Manage Your Sales Pipeline
Learning Objectives
After completing this unit, you’ll be able to:
- Describe a sales pipeline.
- Identify the stages of a sales pipeline.
Get Your Sales Pipeline to Flow and Grow
When people think of a sale, they often think of the close of the sale. But to fully understand selling, you need to look at the entire effort from start to finish. How does a prospect go through each stage until they finally become a customer? That’s what a sales pipeline lets you see.
Managing a sales pipeline, however, can be difficult. A study from Harvard Business Review found that 61% of executives think sales managers aren’t properly trained in pipeline management. This can spell lost revenue.
What Is a Sales Pipeline?
A sales pipeline is a visual representation of where all of your prospects are in the sales process. This lets you gauge likely revenue and determine the health of your business. It provides a snapshot of the health of your business.
Imagine a pipeline as a free-flowing river. If there are problems upstream, there will eventually be problems downstream. Pipeline management lets you catch tiny problems before they become big problems that can impact revenue. With it, you can estimate how much your reps might close in a given week, month, or quarter.
A sales pipeline is not to be confused with a sales forecast. Both draw from similar pools of data. A sales pipeline focuses on the present moment and what reps should be doing right now to close deals. And a sales forecast estimates how much revenue a company can hope to bring in if those opportunities are indeed won.
What Are the Stages of a Sales Pipeline?
Prospecting
Sales prospecting is the process of developing new business. It’s the search for potential customers or buyers of your product, and it involves a lot of research and outreach. There’s outbound prospecting, where you do cold outreach to folks you might have found from doing research on LinkedIn or Google. And there’s inbound prospecting, where you reach out to someone who has already expressed interest in your product through visiting your website or signing up for your newsletter.
You can start gauging interest with potential buyers through personalized emails, cold-calling, customer referrals, industry events, or sometimes just through building a strong social media presence that establishes you as a problem-solving expert.
Lead Qualification
Lead qualification means qualifying, or filtering out, your leads by creating an ideal customer profile, or buyer persona, that outlines the characteristics of the customers you’d like to bring in. Think about your ideal industry, company size, location, pain points. This helps you decide whether a prospect is a good fit for your product.
To move those leads deeper into the pipeline, consider offering an e-book, white paper, webinar, case study, or other type of free resource to determine if the prospect is interested in learning more about your solution. It’s also helpful to conduct a discovery call to get to know the prospect’s needs before you launch to the next step of a sales call.
Sales Call Demo or Meeting
At this stage, your pipeline should be starting to narrow. You strategically filtered out leads that are not ready to buy, and now you’re zeroing in on those that are. This is when you start to go in for a sale. To do this, schedule a demo or meeting.
Make sure everyone involved understands the goal of this meeting; have an agenda prepared ahead of time to help keep everything on track. The demo should only happen after the need for your product is clear. This is when you bring all your collective insights and build a business case that demonstrates how your product will help your prospect achieve their goals.
Proposal
This stage is when you make an official sales offer. Summarize how your company can help address your potential customer’s pain points. Reiterate pricing information and demonstrate why the business value of your product more than offsets its cost. This is also when you spend time differentiating your proposal from the competition, and driving home the advantages of your product.
Key things to remember at this stage: personalization and perceived value. You want the prospect to know that you understand their company inside and out. So make sure you’re not giving them a one-size-fits-all proposal but rather tailoring it to their specific needs.
Negotiation and Commitment
The prospect will likely have objections or additional inquiries that require renegotiating the initial proposal. Discuss expanding or shrinking the scope of work, adjusting pricing, and managing expectations to come to a final agreement.
Contract Signing
Time to celebrate because you just closed a deal! Make signing the contract simple by using an e-signature service that allows your soon-to-be-customer to sign and upload from anywhere. Now you can move the deal toward order fulfillment.
Post-Purchase
When you close a deal, you might think that it’s all over, but the customer experience has just begun. The buyer will expect attentive service during implementation and regular monitoring of the account’s progress. At the right times, you can cross-sell existing customers on new services and upsell them on premium solutions. Overall, be sure to treat your new customers well—referrals and future sales depend on it.
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