Tag Archives: sales funnels

Sales Funnel Bible — Chapter 40

By Aaron Hoos on April 9, 2013 in Business, Portfolio

Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.

Early draft of Aaron Hoos' book Sales Funnel Bible

Chapter 40: Using your sales funnel for business expansion

Throughout this book, you’ve read about growing your business by using different strategies and tactics in your sales funnel. I’ve made the assumption that you have only had one sales funnel to work with, driving one target market to one set of products or services. I used this simplified approach because it’s helpful and less overwhelming to learn all at once.

If you are just starting out, you should start with just one sales funnel – serving one set of products or services to one target market. It’s simple to set-up and you can optimize your sales funnel to increase profit. There’s nothing wrong with having just one sales funnel and focusing your entire business on that, and then growing that sales funnel so that you end up eventually with one big, highly-optimized sales funnel.

But that’s not the only way to grow your business. You can also expand your business by creating more sales funnels. Many businesses have more than one sales funnel (and as your business grows, you might discover that new sales funnels tend to crop up). For example:

  • Your business might have multiple target markets, which each require their own sales funnel because each target market goes through its own mindset evolutions. An example would be my former freelance writing service. I provided writing services to a few different target markets and each of those target markets had their own problems or challenges that my writing solved.
  • Your business might have different products or services, which each require their own sales funnel because the mindset evolution for the target market is different for one set of products or services versus another. A great example would be a car dealership. A car dealership has several different profit centers – they might sell new cars, used cars, as well as mechanical services, and collision repair.

Another way to expand your business is to replicate your sales funnel through franchising. Franchising is essentially “renting” your sales funnel to someone else so that they don’t have to start their own from scratch. It might be just one sales funnel but the sales funnel is replicated over and over with each franchise.

McDonalds rents the right to use their sales funnel to a franchisee and that franchisee pays fees to operate the sales funnel. That sales funnel includes branding, marketing, and several systems to help deliver McDonalds’ product.
A less formal version of franchising is very common online where a highly successful mentor coaches his or her students to perform the same sales funnel activities that the mentor does. In the work I do with real estate investors, this is big business!

So you might be starting out your business with just one shiny sales funnel. What should you do?
My advice is to first focus on that one sales funnel. Master it. Optimize it. Scale it up carefully. Build a good, solid business around that one sales funnel.

In time, new opportunities will present themselves and you might end up either creating more sales funnels in your existing business (for new markets or new products) or you might end up franchising.

If you choose to build new businesses to reach new markets or to deliver new products then apply the same focus to your new sales funnel that you did to the first one – taking the time to master it, optimize, it, and scale it up carefully.

If you choose to franchise then you need to roll up your sleeves and put a lot of focus on making your one sales funnel insanely easy to use. Write out each step in your sales funnel in great detail. Make sure that the sales funnel can be easily implemented by others. Focus on making your sales funnel transferable.

When you grow your business, you are growing your sales funnel or you are creating new sales funnels or replicating your sales funnels.

 
 
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.
 
 

Sales Funnel Bible — Chapter 39

By Aaron Hoos on April 8, 2013 in Business, Portfolio

Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.

Early draft of Aaron Hoos' book Sales Funnel Bible

Chapter 39: Using the sales funnel for competitive analysis

It’s a jungle out there. Your target market is wandering in search of a solution to whatever problem or need they have. If you don’t get your target into your sales funnel and then move them through it to the point of sale quickly, your competitors will snatch them away.

Lost marketshare not only makes you weaker (by robbing you of revenue and profit), it makes your competitors stronger. And although a little competition is good for business and keeps you honest, competitors that are too strong can outpace you, innovate faster, and strip the target market bare of all potential customers, leaving your business as a distant memory.

How can you pay attention to your competitors and ensure that you keep up with them so you can have a fighting chance to survive?

Competitive analysis is what smart businesses use to make sure that they aren’t at risk of losing significant marketshare to their competitor.

When I say “competitive analysis” I don’t just mean finding out what your competitor is and charging the same amount. I’ve worked for companies that called the competition pretending to be potential buyers in order to find out what their rates were. In high school, I worked at a gas station and the owner would drive up and down the street to see what other gas stations were charging so he’d know what to charge. I think: If you’re just spying on your competition to see what they are charging, you’re only doing part of the job. It’s not only about price.

And when I say “competitive analysis” I don’t mean corporate espionage. I’m not advocating that you illegally gather proprietary information or go “Dumpster-diving” to find out who your competitor’s customers are.

