Want to have a systematic approach to selling instead of depending on haphazard deals? Understand the 7 stages of a sales pipeline and how you can create a perfect one for yourself! 👇
As a salesperson, you may get many leads to target. However, effectively closing a sale with a prospect is not easy. Do your prospects get overwhelmed by your pitch? Are you losing potential customers despite having the right features and pricing?
If so, it’s because you do not understand the prospect’s mindset. A sales pipeline can help you understand the prospect’s perspective before delivering the sales pitch. Because of this, you and the prospect will have better synergy.
What is a Sales Pipeline?
A sales pipeline is a visual summary of potential customers and where they are in the purchasing process. A sales pipeline can be helpful for both employees and managers.
If you are a manager, you can use this information to forecast the sales revenue.
Sales Representatives will be able to view their targets because of the pipeline. This will keep them focused on their job and increase productivity.
With a sales pipeline, you can understand where most of your sales deals get delayed, and you can come up with strategies that help you progress forward with the prospects.
If you deal with many prospects, you may get overwhelmed and lose track of them. No sales representative can afford to let potential clients slip. With the help of a sales pipeline, you can view which stage of the sales process the prospect is on.
Your prospects need your product but making the purchase is a big decision. Before they make a purchase, they need to be reassured that it is the right decision. To successfully close the deal, you need to provide them with the right information at an accurate time. With the help of a sales pipeline, you can do that.
The 7 stages of sales pipeline
In the prospecting stage, your company generates leads through promotional activities like social media marketing, PPC campaigns, events, email marketing, or other methods. When potential customer comes across your brand because of promotional content, they are a stranger to your brand.
This is the first time they have heard of your brand, or they may have heard about you, but your marketing message never attracted them. However, now the message has clicked with them, and they are seriously considering you.
Sales representatives often fail to convert the prospects into customers because they face many challenges like being unable to work with gatekeepers.
If you are in B2B sales, you will have to face a gatekeeper before you meet the prospect. Gatekeepers intercept you before you can deliver your pitch to the client. Many salespeople get nervous here and think of the gatekeeper as someone unimportant.
You should be able to convince the gatekeeper that meeting with you will not waste the prospect’s time. Be respectful, confident, and frank with the gatekeeper.
Another challenge in a sales job is that it can be stressful. Your organization expects you to work with many leads. Communicating with the leads can be stressful in itself but what adds more to the stress is that you need to send your prospects customized messages. Most sales representatives get lazy and send similar messages to all prospects.
To take care of this issue, you should make notes about the prospect so you can send them customized messages. In addition, companies should invest in CRM software, so their sales representatives have the needed data about potential clients.
After some time, communication with some prospects may die down. However, the truth is that your prospective customers are also busy, and you should not give up easily. Instead, you should maintain a consistent frequency of reaching out to the prospects to see if they will be willing to buy your product or not. Soon you will be able to identify serious prospects.
Jeffery Gitomer is known as the king of sales as he has written over thirteen books on sales. His books have saved a lot of resources for companies.
According to Jeffery, “If you have to go through the gatekeeper to get an appointment with the prospect, you need to set up an appointment with the gatekeeper instead of passing them by. Have coffee with them and ask them about the company. They are generally flattered and give you the needed appointment as they run day to day operation of the company. It is a great idea to learn about the company from them. Do a pre-call with the gatekeeper and be a little friendly with them. Separate yourself from others by friendliness.”
Pro Tip: If you want to get inbound leads, you should have a website and a presence on social media. People can initiate communication with the contact form on your website or the texting option on social media.
2. Lead Qualification
You will get a lot of leads, but not all of them will convert into sales. That’s why you have to divide the leads based on quality at this stage. The prospects most likely to buy your product will be given a high priority.
The prospects have been in contact with you through email or some other mode of communication, but they have not decided yet. It is up to you to take them to the purchasing stage. They may be comparing your offer with other competitors.
