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The ABC’s of the Online Sales Funnel [INFOGRAPHIC][VIDEO]
If you’re in the SaaS business, think ABC. “Always Be Closing,” is the infamous sales motivation line from Alec Baldwin’s in from the movie “Glengarry Glenross.” Everyone who sells things needs to see this vido clip.
Everything we do in a company is about selling. We all know that, right? Expenses such as training improvements for service staff is ultimately about helping to ensure customers stay loyal so they don’t exit to the competitors. More so that they tell
I’ve been spending a lot of time with Go-To-Market strategies, campaigns and launches with my Stephdokin clients and other companies I pal around with — I’ve been thinking about the journey of building awareness for your product and brand all the way to a happy customer giving you money on a frequent basis.
The Stephdokin SaaS Sales Funnel-On-A-Page
I present to you … The “Digital Brand Sales Funnel-On-A-Page.” It’s a one page look at your SaaS companies go-to-market selling strategy and can be used as strategic model to both review success metrics as well as understand how tactical campaigns and product launches can impact your revenue growth. Lastly, it includes the ways you make money and the RAPID customer satisfaction / loyalty framework from my bud Dr. Bob http://www.businessoverbroadway.com.
The model also applies to non-SaaS companies, of course, but the monthly frequency of the SaaS billing cycle means that enterprises need to really and quickly understand the conversion rates of their Sales Funnel that leads to more impactful decisions about resourcing and prioritization.
“But, Stephen, wait,” you say. “I’ve seen that before – that’s a MARKETING Funnel.”
Yes, that’s true, people do call it that. But, the companies I help want to SELL things, not to MARKET things. So, I call it a Sales Funnel. Just like Alec Baldwin … er um … his character, Blake.
Blake’s acronym for their sales funnel in the movie was AIDC: Attention, Interest, Decision, Action. This was was supposed to help provide a framework for the belabored salesmen to increase their sales, and it was meant to manage 4 stages of a person progressing through the sales process to become a customer. AIDC is a 4 stage sales funnel.
So, this notion of a sales funnels isn’t new — there’s plenty out there, and companies like Curata, Marketo,ActiveConversion and HubSpot, are being successful with different approaches to sales funnel automation. Be careful, though …. The Internet means that we can measure a LOT of stuff. The stages in my SaaS Sales Funnel-On-A-Page aren’t meant to reflect ALL the measurements — it’s meant to reflect the type of “work” that employees do to affect each stage of the funnel so we can turn the whole thing into an operational model to drive tactical execution.
I had a lot of training for Six Sigma while I was at Intuit, and so I’ve adapted that process excellence thinking to agile business cycles. That means we can intelligently understand which measurements are more important. Not all metrics are created equal, that’s for sure – unfortunately, companies measure and collect WAY too much, and too much data gets in the way of understanding, not to mention speed of decisions. #bigdata
Nine Go-To-Market KPI’s
There are 9 Go-To-Market stages in the Funnel-On-A-Page:
I actually don’t consider a potential customer in my Funnel until they’ve reached the gravitational pull of my website; i.e. “Traffic” stage.
Before people become part of the “Traffic” to you website, they are in the ooze … the metamorphic “Awareness” and “Interest” stages are where people can be reached by three different types of marketing: OldSchool, OutBound, and InBound; which I won’t cover here, but suffice it to say, each comes with it’s own ROI depending on the company, product, customer type, effectiveness of campaign, alignment of product value proposition and luck, of course.
An example of an “Awareness and Interest” campaign is a media release. I just did one for TCELab on Friday the 13thso it’s fresh in my mind. I use PRWEB for my platform of releasing news … they do a good job of targeting as well as measuring; so with a PR campaign, I know that a release (for example) had 130,000 impressions, 9,200 page-reads and 1,400 click-throughs. Impressions are “Awareness,” … it probably means your headline showed up in an RSS feed list in the side bar of various news sites but, like mentions in twitter, it could be seen. Page-reads of the release are “Interest” as people see the TCELab brand in the context of the news in the release.