Smart competitive analysis should try to discover why customers buy from your competitors instead of you. Remember: You’re selling into an environment where your target market is looking for a solution – any solution! – to their problem. And unless they have a very strong reason to buy from you, they are looking at you and at all of your competitors as potential solution-providers.

So competitive analysis should seek to understand the competition so that you can keep more people moving forward in your sales funnel.

The sales funnel is an effective tool to help you do competitive analysis.

If you want to truly understand your competitor and why some of your target market buys from them instead, build your competitors’ sales funnels. Take a piece of paper and create a sales funnel for each of your competitors in the same way you created a sales funnel for yourself earlier in this book.

Identify the target market at the top. Identify the products or services at the bottom. Then, run through your competitor’s sales funnel (as much as you are comfortable doing so – perhaps you don’t want to actually buy from them). Along the way, record what mindsets, messages, activities, and channels they are using. Reverse engineer as many steps as you can. (Chances are, you can build a pretty good sales funnel at least describing their marketing efforts, if not also a lot of their sales efforts).

You will need to do research for this project. I say that because the target market you serve and the mindsets you connect with at each step of your sales funnel will be different than your competitors’ target markets and mindsets. There may be some overlap (there may be a LOT of overlap) but there will definitely be some differences that you should try to dissect.

Once you have created an at-a-glance Sales Funnel Strategy Matrix for each of your main competitors, you will have a very deep understanding of how their businesses operate and how they are similar to you and different from you.
With that information, you can do the following:

  • Do a better job of identifying your own target market to potentially reduce the overlap and increase how well you connect with that smaller sub-set of your once larger target market.
  • Adjust the mindsets you are reaching to better connect with your refined target market. Specifically, you want to show your newly refined target market why your solution is the best one out there. (The combination of speaking to a smaller group of people with a clearer message can be a powerful way to draw more people into your sales funnel).
  • Adjust the messages and activities and channels you are using to better connect with your refined target market.
  • Adjust the marketing and sales messages you are using to do a better job of differentiating you from your competitors.
  • Adjust your products or services so that they seem very different from your competitors. This might be done with some branding changes or by packaging your products and services together or in how you describe them; it might mean developing new products and services to meet the needs of your newly refined target market.
  • You might even get in touch with your competitor and work out a deal to trade names back and forth if someone from their target market lands in your sales funnel. As long as each member of this arrangement plays nice, it works out well. (Note: In my experience, some industries are going to be much more open to this idea than others!)

Schedule time regularly to do competitive analysis on each of your competitors regularly. The first competitive analysis on each competitor will be a lot of work but future analyses will be much easier because they might only be small adjustments when you learn more about them.

 
 
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.
 
 

Sales Funnel Bible — Chapter 38

By Aaron Hoos on April 7, 2013 in Business, Portfolio

Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.

Early draft of Aaron Hoos' book Sales Funnel Bible

Chapter 38: Sales funnels need a place in business plans

Over the years, I’ve read a lot of business plans. I’ve never seen one that included a sales funnel. It’s disappointing, since I see the sales funnel as the most essential aspect of the business.

True, you could probably piece together parts of the sales funnel by reading a business plan but it wasn’t obvious. Want to piece together the sales funnel of a business based on the existing business plan structure? You’d have to look in the Opportunity section of the business plan to see what need is being met. You’d have to look in the marketing and sales section to see some of the high-level marketing and selling ideas. You’d have to look in the offering section to see what the business was going to sell.

And that’s only part of the story: You wouldn’t see how each one connected to the other; you wouldn’t see how smooth the process was; you wouldn’t see how the numbers aligned with the effort; you wouldn’t see where the pitfalls might be.

Why make your business plan audience do all of that work when a simple sales funnel image posted near the beginning of your business plan can do so much for you. The sales funnel is a fast and easy way to explain your business at glance to others. By putting it front and center, your business plan shows how all the key pieces are integrated together to run the most important money-making system in your business!

I propose the following change to business plan outlines in use today: After an introduction, the very next section should be the sales funnel (perhaps even a one-page Sales Funnel Strategy Matrix or some other simple at-a-glance depiction of the sales funnel). In one simple image, the business plan reader gets a quick, high-level view of who the business’s target market is, how the business intends to reach this audience, and what the business will sell.
That initial image, or a brief overview that describes it, then becomes a sort of table of contents outlining the rest of the business plan – the plan would go on to describe each element of the sales funnel from top to bottom:

  • The market need, opportunity, and target market, and projections
  • The marketing methods and then the sales methods, including the messages, activities, and channels used at each step – in order, and with projections
  • The product or service being sold, as well as monetization considerations (like paygates)
  • Any follow-up or additional notes (such as an explanation of the evangelist program)
  • Plans for future expansion

Of course there are other things to include in a business plan and those can come after. This is where you’d include your management team, competitive analysis, etc. The sales funnel can be shown again here, perhaps indicating the areas that each member of the management team is in charge of, and the competitive analysis can show a similar sales funnel picture but with competitor sales funnels depicted for comparison.

