Sales Operations 3 Comments
6 Ways to Fix a Leaky Sales Funnel
Few things are worse than a leak in your sales and marketing funnel that is costing your company revenue, and slowing your growth by losing leads somewhere between creation and close. No matter where you get your leads, it is important to identify the leak and not only plug the hole, but repair it.
Finding the leak will require sales and marketing to work together. Both teams need to be aware of when there could be a potential leak. There are five areas to monitor for potential red flags:
- The rate of leads to closed deals is low;
- The rate of opportunities to closed deals is low;
- Pipeline coverage is too low for your sales team to meet quota;
- There is a high amount of stalled opportunities; and
- There is a high amount of leads that haven’t been followed up on.
Some sales funnel leaks are easily identifiable, while others may go unnoticed and take a while to discover. But regardless of where a leak occurs or its cause, the longer it takes to find a leak, the harder and likely the more money it will cost to fix the issue.
Because you cannot identify where there is a leak when trying to fix multiple stages at once, this process will take time: your team will have to walk through the entire funnel, testing each stage. Here are six ways to examine your funnel and make it stronger.
1. Storyboard your current process from lead to close
Before you begin, your team needs to understand what a lead needs to do business with you and how to optimize the buyer’s journey. Take time to write out each individual step from lead form to close.
When you build out the buyer’s journey, think too about potential flaws in your system that make it hard for a prospect to do business with you. Far too often, companies sacrifice customer experience for internal process. Make sure that you break down barriers and make it easy for prospects to engage with your team at every stage.
2. Time initial lead response time
According to InsideSales.com, 35-50 percent of sales go to the vendor that responds first. With the average lead response time over five minutes, the chance of turning a lead into a customer decreases quickly. Today’s buyers are changing, expecting a B-to-C experience from B-to-B companies. That means speed wins deals.
The time it takes for your company to respond to leads once they hit their inbox may be the first source of a leak. Once you can respond at a healthy pace, review lead creation time from the lead form to the CRM and inbox. This is an important step because even if your team is responding immediately, it might take a long time for a lead get to them.
3. Track Attempts and Touches until initial conversion
Although starting with your initial response time is important, you must also understand your ongoing pursuit of a prospect and what it takes to convert those who don’t answer right away.
Various sources, including Topo, SalesLoft, and The Bridge Group, identify 6 to 13 as the optimal number of touches it takes to get a prospect to convert. Test out multiple cadences for yourself to discover what works best for your business.
Most people that I have spoken with typically settle on seven to nine touches, with a mix of email and calls over a two-to-three week period. They dig deeply into data, and make decisions based on evidence that it worked.
4. Identify why prospects are disqualified
As you begin to dive deeper into your process and ensure you are making the appropriate amount of effort to reach your leads, start to learn about the leads that aren’t working for you. Do they fit your Ideal Customer Profile? If they do, why did they not show interest in your company?
Take time to determine whether your messaging is not resonating with your target audience. It could be price, market immaturity, or a too-long product implementation schedule. Get on the phone, or listen to call recordings to hear it for yourself. It is the only way you can hear what is actually being said, and how your solution is being presented by your team.
5. Track the effectiveness of the handoff between BDR and AE
One of the easiest places for a lead to get lost in a sales funnel is during the transfer of ownership inside of your organization. Talk to your team and make sure they can talk you through the process of how they transfer ownership of the prospect, as well as ownership of their knowledge to the next person.
Work with every team to create a documented process from BDR to AE, and AE to Client Success to be certain that each prospect is set up to progress smoothly through the sales funnel. With documented handoffs, redundancy can create a bad customer experience, or cause prospects to get lost altogether.
6. Track the effectiveness of each stage of opportunities
Even if a handoff is smooth, each stage of the process must be effective. Identify how long each opportunity remains in a sales stage, and why they stay there. The team needs to be able to understand how to introduce a compelling event to encourage a prospect to take the next step in the sales process.
By setting clear, action-oriented goals for each stage of the process, you begin to learn about why deals stall. You can then begin to track conversions from one stage to the next. As you optimize each stage, you will be able to slow down and teach your team how to push their deals through the finish line.
You should also work to discover when and why you lose opportunities. After each closed-lost deal, debrief the AE. Next, work with the AE to learn how and why the loss happened.
Finding leaks in your sales and marketing funnel will be challenging and time-consuming. It will take commitment from the entire team, breaking a large process into smaller projects that can be completed step-by-step and clearly documented.
Keeping the customer at the center of each change is key to a successful plugging of the sales funnel – and that requires knowledge of customer engagement. Use the data you already have to determine the way forward for your team. Every small fix will produce better results, and help you grow your pipeline as well as your revenue.
Whether it’s fixing leaks in your sales and marketing funnel or just about any other sales topic under the sun, you’ll want to be in the room–virtually, of course–for the upcoming Sales Kickoff Summit 2016, a virtual event with over 30 featured speakers covering Sales, Marketing, and Social.