A sales funnel is an essential tool if you want to sell products online. If you haven't heard of a sales funnel before or want to understand how to create and build one, then this article is for you.
What is a Sales Funnel?
A sales funnel is best described by way of a real-world example.
A shop sells shoes. Many people will walk past the shop (potential customers) but only a few are likely to stop or enter the store. Some will notice shoes in the window and of those a few will enter the store and talk to one of the salespeople about the item.
They are told of the benefits, why it is so popular and why it would be good to buy. They may try them on and if they are interested and want to buy them, they may then be told about any offers on those shoes, for example, buy one, buy the second pair for half price or 30% off if you spend over a certain amount (upsell offers). They are also offered shoe protector, shoe polish or other accessories (order bumps).
This is a sales funnel in the real world.
Put simply a sales funnel is the sales process that leads a potential customer from the hook, offer through to sale.
What makes a good sales funnel?
We have described an example of a "real world" sales funnel but what makes a good sales funnel online?
At its most basic a good sales funnel is one where for every single dollar/pound/euro spent in advertising the funnel you make more than that in profit on your sales.
I want you to think about this statement because it has quite profound implications - if you create a funnel and have enough supply of your product (which is why digital products are so useful) then once you find this magic formula of 1 dollar = 2 dollars out then you have the ability to "turn on the printing press" by increasing the advertising spend. As long as the formula holds, your funnel becomes a money-making machine!
There are some caveats to this around market, audience size and fatigue but I hope you understand the idea.
Shop websites in general don't make good funnels. Technically an eCommerce store is a sales funnel but it has been shown that the conversion rate is much lower than having a dedicated funnel. Don't get me wrong, an eCommerce store is great for showcasing your brand, and acts as a channel for organic search traffic, but as a dedicated sales tool it's is not the best solution.
Shopify (a popular eCommerce store creation tool) suggests building a marketing funnel in addition to a store (1)
How do you build a sales funnel?
A good funnel is made up of multiple parts which need multiple tools to create. We will briefly describe here:
- Software to build the funnel - this can range from code it yourself to using SaaS funnel software to build
- Sales Copy - an often underlooked part is critical to the success of the funnel, the text content that sells the product
- Video recording software - if you want to include video to sell
- Paid Advertising - advertise online using the major social media and advertising platforms (e.g. pay per click or PPC campaigns)
- Free Advertising - create a following by blogging, vlogging or podcasts who you can sell to
- Email list building software and automation - a critical part of the funnel is the follow-up. Capturing emails and following up as part of a marketing campaign can make a huge difference to the profitability of the funnel.
There are a few options for how to actually build the funnel:
1. Get someone else to build it for you
The easiest option but likely to be the most expensive in terms of upfront costs. However, if you choose a reputable company that has experience in building funnels then you are likely to save in the long run. This can be the difference between a successful and unsuccessful funnel.
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2. Project Manage it yourself but outsource the bits
If you know enough about how all the "working parts" should work together and have some project management skills then you could split up your funnel building process and outsource all the bits
3. Do it yourself
Taking the project management route a bit further, do most of the work yourself, only outsourcing those bits that you don't have experience in.
Whatever route you choose to go, for a comprehensive course on building your first sales funnel with hours of content, I highly recommend the OFA Challenge. There is accountability by being part of a group of people all working on the challenge at the same time. It is run regularly throughout the year so you should be able to join the challenge fairly quickly. The course is created by ClickFunnels and although they push you to use their products, you don't have to. Its a 30-day challenge and once complete, you will have learned everything you need to build a successful funnel.
You can access the One Funnel Away Challenge here
What can I use for a sales funnel?
Use free software and free solutions
if you are on a tight budget then some of the major players that help you create your funnel can cost a lot. The cheaper solutions tend to take a bit more work to set up but its totally achievable. Here is a selection of free tools for each part of the funnel :
Funnel Building Software (FREE) - GrooveFunnels
Video Recording Software - OBS Studio (https://obsproject.com/)
Advertising - Often if you browse on Facebook you will see free credits for Google Ads, otherwise its time to start a podcast, blog or youtube video channel to start promoting yourself!
Email list and automation software - GrooveMail. FREE for 500 users, and you can send 5000 emails a month. For a description of the package see here
Images. logos and other graphics - Create you own in Canva for FREE here
Use paid software and services
There are many different paid solutions. I have selected some of the most popular here:
Funnel Building Software (FREE) - ClickFunnels - the original and possibly still the best of the funnel builders but it's not cheap
Sales Copy - Funnelscripts - separate but connected to the ClickFunnels family. Lifetime deals are available but again it's not the cheapest tool.
Email list and automation software - part of the Clickfunnels platinum package are "follow up funnels", this is another name for the email follow-ups. For Clickfunnels pricing see here
Images. logos and other graphics - Use Fiverr to find someone to produce the images for you, there are thousands of excellent graphic artists and designers on the marketplace
Final Comment: Paid funnel software costs can mount up, Clickfunnels offer those who sign up to the OFA Challenge (see here) a package deal on ClickFunnels, Funnelscripts and several high-value courses at significant price reductions. I recommend the OFA challenge anyway so its work checking out the offer if you do sign up.
What are the stages of a sales funnel?