Then, in the financial section, the sales funnel could be shown again as a supplementary image in which key financials are added in to show the impact of income and expenses on the sales funnel.

And for venture capitalists and angel investors who read business plans: Insist on a sales funnel in the business plans submitted to you. And when you receive a business plan from a prospective investment, grill them about their sales funnel. Make sure they understand how all of the parts fit together – how their target market will be drawn into their funnel, what mindset evolutions will take place, and how those mindset evolutions will eventually turn into sales. Then ask about price – ensure that the price covers the cost of running the business now and the cost to investment in scaling up the sales funnel.

And when you see a business plan that includes only a sales funnel with a problem, use it as an opportunity to drill down. How many unviable businesses could have been passed over (instead of invested in) during the dot-com bubbles if a picture of a sales funnel at the beginning of the business plan prompted discussions about adequate monetization?
Use the sales funnel as a way to view the business, dissect it, analyze, and help you determine whether or not to invest.

 
 
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.
 
 

Sales Funnel Bible — Chapter 37

By Aaron Hoos on April 6, 2013 in Business, Portfolio

Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.

Early draft of Aaron Hoos' book Sales Funnel Bible

Chapter 37: Equilibrium in your sales funnel

In the past few chapters you’ve read about the importance of investing in your sales funnel, innovating in your sales funnel, and hiring in your sales funnel. I’m trying to provide a new way of thinking about your business – as something that should be built almost entirely around your sales funnel. Investing for growth sounds really attractive for businesses and the sales funnel provides an excellent way to direct your investing. However, all of that investment should come with a warning and that’s what this chapter is about.

You’ve probably heard the startling statistics about the number of businesses that fail within the first year or within the first two years or within the first five years. The number of businesses that actually survive is quite small. So why is the failure rate so high? There are several reasons, of course, but one of the biggest reasons is related to sales funnels.

Actually, this sales funnel problem is not only a problem for new businesses but it’s also a problem for existing businesses – it’s just not as big of a problem for those existing businesses because they usually have some cash flow to help them get through the problem without really noticing it when it occasionally does arise. All businesses face this problem but new businesses don’t survive because they lack the resources to carry them through the blips that occur when this problem happens.

So here’s the situation (and why it turns into a problem): Sales funnels operate with a balance – an equilibrium. A sales funnel that operates within this equilibrium brings in just enough customers to buy up the available inventory. (I’m defining inventory as being either the products you sell or the time you have available to deliver your services). The right number of customers show up to buy your inventory and they walk away happy.

A good business finds this balance fast – just the right balance between customers who buy and the amount of inventory available. And this is the first area where new businesses struggle because it’s hard to find that balance; it’s too easy to end up with too much of one thing and not enough of another.

Too many customers (compared to inventory) and you end up with angry buyers who go elsewhere to solve their problem; they never come back and they tell their friends about how you wasted their time offering them something you couldn’t deliver. Too much inventory (compared to customers) and you end up with unpaid supplier bills and warehousing costs and not enough money to run your business.

That equilibrium is made even harder to achieve because of trends in the marketplace: Perhaps a competitor offers a huge discount on the same product you sell; or maybe a negative news story comes out about your industry; or maybe everyone in your sales funnel stalls because a massive hurricane pulls people’s attention away from the problems you solve and on to more pressing issues; or maybe a massive hurricane disrupts your supplier and tightens up your inventory too much. Whatever happens, the result is that equilibrium is very hard to maintain. But if you can find something close to a balance – a sort-of “window” of equilibrium that you can survive in – then you’re good.

Unfortunately, that’s not the only equilibrium problem. It’s actually only the first part of the problem. Assuming the business survives that part of the equilibrium problem, they discover quickly that the problem actually continues (in fact, it gets worse) as the business grows.

A growing business needs to maintain that equilibrium by scaling the sales funnel AND scaling the balance between customers and inventory. It can’t just start dumping new people from the target market into the top of the sales funnel without making adjustments to the inventory. Again, too much of one and not enough of another leads to lost revenue, and either angry buyers or angry suppliers.

