What is a Sales Pipeline?
Do you want to know what is Sales Pipeline? Why is it important to your business? The sales pipeline is a term used to describe how a salesperson moves forward with prospects and customers. It involves completing the sale by following up, learning about what was enjoyed or not, and getting permission for future contact.
The sales pipeline is a critical component of a sales process that tracks and displays wherein a potential customer is at any given time. The goal of a sales pipeline is to ensure all potential customers are contacted at the right time, by the right person, with the right message.
A sales pipeline is a step-by-step representation of your customer’s path to complete a deal with you. Each organisation’s pipeline may be a little different, but generally, they’ll contain these stages or other very similar options. The sales process is the process of selling a product or service to a potential customer. The stages are an incremental series of steps taken by the prospective buyer over time.
This blog post will walk you through some things you need to know about Sales Pipeline.
The Stages of the Sales Process
1. Pre-Sales: This is when a company is first introduced to a new prospect and learns about their needs. This information may come from industry publications, competitor research, and other sources.
2. Initial Meeting: This stage is where the company introduces itself and learns about the customer’s needs and priorities.
3. Presentation: This is where the company presents its product or service to the customer and tries to gain their interest. It includes knowledge about the customer, benefits of the product, its prices and promos, and many more.
What’s the Difference Between a Sales Pipeline and a Sales Funnel?
A sales pipeline is the list of all your prospective customers. It’s like a big bucket list that you are going to go through one by one, checking off each person on the list who wants what you are selling. A sales funnel is a device that helps you find your prospective customers. A sales funnel works like this: when people come in, they go through a process that allows you to filter out the ones you don’t want and the ones you do. At the beginning of a sales funnel, you’ll have a huge pool of people.
At the very top, you have a few “warm” leads (people who are just learning about your business or who are curious about what you have to offer) and then, way down at the bottom, you have a few “cool” leads (people who are seriously interested in what you have to offer). In the middle are your “hot” leads (people ready to buy from you).
What is Sales Pipeline Management?
Sales Pipeline Management is the process of managing your sales pitches and marketing campaigns so you maximize the results you get for your investment. In other words, it’s everything SPM stands for… “Sell them By Walking Them Through Their Doorstep!”
It is a set of techniques for organizing a series of tasks or projects to be completed. It can help increase the speed and efficiency of sales. It usually takes a large chart that lists every possible customer at the top and tasks for each customer down the left side.
Sales pipeline management is an important part of any company’s plan. Without understanding the pipelines for the current sales team, it becomes difficult to determine the direction in which to take a business.
The Importance of Sales Pipeline Management
No matter the size of your company, it is imperative that you have a sales pipeline in place. Your company needs to understand what type of customer it is selling to and what segment is buying your product. The ability to plan out your sales pipeline will allow you to keep up with and see what segments are being underserved in your market.
Use LinkedIn analytics, Facebook lookalike audiences, and any other social media/PPC tools you have available to determine where the biggest gaps are. From there, you can start creating digital campaigns specifically for these segments.
The three primary aspects of sales pipeline management are tracking, analyzing, and forecasting. Sales managers are concerned with the timing and volume of pipeline information, while marketing managers focus on its quality and accuracy. Timing is critical to a company’s success. Sales managers need their pipeline information early in the week to develop their sales strategy. Many CRM applications already have features for tracking deals in your sales pipeline.
Tracking a deal begins with having a good idea of what your sales pipeline looks like. This is not as simple as seeing what deals are in the queue or waiting to be placed. It is the task of finding, qualifying, and winning not just one sale but doing the right sales process that will eventually lead to more customers.
Once you have a good idea of your sales pipeline, it is critical to analyze the data. The most valuable form of data is the results of sales calls in which the salesperson has actually sold the product or service to an individual or organization.
These sales calls are vital to understanding the metrics of your company’s activities.
Now that you have a good sense of where you stand in the sales process, you can begin making necessary adjustments to how you sell.
