon I’ll write a couple of posts about the traffic, so as a prerequisite I want to clarify the terminology. You have heard about Sales funnel numerous times, but what is the meaning of this “cliche” !

The Wikipedia definitions are:

“A sales process is a systematic approach to selling a product or service.”

“A Sales funnel is the way that both direct sales persons and sales force management systems visualize the sales process of a company.

A sales funnel is constructed by stacking several layers together:

  1. New Opportunity
  2. Initial Communication
  3. Fact Finding
  4. Develop Solution
  5. Propose Solution
  6. Solution Evaluation
  7. Negotiation
  8. Sales Order
  9. Account Maintenance

New opportunities are put in the top and worked through the funnel until they either issue a purchase order, or become a disqualified lead.”

Those are correct but stiff definitions, and I try now to see how they are reflected in the  affiliate marketing.

In general our goal as Internet marketers is to maximize results, and in the same time  minimize expenses.  We are looking to:

  • generate consistent online profits
  • stay competitive in our niches
  • find ways to track and improve (without tracking we throwing away money, without improving we don’t make progress)
  • create a revenue model for increasing profits
  • and ultimately we must create a “Sales Funnel”

Tracking is very important but to get a complete picture we need to follow all the elements which can be tracked:

  • Conversion rates
  • Cost per prospect, lead, and sale
  • Prospect,  lead,  and customer value

It is clear that we have to think about Sales Funnel as a system not a stand alone action. Sales Funnel can have a lot of flavors but this is the most  complete chart I know:

00MC03 The Meaning of Sales Funnel

So the sales funnel system must have all the following components:

  • A main product(s) offer
  • Up-sell products offers
  • Back-end products offers (OTO)
  • Continuity programs as part of up-sell and/or back-end offers
  • The elements for maximizing revenue:
    • opt-in forms to capture prospects information
    • effective follow-up messages
    • powerful sales materials and copy
    • affiliates and JV partners

In summary:  We need a business model, and the sales funnel must be part of it…

Until next time stay informed

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