The Optimising Process
Every business has a sales funnel. It is the process whereby potential customers go from not knowing about your business to becoming clients.
This sales funnel needs constant work. Where are the weaknesses? Where can it improve? How do I improve it? These are just some of the questions business owners ask when struggling with their own sales funnel.
In this article, we’re going to look at how you can constantly analyse, test and improve your sales funnel to increase profits.
What is a sales funnel?
To start with we’re going to define the stages of the funnel. In your company, they may have different names, but the basis should be the same:
- Awareness – This is when someone first becomes aware of your company and the solution it offers. At this stage you might be running ads, networking, producing blogs, posting on social media etc.
The aim is usually to get their contact information or to show them a product to then be able to retarget them with ads.
- Interest – Once you have their contact information you can then try to build their interest. This is usually in the form of an automated series of emails that offer further problem-solving information for free, such as a blog article.
This builds your brands trust in their eyes and moves them closer to a decision.
- Decision – Here you’re looking to guide a potential lead to making a decision. Usually, they are led towards a decision by influencing strategies such as a clever pricing structure or time-limited offers.
- Action – You then need to make it as easy as possible for a potential client to take an action. This could be booking a meeting, to agreeing to a service or buying a product.
As an example, one of our funnels starts when potential leads see an advert on social media. They are then sent to a landing page where they are given a free course in exchange for their email address.
We then send a series of useful emails linked to articles that offer value to their business. Only then do we offer them a call. They choose a time that suits them with no back and forth emails.
Get control of your data
The most important part of this whole process is to collect and understand your data. We use Google Analytics, though there are several platforms out there.
Do you know the percentage of people who see your ad vs those who click on it? How many of them take an action? Do you have people who book a call, but don’t show up? Do potential customers leave a purchase in their basket?
Each touch point for your potential clients and customers need to have a value of success. In our example above users were pushed to a landing page through an advert and then we collected their email address by offering a free course.
If we could increase the sign-up rate from 5 to 10% of the traffic it would half our marketing spend. You can only decide where you need to intervene once you have a grasp of your data.
Pick a target
So, you have a sales funnel set up, a system to collect data at each stage and you know the conversion rates. Which part of the funnel do you target for improvement?
There is no easy answer to this question, but it is an important one to answer. For example, a 5% conversion rate on a landing page might be amazing if it is a sales page, but it is poor if you are giving away something for free in return for an email address.
The best way is to build a model of your sales funnel. Let’s say you have a company where the lifetime value of a client is £800. If it costs you £400 to get 400 people to your landing page and 5% sign up for your lead magnet and give them your email address, then you have 20 people left in your funnel.
Then through your email targeting you get 10% to opt into a call and 50% of those calls take out your service, it means that you have 1 client for your £400 spend. Giving you a cost of acquisition of £400.
What stage of that funnel do you target? The best way is simply to do some research. A 5% conversion rate on a landing page would be the first thing to look at.
If you manage to increase the landing page conversion rate on the landing page to 10% then you half the cost of acquisition.
Sorting your ideas
Now you have your target where there is a weakness in your funnel. You probably have a million ideas about how to solve it. How do you rank your own or your team’s ideas to decide which ones to test?
We come up with several and then we rank them using an ICE scoring system. Each part is given a rank from 1-10 and then an overall score:
- Impact – What impact do we think the change would make?
- Confidence – How confident are we that the idea will work? Is there any evidence that the idea has worked in other companies or have we had any experience of it working?
- Ease – How easy is it to carry out? How much time or money will it cost to implement it?
The idea with the highest overall score is usually the one we test first. However, sometimes we want to work through the easiest ideas first to get some easy wins or the highest impact if a section really isn’t functioning as we expected it to.
As an example, completely remaking a landing page might be a higher impact score, but a higher ease score would be to change a call to action on the page.
Once you have analysed your sales funnel, you know where you want to improve and you have ideas you want to test, the next stage is seeing if it works.
This is where you move into A/B testing. Using this process, you would test one factor against a control. One example could be to change a call to action on a landing page and test its conversion rate against the previous example.
You can A/B test all along your sales funnel from the booking system for calls, to the wording on product pages or images in ads. The possibilities are endless.
If you have a high enough stream of traffic you can move into multivariate testing. Rather than just one change you can test more than one at the same time.
Once you have the hang of this you can then start to test out your ideas at every stage of your sales funnel. Small, continuous, incremental improvements can lead to big results over time.
Constantly testing and improving your systems can lead to amazing results. In addition, it gets you and your team into a great frame of mind, constantly testing and looking for new areas for growth.
Though setting up this kind of system can take a great deal of effort the results will be worth it.