So how can you maintain equilibrium. It starts with metrics and tracking. As much as possible, apply metrics to your sales funnel and track those metrics diligently. Watch your ratios and get a sense of how many people at each step of your sales funnel move forward, and how many of them ultimately become customers. That will give you an approximate inventory number you need. Then, carefully test changes. What happens, for example, if you increase the percentage of prospects advancing to become customers? A small increase can tell you a lot and help you prepare for a big increase later.

When you know these numbers, use them as triggers to alert you to adjustments you need to make. For example, if you have a 10-step/10-week funnel (and each step takes approximately 1 week), and you know it takes 4 weeks to get more inventory, then find out what percentage of people in step 6 turn into customers and watch that number closely. If the percentage increases, you have time to make adjustments to inventory. The reverse works as well: If you sell your services and you want to take a vacation next month, you have about a month’s worth of time to adjust your marketing and manage the expectations of the people who are a month away in your sales funnel.

I would also suggest that if you are growing your business, you don’t make too many changes in your sales funnel at once. Make changes and then watch the result. A seemingly small change can have huge repercussions. A change in the marketing message at an early step in your sales funnel could have cascading impacts all the way down your sales funnel. So make changes to grow your business but make changes carefully to help maintain the equilibrium.

 
 
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.
 
 

Sales Funnel Bible — Chapter 36

By Aaron Hoos on April 5, 2013 in Business, Portfolio

Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.

Early draft of Aaron Hoos' book Sales Funnel Bible

Chapter 36: Hiring for your sales funnel

Traditionally, human resources and sales funnels have been thought of as separate entities, with the sales funnel as the money-earning system and HR as the department that ensures the business is fully staffed. I don’t mean to suggest that HR and sales funnels each operate independently, and at cross purposes. Rather, I mean that each one has its own purpose and those purposes aren’t always aligned because business owners haven’t made the connection between the two.
Consider the typical scenario where the founder of a small business realizes that they are too busy to run things on their own so they need to add someone else to their business. They might look at what skills they lack and hire for that. Or they might look at a particularly time-consuming aspect of their business and hire for that. Or they might look at an area of the business where they want to grow and they hire for that.

This practice happens a few times until there is a small handful of staff in the growing business. This hiring practice is okay because it addresses the immediate problems and challenges that the business is facing. But as the business continues to grow and change, those problems and challenges change and the people who were hired to deal with them may or may not keep up.

Before long, the business gets to the point where they need to add even more staff, as well as support staff. So the business owner (or, at this point, perhaps an Operations Manager) starts thinking about what roles need to be filled. They look to traditional job titles and traditional job descriptions. Then they pass the hiring responsibility on to a Human Resources department who continue with the traditional job titles and traditional job descriptions.

So the hiring process starts off as a gap-filling effort and later it changes to become an effort of filling traditional roles.

There are problems created by this type of hiring:

  • Not sure who to hire first: A new business owner who has a busy business that they need to staff up is faced with the very difficult decision of determining who should be hired first. Their business isn’t big enough to bring in an HR expert to help them so they have to just figure it out on their own – and that is not easy.
  • Now sure what hiring model to use: Should the business owner hire full time? Part time? On contract? Can they hire a freelancer? Should they pay more for a specialist or someone who is a little more of a generalist? Should they hire someone with little experience but who will learn on the job? Does the job need to be done on-site or can it be outsourced over the web?
  • Hiring the wrong person too soon: Early efforts by the founder to fill gaps aren’t necessarily the best way to hire because the risk exists that they will spend too much on a staff member whose skill set doesn’t fully contribute to the growth of the business.
  • Fixing hiring mistakes: There’s a disconnect between the first type of hiring and the second type of hiring HR staff may need to fix the hiring problems created when the business owner was in gap-filling hiring mode.
  • Reliance on traditional roles and growth models: When an HR department is created and tasked with hiring, their job is to staff up the business in a way that can contribute to growth. However, every business is different and adding people in traditional roles to a dynamic organism like a business is like putting a square peg into a round hole.
  • Employees lacking direction: Square peg employees who are hammered into the round hole are given a job to do and although they might understand what the business does as a whole, they may not necessarily see how their job is part of that whole. Rather, their focus is on completing their job. They have a direction for their job but not necessarily for their job as part of a larger picture.
  • Performance review challenges: There is an expectation of employees to perform to certain standards. But what standards should be held up as the ideal? A human resources department might have some ideas about this but businesses need to review employee performance long before they hire someone to do it for them.
  • Businesses that turn into kingdoms: Employees who are hired for a role in the business can often feel pigeon-holed from the other employees, as if each employee (and later, each department) becomes its own little kingdom. Those kingdoms generally get along and work together but things can get territorial. The bigger the business gets, the more conflict arises between those kingdoms.

