Beginner’s Guide: How to Build a Sales Funnel for Your Online Business

This article has been fact-checked for accuracy.

What is the final objective of any business owner or entrepreneur? Why do they work so hard to publish insightful content? The ultimate goal of all your marketing strategies is to convert prospects to leads and finally, to paying customers. An army of happy and loyal customers increases your revenue and helps your business grow.

However, convincing potential customers to make a purchase is becoming increasingly difficult. This difficulty is mainly due to the state of consumer behavior – today’s consumers are flooded with options every time they want to buy a product or service.

The abundance of online businesses only makes this competition worse. Having an array of selection, in turn, makes consumers skeptical and compels them to perform extensive research before coming to a decision.

Therefore, offering a great product or service isn’t enough to attract customers. If you want to increase your conversion rates, it is crucial to develop a robust sales funnel. It helps nurture your prospects at different stages and ultimately, increases the likelihood of conversion.

Before we discuss the steps to build a sales funnel, let us take a closer look at the concept.


What is a Sales Funnel?


A sales funnel is the journey a buyer goes through, from their first interaction with your brand to the final purchase. In other words, it is the path of a potential buyer from a prospect to a lead and finally, a customer.

The “funnel” part is because all sales processes will always involve more prospects at the top of the funnel than there are customers at the bottom.

sales funnel


Let us use a sales funnel example to understand it better.


A Real-World Example


Let’s say you run a small bakery and you have recently distributed flyers in your neighborhood to grab eyeballs.

One person sees this flyer and decides to check out your place. At this point, they are just in the mindset of browsing through your products; they qualify as a prospect. Pitching in with a discount for a birthday cake order might seem slightly pushy at this stage. Instead, you should have a staff member politely greet them and offer assistance.

As the visitor looks around, they get attracted to a jar of gluten-free cookies; you now have a lead. You seize the opportunity and inform them that you have other gluten-free products as well. You request a staff member to show them around in the gluten-free section. As they contemplate making a purchase, you entice them further by offering a discount.

Once the visitor reaches the cash counter, you recommend them to try the latest healthy brownies as well. Since they have had a positive experience so far, they are more likely to consider your suggestion. You also inform them that you can create customized cakes for special occasions and offer them an exclusive discount. At this point, it is also important to ask for their contact details such as phone number or email address.

You have now successfully converted the visitor into a satisfied customer. Moreover, you have given them a reason to come back to your bakery. This cohesive strategy has helped you create awareness, increase footfall, and finally, boost sales. It is crucial to pitch the right offer or incentive at the right time; otherwise, you can drive potential customers away.

The next logical step is to keep your customers updated about the latest discounts. You can also let them know whenever you launch a new product that resonates with their taste. A solid follow-up strategy encourages existing customers to make a repeat purchase, which can drive up your revenue significantly.

Let us now understand how a sales funnel applies in the context of online businesses.


Sales Funnel for Online Businesses


In the case of an online business, the first point of interaction is usually your website or a landing page.

Therefore, the sales funnel is essentially the path taken by website visitors before they purchase your product/service. They could reach your website or landing page from search engine results, social media posts, and paid advertising.

It is important to understand that in the case of an online business, there is no scope of direct contact or face-to-face interaction. It often makes your potential customers more skeptical about buying your products. Therefore, it is crucial to woo them in the right manner and earn their trust. This focus on converting makes sales funnel all the more important for online businesses.

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Image via Thrive Themes


It is now time to take a look at another sales funnel example.


Online Sales Funnel: An Example


Let’s say you curate and organize unique treks around the world and use your website to sell them. Your target audience possibly comprises the social media-savvy younger generation. You can use a Facebook Ad or an Instagram post to reach out to them and lure them to your website. Having a robust acquisition strategy is the first step of your sales funnel where you are trying to drive more traffic to your website/landing page.

Once a visitor lands on your website from an Instagram post, they now qualify as a prospect. At this stage, it is crucial to capture their attention with a lead magnet. For instance, you can offer a free e-book titled “Beginner’s Guide to Trekking in the U.S.” in exchange for their emails.

As soon as a visitor submits their email address, you acquire a lead that needs further nurturing as it trickles down your sales funnel. Setting this up requires you to create fresh, insightful, and relevant content and send it out to your leads in the form of newsletters. 

For instance, you can create a series of blog posts targeted explicitly for novice trekkers. Your content could be related to renting trek gear or packing hacks. The idea here is to establish your authority and expertise and win the trust of your potential customers. You can lure them further by including testimonials from existing customers and some videos/pictures from your previous treks. You need to hypnotize them with your content so that they can’t refuse when you make your final offer.

In this example, you can conclude your email campaign by offering them an attractive discount on their first trek with you. A typical sales funnel mistake is to completely ignore a lead once you have converted them into a customer. Instead, it would be best if you created a separate retention strategy to keep your existing customers engaged.

One way to accomplish this is to seek honest feedback. Motivate them to write about their experience on social media as well; this will increase your reach further. You can always reward them with a unique coupon for doing so. Also, you can offer them an incentive for referring your brand in their networks. You should also update them about your upcoming treks or provide advice on how to design their treks.

