A sales pipeline gives a comprehensive overview of the buyer’s journey within your business’s sales process. According to the Harvard business review, companies that follow a formal business process generate higher revenue. Interestingly, companies that followed effective sales pipeline management practices experienced a 15 percent growth in revenue compared to their competitors.
Sales pipeline management is fundamental to business success but how do you ensure an effective sales process that focuses on building a robust sales pipeline? The solution lies in paying attention to every single stage within the sales pipeline and following best practices by using pipeline management software at each stage.
Sales Pipeline Stages
While the steps that all sales reps follow and the overall sales process is unique according to the business needs, the sales pipeline stages follow a common blueprint. The journey of acquisition of leads and their eventual conversion into paying customers remains the same across the different industry verticals.
The names given to each of the pipeline stages may vary according to the company preferences. Some companies may prefer to club two stages together while others may choose to divide a single stage into multiple stages on the basis of the actions performed but the actions performed in each stage remain consistent.
Here is the breakdown of B2B sales pipeline stages that can lead you to a robust sales pipeline.
1. Prospecting/ Lead Generation
The first stage of sales pipeline management is all about attracting and engaging prospective clients through marketing campaigns. Prospecting involves connecting with the right audience that needs the product or service you offer.
The first step is of key importance because the quality of leads that go into your sales pipeline would eventually determine how many of them would actually convert and generate revenue for your business. The prospects and leads generated need to be interested in your offering because it provides them with something of value.
So how do you start? Where do you look from prospective customers who would potentially be interested in what your business offers?
- Create an ideal customer profile: The ICP, also known as buyer personas consists of grouping the target market according to their common traits and demographics. Ideally, this target group has another thing in common. Your product solves a common problem for them making them interested in your product offering and willing to pay you their money.
- Start with inbound marketing: Creation of specific content targeting the ICP and attracting potential customers via content and social media marketing strategies is what inbound marketing is all about. The prospects are offered something of value which draws them in and results in the generation of a lead. The outreach happens from the customer’s end rather than the company’s end.
- Leverage outbound marketing techniques: Outbound marketing is when the company proactively reaches out to the prospects that fit the ICP and informs them about the product offerings in an attempt to get them to convert. The outreach can be done in the form of email marketing campaigns (cold emailing) or cold calling the prospects.
2. Initial contact
The first contact with the leads can be done via emails, telephone calls or in-person meetings depending on your sales process. The main objective of the initial contact is to figure out whether the leads generated are a good fit with your ideal customer profile, whether the product you offer is something they are looking for and would be willing to pay for and whether furthering the lead through the sales pipeline stages would result in eventual conversion.
Establishing trust is a priority during the initial contact stage for future conversations with the leads. Understand what the customer requirements are and shed some light on how the product or service offering can help solve a potential problem and alleviate their pain points for them.
3. Lead qualification
Lead qualification involves vetting the prospects in order to determine if they are a good fit for your company and the product or service being offered. It is the determination of the willingness and the ability of the prospect to make the purchase decision and subsequently becoming a customer for the business.
As the prospects go further along the sales funnel, they start dropping off. The time and resources spent chasing these leads gets wasted. This is why qualification of the leads becomes of critical importance. It prevents the sales reps from chasing every single lead in the hope that they convert. It also lets the sales and marketing team’s efforts be focused on pursuing the leads that have the highest chance of converting. Use of marketing automation tools for scoring of leads helps to take the pressure of performing manual computing of lead scores off the sales reps and lets them focus on actual selling.
Lead qualification consists of two stages:
- Marketing Qualified Leads: These are the leads generated through inbound marketing efforts. They may have clicked on the call to action button on your website and submitted their email address in the lead generation form or they may have signed up for a free trial or a demo to your product.
- They are scored based upon the actions they take, get converted into marketing qualified leads and are handed over to the sales team for follow up and furthering their buyer journey in the sales cycle.
- Sales Qualified Leads: These are the leads that have been vetted by the sales team. They are deemed to have a genuine interest in the product/service offering before being furthered into the next stage of the buying cycle.
4. Fact Finding
Fact-finding stage focuses on matching the prospect needs with your product offering and helps bridge the gap between the two. You need to determine whether the prospects are a good fit for the product or service you would be pitching to them, whether they really need it and if they have the means and the decision making power to complete the purchase. This can be achieved by asking leading questions to the prospects or sending out surveys to the qualified leads.
BANT framework is a popular method of determining whether the lead fits the target customer profile. BANT stands for budget, authority, need and timeline.
- Budget: What is the amount they are willing to pay to avail the product or service?
- Authority: Who are the key decision makers? Does the authority lie with someone higher up in the organizational hierarchy?
- Need: How bad is the requirement of your product or service to them? Whether the need is critical and they are in dire need of your product or they can make do without it?
- Timeline: Do they have a predefined time frame to make the purchase decision?
