One of the biggest mistakes many businesses make is trying to grow sales is to go directly from initial contact with a prospect directly to making the first sale.
Can it happen that way? Yes. Does it happen that way most of the time? No!
Just like a budding romance, the prospect has to be warmed up to you over time. It can take a short while or a very long time. This is when the personality of the person providing the service is a huge part of why customers buy from the business.
It can be a dilemma for you, the seller of your product or service. What should you do while the customer is evaluating you and your offering? If you’re selling on a 1 to 1 basis, then backing off is not the correct option – but neither is pestering the prospect for the sale.
What you really need is a ‘sales funnel’, a way to track prospects through the journey between first contact and final purchase and plan your activities for each step along the way.
Now I know, as soon as I wrote “sales funnel,” a dark cloud started to pass in front of your eyes. There are literally hundreds of CRM systems out there that promise to help you track your sales leads, close more deals, and make you more money, and most all of them are built on a sales funnel philosophy.
ICT Execs prefer to keep things simple, so here are the necessary steps in the process anyone can use to set up a sales funnel that actually grows business, instead of just becoming a waste of time.
Define the Steps and Keep them Simple
We recommend just 4 categories to build your funnel: lead, pitch, closing, and won. This gives you all the data you need to see at a glance which of your prospects are where on the road to a purchase.
Track Closely Only Those Prospects Who Could Turn Into Customers
A key problem with many CRM databases is that they ask you to put in information about anyone and everyone. The burden of manual entry is tremendous, and completely unnecessary. Your CRM is for tracking prospects that might become actual customers. Don’t clutter it up with all of your networking contacts who are great people to know but will never become paying customers. Those people belong in your Contacts database, not your CRM (some database do both so functions so use them differently.
Know Where You Are In the Sales Process
On a single page or screen you should be able to know how many deals you have in your sales pipeline at any given time. You should be able to see how much each deal might be worth, and where each one is in the process. This kind of tracking helps you see exactly what’s happening in your business and where future revenue might be coming from.
Plus, it gives you a chance to do some financial forecasting. If you have 5 active deals, each with a potential £5,000 in revenue, your pipeline is worth a maximum of £25,000. Add in your overall conversion rate and you can do some easy forecasting for where your business should be in revenue over the next few months.
Manage the Conversion Rate at Each Step
Typically, “conversion rate” means how many prospects end up buying – but this is not specific enough to be helpful. Why didn’t they buy? Was it because of your price? Did your sales person do a bad pitch? Maybe they did not understand your complex solution to their simple problem?
Don’t just track overall conversions; track them at every step through the funnel. By doing this you will visual each specific step your customers have to take. Usually what happens is there are one or two steps that become sticking points, – fix those and your overall conversion rate will improve dramatically.
Every business that does 1 to 1 selling needs a method to track its prospects. As you think about the right system for you, make sure you don’t over complicate the process. Doing so will lose you time and efficiency; robbing you of precious hours you should be spending trying to grow your business.
Simplicity is the key to implementing systems that actually get used. Whatever system you choose to track your sales funnel, even if it’s just a spreadsheet, make it as easy to use as possible. Do that and you should see improvement in every area of your sales efforts along with a healthier bottom line.
The next articles will discuss the next steps in the growing your business revenue – so keep coming back here for more. Or if you cannot wait and want a free discussion with Phil about the specifics relating to your business then call or email directly our details are here.