The problems created by this scenario can potentially be solved by sales funnels:

During the early days of a business, when a founder needs to staff up, they should be hiring with their sales funnel in mind. Although there might need to be some gap-filling issue that also helps to inform them, their sales funnel should inform them about who they need. As much as possible, business owners shouldn’t be gap-filling in their business but rather they should be hiring people to contribute to their sales funnel. The business’ sales funnel can also inform the business owner about the roles that need to be filled: Staff should be hired based on the sales funnel, with roles and job descriptions built around the different steps, activities, and channels that the staff member can fulfill. The scope of the step will help the business owner know whether to hire full-time or part-time, on-site or outsourced.

The sales funnel also becomes the bigger purpose for the employee, as well as the ideal used for performance review. Employees should be trained to see themselves as a key part of the sales funnel, with other staff members also contributing to the sales funnel, and everyone working together to move people to the point of sale (which, hopefully, improves an employee’s sense of direction and eases the kingdom issue). And if metrics were effectively added to the sales funnel before they were hired, they have a benchmark that they can be measured against.
The hand-off from business owner to Operations Manager and then to Human Resources is much smoother, too, because sales-funnel-focused hiring is much more scalable than the gap-filling method that morphs into the traditional roles.
For new businesses, the sales funnel should be the most important system built up in the business and all hiring decisions should be decided upon using the sales funnel as a jumping-off point.

And once the hiring process is firmly in the skilled hands of the Human Resources department, the sales funnel should continue to be the go-to system against which HR can make hiring decisions. Of course there will still be roles that might be argued are not specifically tied to sales funnels but most can be (and should be!) and that will help to align the entire business toward the most important common goal.

 
 
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.
 
 

Sales Funnel Bible — Chapter 35

By Aaron Hoos on April 4, 2013 in Business, Portfolio

Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.

Early draft of Aaron Hoos' book Sales Funnel Bible

Chapter 34: Innovation in your sales funnel

In the previous chapter you read about the importance of investing in your sales funnel and I outlined a suggested order of investment opportunities. Now I’d like to talk about a related topic – innovation.

Innovation in your sales funnel is very similar to investing in your sales funnel. The difference is: I focused a little more in investing assets (mostly money but also time and effort) in the last chapter. In this chapter, the emphasis is on investing in and developing new ideas and opportunities that will enhance your sales funnel.

Too often, entrepreneurs who want to innovate in their business think specifically of innovating a new or improved product or service (or some aspect of their product or service, such as delivery or customer service). But if you broaden your view of innovation and commit to driving innovation into all aspects of your sales funnel, you’ll see a much greater benefit.

A product-only approach to innovation can be costly, with many unworkable attempts ending up in the trash, and some businesses might struggle with how they can innovate a very standard product or service. How can a locksmith or a collision repair shop or a plumber innovate their products and services? It’s not impossible but it is hard and the return for effort may not be worth it.

However, a sales funnel approach to innovation gives you a greater opportunity to invest in innovation across a much bigger playing field, and a greater opportunity to derive a return because you are “investing” in new ideas to drive your sales funnel. Instead of trying to reinvent the wheel that your business is selling, you are reinventing how you sell it.

So, what does innovating in your sales funnel actually look like? Innovation in your sales funnel is all about deploying new ideas throughout each of the steps. It’s easier and faster to innovate because you no longer need to think of innovation as reinvigorating an existing product or service. Rather, your innovation might be something as simple as finding a new way to communicate the same message to your audience. Or, developing new tools that you can use to measure the steps in your sales funnel. Or, using new channels in your sales funnel that your competitors aren’t using. Or trying a different paygate or delivery model. Of implementing an evangelist program that is unheard of in your industry.

Some people might argue that the description above is not really innovation. They’re thinking of high-cost product-specific innovation. They’re forgetting that there are other types of innovation besides that.