Likewise, if you run a digital marketing agency, you can create a plethora of lead magnets such as podcasts, webinars, and case study reports. Track the route taken by your prospects to reach your website and hook them with a suitable magnet. In the next, send out a series of newsletters featuring high-quality content that will be relevant to your leads. Finally, you can pitch your services and offer a discount at the end of the campaign.

The steps of an online sales funnel are slightly different from traditional marketing funnels. Before we delve deeper into this, let us understand why having a sales funnel is so important after all.


Why You Need a Sales Funnel


There can be no business without customers. There, acquiring new customers and retaining existing ones requires a solid strategy. This is where a sales funnel comes in. Sales funnels help by enabling you to attract your target audience and convincing them to purchase in a conversion-focused manner.

Chances are, you probably already have a sales funnel unknowingly. When you run a lead generation ad on Facebook and contact these leads via email and texts, you are following a sales funnel. However, in the absence of a well-thought-out plan, potential leads can still slip through the cracks as they progress along the funnel. This will hinder your conversion rate despite receiving many leads.

Instead, if you have a solid funnel to nurture these leads, the conversion rate will improve. A sales funnel gives you a better understanding of your target audience and their interaction with different elements of your website, blog posts, and newsletters. This allows you to control how your prospects move down the funnel.

Understanding the online sales funnel equips you with the right marketing collaterals to woo prospects at every stage. It also helps identify any cracks in the funnel and repair them to maximize conversions.


Stages of an Online Sales Funnel


So far, we have discussed what a sales funnel is and how it is indispensable for online businesses. Sales funnel deals with leads/prospects at different stages of the buyers’ journey. Therefore, it makes sense to divide the sales funnel into various stages as well.

Broadly, a sales funnel can be broken down into four stages: awareness, interest, decision, action.

Each step requires you to take a different set of measures to ensure that the lead takes to the next action you want them to take.


Stage 1: Awareness


Awareness is the stage where you are trying to grab the attention of your target audience. The first point of contact can be through an infographic shared across social media platforms or a compelling YouTube video. High-quality, optimized content for the search engines will also help you grab eyeballs at this stage.

Your sole focus should be on attracting the target audience to your website or landing page. Next, you have to hook them with relevant and highly engaging content. The idea is to build a strong rapport with your potential customers and encourage them to return to your website/business.

The main tools at your disposal include social media marketing, paid search advertising, search engine optimization, and content marketing. You can increase your reach further by collaborating with an influencer who is relevant in your niche.


Stage 2: Interest


Once you have successfully managed to capture the attention of a prospective customer, they want to know more about your business. They are still not ready to make a purchase. Instead, they might be digging deeper to find your online reviews and research your competitors. This is your window of opportunity to showcase your expertise instead of trying to sell your product/service.

The first task here is to convert a prospect into a lead by offering them a strong lead magnet. You can lure your leads in with free e-books, podcasts, and product trials in exchange for their email address. The next step is to deliver personalized and relevant content that addresses their pain points and educates them on how to overcome them.

For instance, if you want to sell a keyword research tool, you have to demonstrate why you are better than your competitors. A simple way of establishing your authority is to publish a series of blog posts related to modern SEO techniques. Creating a weekly newsletter using these blog posts will keep your leads engaged.


Stage 3: Decision


Decision is the stage where a lead is contemplating the purchase. Decision-making is the stage where they are still considering a few options – you or your competitor(s). They might need a slight push to buy your product/service. This stage is the right time to pitch in with an irresistible offer that a potential customer can’t afford to ignore. It could be in the form of a free trial or demo, exclusive discount, and product upgrade.

The key here is to make an offer that distinguishes you from your competitors. For instance, if you run a digital marketing agency, you could offer a week-long free consultation before a customer makes up their mind. You can also collaborate with a relevant and popular influencer to host a giveaway of your products.


Stage 4: Action


At this stage, the customer has finally made up their mind to purchase from you. Once you accomplish this, you might be tempted to think that you’ve done your job, which is one of the biggest mistakes that online business owners and marketers make. It often costs you more than you’d like to think.

Acquiring a new customer costs five times more than retaining an existing one. Therefore, you can’t afford to abandon a customer after their first purchase. Instead, you should keep in touch and make them feel valued. In addition to providing flawless customer support, you can ask them for a review/testimonial.

You can also offer them a special coupon code for their next purchase. Likewise, you can develop a solid referral strategy and ask customers (who already bought your product, so there’s a certain degree of trust) to recommend your products/services in exchange for incentives. Apart from increasing brand awareness, this also helps you reinforce customer loyalty.

Now that we’ve explored the various stages of the customer journey, let’s dive into the process of actually developing a sales funnel.


Developing an Online Sales Funnel


We have seen a few sales funnel examples and understood how important it is for your business. It is now time to discuss how you can create a sales funnel that will help you achieve higher conversions than your competitors.


1. Know Your Target Audience


Every marketing strategy ultimately depends on how well you know your target audience. Building a successful sales funnel also requires you to gain a thorough understanding of your target audience. In addition to essential parameters such as geographic location and age group, you should identify their preferences, expectations, and pain points.

