The sales pipeline is a very important tool in any company’s success. It is a step-by-step sales process that is used to measure and track the progress of a sale. This helps a company to better understand how and when a sale will be completed, as well as identify any problem areas in the sales process.
Consequently, it will allow a company to improve its sales strategy and increase the number of sales made, which in turn helps to increase its revenue. The sales pipeline also provides an overview of the prospects and customers that are in the buying process. This information is vital to the success of the company, as it allows you to identify and take advantage of sales opportunities.
Differences between the sales pipeline and the sales funnel
Sales pipeline and sales funnel are two terms related to the sales process, but they differ in their approach. While the former is completely sales-oriented, the latter focuses more on detailing the journey of potential customers at each stage of the process.
Here is a brief summary of their contrasting differences:
- Focus: as we have already mentioned, the sales pipeline focuses on the sales process. That is, on the steps that must be followed to close a sale. On the other hand, the sales funnel focuses on the number of leads at each stage of the sales process.
- Graphical representation: the Spanish translation of pipeline is tubería, and this is how the sales pipeline is visually represented. This is because it is about bringing already interested (i.e. qualified) customers to close the sale. The sales funnel, as its name suggests, owes its shape to the fact that it is about capturing leads from a very broad audience to the consumers who have made the decision to buy. While at the top of the funnel there are many potential leads, at the bottom you will find a smaller number of potential customers, but more likely to buy, ready to convert.
- Measurement: The sales pipeline is measured by the effectiveness of the sales process, while the sales funnel is measured by the number of leads and closed sales. This is because their objectives are different. In both cases the efficiency of the team is important, but when we talk about the sales pipeline, it is all about getting a successful outcome for the activities that the salespeople have performed, whether it is a call, email, demo or a set of strategies.
Stages of the sales pipeline
Defining sales stages is crucial to increase sales success. It must be segmented into stages that align with the customer’s decision-making process. At the same time, the sales team must adhere to the stages and understand the importance of each stage.
It is recommended to review and refine the stages every month or two to ensure that they reflect typical sales scenarios. It is important to discuss the stages with the entire sales team to ensure they understand their importance.
While it is ideal to have a SMART goal-oriented pipeline, generally speaking, its structure is as follows:
Qualification: this stage assesses the viability of the sales opportunity and determines whether the prospect is a good candidate for the sale. One way to do this is to carry out an SEO and search engine optimization analysis to identify whether the potential customer is actively searching for the product or service being offered. In addition, a conversion is performed to determine the likelihood of the potential customer making a purchase.
Presentation: at this stage, the offer is presented to the potential customer and their doubts and objections are resolved. Different marketing strategies can be used to carry out this stage, such as telemarketing or internet advertising. Facebook ads can also be considered to reach a wider audience.
Proposal: at this stage a formal proposal is presented to the customer, including details about the product or service, the price and the terms of the sale. To carry out this stage, it is important to take into account what a CRM is, since this tool can help manage customer information and customize the proposal according to their needs and preferences. In addition, a marketing strategy can be developed that takes into account the competition and Google positioning.
Negotiation: at this stage, the terms of the sale are negotiated, including price, payment terms and other relevant details. To carry out an effective negotiation, it is important to take into account the relationship between marketing and sales, and to use the right keywords to generate trust in the potential customer. In addition, it is important to take into account the importance of photos and videos to present the product or service in an attractive way.
Closing: at this stage, the sale is closed and the final terms of the transaction are established. To carry out an effective closing, it is important to use direct marketing strategies and have a bank of images to present the product or service in a clear and attractive way. You can also consider blogging to keep customers updated about the products or services and establish a long-lasting relationship with them.
Structure a strategy first
Salespeople often face the challenge of managing a complex sales pipeline with numerous prospects, leads and deals at various stages of the sales cycle. This is often time consuming and difficult if the right forecasts are not made.
By following a few key tips, salespeople can simplify their approach and increase their chances of success:
Establish a precise and well-defined sales process.
It is important to have a set of guidelines for identifying, qualifying and nurturing prospects. Similarly, a system for tracking and managing leads through the different stages of the sales pipeline is a key element. This practice will help salespeople understand the process and adjust to it, and with a defind plan, they will know better how to manage both their time and resources. This ensures that they focus on the most promising opportunities and make the most of each sales interaction.
Define clear qualification criteria
Prioritizing leads based on their needs, business implications and openness to communication with the sales team is the secret to a successful strategy. As a result, salespeople will be able to manage their time and resources more effectively, improving their chances of success and closing rate. Establishing transparent qualification criteria that give prospects a score based on their level of involvement and potential value to the company will help you achieve this. As a result, you’ll be able to focus on leads where the stakes are high and where a potential champion could stimulate sales team activity.
Organize a plan and don’t break the chain!
It is essential to maintain order and concentration throughout the sales process. But it is even more important to maintain it constantly. Some recommendations for not breaking this “sales closing production chain” is to make sure you evaluate your offers and sales pipeline regularly and rank them according to your sales qualification procedure. Some B2B sales agency organizations use stages that have exit requirements or benchmarks that must be met in order to include highly sought-after sales departments in the campaign.
To streamline their approach and lessen the administrative burden of managing a complicated sales pipeline, salespeople can also use automation tools and technologies, such as LinkedIn’s CRMs or Sales Navigator, among many others.
Don’t forget to measure
Track progress: we’ve said it many times before, “what you can’t measure, you can’t improve.” It is important to track progress to identify what is working and contrast it with those aspects that need to be strengthened. With proper monitoring, you will have the opportunity to identify the hidden potential of some areas, as well as focus on the failures to improve them.
- 4 key tracking KPIs you need to know: to start your inspection, we advise you to focus on four KPIs that will help you evaluate progress. These are: deal size, success rate and velocity of your sales pipeline. Focusing on these elements will help you have a clear view of your pipeline, so you will be able to make better decisions to improve it.
- Focus on one or three elements: although it is important to follow the four key elements, it is also important not to follow too many things at once. Focus on one or three elements at a time to maximize the use of the information.
- Identify the most important problem: If you are not sure where to start, start by tracking the problem that is affecting your sales results the most. For example, if you are not adding enough deals to your pipeline, start by tracking the number of deals you are adding per day or week.
- Be specific in your tracking: When tracking your pipeline, it’s important to be specific. You can track not only the number of new deals added each day or week, but also the number and value of key transition milestones in your pipeline.
- Use sales tracking tools: when you are alone or in a small team, you can track your activities as you wish. You can do this through a spreadsheet or even by drawing an “X” for each on a whiteboard. However, as you grow, you may want to use sales tracking software to help you track more efficiently.
- Keep tracking: no matter what method you use, be sure to use it continuously. If you wait until the end of the week, it will be harder to remember exactly how many sales you made.
Protip: One recommendation is to decide which of the four key elements is most important to your success and start tracking it. Set a reminder for 90 days from now to measure the progress of your tracking efforts. This will help you decide if you should stick with that element or try something different to improve your sales results.
When we enter the world of marketing we encounter a variety of concepts that can be confusing, however their differences will determine the effectiveness of the advertising or sales strategy. Therefore, knowing what the sales pipeline is, what its stages are and some fundamental tips will make the difference between closing sales or attracting new potential customers.
To achieve successful results when using a sales pipeline, it is crucial to create clear processes, prioritize prospects in the right way and focus especially on organization and efficiency. By following these key strategies, you will not only increase your revenue, but you will create a team that is ready to be a sales machine.