The Sales Pipeline is the process of transforming interested people into customers, and consists of a series of steps you must follow to achieve this. The purpose of this process is to optimize your sales closing process, helping your company become more efficient at generating sales and revenue.
The question, however, is the following: which steps should you include in your sales pipeline? You might not be sure what the stages of the sales pipeline are or how to follow them. If that’s the case, this blog post is for you. We’ll cover the seven main stages of the sales pipeline, so keep reading to learn more.
7 stages of the sales pipeline
The sales pipeline can have slight variations for each company. Some companies have sales pipeline stages different from others. That said, there are seven main stages that most companies use, including:
1. Prospecting
The first stage of the sales pipeline is prospecting, the marketing phase at the beginning of the process. During this stage, potential customers discover your company through ads, search results and more. When they do, they visit your website and learn what you sell.
To make this stage more effective, you can refine your marketing and ad targeting to focus on a specific audience that you know is likely to buy from you. For example, if you find that most of your customers are people from Lombardy between 30 and 60 years old, you can target your campaigns to that specific group.
2. Lead qualification
The next stage is lead qualification. During this stage, you seek to turn people into leads by offering them incentives such as:
– Free demos
– E-books
– Newsletters
– Exclusive content
– And much more!
Basically, you offer people a specific advantage that they can access by providing, for example, their email address. Many people will not be willing to take this step, so you know they weren’t people you should have focused on anyway. But people who do qualify as leads. These are the people to target in the subsequent stages.
3. Initial meeting or demo
Once you have a list of leads, you can start to target them more directly. The best approach is to offer a meeting or product demo, so you can show them what your company has to offer and how it can help them.
For those who accept, schedule the meeting. In addition to showcasing your product or service, use this time as an opportunity to assess the interest and engagement of each lead, so you can determine if they are suitable to receive a proposal. If so, you can move to the next stage of the sales pipeline.
4. Needs analysis and proposal
The next stage of the sales pipeline is needs analysis and proposal. A needs analysis is exactly what it sounds like: an analysis of a lead’s needs. Basically, you evaluate each lead’s unique situation: the goals they have, the obstacles standing in the way of those goals, and the opportunities you have to sell them something.
If that analysis presents a valid sales opportunity, you can then draft a proposal. Meet with your leads again to present your final offer, telling them exactly which product or service they should buy and how they will benefit from it, along with the associated pricing.
5. Negotiation and commitment
Not all companies include this stage in their sales pipeline. For those that do, it’s a stage where you negotiate the details with your leads. Maybe they want to adjust the price or modify the scope of the project you’ll help them with. Whatever the case, this is where that issue gets resolved.
On the other hand, you might not leave room for negotiations: perhaps the scope of your services is more or less fixed and you don’t offer flexibility on pricing. In that case, it might simply be a matter of moving directly from the proposal to the next stage of the sales pipeline.
6. Deal close
This is the stage where you finally reach your goal: a sale. If leads reach this stage, it means they’ve taken the final step to make a purchase and become customers.
Once the sale is made, you just need to make sure the customer receives the product or service they purchased. There’s not much else to this stage!
7. Follow-up and retention
It’s easy to think that the sales pipeline is complete once your customers make a purchase. And for some companies, it might be true: if you offer occasional sales, like the sale of a washing machine, you probably don’t need to worry about customer retention.
If a sale leads to a long-term relationship between you and the customer, your task now is to keep that relationship alive. For example, if a company hires you as a financial consultant, it’s not enough to send them a product and call the job done. You’ve invested a lot of time and energy getting that customer, so you don’t want to lose them now.
To that end, make sure you continue to provide high-level customer service. Constantly evaluate your customers’ needs and address any changes or obstacles that might arise for them.