Some salespeople are so desperate to form a rapport with the lead that they keep flooding their inboxes. If you do that, there is a chance that the prospect will put your emails in the spam folder. One way you can avoid coming out as a spammy salesperson is by automating emails after a certain action is completed. For example, if a prospect visits your website, an automated email will be sent to them. Kindly ensure that these automated emails are relevant to the situation. If someone receives your email just after they have been through your website, they are more likely to book an appointment with you to know more.
To qualify a prospect as a serious lead, you need to test their level of commitment.
Author and sales consultant Mark Hunter suggests: “Ask the lead to make a small commitment. I call them ‘micro-steps.’ The objective is to begin understanding if the lead is a valid prospect.”
Try to escalate the level of commitment that the lead shows towards you. They are a serious lead if the prospect is ready to meet you in person or have a zoom call. If a prospect only communicates through emails, they may not be serious about buying your product or services.
Sales coach Brian Iannarino points out that many prospects may already be using a similar product or service. You need to identify the lead’s willingness to solve their pain point. Are they actually looking for a new product or service to solve their current issues?
As a sales rep, you will get two types of leads, sales-ready and change-ready leads. Prospects that are ready for a change are more likely to convert. All you have to do is convince them that your product or service addresses their pain point.
“Disqualifying before you discover whether or not the client has a compelling reason to change is a mistake. And it is a fallacy to believe that you can discern this information from looking at a name,” says Iannarino.
3, Meeting the Prospects
In this stage, you get to meet the prospect and explain the products or services your company can provide them. If the potential customer has questions, you must answer them. The customer got ready to meet you in person, which shows a level of commitment on their side. However, they still have more questions about your organization, products, and prices.
During this stage, you may meet prospects who like your product but do not want to invest in it. They are thinking of the money they will have to spend to get your products or services. You have to change their mindset. Instead of getting them to think about what they will lose, tell them what they stand to gain if they invest in your product.
Dave Kurlan is a sales thought leader, and according to him, you can differentiate your product all you want, but in the demo, you appear like a salesman to the customer. That’s why they are wary of you. He advises salespeople to use the technique of consultative selling. Instead of posing as a salesperson, you should talk like their advisor.
“ Presentations and demos may point to differences in your offerings, but the act of presenting and doing demos makes you appear very much the same as everyone else. When everything looks the same, prospects focus on price. Consultative selling, an extremely underdeveloped skill for most salespeople, is the approach which all salespeople must master to differentiate themselves effectively.” He said.
Pro Tip: There is one more trick that you can follow. You can summarize any conversation you had with the client in the past, reminding them why they need your product in the first place.
Provide the customer with a reasonable argument on why they should side with you. Mention the competitive advantage you have. When you provide the customer with a proposal, they think about how they can gain the most from this deal. They wonder if the product or service is cost-effective or not.
You may often send your prospect a proposal, and even though they sound excited, you never hear back from them, or they say no. What exactly went wrong in such a situation? What changes can you make to the proposal so that this doesn’t happen in the future?
Any salesperson knows the basics and can point out the Unique Selling Point in the proposal, but maybe you did not provide the client with the information they wanted. It is either that or the client did not like your pricing model.
To be able to provide your customer with every information they need, you should read the Request For Proposal (RFP). You know what the client is looking for if you have read the RFP, and your sales proposal will reflect that. Reading the RFP is part of understanding the customer, and you cannot sell without understanding your potential customer.
If many prospects are not buying your products after receiving a proposal, it is time to revamp your pricing model. Do market research, try to find new suppliers, and check out how much your competitors are charging.
Sales Expert Colleen Stanley warns salespeople that many prospects have no intention of doing business with you. Some prospects only buy based on price point and not value, while others just want to look out for what’s new in the market.
Non-assertive salespeople get into this trap because of the play-nice tone in their sales proposal. However, assertive salespeople can identify prospects they have no chance of winning.
