How to Create a Sales Funnel (+ Free Template & Examples)
Jess served on the founding team of a successful B2B startup and has used a wide range of sales and marketing tools over the course of her 15-year career. She uses her industry knowledge to deliver the best answers to your questions about sales tools and sales management.
This article is part of a larger series on Sales Management.
Sales funnels visualize where prospects are in the buying journey of a sales process and assist in forecasting sales, improving lead generation and nurturing processes, and managing goals. To create a sales funnel, you first need to understand your company’s sales process and envision it in a way that can be broken down into stages. Each stage represents phases of the buying journey, such as brand awareness, lead nurturing, offer, consideration, and decision. This will then help you define essential sales pipeline activities needed to move a lead from one stage to the next.
We will show you how to create a sales funnel for your business in four easy steps and give you a downloadable free sales funnel template. Plus, we’ll also share examples of how sales funnels vary for different types of businesses.
1. Define Your Sales Pipeline
First, determine what your sales pipeline stages are by evaluating your sales process. The sales pipeline stages are internal activities that occur in the process grouped into larger categories, such as generating, qualifying, or nurturing leads.
Sales funnel and corresponding sales pipeline example
For example, the sales process typically starts by identifying prospects and introducing them to your business, solution, or offering. You would then define a sales pipeline stage around the groups of activities you need to complete to generate a lead.
Pro tip: For assistance developing your sales pipeline, check out our article with nine pipeline stages every sales team should have.
2. Consider How Each Pipeline Stage Relates to the Buyer’s Journey
Once the sales pipeline is established, think about how each stage helps move a lead closer to making a buying decision. Below are some examples of stages of the buying journey and how they relate to common activities found in a sales pipeline:
- Creating awareness: This is the top of the funnel when the lead becomes aware of your brand and what your company offers. Pipeline activities like researching prospects, cold calling, and generating online leads yield this stage, and this is where prospects enter your sales funnel.
- Fostering interest: Getting new leads interested and guiding them as they learn more about your business. Pipeline activities like introducing products or services, qualifying leads, and nurturing leads using email marketing or direct mail can move prospects to this stage.
- Pitching your offer: This is when the lead gives your business the opportunity to make an offer. Pipeline activities like setting up and delivering a sales presentation or offering a free trial move leads to this stage.
- Consideration: The lead has all the information required to make a decision and shows intent to buy. Pipeline activities like sending proposals, generating quotes, and negotiating terms move leads to this stage.
- Decision: The lead elects to purchase from your business. Pipeline activities associated with closing a deal and onboarding customers lead to this stage. Alternatively, if the lead decides not to buy, they may fall out of your sales funnel altogether or revert to a previous stage.
3. Design the Funnel Visual
Once your funnel’s stages are established, create a sales funnel template as a visual for your business. Add funnel stages in chronological order from the top going down. The initial stage, where leads are generated, is at the widest part on top, whereas the final stage, where the lead becomes a customer, is at the narrowest part at the bottom.
Many customer relationship management (CRM) software platforms help you save valuable time by doing this for you. CRMs aggregate the data in your system and visualize it with displays, including sales funnel charts.
For example, check out this customizable sales template example from Zoho CRM. The top of the funnel includes quantitative information of how many leads are in the sales process, which is visualized at the widest shape at the top. It then narrows down each stage of the funnel as the total number of leads at each stage gets smaller.
Zoho sales funnel customization (Source: Zoho)
Pro tip: Providing tools like a CRM to your sales team is just one key element of being a great sales manager. Our ultimate guide to sales management helps you improve your sales management attributes with insights on onboarding, training, developing, and motivating your sales team to ensure each sales rep is performing at their best.
4. Add Customer Data Into the Sales Funnel Template
Now that your sales funnel template is created, use your lead and customer information to create a real-time sales funnel for each of your prospects. To do this, you’ll need to monitor the status of each lead and track your interactions with them.
You can do this manually or via spreadsheet apps like Excel or Google Sheets, but a CRM is the most efficient way to manage customer data and generate visual sales funnels. A CRM stores prospect information, aggregates it, and generates visual charts showing how many leads are in each stage of the funnel, corresponding revenue opportunities, and where individual prospects are in the funnel.
Pro tip: Creating a sales funnel is a key element to comprehensive sales planning. For instructions as well as a free sales plan template for documenting and strategizing your sales objectives, check out our step-by-step guide to creating a sales plan.
Free Sales Funnel Template Download
To create a custom sales funnel for your business, download our free sales funnel template. Then add your company’s major stages and corresponding sales process activities to the sales funnel template. Your sales funnel will then show the journey leads take with your business when they go from first becoming a prospect to buying and becoming your customer.
Download a Customizable Sales Funnel Template
Sales Funnel Examples
Sales funnels vary by industry, offerings, and operational structure. Businesses will also find that certain stages of the sales funnel last much longer than others. For example, creating customer awareness can be quickly accomplished through one phone call or email, while gauging the customer’s interest may take multiple follow-ups and long-term nurturing to accomplish.