Apple Inc. is a good example of a company that does both product-specific innovation and sales funnel innovation. We tend to think of Apple’s innovation as being product-specific: They changed the mobile device market with attractive designs and technology, and they continue to release cutting-edge iPhones (and other products) regularly. But that’s only the product-specific innovation. They also innovated throughout their sales funnel: Their famous Super Bowl commercial in 1984 was an innovation. Their target market was an innovation. Those “I’m a Mac; I’m a PC” commercials were an innovation. Their iTunes store was an innovation. All of these things go beyond the product-specific innovation that most people tend to think of. We don’t see them as much because they aren’t as flashy and many of them are behind the scenes. But they were just as important to Apple’s success.

Sales funnel innovation provides a larger field to work in and the innovations you can make in them are faster to discover and deploy.

To innovate in your sales funnel, take a look at your Sales Funnel Strategy Matrix – the one-page list of (mindsets, activities, channels) that makes up your sales funnel. Look at your current messages, methods, and media, and consider how you can try new things (adopted and adapted from other companies or industries) to be even more effective in your sales funnel.

 
 
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.
 
 

Sales Funnel Bible — Chapter 34

By Aaron Hoos on April 3, 2013 in Business, Portfolio

Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.

Early draft of Aaron Hoos' book Sales Funnel Bible

Chapter 34: Investing in your sales funnel

Business owners need to invest in their business if they want it to grow. No business can grow without some investment. (An investment can be money, time, effort, or some other asset).

When it comes to your business, there are seemingly an unlimited number of options that you can invest in and there are a million and one gurus who will tell you that you should invest in their solution.

I’ve seen business owners who invest in one branding effort after another; other business owners who invest in a great looking business plan; other business owners who invest in web design; other business owners who invest in innovative tools. I’m only just scratching the surface of potential investments and there is no shortage of opportunities to invest your money.

So where should you invest? In my opinion, the best place to invest is in your sales funnel.

By investing in your sales funnel, you invest in the very system in your business that will generate more customers, more revenue, more profit, and enable you to buy those other things you need to buy and invest in those other things that will grow your business. But invest in your sales funnel first because that investment will provide the greatest and fastest return.

All other investments should be subordinate to your sales funnel. Yes, you might need to buy a stapler and some paperclips for the office, and yes you’ll need to probably spend some money on branding and web design, but if you have limited money to fund your business’ growth and you’re not sure where to spend it, look to your sales funnel for guidance.

Here are some specific things to consider investing in. I’ve arranged them in an order of importance, starting with most important investment opportunity.

  • Invest in tools and resources to help you track and measure your sales funnel. No other tool or system or secret will provide a greater return than the one that helps you understand what is happening in your sales funnel and give you the data you need to make adjustments. Often, business owners want to invest in marketing methods that will increase the number of people in their sales funnel but you’ll see faster results, and more profitable results, if you first focus on measurability.
  • Invest in systems and processes that help address your sales funnel’s capacity limitations so that your sales funnel can handle more people moving through it. This is one of the most important things you can do in your sales funnel, second only to investing in tracking, to help your sales funnel grow.
  • Invest in the parts of your sales funnel that have the greatest contribution to your sales. For example, you might have several overlapping channels that each help evolve your target market’s mindset. If you have measured and tracked the results of those channels, you should have an idea (even an approximate idea) of which ones have the biggest impact. Invest there.
  • Invest in improving the percentage of people who advance from one step in your sales funnel to the next. (And if possible, start by investing closer to the point of sale and moving “up” your sales funnel toward the top).
  • Invest in aspects of your business that will increase the amount of money people spend in your sales funnel (i.e. by investing in up-sells, ancillary sales, and follow-up sales).
  • Invest in an evangelist program to get your happy customers telling other people about your business and you helped them.
  • Invest in techniques and methods that get people moving through your sales funnel faster.
  • Finally (yes, this is the very last one) invest in new marketing methods that put more of your target market into your sales funnel.

Surprised by the order I’ve put these in? Here’s the thinking behind it: Before you start dumping more and more people into your sales funnel, there are many ways that you can optimize your sales funnel to sell more to more people. So that when you do finally get to the point where you start putting more people into your funnel, you’ll sell more to more of them (more profitably!).

Resist the urge to invest in some other aspect of your business that is not directly related to your sales funnel. I’m frustrated when I see business owners with limited funds and a desire to invest in their business but they spend money on some aspect of their business that won’t have the contribution to their business that a sales funnel investment will have: One of the most common bad investments that businesses make today is investing in social media training and tools. Of course, there’s nothing wrong with social media training but because they are so popular right now, they become a big investment and business owners put their limited funds into that one thing, and they miss out on the benefits they could derive from first investing in their sales funnel (and later using the increased income to invest in new marketing methods.

 
 
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.
 
 

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