5. Proposal/Product Pitch
The next stage in the sales pipeline is to send out a detailed proposal to the prospect that includes specifications on the product that is being offered, for how long and at what price.
The focus in this stage needs to be on the customers rather than the product itself. Having an explainer video or a demo by the sales reps that focuses on how the offering is beneficial to the prospects can result in a more effective proposal.
Here are a set of best practices that your sales team needs to get started with for a stellar product pitch in order to close more deals
- Log the activities undertaken in a CRM software: Sending over the proposal takes place in the form of multiple interactions with the prospects. Having a log of all the conversations that have taken place as well as the future appointments in one place through the use of sales pipeline management and CRM software is vital for the sales reps to close deals more effectively.
- Keep the customer in focus: Remember, you are not selling a product, you are selling a solution for your customers. Having the product pitch personalized to the individual customer needs on the basis of fact-finding done in the previous sales stages makes the leads more invested in your offering
- Clearly outline the offering: Make sure the product pitch contains a clear communication about the product in addition to the pricing and other terms and conditions if any. This removes any ambiguity from the offer making it more compelling
- Simplify the proposal: The final proposal should steer clear of all the technical jargon and use of heavy words. The aim should be to send the message across to the leads in the simplest words possible.
- Schedule follow-ups: The decision-making process likely takes time. There may be several other stakeholders involved which may delay the decision. Scheduling follow-up appointments in the sales CRM helps prevent stagnation of the deal.
If the prospect is ready to make a purchase, you can go ahead and close the deal but that doesn’t happen that often. There are usually additional concerns that need to be addressed and queries that need to be resolved before the actual buy happens. Small changes to the proposal and pricing may be required from your end before the lead actually converts and this is what the negotiation stage consists of.
Both you and the potential customers need to be on the same page during the negotiation stage to make sure that the deal goes through. The key aspect you need to focus on during negotiation is to establish a two-way communication. While getting your point across to the prospects is important, listening to their concerns is equally important.
The negotiation may take place over a phone call, an in-person meeting or over an email. It depends on the preferences of the sales reps. What matters is that all the conversations that take place during the negotiation are stored in a centralized location that the sales reps can refer back if required.
7. Closing the deal
Depending on whether the prospect ends up buying your product offering or not, the deal is closed and classified as won or lost. There is no specific line in the sand that determines the exact moment that the deal actually closes. It depends on your personal classification.
Some businesses may consider signing of the contract is the moment when the deal is won while others may write off the deal as won only after the payment actually comes through. Either way, the deals that manage to get through are classified as won. On the other hand if the lead drops off during any of the sales pipeline stages, the deal is considered lost.
This isn’t the end though
Contrary to the popular belief, simply winning or losing the deal is not the end to sales pipeline management. Here is a list of further steps that need to be followed when the leads complete their journey through the stages of the sales pipeline.
- Maintain and nurture relationships: Continue with strategic communication with the clients and provide robust support in case they face any issues while onboarding. Relationships with the new customers need to be nourished and their trust needs to be maintained. Make it a point to be a source of helpful information in order to excel at establishing an ongoing relationship
- Always ask for feedback: You need knowledge about the aspects of your sales process that are working and ones that are not. Customer feedback is crucial to gain these insights.
- Revive and follow up on dead leads: In case the deals are lost, don’t simply write them off. Dive deep into the reasons the leads failed to convert and be ready to revive the leads on a later date when the conditions are more favorable.
- Leverage existing leads to build new relationships: Ask the current customers for referrals to generate new leads. The existing customers can also be offered upgradations and other relevant offerings in the form of up-selling and cross-selling.
Best Practices For Sales Pipeline Management
Optimization of the sales pipeline to ensure that the leads quickly go through the different stages and eventually convert directly correlates to greater profitability of your business venture. Here are the best practices that you need to follow within your organization to ensure effective sales pipeline management for achieving your sales goals.
- Keep a log of activities undertaken and upcoming future appointments in CRM software.
- Have the sales reps to consistently fill their sales pipeline in the sales and make it a habit
- Follow an organized sales process to minimize churn and maximize conversions.
- Train the sales managers in pipeline management techniques and strategies
- Track the sales pipeline metrics to measure and analyze the buyer’s journey
- Identify regions of stasis within the pipeline stages and undertake corrective measures.
- Take data-driven decisions and schedule regular follow-ups
The sales pipeline is the road prospects take to transform into clients and the sales pipeline stages act as the milestones that guide the customer along the way. Making use of a sales CRM software like Benchpoint lets you visualize the sales pipeline in a more effective manner.
You can actively track a number of deals as they move through the different stages, figure out areas of stagnation and latency within the pipeline, streamline communications and events so that you never miss out on an appointment and can effectively track the important sales metrics so that you get a clear overview of the actual performance of your sales team.
It is the best Insightly alternative, Pipedrive, Salesforce and other popular CRM software commonly available in the market. What’s more, it comes with a forever free plan making it the best tool your sales team would ever need.
Try Benchpoint for free today!