Another essential part of sales is forecasting the potential sales that you may make in the future. Take the time to consider your current pipeline and what deals are pending or recently closed. What is your present pipeline? How much time does it take to complete a deal and sell? If you are not currently building your sales pipeline, then make sure that you begin this process.
What Should You Include in Your Sales Pipeline?
The first thing you need to think about when you begin any SPM project is what you want to have in your “pipeline”. Your “pipeline” will probably look different for any type of sales effort and to other kinds of products or services. However, there are some “core” items you should always include. These are:
A list of your prospective buyers
You can provide a list of people with whom you have a potential relationship. You must provide a brief description of that person and their business for each person on the list.
Your team’s sales process
Provide a description of how your team plans to approach each of these prospects. Will they be contacted via telephone? If so, by whom? How will initial conversations be initiated? What kind of information will be needed from the prospect for you to be able to build a strong enough relationship to make an offer? Will your team be using a simple “sales pitch” or will they be developing a more complex sales presentation? What special offers or incentives will your team use to overcome objections? How will your team handle “change-of-heart” situations? What you are selling? For each of the people on your list, you need to know what your team is going to offer them.
Your revenue targets
This is the most important element of all. If you don’t know what your targets are, you can’t really determine if you’re on track or not. The first step toward determining your targets is to determine what you want to have in your pipeline. Are you after ARR (Average Revenue per Order), MRR (Monthly Revenue), LCR (Last Call Resolution), CR (Customer Retention), or something else? Once you know that, you can begin to set your targets.
Tips for Building and Managing Your Sales Pipeline
We are going to give you some very specific advice on how to create a rock-solid sales pipeline. A sales pipeline is simply a collection of notes and snapshots of people or companies who might be interested in what you are selling.
It doesn’t matter if you are selling information, goods, or services – your sales pipeline should contain notes about everyone who could be interested in what you have to offer. You can make your sales pipeline as detailed or as sketchy as you like. It just needs to contain enough “squiggly lines” to give you an idea of the types of people or companies that might be interested in what you have to offer.
Remember to follow up
Buyers today have more choices than ever before, and with it, they need more help to make the right decision and choose your product or service.
The best salespeople will make sure they keep following up with leads to land the sale. But, in reality, most sales professionals give up after 2 calls – so make sure you always follow up.
Following up isn’t easy. In fact, it’s currently ranked as the third most significant challenge for sales teams.
One way to follow up is to set a reminder that notifies you each time you follow up with a prospect. Another solution is to automate the process completely by using one of your sales email templates to automatically follow up on a specific date or after a specific period of time (i.e. two weeks after the initial phone call).
Focus on the best leads
If you take a closer look at your sales process, you’re likely to notice that it takes about the same amount of time to close each deal.
Instead, make sure you concentrate your efforts on the best, most sales-ready, high-value leads, and avoid getting distracted by anything that won’t push the needle for you or your business.
For example, if you sort your sales dashboard from high to low, you can instantly see which leads are the most valuable to your business instead of by date. In addition, by viewing your sales activities for each lead, you can identify which leads are the most engaged and which ones you should then focus on.
Drop dead leads
As important as it is to focus on high-value leads, it’s equally as important to know when to let go of a lead, too.
Letting go can be hard, especially when you have spent weeks or even months building and nurturing a relationship with them.
A lead is dead when they clearly state they’re not interested when they can’t be contacted, or you’ve spoken to them multiple times and they can’t be pushed through to the next stage of the pipeline.
Learn to identify these dead leads quickly, so you can move on to the next sales opportunity to close a big deal – without wasting any more time trying to breathe life into leads that simply won’t buy from you.
Monitor pipeline metrics
Your sales pipeline is a living, breathing entity that changes all the time. Therefore, you need to monitor the key sales metrics that it produces. Make sure you set aside time on a weekly basis to regularly review these metrics as they’ll give you an ‘at a glance’ view of the health of your sales pipeline and your business.
Tracking the results over time will also give you a strong indication of how any changes or improvements you make to your sales process contribute to overall growth.
