How Sales Funnels Can Help You Grow Your Business

by | Jan 11, 2019 | Customer Growth

When discussing sales funnels, it’s important to understand the framework of a funnel.  There is generally a frontend and a backend to a funnel.

The Frontend—is the initial offer that you use to get a prospect or lead to purchase from you and become a customer.  This is generally a lower cost product or service.

The Backend—any offers (including upselling, downselling, and cross-selling) you make to your existing customers once they’re in your ecosystem.  Your backend offers are primarily focused on driving customer ascension in order to increase the average lifetime value of each customer.  This is where you would traditionally offer higher cost or premium services to your existing customers.

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The real power of a sales funnel is when you leverage artificial intelligence and automation.  

A Sales Funnel Example

Let’s say you provide legal services and you have a physical book or eBook for sale.  Your frontend could consist of what’s known as a “Free Plus Shipping” offer. This is where you drive prospects to get your free book (they only cover shipping), and now they’re in your ecosystem.  

You generally take a loss or breakeven on a frontend offer like this. Ideally, you would at least cover your advertising costs. But, the backend is where the percentages swing in your favor and lead to profit. You could then immediately upsell your new customer on a one-time discount (also known as a One-Time-Offer or OTO) on a Cyber Security Risk Assessment service.

Your sales funnel can have as many steps as you’d like.  And, it can extend for any length of time. Even if you don’t have an immediate upsell, you can do this at a later time through another medium. However, you’ll need to capture an email address to make this happen. 

The success of your funnel all depends upon your sales success at each step in the process.  As long as you close enough backend offers, you can justify taking a calculated loss on the frontend.

Planning Your Funnel 

Think of your customer journey.  Where do you want your customers to end up? 

Once you figure this out, you can work backward to determine what steps your customers should take to get there.

Many businesses have a cap on products or services they’re able to offer.  If you have customers at the “end” of your customer journey, it’s time to think up other products or services to sell. 

Happy funnelling.  

Ryan has been heavily involved in the world of Information Technology and entrepreneurship since the early 2000s. From small business consulting to Fortune 500 IT leadership, Ryan has a wide array of industry knowledge. He earned his BBA from the University of Iowa in 2004 majoring in Management Information Systems and later earned his MBA from the University of Iowa in 2009 with a focus on Management and Marketing. When he's not spending time with his wife and three young children, you'll find Ryan pounding away at his keyboard, spinning on his Peloton, or listening to a good audiobook or podcast.

Connect with Ryan on Twitter or Instagram.

Ryan Glick

Co-Founder, Pixelayn Innovations

Ryan has been heavily involved in the world of Information Technology and entrepreneurship since the early 2000s. From small business consulting to Fortune 500 IT leadership, Ryan has a wide array of industry knowledge. He earned his BBA from the University of Iowa in 2004 majoring in Management Information Systems and later earned his MBA from the University of Iowa in 2009 with a focus on Management and Marketing. When he's not spending time with his wife and three young children, you'll find Ryan pounding away at his keyboard, spinning on his Peloton, or listening to a good audiobook or podcast.

Connect with Ryan on Twitter or Instagram.

Ryan Glick

Co-Founder, Pixelayn Innovations