A sales funnel is the most important part of your business because it’s the way you generate revenue; everything else in your company grows out of your sales funnel successes. Unfortunately, there are 4 deadly sales funnel sins that businesses commit, which dooms the business to almost certain failure.
Are you committing any of these?
DEADLY SALES FUNNEL SIN #1: LOSING LEADS
Building an Audience is not that hard, especially in today’s highly connected social-networking-crazy world. Unfortunately, businesses commit the first deadly sin by not strategically pushing Audience members to become Leads. For example, maybe there is no plan to take all of those Twitter followers and Facebook fans and get them clicking from Twitter or Facebook to your website. Or, maybe there isn’t an attainable SEO strategy that will generate enough traffic to your site.
In my experience, it’s rarely an intentional mistake. Rather, I’ve met many entrepreneurs who confidently believe that people will somehow find the business website simply because it’s online. Or, they confidently believe that fans or followers will click the website just because they can. But that’s rarely the case. Like contacts in any other stage of the sales funnel, people in the Audience stage need a reason to move the forward. Are you giving them that reason? Are you tempting them to take the next step in the relationship? Are you asking them for a small commitment to move forward?
How deadly is this sin? Figure out the amount of time that it takes for someone to go from Audience stage to the Customer stage. That’s how long your business will live if you don’t prompt more of your Audience to become Leads.
DEADLY SALES FUNNEL SIN #2: SKIPPING OUT ON SALES
Marketing is fun, easy, and creative. You can do lots of it yourself, very quickly, and pretty affordably. The web gives a lot of options to market. Unfortunately, Prospects don’t become Customers through marketing alone. There needs to be some sales effort, and that is where a lot of entrepreneurs fall short. Selling can be hard work, time consuming, and it can feel negative because it’s filled with rejection.
Entrepreneurs who spend all of their effort marketing but zero effort on sales, will run out of money very quickly. Sales will dry up (or will simply not occur if there were there at all). If you’re running a business that is heavy on marketing and light on sales effort, you may not be generating the revenue you were hoping for because contacts in the Prospect stage are not converting to the Customer stage.
How deadly is this sin? Add up all of your expenses in a month. How long can your business survive by borrowing that amount of money every month from lenders, friends, and investors? Since there are no Customers, there won’t be any revenue.
DEADLY SALES FUNNEL SIN #3: IGNORING PREVIOUS CUSTOMERS
Once a Prospect becomes a Customer, you’ve done the hard work of convincing them that you can help them. They’ve handed over their money and you have provided your product or service. For many businesses, this is the end of the story and they move on to spend their time and effort to convert another Lead into a Prospect then into a Customer. Many businesses ignore the already-sold Customer as a “past customer”. Instead they should be thinking of those Customers as “repeat buyers”.
Very few businesses have an effective method to sell to their previous buyers. Small businesses often only have a couple of products or services and if they sell those to a Customer and solve the need, end of relationship. But there is much more that businesses can do to turn one-time Customers into repeat-purchase Customers. The advantage of this is that it’s usually cheaper and faster to sell to these “already-sold” Customers than it is to sell a Prospect.
How deadly is this sin? Add up the per-Customer expense of bringing a contact along the sales funnel from the Audience stage to the Customer stage. Now figure out how big you want your business to grow and multiply your sales funnel expense by the percentage of growth. That’s expensive! Now, you will still spend some of that, but you can fuel profitable business growth at a lower cost by selling more to your existing Customers.
DEADLY SALES FUNNEL SIN #4: FORGETTING ABOUT YOUR SALES FUNNEL
The deadliest of the deadly sales funnel sins! Every year, thousands of small businesses start and fail. Businesses start because of a good idea by an innovative, energetic entrepreneur who wants to build a business. Businesses (often) fail because there isn’t enough revenue to pay the bills, to manufacture the goods, to pay for marketing and sales, and to keep the lights on.
While it’s true that there are several reasons for business failure, many business failures are tied to a sales funnel that did not produce the flood of eager Customers the businesses needed to thrive. Maybe the sales funnel was intentionally engineered but the demand wasn’t there. Maybe the product was too expensive and the sales funnel marketing collateral did an insufficient job at positioning the product at that price point. There are lots of reasons. But frequently, businesses skip out on designing and building their sales funnel. They know their market, they have some marketing and sales ideas, and they have a compelling product… shouldn’t that be enough?
It’s not. A sales funnel is an essential, strategic business asset that can help increase the likelihood of business success.
How deadly is this sin? We’ll never know. But there are a lot of struggling businesses out there. A sales funnel may not be the panacea to eliminate all of their woes, but it can help to highlight where many of those challenges are so they can be mitigated.
If you are committing any of these sales funnel sins, it’s time to stop where you are and start designing your sales funnel from the ground up.
Start by downloading the free Sales Funnel Quick Reference Guide to get an at-a-glimpse overview of sales funnels.
Then subscribe to my blog to learn more about sales funnels. I’ll show you how to design and engineer a sales funnel to help achieve business success. And very shortly, I’ll be publishing some exciting, useful tools to help you.