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What Is a Sales Funnel? Difference Between Sales Pipeline And Sales Funnel

This might be news to you, but if you have been using the terms “sales funnel” and “sales pipeline” interchangeably – It is time for you to pay heed.

The sales funnel is one of the most important aspects of a company. From individual reps to even CEOs, it’s closely scrutinized by anyone and everyone from within a company.

Sales Funnel

A sales funnel is a metaphor for a traditional sales process from beginning to end. It starts with the potential buyers at the top and based on certain criteria, they are reduced down to prospects towards the middle of the customer journey followed by handfuls in the decision-making stage which finally concludes into closed-won or lost deals.

Importance Of a Sales Funnel

A sales funnel is a great way to understand what potential customers are thinking and doing at each stage of the purchasing journey. You can then invest in marketing activities and channels that will be most relevant, create messaging for different stages and convert more prospects into paying customers. Here is a detailed breakdown of the importance of a Sales Funnel:


Helps To Pick The Right Marketing Strategy

Ever find yourself penniless on marketing strategies that yield minimum to no results? That’s why the sales funnel is so important, it will help you understand what tools or business models might work for success. Some marketers prefer focusing on clients who are already in the Decision section of the sales funnel and this makes it easier for them to drive customers towards Action because they’ve already decided on your product or service.

Helps To Relate To Customers

Whenever you’re using words to describe your products, produce content or talk to clients they must resonate with the reader. Once you know which part of their sales funnel a potential customer falls into then you can easily adjust how you speak and relate better by making a well-directed copy, crafting enticing offers directed at their needs such as language that speaks directly to what he/she wants for him/her reach his goal quicker than if there was no input from this strategy on your side.

Generate Better Sales

To successfully drive more potential customers in the Action section, you need a great marketing strategy and know-how. If only you mastered the sales funnel, then it would be much easier for your business to make more sales in long run – even if they are just as easy! The principle of this is learning how to pull them systematically towards what we want them to do: buy our products or services.

Provides An Edge Over Other Entrepreneurs

Entrepreneurs are quick to get ideas but can be stumped when it comes time to execute. That’s where the sales funnel is a lifesaver! It helps you stay in front of your competition by giving you a clearly defined path for getting customers and keep them coming back every time.

Helps To Grow Your Business

Creating a perfect business model is impossible, and it’s not an overnight success. Understanding the sales funnel can help you know what strategies to take to grow your sales. Perhaps you noticed that potential clients on the Decision section choose another product because of your pricing? You could easily change this by identifying roadblocks, like pricing issues or other things people might find dissatisfying about their experience.

Stages Of a Sales Funnel

Once they hear about your product or service, a prospect will pass through different stages of your sales funnel. That journey may change from one person to another but in the end, he/she’ll evaluate it based on their interest level and think about how you can solve their problem. They’ll conduct competitive research to make sure that what you’re offering is better than other solutions already present in the market. The four crucial stages of a sales funnel are:



The awareness level of the sales funnel is when people first become aware of your product or service. They may hear about you from advertising, social media, even word-of-mouth. How and why those people move down the sales funnel depends on how skilled you are as a marketer; however, the leads in middle and lower levels should be paid attention to because they have moved beyond the “awareness” stage to an “interest” phase for your company’s products/services.


Prospects evaluate your brand based on their interest level. They’ll think about the problem they are trying to solve and conduct competitive research to make sure that your offering is the best solution, especially if there’s a lot of competition.


Armed with information about your company, prospects will dig deeper into why you’re the best for them. Sales pages, webinars, and calls can help sway a prospect to make a purchase.


All your work comes down to this stage: Whether they buy or not. If the prospect doesn’t, then you can create nurture campaigns to make sure that you stay top of their mind.

Steps To Create a Sales Funnel For a Business

The first step in creating a sales funnel is to find prospects who can make it through the entire journey. To do this, you need lead scoring which lets you identify where your prospect is on their path towards becoming an actual customer – that’s one of five steps to help create a successful new marketing strategy for any business.

Create a Landing Page

A landing page will be the first time prospects learn about your company. If they click on an ad, sign up for a webinar or download an ebook, they’ll go to a landing page that should communicate who you are as a company and what makes you unique to wow them! And make sure there is plenty of room for form input – capturing their email address so that we can continue communicating with them later.

Offer Something Of  Value

A lead magnet is a powerful way to get your prospects’ email addresses. Think of it as an enticement, like offering them something in exchange for their information. It could be anything from an eBook or whitepaper to some other type of valuable offer that you can only find by signing up on the site.


Once your prospects make it to the second stage of their buying cycle, they’ll be in a place where you can influence them with informative content. Use email series like those that have worked for other companies and send out information about what makes your company’s offering better than the competition.


As prospects move into the Decision stage, they are ready to make a purchase decision and you need to offer anything that can nudge them in that direction. This could include giving an extended free trial or offering special discounts like coupons.

