Blog The sales funnel - how should it be structured?

B2B companies often represent their sales process as a funnel. The sales funnel usually starts with qualified (or “sales ready”) leads and ends with closed-won opportunities. Modern sales methodologies insist on managing this funnel professionally. But how should it be structured in the first place?

Obviously, the answer will vary from company to company, but here are three quick tips to hone your funnel.

 
1. Meaningful transitions I

A good way to choose the right sales funnel stages is to focus on “meaningful transitions”, i.e. borders between stages representing a shift in the sales process.

In this respect, the distinction between “continuations” and “advances” established by SPIN Selling is very useful:

• A continuation is an action that is useful in the context of the sale (e.g. sending the prospect a presentation he requested) but does not “move the sale forward”.
• An advance is an action that moves the sale forward (e.g. answering an RFP formally).

This distinction gives you an “internal view” of the best structure for your sales funnel, as advances obviously signal borders between funnel stages.

 
2. Meaningful transitions II

You can also take the “external view” of the transition of opportunities from one stage of your sales funnel to the next. The idea here to consider your sales process from the perspective of the buyer. What information are they looking for in each stage of the funnel? How do they confirm you have answered their questions?

From this, you can infer the content of each funnel stage, hence the overall structure of your sales funnel.

 
3. Reflect and refine

There is another, potentially easier way to find the right structure for your sales funnel: start with the time-tested SPANCO model and refine it based on the analysis of your funnel dynamics.

You are looking for two indicators.

• “Reasonable” conversion rates from one stage of the funnel to another: as a counter-example, a seven-stage funnel with a 55% conversion rate from stage one to stage two would obviously be weird.
• Balanced stage durations: funnel stages should have approximately the same length. This is not a question of aesthetics, but of convenience – it makes identifying potential delays easier and thus reduces monitoring costs.

Over time, pipeline dynamics will reflect both the internal and external view of the structure of your funnel. The key is to keep monitoring them.