Lead generation funnels are a vital tool in your arsenal if you desire higher sales.
Marketing departments like their jargon. It helps the people within them talk with each other efficiently about what they’re doing.
A lot of the terms that they use, however, can alienate those who don’t live in that world. You might be one of them.
The term “lead general funnel” is a particularly striking example of jargon in action. Not only is it a metaphor, but it uses words like “lead” which are quite specific to a particular context.
Like it or not, lead generation funnels are a vital tool in your arsenal to get higher sales. If you don’t understand the concepts behind it, you’ll struggle to make serious in-roads with your audience and get them to pay you for your services.
What Is A Lead Generation Funnel?
The lead generation funnel describes the various stages that customers pass through as they move from their first interaction with your brand to buying your product.
The very first stage is awareness of what you sell. A customer may never have heard of your company before or what you do so that the first point of contact is vital. It’s where you get to create a good first impression and convey the necessary information about your products.
The next step in the lead generation funnel is when a customer becomes “engaged.” How you define an engaged customer is a little wishy-washy, but it’s somebody who is actively interested in your firm even if they’re not willing to buy right now. You might consider a customer to be engaged, for instance, if they return to your site a day or so after their first visit. Something has piqued their interest.
The next stage is your “prospects.” Prospects are customers who have moved beyond the engaged step and you believe are ready to buy. Again, identifying prospects is difficult, but there are tools like Kunversion that you can use if you think you’re on to something.
Most firms consider a prospect to be somebody who has interacted with your marketing to a higher degree than a person who is “just interested.” Marketing managers often use “lead scoring” to determine how closely the prospect fits the company’s buyer persona. The closer the match on metrics like age, job title, and so on, the more likely the opportunity will convert.
After prospects come marketing qualified leads. You create a marketing qualified lead by adding up the lead score of the prospect. If the number is big enough, it’s worth your while dedicating more marketing resources to that individual to get them to convert. A marketing qualified lead, therefore, is a person you bombard with additional marketing material.
One step further down the lead generation funnel is the “sales qualified lead.” A sales qualified lead is someone your marketing team believes is ready to buy right now and is worth a lot of money to your firm. It’s worth making a direct call to this type of lead because the chances of conversion are so high.
Right at the bottom of the funnel is when you convert a lead into a customer. All your effort has yielded a result.
Hopefully, from the above description of lead generation funnels, you can understand why marketers chose the funnel metaphor. At each step in the process from the first contact to final sale, you lose some prospects along the way. The reason for this is simple: the majority of people are not ready to buy from you yet. Understanding the concept of the lead generation funnel is vital if you are to use your marketing dollars effectively. You’d much prefer to target the people who are likely to buy from you than waste marketing dollars on those that won’t or can’t.
The Three Pillars Of Lead Generation
When it comes to lead generation, there are three pillars – thing that will make your lead generation strategy successful. These pillars are lead capture, lead qualification and lead nurturing. Let’s take a look at each below in turn.
Before you can begin selling, you have to capture leads. The basic idea here is to engage in marketing that will attract people who could benefit from buying from you. At the moment, there are millions of people who would like to use your product but don’t know anything about it. Your job is to use marketing methods that get the message out there and communicate with prospects, telling them about what you do.
Lead capture is a heck of a lot more complicated than you imagine. Your marketing materials have to be clear and concise in a way that customers immediately understand how you can help them.
If your business is selling cakes over the internet, then your lead generation is relatively straightforward. You just tell people that you bake delicious cakes. If, however, you sell some sophisticated software product, then lead generation is a heck of a lot more difficult. You need to explain your product in a language your prospects can understand, while also talking about the benefits.
Getting hold of leads is one thing, but selling to them is quite another. Top sales managers know that not all leads that they capture are of equal quality. Some people are not ready to buy yet, some are confused about what you offer, and some can’t afford you.
The lead qualification process is the part where you separate the wheat from the chaff. You don’t want to pursue all your leads to the fullest extent possible – that would drain your resources. Instead, you want to target those who stand a realistic chance of eventually buying from you. You’re avoiding time wasters.
Most firms use lead scoring to decide which customers they’ll approach. It’s objective, quick and, in some cases, automated. Lead scoring is where you apply a score to a prospect based on how similar they are to your target customer persona. The closer they are to your ideal customer, the higher their score.
The final pillar is called lead nurturing. Lead nurturing isn’t the kind of thing you can do en masse. It’s all about listening to the customer, finding out more about their situation, and then waiting for the opportune time to approach them for a sale.
Lead nurturing is one of the humanistic ideas to come out of the marketing community for a long time. You’re trying to find out not only if a person is likely to buy from you, but when. You can collect data to do this, but the most reliable method is usually one-on-one interactions.
Lead Management Is Not What You Think It Is
If you want to convert a lot of your leads into paying customers, you need to adopt a managerial approach. You might find this an unusual idea, but when you think about it, it makes sense. Customers, like colleagues, are people who need you to shepherd them in the right direction at the right time. You’re there to help guide their decisions so that everyone can benefit from a positive outcome.
Of course, this isn’t what usually happens. The usual course of events is a pushy sales managers hounding customers to hand over their money and complete the task at hand.
The problem with this approach is that it can cause people to fall out of the sales funnel altogether. A prospect might be interested in what you have to sell, but if you try to push them along too quickly, they could become irritated. People don’t want to feel like you’re forcing them to buy. They want to think that you’re there at the moment they need you.
Marketing managers in the modern era can find it tempting to quantify everything their customers do. Putting numbers to each individual certainly helps you automate marketing processes, but it misses out on the human element. Marketing is a relationship as much as it is an optimisation problem. You need to understand your customers and their thought patterns in real-time. If a customer’s data says that they are ready to buy, but emotionally they’re not there yet, it makes no sense getting a sales rep to call them. It’ll probably just annoy them.
Once a customer pops out the bottom of your sales funnels, that’s not the end of the story – it’s just the beginning of another. You can often re-insert that customer up your sales funnel at the prospect stage, knowing that they may need to use your services again.
Some marketing professionals use the term “recycling” to describe this process. Repeat customers suddenly become prospects again after buying from you. They stand to benefit from consuming more of your products.
Recycling is vital. It’s much easier to get business from a repeat customer than it is from a new one, not to mention cheaper. Your sales funnel, therefore, should reflect this. You want people to become customers and then immediately become prospects again. Many of the top companies in the world operate on this principle, offering their customers more products as soon as they make a sale.