Why Sales Funnels Are Important In A Competitive Market

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Why Sales Funnels Are Important In A Competitive Market

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In this digital age of dwindling attention spans and stiff competition among companies, businesses are finding it increasingly difficult to make consistent sales. This is the reality in spite of the vast technological advancements across all industries.

The 2020 report from the Bureau of Labor Statistics affirmed that 20% of small businesses fail in their first year, and as much as 50% fail by their fifth year.

Businesses in the digital industry are not exempted from this statistic, and in recent years, numerous techniques have emerged to improve the odds of business success. Sales funnels are one of these developments.

They are modern tools that have revolutionized the digital marketing industry by reducing the clumsiness of business processes through  business automation with great ease of scalability.

What are sales funnels?

A sales funnel is the marketing term used to describe the process that businesses adopt to move their prospects through on their way to a purchase.

When this multi-step and multi-modality process is properly utilized, a seemingly non-existent business could be propelled to the heights of a multi-million-dollar machine in a short period.

Sales funnels are very similar to generic funnels where substance goes in at the top and emerges from the other end. For sales funnels, the top is that section where a stream of prospects arrive and are taken on a journey through to making a purchase at the bottom of the funnel.

Understanding sales funnels

There are various means of attracting customers to a business - some of which include blogging, e-book download, posts on social media, cold or paid advertisements, newsletter signup, etc.

However, the quality of traffic a business gets to its sales page plays a critical role in shaping the buyer’s psychology and guaranteeing sales.

There are various phases in the sales funnels that businesses need to be aware of to better understand how to convert prospects into leads. These phases include:

  • Awareness Phase

This is the phase where potential customers are made aware of existing solutions to their problems. These prospects might have heard about the product via word of mouth, advertising or from social media.

An important question that business owners need to ask at this phase is “What state of mind is a typical prospect in when they arrive on your sales page?”

  • Interest and Evaluation Phase

The interest of prospects can be maintained by sending creatively crafted emails in an automated email sequence. The best digital marketers understand that prospects need to be familiarized with the concept of clicking on links if they are to increase sales and they implement this strategy from the start of the prospect’s journey through the sales funnel.

  • Decision Phase

Getting prospects to purchase a product/service is simple but not easy. Effective storytelling, copywriting and cultivating a link-clicking habit among prospects are some ways of making the final decision-making easier. Customer reviews and testimonials are also known to be helpful.

  • Taking Action

This is the final stage of the sales funnel where the conversion rate becomes evident. The level of success that product vendors and affiliate marketers experience is dependent on how effectively the preceding steps have been carried out.

The importance of a sales funnel

Businesses need to properly nurture prospects to close more deals and reduce client loss rate, a sales funnel offers this and more. Here are some other benefits of using a sales funnel in your business.

  • It helps businesses relate better with their customers

A well-organized sales funnel with engaging sales copy is an effective way of driving prospects further along the funnel and growing sales. A would-be customer is more likely to make a quick purchase decision when the product/service is well described and the business communicates in a way that resonates with the client.

  • It helps businesses select the right marketing strategy

A sales funnel affords business owners more opportunities to try out various marketing strategies. This way, businesses can find the marketing strategy best suited to their business model, product or service.

  • It increases sales

As you improve your business relationship with your customers and select the right marketing strategy, revenue will undoubtedly increase.

  • It gives companies/businesses a competitive advantage over those who don’t use a sales page

With a sales funnel, businesses are better able to focus their resources and have easier access to the right metrics that influence sales. A proper understanding of the sales funnel, sales metrics, and sales funnel management provides a competitive edge in any business niche.

  • It helps scale businesses with greater ease

      With the wealth of insight and metrics that a sales funnel provides a business, it is easier to make decisions and makes exponential growth more attainable.

Who needs a sales funnel?

Every business, vendor, and affiliate who sells/promotes a product or service needs a sales funnel. It is a proven way for nurturing leads until they mature into customers and it is a must-have to remain profitable in the modern competitive marketplace.

Businesses can now be rapidly scaled and tweaked to increase their prospect's conversion rate and increase sales. However, setting up a sales funnel isn’t all there is to guaranteeing success in the digital space.

Vendors and affiliate marketers still need to create engaging copy, install pixel trackers on their site, and create email sequences.

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Why Sales Funnels Are Important In A Competitive Market

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