“A sales pipeline is an essential system for any company to maintain. It’s the lifeblood of your business and will keep it going in the long run.” Learn from our team of experts at Digitally Global to build a sales pipeline that will result in conversions.
What Is a Sales Pipeline?
A sales pipeline is a system that allows to methodically organize sales and outreach efforts, to maximize success by cleverly effectively organizing leads.
It can be broken up into stages that help to track where a prospect is at any given time of the sales process. This enables teams to take appropriate action and move prospects from being contacts, all the way through closing a deal.
Benefits Of a Sales Pipeline
A sales pipeline provides the much-needed insights into financial metrics that indicate which deals are most likely to close.
A sales pipeline gives visibility into the performance of different team members in the sales team and monitors how close they are to meeting their target.
It’s an indicator of how well deals will pan out, so it helps sales leaders predict their monthly revenue.
Difference Between a Sales Pipeline And Sales Funnel
- Sales pipeline and sales funnel are often misunderstood to be the same thing. They’re actually discrete, each with its own data points.
- A sales pipeline is about deals, while a sales funnel is about leads.
- A sales pipeline refers to every step in your process that a rep takes to move deals from start to close; on the other hand, a sales funnel covers all stages of buying before becoming customers.
Stages Of Sales Pipeline
The sales pipeline stages for a typical B2B business look like this:
You can generate leads for your business using a variety of techniques. There are paid and non-paid campaigns, like the ones you see in Google AdWords or Facebook ads, as well as free methods such as e-mail marketing. The most effective strategy is to create an ideal customer profile with specific parameters and target prospects who fit that description through various channels.
A potential customer is identified and followed upon. The first step in the sales pipeline stages is recorded until the successful closure of a deal.
This pipeline stage is where a sales rep attempts to contact the lead and understand their business. The goal of this phase is for you to map your services against what your prospect needs.
The lead might be convinced by the initial conversation. You can schedule a demo or set up a meeting with the decision-maker to negotiate the contract.
It’s time to make the sale and seal the deal. Negotiate on price, services, and conditions until you’ve reached a mutually beneficial agreement- then submit your proposal.
The final stage in your sales process is where you record the outcome of your deal. If it’s finalized between you and the prospect, mark them as a ‘won or lost’ customer. There are times when they aren’t ready to buy yet; if so, there’s an option for marking them ‘nurture’ which will keep track of their progress over time until they’re finally ready to purchase from you.
Steps To Build a Sales Pipeline
Identification Of Prospects And Stages
Creating a pipeline for your potential customers and placing them in different stages depending on where they are in their buying journey is the first step to segmenting opportunities. Segmenting helps you figure out which stage of the buying process each customer falls into so that you can tailor what information will be most beneficial to them at any given time during this vital decision-making period.
Sales Activities For Each Stage
To ensure that sales activities are as effective as possible, it is important to assign them at the beginning of every deal. Some companies push for many different types of sales activity to move their pipeline more quickly and some stick with a few tried-and-true tactics instead-but assigning these early on allows you to bring clarity into what your team will be doing so they can work smarter than harder!
Defining Of Sales Cycle Length
Your sales pipeline is heavily dependent on your sales cycle. It can be long or short, depending on some vital factors including how quickly or slowly your team closes deals and whether you’ve been able to generate enough interest in the product during earlier stages of marketing. The factors mainly include:
- The complexity of the product
- Customization required
- Lead sources
A shorter sales cycle means more prospects and higher conversion rates, so the first thing you should do is find out how long your average lead takes to convert.
Determination Of Pipeline Size
Setting expectations for what can be achieved in sales is an important step towards meeting your goals. This starts with determining the number of deals needed to close per quarter, based on how much revenue you need by the end of it all. With those numbers as a guide, set monthly or quarterly targets and make sure that each person knows their target so they know when they’re successful – this helps keep them motivated! And remember: don’t stop going after new opportunities even if old ones fall through.
Removal Of Stagnant Deals
Deals like wine, do not age. As time passes the likelihood that you will win a deal diminishes and it becomes more of a rotten deal than anything else.
Keep track of how old your deals are (any deal that exceeds your sales cycle length should be on your ‘dead’ radar). If you have an issue with stagnant deals exceeding this limit for too long then prioritize them – pay attention to these dead-deals first. This process helps clean up our pipeline by getting rid of stale or bad leads before they turn into bigger problems down the road.
Having a CRM that automatically updates your team on stagnating deals and sales activities performed for the deal will help you maintain an efficient pipeline.
Defining Pipeline Metrics
Sales pipelines are great visual aids for sales managers to track and monitor their salespeople. Sales activities constantly change the length of your pipeline, but monitoring metrics can help identify how many deals you need to bring in so that you earn profits by year’s end.
Common Mistakes To Be Avoided
Sales pipelines are just an indicative number of deals that your business has. You might think you’re doing well with a lot in the pipeline, but many may not convert immediately so always having more help.
To prevent your pipeline from running dry, ensure salespeople have at least 6-8 deals in their pipeline for 4 to convert per quarter – this is about 25% higher than a target!
Lengthy Sales Cycle
Don’t let your prospects get tired of waiting for you to call them back, make sure the sales cycle is as short and painless as possible! Shorten it so that they don’t have a lot of hoops in their way. Make deals faster-paced month after month by closing more quickly and making targets reachable sooner with less work from team members. You can also identify which leads are taking longer than usual – those who might need more convincing or special attention – then customize your strategy accordingly.
Lack Of Coordination
When it comes to sales, miscommunication can be a deal-breaker. Every team in your company has an important role during the buying journey and should work with one another seamlessly or else you risk losing that opportunity for new business altogether. When handing off from one department to another, make sure each is up-to-date on all information related specifically to this customer’s sale so no details are lost along the way just because of poor coordination between teams – ensuring better communication will help keep deals flowing smoothly through your pipeline!
Some customers are more difficult to sell than others. If you try and force your product on them then it will only cause the pipeline of deals that need attention to clog up, preventing any new contacts from getting through for nurturing. It pays to get an in-depth understanding of their needs before nudging them into a decision about your product.
Lack Of Deal Insights
When your salespeople are flooded with work and don’t know which deals to prioritize, you’re more likely to lose out on a lead. It’s easy for them to forget the current status of their pipeline is because it can be hard to keep track without extensive training or close attention. A recurring problem in many companies is that leads aren’t always tracking how long they’ve been stagnant if there has been interesting from the associated prospect, how interested they may have become over time, as well as any other important information about these lost opportunities since this kind of data often cannot be found elsewhere.
CRM’s are an invaluable tool in the competitive business world. But you’ll never get far without a CRM that provides insight into AI-powered deal insights, predicts your next best action to take based on past deals, and helps track parameters such as frequency of sales activities last 30 days or rate of engagement with clients.
Focusing On One Particular Stage
Too often, we focus on one important development at one particular stage of a deal. Managers must be aware of what is happening in their sales pipeline as well because when they’re not paying attention to the entire process it can lead them down an unproductive path with less than stellar results and quickly kill any momentum they had going for themselves.
Sales teams are getting busier every day, but with the help of CRMs, they can keep track and optimize their sales pipeline. This type of software helps you visualize your open deals and expected close dates for each one to make it easier to see where there might be a bottleneck or opportunity. It also shows how many people in the team need new leads, making sure everyone is busy without worrying about who hasn’t been assigned anything yet – which means closing more deals faster.
If you find the task of building a sales pipeline mammoth considering the size of your enterprise, click here!