There are many different models for a sales funnel and the steps needed to take potential customers from the start to a sale. The exact sequence depends on the product(s), offers and target audience. Your funnel needs to map your customer journey. Let's look at a couple of models:
Clickfunnels in the OFA Challenge talks of the Hook, Story, Offer concept. The idea is to hook someone with adverts, tweets, social media posts or interesting articles, describe your story or the story behind the product to build a greater level of rapport and understanding and then present the offer or offers. This can be repeated multiple times throughout the sales funnel stages.
Another model is AIDA (Awareness, Interest, Decision, and Action), This is similar to the Hook, Story, Offer. The Awareness stage is about attracting your potential customers' attention through adverts, posts on social media, google search etc. Interest stage mirrors the story idea, you aren't trying to sell at this point just establish background, understanding and expertise. The Decision stage is when the prospective customer decides to buy your offer or offers. Finally, the Action stage is about following up, providing support and after-sales care. It is also about your follow up funnels, like email newsletters.
Example of A Sales Funnel
To better explain all the concepts we have discussed in this article so far, I will describe an example. I will try to keep it as general as possible so that you can apply the theory to your products or services but this will only be a brief description.
The steps are as follows:
Identify the Product
Identify your product(s) or service(s) - ideally, you want multiple products that you can package together as you progress through your funnel
Identify Your Audience
Identify your audience. Really narrow down on who you want to be targetting. DO NOT target everyone because it's just too vague. If you have multiple target audiences consider splitting them into separate funnels. Audience targetting matters.
Identify where your audience hangs out. Is it on social media, Facebook, Twitter, Instagram? On Reddit or Medium or other blog sites? On Google or Bing? On Youtube? Once identified you know where you need to target and what content types you need to support (ads, blog posts, videos, podcasts)
If you have sold your product or services before, ask for testimonials that you can put on your landing and offer pages. This provides social proof, making it more attractive to other potential buyers.
Create your Sales Funnel’s Landing Page
Create your landing page using your software of choice. There are different ways to structure a funnel, and how you lay-out your offers. In this example, we are going with a free offer on the front end. In exchange for their email address, you offer them something either for free (if it's a digital product) or free + postage (if its a physical product). The goal here is two-fold:
- Get their email address (and address/payment details if postage is required)
- Send them to the thank you page
The email is important to send the product (if it's digital) and to add them to the follow-up funnel (depending on the country you live in you may need to get opt-in to add them to your follow up list e.g. GDPR rules in the EU. Please check with your local laws and rules for more details).
Create a thank you page - the thank you page serves several purposes. Firstly as the name suggests to thank them for signing up but seconding to offer them an up sell and an order bump.
An up sell is making an additional offer, so, for example, you could on the thank you page offer them a reduced price for a course you have for sale. You could also offer a package of items.
An order bump is a small addition to the offer, for example with the course it may be the ability to receive printed versions of the notes.
You can also repeat this whole process if you wish, with new offers, up sells and order bumps, offering them more and more value. This is called your value ladder.
Next, you need to create the follow-up funnel or email drip sequence. This is an email marketing campaign, providing value to your email list, telling stories and trying to build a relationship with them. Depending on the nature of your business it could be tips and advice or offers and deals. You don't have to create them all at once, just enough to be able to send regular emails to your list so you don't run out before you can write more.
A great source of information on email sequences, including the infamous soap opera sequence is the book Dotcom Secrets (2nd Edition) by Russel Brunson (founder of Clickfunnels). You can get it here
Driving Traffic to Your Sales Funnel
Once the funnel is set up, you are then ready to launch it and start driving traffic to the landing page. Depending on what you have decided to use as your targeting method (paid vs free, different channels), will then determine your next steps.
Measuring the Success of Your Funnel
Your first funnel is unlikely to make you a millionaire overnight so it's important to measure its success so that you can tweak and improve it. Define the metrics or measures you will use to test how your funnel is doing. Some measures that are used:
Net profit = sales less cost of the funnel and product - this gives you an overall feel for total funnel performance but doesn't give you an idea which parts are performing well and which aren't
The conversion rate for each stage of the funnel = e.g. how many visited your landing page and then entered their email address divided by how many visited your landing page. This is a useful measure as it allows you to tweak the funnel step by step. e.g. Get the advert right so you maximize the numbers to the landing page, then get the landing page optimised and so on....
Google Analytics is a free tool that allows you to measure conversion rates of your different funnel pages. It requires some work to set up but can be used to track progress through your funnel.
Ways to Optimize Your Sales Funnel
So once you think a page or advertising campaign or email sequence needs optimizing how do you go about doing it more effectively?
For Facebook ads, you can run multiple different ads as part of a campaign, similarly, with google ads, you can run multiple adverts and test their success against each other
For landing pages and the other pages attached to your funnel, you can run A/B tests. A/B tests take a bit of time to set up and require extra software (or coding) to run. They allow you to show multiple versions of the same web page to prospective customers to see which one works the best.
For emails, you can run similar A/B tests although not all email software support this.
Also, look at your competitors and see what they are doing with their funnels. This may give you ideas to use in your own.
We have only really scratched the surface on what it takes to build a funnel. Creating a sales and marketing funnel using the process described above is not easy. It takes time and hard work to build, optimize the steps and deploy a funnel.
Whether you decide to do it all yourself, learn enough to project manage or outsource it all, a sales funnel is a valuable tool to have in your sales arsenal.
Questions? Need help with creating high converting sales funnel? We can help, contact us here for more details
[Disclaimer: some of the links in this article are affiliate links, however, they are products that I use personally so come fully recommended (and is why I became an affiliate). I don't recommend anything that I would not use personally]