Hello, proactive business owners!
In the previous part of this blog, we spoke about:
- What is a sales funnel?
- How does it work?
- What kind of content is required at each stage to ensure effective sales funnel management?
And finally,
- How can you incorporate sales funnel management in your business?
Now you must be thinking that your work here is done, right? Wrong! I have some stats for you –
- Approximately 79% of marketing leads never convert into sales, primarily due to a lack of proper lead nurturing.
- On average, only 3.1% to 5% of visitors convert into leads through a sales funnel, highlighting potential leaks where businesses lose prospects before they become leads.
- Approximately 96% of website visitors leave without converting into a lead or sale.
Despite having a sales funnel, why is this happening? Leaks/ cracks in the sales funnel are causing issues like – initial interest is not being captured and converted effectively, potential customers are not being effectively guided towards making a purchase, businesses cannot identify where prospects are dropping off, etc.
Let’s dive into how you can identify and fix cracks in your sales funnel.
What are the ways you can identify the cracks in your sales funnel?
Ask yourself these questions:
1. How good is your lead targeting strategy?
Understanding and Targeting the Right Niche: Are you reaching the audience most likely to be interested in your product or service? Use tools like Google Analytics and social media insights to understand who engages most with your brand. This helps ensure that your marketing efforts are directed toward a receptive audience.
For example, an accounting firm targeting e-commerce apparel businesses should focus on companies without physical stores to capitalize on the rapid rise of the e-commerce fashion market. This lead targeting strategy helps them increase conversions.
- How well are you addressing their pain points?
Your product or service should directly address and solve the issues your prospects face. Understanding their pain points allows you to tailor your offerings to meet their needs effectively.
For example, your target audience struggles with inventory management, highlight how your solution simplifies this process and saves them time.
- Are there any frictions in the lead conversion process?
Look for barriers that prevent leads from moving smoothly through the funnel. This could include a complicated checkout process, unclear calls-to-action (CTAs), or slow response times.
For example, a slow-loading website can deter visitors from completing their purchase. Optimizing website speed can reduce this friction.
- How good is your value proposition from the consumer’s POV?
Your value proposition should be clear and compelling, highlighting the unique benefits of your product or service. Ensure that what you offer aligns with what your prospects need and value.
- What might be the potential leaks in each stage?
Look for specific areas where leads drop off, such as attracting unqualified leads, lack of lead nurturing, or a complex checkout process. Understanding where these leaks occur helps you address them more effectively.
For example, a lead drops off after initial contact. In this case you can consider enhancing your follow-up process to keep them engaged or bring them back in the funnel.
Using Analytics tools to identify leaks:
a. Heatmaps:
Heatmaps show how users interact with your website, highlighting which elements are engaging and which need improvement. By analyzing heatmaps, you can identify areas where users lose interest or encounter difficulties.
For example, if a heatmap shows users frequently clicking on an element that doesn’t lead anywhere, consider making that element more functional or informative.
b. Google Analytics:
Google Analytics helps track user behaviour, conversion rates, and key metrics. This data reveals where users drop off in the funnel, allowing you to pinpoint and address leaks.
For example, high bounce rates on a particular landing page may indicate that the page content isn’t resonating with visitors. Revamping the content to better match visitor expectations can reduce bounce rates.
c. CRM Systems:
CRM systems track interactions with leads and provide insights into their journey through the sales process. By monitoring user behaviour at every stage of the funnel, businesses can identify where potential customers drop off and why. This combined approach helps pinpoint where leads encounter issues or lose interest.
If many leads express similar complaints about a particular stage in the process, it may indicate a systemic issue that needs addressing. Similarly, if users consistently abandon their cart at the payment stage, simplifying the payment process or offering more payment options can help reduce this drop-off.
How can you fix these cracks in your sales funnel?
Now that you have identified the leaks, let’s look at ways to fix them!
1. Not targeting the right audience:
Problem:
Targeting the wrong audience leads to unqualified leads progressing through the funnel, reducing conversion rates and wasting resources.
Solution:
Find the perfect niche audience for your business using tools like Google Analytics, social media insights, and customer surveys to gather data on who engages most with your brand. Create detailed buyer personas that outline your ideal customer’s pain points, preferences, and purchasing behaviors. Tailor your marketing messages and campaigns specifically to these people and try to capture the market within your niche with effective sales funnel strategies.
Example:
As discussed in the example before, if an accounting firm exclusively targets E-commerce apparel businesses that do not have physical stores yet. Due to the rapid rise in the e-commerce fashion market, they can be aggressive in targeting businesses in this niche and improve conversions offering their expertise in the field.
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Poor value proposition:
Problem:
The purchases of differentiated products are driven by the value consumers perceive them to have. You may have the best product in the market but if a consumer perceives its value below the price they pay, they are not buying it. Any product/service with no distinct value makes price the only factor for the purchase decision, ultimately brewing cut-throat competition where your margins take a hit.
Solution:
Clearly articulate what makes your offering unique and superior to the other alternatives.
Alex Hormozi, a big-time salesman uses this value equation to create the best offers ever:
The goal here is to maximize the first two factors (Dream Outcome and Perceived Likelihood) while minimizing the last two (Time Delay and Effort/Sacrifice). This creates a highly compelling offer that differentiates you from your competition. Working with this equation helps to create ‘The Offer’ that every lead wishes to stumble upon.
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Irrelevant CTA (Call to Action):
Problem:
Businesses make the mistake of using the same call-to-action (CTA) irrespective of where their prospect is in the consumer journey. However, using the wrong CTA at the wrong stage can cause confusion and your leads might drop off from the funnel.
Solution:
To plug this leak, putting out personalized CTAs according to your consumers with great copy and aligning it with the sales funnel stage your leads are going through helps immensely with their smooth flow throughout the funnel, ensuring that they have a sense of direction about their next steps in the process.
Example:
For instance, if you share a BOFU (bottom of the funnel) CTA when your consumer is still in the awareness stage where they are not yet aware of your product or the problem it solves, you might lose the lead. Use a simple “Learn More” CTA in the awareness stage and a “Get a Quote” CTA in the decision stage.
The average conversion rate is between 2% to 5% and losing those already low conversions to a poor sales funnel strategies is something you cannot afford! Tired of losing leads due to bad sales funnel management? Worry not, that is where we come in to save the day! We help businesses prepare, maintain, monitor, and constantly improve them. At Contetra, we have worked with 150+ business owners to help them create cash-rich scalable businesses! We do this by – creating sales budgets, evaluating, and revamping the sales funnel & lead targeting strategy, setting up and monitoring KPIs of the sales team and bringing about a 2x positive increase in the top line as well as the bottom line. Feel free to book a slot here for a personal one-on-one review with one of our business consultants to know how we can do this for you too.