Here are four sales funnel examples based on varying business types:
1. SaaS Sales Funnel
Selling a software-as-a-service (SaaS) product requires a prospect to become both aware of your product and gain an idea of how it works, often through a product demo or free trial. A SaaS sales funnel may involve many steps due to the research and learning needed to make a sound purchase decision and because purchases are often subscription-based, which requires sales activities for both producing and retaining current customers.
Sales Funnel Stages | Description |
|---|---|
Awareness of SaaS Product | Potential customers become aware of your SaaS product through online ads, content marketing, introduction emails, or cold calls. They enter the funnel and become a lead, or prospect. |
Interested in Learning About Features | Leads become interested in learning about the features of your SaaS product. This is done through lead qualification or nurturing activities such as phone calls and email marketing. |
SaaS Product Demo | A formal demonstration of your SaaS product features is presented, showing what the product interface looks like, how it works, and what it enables the prospect to accomplish. |
Business Proposal | The prospect likes the features included in your SaaS product and requests pricing information and service terms. |
Consideration | The prospect is deciding whether to purchase, and may also seek to negotiate with your business on pricing and terms. |
Purchasing Decision | The prospect decides to either subscribe to your SaaS product(s), select a different option, or not purchase any SaaS product at that time. Onboarding and payment transaction activities take place if they decide to purchase. |
Client Renewal | Current customers either renew their subscription, upgrade to a better plan, or decide to unsubscribe from your product. Account management and customer service activities help get customers to the renewal stage. |
2. Business Consulting Sales Funnel
A business consultant could include any business-to-business (B2B) services for managing or advising on a particular function or department of an organization. Examples include marketing agencies, information technology (IT) management, tech consulting companies, law firms, accountants, and management consultants. For consulting businesses, both awareness and education about services are usually needed before a proposal is sent.
Sales Funnel Stages | Description |
|---|---|
Awareness | Business buyers and decision makers become aware of how your business can help fulfill a particular need for their organization through activities like online ads, content marketing, or a cold call or email introduction. They enter the funnel and become a prospect. |
Education of Service | Prospects learn how your service can solve their problem and your unique approach compared to other options. Sales presentations and consultations help educate and qualify potential customers for this stage. |
Business Proposal | Prospects are interested in seeing pricing estimates and scope of work proposals. Sending quotes and comprehensive explanations about how the service will be provided is included in a business proposal. |
Consideration | This is when prospects are pondering a purchase decision. This stage also includes negotiation with your business on pricing and terms. |
Purchasing Decision | The prospect decides to either enroll in your consulting services, select a different option, or not purchase a solution at that time. Onboarding and payment transaction activities take place if they decide to purchase. |
3. Agency/Broker Sales Funnel
An agency or broker is a business that sells products by representing multiple providers as authorized “agents” who “broker” the product or service being sold. Common examples are insurance agencies, mortgage brokers, and financial advisers. For most of these businesses, underwriting requirements will be needed behind the scenes to create a quote.
Sales Funnel Stages | Description |
|---|---|
Brand Awareness | Individuals or business buyers become aware of your business or a specific product offering through online ads, content marketing, or introductions through email or cold call. They enter the funnel and become prospects. |
Gauging Interest | Prospects are interested in learning about the options you offer. This is done through lead nurturing and qualifying activities such as phone calls or emails where you ask questions and provide info to determine which of your solutions would most benefit the prospect. |
Sales Quote Request | The prospect likes what they heard when you were gauging their interest so they request pricing estimates and product options. |
Options Presentation | The prospect receives the quote or proposal, typically via an in-person or online presentation, where they can ask questions about the various options to make an informed decision. |
Purchasing Decision | After the presentation of the options, the prospect decides to either purchase from your business, purchase from another business, or not purchase any products at that time. Onboarding and payment transaction activities take place if they decide to purchase. |
4. Ecommerce Sales Funnel
The ecommerce business sales funnel is best for companies that sell products online. Online businesses usually have a simpler sales funnel because sales reps don’t need to be involved in the process. Customers generally become aware of the ecommerce site and make purchase decisions on their own.
Sales Funnel Stages | Description |
|---|---|
Brand Awareness | Potential customers become aware of your business, online store, or a specific product you offer through online ads, social media, or content marketing that drives website traffic, and enter your sales funnel. |
Website Browsing | The online shopper navigates to your business website to learn about products they are looking for or products they’ve just become aware of. Prospects in this stage may use the “add to cart” or “favorite” features for items they are thinking about buying. |
Purchasing Decision | After browsing your ecommerce website, the online shopper decides to either check out and purchase your product(s), buy from a different store, or not purchase anything at that time. Payment transaction activities and collection of shipping information take place if they decide to purchase. |
Brand Loyalty | After an initial purchase, customers may continuously repurchase from your business if new products are available or if updates are made on current ones. You can use loyalty programs, email marketing, and personalized promotions to keep customers coming back. |
Bottom Line
Download our free sales funnel template and personalize it to visualize your customers’ journey from start to finish, improve your processes, better forecast revenues, and set and manage sales goals more effectively. Any of the sales funnel examples we provided may be a more accurate depiction of your sales process’ buying journey, and you can take inspiration from them to identify the activities needed to move leads through your sales funnel.
