Lead generation funnels and sales funnels
Sales funnels have been around since the 1890s, so you probably have a fair understanding of what they entail. Lead generation funnels, on the other hand, are less widely understood.
So what is a lead generation funnel? Like sales funnels, lead generation funnels help us to strengthen our marketing strategy. Whereas sales funnels focus on improving the entire sales journey, lead generation funnels primarily help us to filter strangers into a pool of qualified leads.
Improving your sales funnel can increase your sales. However, do not overlook the importance of implementing a strong lead generation funnel. After all, leads are the lifeblood that sustain your sales pipeline. With that in mind, let’s explore how sales/lead generation funnels can help grow your business!
What is a sales funnel?
Sales funnels have existed since the 1890s but, over the years, the internet and smartphones have revolutionised the way funnels actually work. A strong sales funnel will generate leads, close sales and retain customers.
So, is there a sales funnel blueprint that can be applied to all businesses? Well – yes and no. The strategies we use to implement our funnel will certainly differ depending on our industry, the size of our business, and other factors. Nonetheless, most sales funnels will be based on the following format:
- Attract – At this stage, the challenge is to engage strangers. You’ll be planting a seed in their minds and inviting them to learn more.
- Convert – If a stranger is incentivized to disclose some of their personal information to you, they can be considered a lead.
- Qualify – As you probably know, not all leads are equal. Often, a good sales funnel will prioritise the most qualified leads, so you can spend more resources on people most likely to buy your product.
- Close – Now that you’re on first name terms with your qualified leads, you can build trust and sustain their interest. If they’ve reached this stage in the funnel and you are practising good marketing strategies, they should end up buying your product. At this point, a lead becomes a customer.
- Delight – Once your lead has filtered through the sales funnel, you’ll try your best to retain them. Remember, a satisfied customer is more likely to recommend your business and positive recommendations will attract more strangers to the top of your sales funnel!
If it all sounds a bit fluffy then don’t worry; we’ll explore how to implement a funnel in a bit more detail below. First, let’s explore exactly what we mean by a lead generation funnel and how it relates to the sales funnel described above.
What is a lead generation funnel?
Sales funnels and lead generation funnels are often referred to interchangeably, but they are slightly different. If you were implementing a lead generation funnel for your business, you’d be most concerned with the first three stages of the above model (attract, convert, and qualify). So, what is the value of a lead generation funnel if it’s basically just the top half of a sales funnel?
It boils down to focus. When we consider the customer journey in its entirety (as sales funnels do), we risk overlooking specific elements of marketing – such as how well we are qualifying new leads. Thankfully, lead gen funnels can provide business owners with a truly focused model for attracting and converting the right customers at the right time.
Indeed, given the complexity of lead generation, it’s no surprise that small and medium-sized businesses often choose to invest a large proportion of their marketing budget in lead generation activities.
Now we’ve discussed sales funnels and lead generation funnels, let’s explore the tools you can use to attract, convert, and qualify new prospects!
Attracting new customers
Strangers to your business won’t know how great you are so you’ll need to tell them. But how can you gain this type of exposure? Your options include:
- Write interesting content on your blog, website and social media – Perform some keyword/topical research to determine what your target audience are interested in. Write content that reflects their interests and you should see more traffic to your sites.
- Earn referrals and reviews
- Run ad campaigns – Facebook lead generation tools can provide great exposure. LinkedIn and Twitter also provide similar services. Some advertising tools propel new prospects down the funnel much faster because they also convert and qualify new leads (see below).
Convert strangers into leads
Implementing a lead magnet or call-to-action can help you turn strangers into leads. So, how does this work?
Let’s assume you’ve written a great, authoritative blog post and at the bottom, you’ve placed a prominent call-to-action; you’ve invited readers to download a free E-book. To access their freebie, visitors will be redirected to a landing page where they’ll need to provide some personal information.
Once the lead has provided their details, you’ll get the opportunity to build a stronger relationship with them, thereby directing them further down the funnel.
Qualify new leads
Depending on how you generate leads, you might find that some are not really that interested in your product. One way to qualify leads is to ask them a few relevant questions when collecting their data.
For example, let’s assume you’re running a Facebook lead ad offering a free test drive for a car you’re trying to sell. In the sign-up form, you could give leads the option to specify whether they have a date/time in mind for their test drive. The leads who do provide a preferred date/time are probably more serious about trying the product than those who leave the box blank, so you might choose to follow-up the first group of leads as a priority. Indeed, qualifying your leads can help you manage your resources wisely.
Learning how to qualify your leads can be tricky but using tools like HubSpot can help you decide where to prioritise your outreach.
Benefits of implementing a lead generation funnel
If you want to grow your business, improving the way you attract, convert, and qualify new leads is bound to help. One of the easiest ways to achieve this is to implement a lead generation funnel. Let’s finish by reviewing the key benefits of this methodology:
- Tried-and-tested – Most online businesses use some type of lead generation funnel. If one of your competitors is growing at a much faster rate than you, it would be quite easy to replicate elements of their lead generation funnel.
- Efficient – A good lead generation funnel encourages new prospects to filter down the sales pipeline efficiently. If you don’t use a lead gen funnel, you could be waiting months or years for new customers to materialise. Moreover, if you don’t qualify new leads, you could be wasting a lot of energy on visitors who don’t really care about your product.
- Cost-effective – Lead generation funnels cost money to implement, test, and update. However, most companies would agree that they are a cost-effective investment because they automate many elements of the sales process. This helps to keep business costs as low as possible.
So, if you want to attract new visitors, turn them into leads, and determine which leads are most valuable to your business, make sure your lead generation funnel is watertight!