“Examine the proposals in your sales pipeline and do some serious reality testing. Did you write proposals to go along to get along? Do you have evidence that your prospect is committed to changing vendors or improving their current situation?” She says.
5. Negotiation and Commitment
Now is the time to discuss pricing, the scope of the partnership, and expectations. The prospect doesn’t doubt that your product will add value to their life, but before they move on to give you the money, they need some changes in the sales proposal. This is the phase in the pipeline where you can discuss price and deliverables.
Most customers think of negotiation as something that is centered around pricing. However, when negotiating with the customer, you can discuss the broad scope of the partnership. As a sales representative, you do not have much control over the product’s pricing. That is why if someone is negotiating just to get a better price, the sale will die down here.
If you felt like you had a good rapport with a prospect, but now they are obsessed over getting a better price. Remind them that you can negotiate over other things like payment schedules, order delivery, and more.
If you cannot adjust the price, try to create synergy with the help of these parameters.
One rare suggestion by Harvard Business Professor Michael Wheeler is that you should try to be a spontaneous salesperson. It is great if you have a magical script that works for you, but what if it is not working for one client? Then you will lose that sale. It is great to have a gamebook, but you cannot always stick to it.
“You can’t always script the process. Sometimes, even if you’re a stickler for the rules, you don’t get the desired results. So what’s the solution? Follow the rules while they work for you, but be ready to throw them out of the window if needed,” He says.
Pro Tip: You must understand that negotiating with prospects can be stressful, and they will try to get the best of you. In the heat of the moment, people sometimes promise discounts or services they cannot provide.
This is embarrassing, so you should set a clear limit on the concessions you can provide before you go to a sales meeting.
6. Deal closed
If you have brought a prospect to this stage, they are ready to sign a purchasing contract. You have convinced them that your company is the right choice. All you two have to do is sign a contract that entails your obligations to each other. Once the document is signed, you have made the sale.
Sometimes salespeople promise customers the world but forget about them when the sale is closed. It is upsetting when you promise the customer a deliverable but do not deliver it. This is an easy way to lose customers.
You may have promised the customer some conditions, so kindly ensure they are met. For example, you must provide free delivery if you promised it.
It is advisable to schedule an after-sale meeting with the customer when you both have signed the contract. This gives you a chance to provide them with effective customer service, which you boasted about during the sales pitch.
To close deals effectively, you need to focus on creating relationships.
Seth Godin believes, “Too often, we close the sale before we even open it. Interact first, sell second.”
Pro Tip: If you closed the sale, great, but what if you failed? Many salespeople take past failure as a permanent reality. Yes, you were unable to meet ends with the prospect for now. However, instead of forgetting about them, you should keep their data stored in the CRM and take them back to the lead qualification process in the pipeline. In the future, things may change, and they may get in trouble with their current vendor. That is when you can knock on their door again.
You made a lot of promises during your sales proposal, and now the customer waits to see how good their experience will be with you. After making a purchase, customers are usually focused on order fulfillment. When they become more used to your process, they may even try to compare how things are different between you and the other vendors. A customer now inspects if their pain point still exists.
You should always try to get in a post-purchase meeting with your customer after completing their order to see how things are fairing. If they have any complaints or problems, you are responsible for taking care of them. The customer should not have any pain points after that meeting because if they do, they will probably not stick with you forever. The post-purchase process exists to ensure that the customer sticks with you.
Pro Tip: If the customer is happy, you can use this as an opportunity to cross-sell or upsell your client on new services and upgraded solutions.
Conclusion: It is impossible to sell consistently without a sales pipeline
Sales Pipeline gives you a better understanding of the customer’s mindset and how to create favorable situations. Without understanding the sales pipeline, you will fail to gain an understanding of your customers too. Following a sales pipeline gives you a better chance of success because it is methodical and data-oriented.
Trying to sell without understanding the sales pipeline is like shooting arrows with blindfolds.