You should also monitor how they interact with your website, landing pages, and various social media profiles. A clear understanding of your target audience helps tailor your messaging at every stage of the sales funnel. You can take this a step further by defining separate buyer personas and customizing your conversion funnel for each persona.


2. Create a Solid Content Strategy


The best way to attract your target audience is by rewarding them with top-notch content. Once you have identified different buyer personas, you can create content that appeals to each one of them. However, instead of randomly publishing a post, you should create a content calendar for each stage of the sales funnel.

Apart from blog posts and articles, you can use other types of content, including infographics, videos, and podcast episodes. Understand what kind of content works on each social media platform and use it accordingly. Outline a clear timeline of what content is to be published when and on what platform.


3. Promote Your Content


Creating high-quality content won’t deliver any results unless it reaches the right people. Therefore, you need to outline a plan to promote this content through various channels. Content promotion is one of the most crucial steps because it helps grab the attention of your target audience where they “hang out.”

You can promote your content using different methods such as SEO, guest blogging, cross-posting, and social media marketing. You can also use paid advertising on search engines and social media platforms. Likewise, you can work with an influencer to promote your content on their social media profiles.

It is crucial to select the channels that are most likely to be used by your target audience. For instance, if yours is a B2B business, LinkedIn Ads might help tap into the right market. Similarly, if you want to attract the attention of the younger generation, Instagram ads and influencer marketing might be more helpful.


4. Use a Landing Page


What happens when someone clicks on your Facebook Ad or search engine results. If you redirect them to a random page on your website, they are likely to exit without taking any action. Instead, you should send them to a crisp landing page that focuses on a particular call-to-action.

You can use it to encourage visitors to download a case study or join a webinar in exchange for the contact information. Having a well-designed landing page helps you capture convert website visitors to leads that you can nurture further. You can also convert your home page into a landing page by tweaking its layout or adding a welcome mat.

We also highly recommend that you create different landing pages for various marketing channels. While traffic from search engines is usually directed towards blog posts, visitors from Facebook Ads should be steered to a hyper-relevant landing page.

You should ensure that the intent of your ad/social media post/search engine results matches that of your landing page. If someone clicks on a Facebook Ad for a free SEO tutorial, the landing page must deliver the same. Any false promise or discrepancy can permanently drive potential customers away.


5. Develop an Email Marketing Strategy


Once you have acquired a lead, the next step is to educate them about your business and showcase your expertise. A simple and effective way of doing this is to create an email drip campaign. Design compelling newsletters with high-quality content and send them to your leads. Make sure you space out your emails so as not to overwhelm your potential customers.

Observe how each lead interacts with your newsletter and send follow-up emails accordingly. Make sure you personalize the emails as you reach closer to the end of your campaign. Conclude your campaign by making an incredible offer to those who show interest.


6. Build a Follow-up and Referral Strategy


The treatment a customer receives after making their first purchase can make or break your business. The right approach is to stay in touch with them by offering customer support and soliciting feedback. Thank them for giving your business a chance and provide a coupon code that your customers can use for their next purchase.

It is equally important to create an effective referral strategy. Provide your customers with a referral link/code and encourage them to share it in their networks. Offer them an incentive such as an extra discount or freebies in exchange. 


7. Use Influencer Marketing


The digital age has opened up several new avenues to connect with potential customers. Influencer marketing is an extremely useful method that can be used at various stages of your sales funnel. From creating awareness to educating your audience about your products – influencers can be of great help. Make sure you collaborate with the right influencer and harness their potential to the fullest.


8. Optimize Your Funnel


A sales funnel, like any other marketing strategy, may require a little bit of hit and trial in the beginning. Monitor the performance at each stage of your funnel to understand whether it has been successful. This optimization process will help you identify any loopholes and optimize them further. The conversion rate at each step is a useful metric to measure the success of your sales funnel.

Keep track of how various marketing channels, such as social media, email newsletters, and search engines, are performing. You can test different versions of an ad and select the best performing one. Likewise, you can check the copy, CTA, and layout of your landing pages using A/B testing. Additionally, keep a close eye on how your audience is interacting with your content at each stage.


Conclusion


From eCommerce portals, course creators, SaaS companies to marketing agencies – a sales funnel acts as the backbone of every business. It is crucial for the survival and growth of your company. While you might be using it unknowingly, a proper understanding of the funnel helps you optimize it.

Creating a tenacious sales funnel requires you great content and a strategy to promote it. You should also possess a deep understanding of your target audience. Use an email drip campaign to nurture your leads and convert them into paying customers. Lastly, make sure you have a proper retention strategy in place to increase repeat purchases and referrals.

To get started with sales funnels, you can use Thrive Themes if you’re a WordPress expert, or you could use ClickFunnels if you’re looking for an all-in-one solution.

Both of these are quite simple to use but Thrive Themes requires a little bit of WordPress knowledge, with ClickFunnels is a more beginner-friendly funnel solution.

What steps did you take to create a sales funnel for your business? Share your views in the comments section below.

A sales funnel is vital to turn your leads into paying customers. Read more on Hustlr\'s guide on how to build a sales funnel for your online business!

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