Sales funnel – a marketing analytic tool

Abstract

The article is dedicated to determining the practical value of the principles of building such a marketing tool instrument as a sales tunnel. Sales are key to the success of any enterprise, sales are the most important task, research and decision-making at all levels of management. Efficient sales management practices are essential for the success of competitive and marketing strategy of the company. Sales funnel is a marketing model aimed at the client which accurately demonstrates all stages of customer promotion before purchase of a product. Analysis of client behavior, motivation, at each stage of the funnel, makes it possible to adjust the behavior of the client, unobtrusively stimulate interest in buying. The very term of the sales funnel was proposed by American advertiser Elias Saint-Elmo Lewis in 1898. The practical value of the sales funnel is that it allows to identify major stages, define the characteristics of the client’s behavior at each stage, accept marketing techniques, and becomes the basis of this analysis to construct a communication with a client. It is researched that at each stage of sales funnels customers differ in behavior and motivation to move on to the next stage of the funnel. The article considers the classical hierarchy of needs for A. Maslow and additional levels to the proposed permutation. The principles of the Maslow pyramid make it possible to formulate several basic needs for business and sales, they’re the ones that push the client to make the purchase. It is confirmed that it is essential to determine the true need of a potential client and building on it to build communication by making strong arguments, which may interest the customer and encourage him to buy the product. An example of a five-level sales funnel is considered, the specificity of the client’s behavior and an approximate set of marketing measures at each stage of the funnel is investigated. Features of classic sales funnel are identified. The average ratio of the first and fifth stages of the funnel has been determined to be 1:10. Accordingly, if the ratio is greater, one must find the cause and pick it up with marketing measures, if the ratio is lower, it’s a very good management of sales. The peculiarity of the sales funnel for an Internet store is considered, task and marketing tools at each stage of the funnel are outlined. Sales marketing analysis is carried out to maximize the use of resources, as well as optimally structuring existing marketing and sales processes. This analysis also makes it possible to determine, where it is in the sales chain that the conversion opportunity is lost and how it can be removed. The sales funnel conversion rate is used to measure business success and defining the tasks of the marketing department.