What is the sales funnel, and why does it matter?

Just like it sounds, the sales funnel is similar to a normal funnel. Imagine a funnel that’s wide at the top, and then you pour water in. As the water flows through the funnel, it gets narrower and narrower—that means that there’s less and less water in the funnel as it moves towards the bottom.

The sales funnel works in the same way. At the very top, or widest part of the funnel, there are many potential customers, called leads, that are interested in your product or services. As they move further down the sales funnel, they begin to learn more about your brand, and move closer to purchasing your product or service. But just because they are moving down the funnel, it doesn’t mean they will eventually purchase your product.

The top of the sales funnel is called the awareness stage. In the awareness stage, customers begin to familiarize themselves with your brand. You’ve somehow piqued their interest, but they’re still in the exploratory phase. They don’t know much, and they want to learn the basics. They entered into the funnel by becoming a lead, whether they filled out a form, visited your website, or subscribed to your newsletter. They’ve somehow expressed interest in your brand and what you have to offer.

The next stage is the middle stage of the funnel, called the interest stage. By the time a lead reaches the interest stage, they’ve learned more about your company, and are beginning to ask more targeted questions. They know to know how your product or service is relevant for them, and how it solves a problem. They may also begin to make comparisons to your competitors in this stage.

The third and bottom stage of the sales funnel is called the decision stage. This is the key moment—it’s where customers decide whether or not they will purchase your product. By moving through the sales funnel, leads have learned more about your brand and are informed enough to make a decision about whether your product is right for them.

By understanding the sales funnel, you can understand how to develop and serve up content that will move leads to the next stage, and closer to a purchase. It allows you to impact their decision-making to improve your business. Using nurture tactics like blog posts, email marketing, social media, and more, you can serve people at different stages of the funnel exactly what they’re looking for to help them make their final decision.