All of this awareness stuff generates “Traffic” to your website. I count only Unique Visitors in my Sales Funnel model. It’s great if people come back a second or third time as Repeat Visitors, but it doesn’t add any extra potential for revenue; the ARPU (Average Revenue Per User) doesn’t go up with multiple visits, although it positively affects the conversion %.
Once people are on your site, you want to “Engage” them. However, they either leave right away (measured by Bounce rate) or they look around at a few pages (called the “page view”). Thus, the # of people who are engaged in your site is “Traffic – (Traffic * Bounce Rate).” I think the ultimate measure of Engage is the number of people who landed on a “Goal” page; i.e. they got to see your offer subscription page or filled your shopping cart with something.
In the case of an online store, someone is a “Prospect” when they’ve started a shopping cart. If they purchase, then they go immediately to being a user, obviously. In the case of many software companies (SaaS and traditional client-server), however, trial and fremium models adds more stages to the Sales Funnel
When a person trusts you enough to give you their email address (and whatever other private details you harvest), then they’ve moved into the “Trial” stage, and we will call that person a “Prospect.” They may have subscribed to your SaaS service or downloaded a trial.
Now, the question becomes “Is the user actually trying out the trial?” Track the frequency of use, and duration of each use of each “Trial“. If it’s a lot, then they become “Engaged.” Thus, if the “Prospect” is using your software, then they become a “Lead.”
The importance of the “Engaged” can’t be understated. It’s often here that many Leads become disappointed, either because the product didn’t live up to marketing expectations or it didn’t align to the Lead’s needs.
Opeartionally, unlike other stages where marketing can operate more or less in a silo, wrt initiatives in the “Engaged” stage, it’s vital that the marketing and sales team co-ordinate with product management, development, service and the C-Suite regarding issues and solutions.
Note the difference between the earlier “Engage” stage and “Engaged” stages … “Engage” campaigns focus on 1:Many marketing tactics. By the time a person is “Engaged,” companies should rely more on 1:1 sales tactics.
Ringing the Cash Register
Finally, a person decides to give you money (or agrees to be advertised to), and becomes a “User.”
The “User” pays a certain amount of money to you, the trusted vendor, in each stated time period. The amount of money they pay in that measured “period of time” is “ARPU” (Average Revenue Per User), a phrase I learned well when I was CEO of Mob4Hire in the mobile and wireless industry. For example, $30 ARPU per month, or $360 annually. To increase the amount of money we get from each user we can only do two things: increase the # of different things that we can sell to them, as well as increase the ASP (Average Selling Price) of each of the things.
After each time period, the user has the choice to continue with your solution, or to stop paying. If they decide to leave, it’s a sad thing, and it is sadly named “Churn“. Churn is an important aspect of your firm’s growth; too much churn and you’ll see your business sifting through your fingers.
All of this sales talk would make Blake smile. Zig Ziglar, too. Hope all of this helps!
The SaaS Sales Funnel-On-A-Page will give you focus for your product management, product development, marketing and sales teams.
Combine managing your business with a good Sales Funnel with a good Customer Experience Measurement and Management (CEM) program — your business growth will accelerate exponentially.
Here are some things to consider as next steps in your own company:
- Start with getting measurements for all the stages. Google Analytics is a good place to get going.
- Assign team member’s name’s to be accountable for each measurement; reporting the KPI and execution of tactics.
- Ensure C-Suite is on board and supports your Funnel strategy, the resourcing required and the reporting you’ll be providing.
- Use good CEM practices to correlate customer loyalty behavior with the stages of the sales funnel, and other operational KPI’s in your organization. Did I mention TCELab, yet?
- Go slowly, take a bit at a time – be relentless on prioritizing activities and strategies using the Sales Funnel as a guideline
- Focus on activities in the stages of the funnel that will have the biggest impact on the Conversion %.
- We’re all learning all the time; so things change and we have to be flexible and courageous enough when we have to alter our behavior. But we don’t want to change on “gut feeling” … it’s all about making data based customer-centric decisions. That’s why measurement and context of that measurement is so important.