When is a sales process considered to be a successful one? When a sales prospect converts into a lead. But this is not a direct conversion. The entire process is very elaborate but not impenetrable.
It takes strategies and a vision to achieve the end result. Sales pipeline facilitates that vision. It is a representation of a company’s sales prospects and how close it is to converting leads.
It visualizes and describes the steps and the process it takes to approach the potential customers and also the strategies to sell them the ideas and goods and services of the company. A sales pipeline acts like a guide.
It is formulated by the company strategists and the employees based on predictions and facts in favor of the potential customers and what would be the best means to approach them and how to convince them.
The foremost benefits of sales pipeline is that it improves the end results as the predictions are close to accurate, enhances interaction and communication where the sales persons are concerned and also the sales CRM and it also identifies blockages in the sales funnel to improve upon. Upon recognizing the obstacles, the company comes into a position to also neutralize those for best results. But sales pipeline is not a subject-matter that is difficult to achieve. With the right sets of minds working together, it can prove to be extremely beneficial for the company. In fact, we discussed about the benefits of sales funnel management in our previous article on this blog.
Here are 4 steps to understand sales pipeline management in 4 minutes:
- Sales process- In order to achieve maximum benefits and positive outcomes by the means of sales pipeline, the company need to really define the sales process. They need to create a structure to follow and step by step go about the sales process. There are five factors that need to be kept absolutely in mind while devising a sales pipeline; first is to shortlist the potential customers. It is important to see that he is a good fit because if not, all the efforts, time and money got to waste. Second is to understand the customer’s needs. Third is give a demo or a sample of how the company is going to be beneficial for them. Fourth is to give a fitting and appropriate proposal that the customer won’t be able to refuse and finally fifth is to close the deal and convert the prospect into a lead.
- Predict targets- Once the sales processes start, the picture of the real world customers, away from the conference board, becomes clearer. The salesperson gets a better idea of how a customer responds to the sales prospects and how to close a deal. So at this point in time, it becomes important to keep predicting and updating targets. It is understood that in the sales pipeline structured before starting the sales process, there is a target set by the company that is to be achieved either on a monthly or daily basis. But it is not necessary that all the potential customers would turn into leads. So in order to not fall behind on targets, the salespersons need to keep updating the targets and try and get as many conversions as possible. A positive outlook towards the customers, works wondrously for this cause. So the predictions and the challenged must be synced and dealt with hand in hand.
- Pipeline goals- Now that the company has a better understanding and a perspective of their pipeline, it becomes important to establish sales pipeline goals. These goals help in devising the growth targets of the company. The most beneficial way to do this is to go in reverse from revenue goals. So if the revenue goal per is at $200,000 and an average size of a deal is $40,000 then, in the best possible scenario with the given budget the ideal number of deals required in a month would be 5. So if the company wants to effectively put its revenue in place, it needs to close 5 deals in one month. This would be a saturated scenario. This conversion data from the target generation of revenue, helped in devising the target leads of one month. This gives a goal and assures efficiency as the sales person is aware of how he has to perform in order to achieve those targets and will be focused.
- Optimization- With all the data and strategies that in hand, the company’s next step, without any hesitation must be to optimize those resources. They need to put these resources to the best of their use. There will be plethora of data available right from industry conversion rates to internal conversion rates. This can be compared and analyzed thoroughly to identify loopholes and gaps in their sales pipeline which can then be rectified. The companies that have their 5 step procedures during the sales process not up to the mark or are falling behind in the converting leads have to then restructure the entire sales pipeline structure to create an efficient configuration. If they don’t optimize the data available to them, then the company is bound to face setbacks.