Keep Going

In the Action phase, you can either close a sale or find out why someone didn’t buy. Either way, stay on them! For new customers focus on product education and customer retention; for people who don’t want to buy – well start building that nurture series now so we have something ready when they’re finally ready to purchase.

Sales Pipeline

A sales pipeline offers a holistic picture of your sales process. A pipeline in sales enables your sales team to organize and manage the entire sale process, marketing teams can forecast revenue by identifying the stages where opportunities lie and predict how many prospects will become customers during a defined time frame.

Stages Of a Sales Pipeline

The sales pipeline is an important tool for businesses, but it can be confusing if you’re not sure what each stage means. Let’s take a look at the different stages and how they play into the success of a business. By looking at each step in detail, salespeople can have better organization and more productivity.


Lead Generation

The first step is generating new leads. For us, that’s prospecting, but any type of lead generation will be assigned to this stage in the pipeline. A big chunk of the sale funnel is concerned with this first stage before we even get into our pre-marketing and marketing processes.

Lead Qualification

Qualifying leads is an important part of maximizing efficiency in any sales team. This allows them to focus on quality rather than volume and makes the process more manageable for all involved parties.

Call/ Meeting Setup

It’s the reason salespeople get out of bed in the morning: The sale call or meeting. In reality, this stage might consist of multiple contacts. Clearly a key stage, the amount and quality of leads that have come through previous stages will affect how successful meetings are to follow.

Sales Proposal

After the sales call, your prospects will receive a detailed email outlining all of the costs and terms for their purchase. If they are uncertain about anything – or if there’s something you want to make sure it was clear on- feel free to contact them.

Sales Closure

Coming into the home straight, the salesperson conducts any final negotiations, signs the contracts, and closes deals. At this stage, prospects have journeyed through the pipeline to become customers.


It should be noted that customer retention and loyalty are an important part of the sales process. By shifting responsibility to client services and marketing, reducing churn rates can help a business succeed in the long run.

Difference Between Sales Funnel And Sales Pipeline

Sales Pipeline Sales Funnel
Visualization Shows the quantity, value, and stages of various open deals. The funnel offers valuable insight into the volume of open deals at a given time.
Tracking Tracks active leads at different stages of the pipeline. Tracks conversion of leads on a stage-by-stage basis.
Measurement Measures the quality of leads you drive to the pipeline. Measures the efficiency of your lead generation efforts.
Reporting Sales pipeline report shows lead activity during the sales process to help sales teams determine where to focus more resources for higher conversion rates. Sales funnel report shows conversion rates throughout the sales process. Sales teams use the data to improve individual stages of the sales process and prevent leaks in the funnel.
Buyer Journey Representation From the viewpoint of the sales rep From the viewpoint of the customer
Focus Activity and value-oriented Performance and quota oriented

Do You Need a Sales Funnel Or a Sales Pipeline?

The right sales strategy for your brand depends on what you really need. For a high-value product that requires a complex sales process, it may be best to use one pipeline or integrate both options depending on the needs of your company’s individual market and team members. A funnel can help if B2C is typically more main focus because this has shorter sales cycles but still require marketing efforts making them ideal candidates for pipelines with their standalone features such as forecasting tools without all the bells and whistles.

In today’s competitive arena, the key to success is often conversion rate. Focusing on this metric helps team members identify and eliminate problems while establishing a benchmark for each stage of the funnel. For instance, if you notice the higher drop-off from qualified leads at proposals than other stages in your pipeline then it may be due to the lead qualification process not adequately qualifying them as true buyers or prospects with intent. Conversely, if you have trouble booking meetings with these potential clients after they are qualified by sales qualifiers then perhaps there needs adjustment within that department? While all departments should work collaboratively together both internally and externally through activities like content marketing where possible – diversify efforts towards various channels such as social media posts meant driving more targeted traffic into your site.

How Can You Use Both Optimally?

Don’t just choose one, use both – For sustainable business success and higher conversion rates we highly recommend that you first integrate a Sales Pipeline with the sales funnel.

Together they can offer valuable insight into how your sales strategies evolve while offering invaluable information on every stage of this process from identifying customer needs to closing deals for high return on investment.

The attention should be paid not only to what goes in but also where it gets out so as long as there is an intersection between these two visualizations which cover all stages of the sale pipeline then any adjustments are easy enough for even novice shoppers like myself who want nothing more than top-notch merchandise at reasonable prices quickly and conveniently.

Business owners need to understand the difference between a sales funnel and a sales pipeline. Once you know how they work, you can determine what type of marketing campaign will be most effective for your company. A sales funnel helps guide prospects through the buying process with sequential messages and an opportunity at every stage to convert them into customers; it’s used primarily in B2C businesses where there are several touch points before making a purchase decision. A sales pipeline is designed specifically for enterprise-level companies that engage in complex back-and-forth negotiations with clients over long periods of time – sometimes years – often using formalized proposals as part of their strategy. Both tools offer different benefits.

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