Review and improve your pipeline processes
A sales technique that works today may not work tomorrow. The best sales organisations regularly review their sales pipeline and techniques to make sure things are finely tuned and highly optimised to ensure maximum efficiency and success.
When it comes to sales, everything – from the first sales pitch, the frequency of follow-ups to the offers you make – can be improved and adapted over time until you find a successful formula.
The best way to approach these changes is to look at where you think there are bottlenecks or blockages in your pipeline and consider ways in which they can be cleared out. Then, you can test changes or run mini “sales experiments” to try and continuously improve each part of the process.
If you look at making these changes bit by bit and one at a time, your pipeline will become a well-oiled sales machine in no time!
Update your pipeline regularly
Your sales pipeline is constantly changing.
New leads are added, leads move through from one stage to the next, and deals are closed.
If you’re not careful, your sales pipeline can start to get a little disorganised and chaotic, making you inefficient and leading to lost sales.
To avoid this, you need to ensure that you’re keeping details up to date on every lead by adding regular notes and information for each stage of the sales process.
Yes, this does mean you need to spend more time on admin, but if you use this time to remove dead leads or update outdated contact information, then it’s time well spent.
Use a CRM to manage your sales
When your sales pipeline is full of leads – and leads are all in different stages of the process – you need to make sure you’re managing it effectively.
If you’re a one-person sales organization on a tight budget and only making a few sales per month, then you can use a simple Excel spreadsheet to track all the details in your pipeline. However, as your business grows, you’ll need to consider using a CRM system to keep track of all your sales activities.
Without a dedicated CRM, you simply won’t be able to manage your sales pipeline properly. In fact, CRM software has become such an integral part of sales that high-performing sales teams now rank CRM as their second most important sales tool.
Not only will a CRM automate several processes for you, but it’ll help you track metrics, easily manage a large volume of leads and enable your team to quickly access the right information at the right time.
A sales pipeline can be compared to the beating heart of your business. That’s why its importance and value can hardly be overestimated. This means that if you don’t manage your pipeline successfully, then you risk losing out on new customers and your business could suffer.
With more than 60% of sales managers saying that their company does poorly manage their sales pipeline, chances are you need to improve the way yours works, too.
Sales pipeline management is an important part of any company’s plan. However, without understanding the pipelines for the current sales team, it becomes difficult to determine the direction in which to take a business. So, if you are having a hard time understanding how to create or start your Sales Pipeline, we can recommend a reliable and highly efficient digital agency that can help you with this. Ubique Digital Solutions is a highly recommended partner who can make your business planning becomes more effortless. We will help you create a clear and functioning pipeline that will surely bring you more revenue and lead you to more customers than before. Reach out to us today.
Q: How big should the sales pipeline be?
Well, that really depends. If you’ve got a modest-sized business and you’re selling one or two products, you might have a 10% conversion rate. That means 90% of your customers will just buy whatever it is you’re selling without even talking to you.
Somewhere between 1 and 5. Usually, a startup should only have one or two people building out this “sales pipeline”. You see, once you have a product/market fit, it is then time to start scaling up your sales efforts. However, this does not mean you should stop “hunting” for more customers.
Q: How do I know which sales leads are ready to close?
Clients often asked, “How do I know which leads are ready to buy?” The standard answer is, “You don’t. Not until you talk with them and find out.” Or in other words, “Don’t guess. Ask!” Guessing isn’t good business. Neither is “winging it” when you don’t know the answers.
It’s not easy, but it will become second nature to you if you learn to recognize the signs. Here are the “salesmanship” clues that will help you: Leads with an “Action Plan” are Leads You Can Close! The first thing you should do is put together a file of all the leads in your possession.
Q: How can I plan my sales pipeline?
Well, I guess I’d better jump right in and give you a few ideas. First off, let’s say you have decided to concentrate on selling your newsletter or product via direct response advertising. In this case, you have options when it comes to planning your sales pipeline. You need to plan it with your team and brainstorm on your sales pipeline strategies. The foundation would be to create a simple linear (one-dimensional) “pyramid” of benefits. And everything will follow under your sales team brainstorming.