The Magic Funnel 

Liz Heiman
13.01.22 04:27 PM Comment(s)

The Magic Funnel 

OK, the funnel isn’t magic, but sometimes the simplicity of it is magical.  Managing selling work can be overwhelming.  Depending on the number of buyers involved and the length of the sales cycle, there can be a lot to keep track of.  Thank goodness for CRMS (or spreadsheets).  If you use your CRM correctly, it can help you manage your sales (or your sales team). 


The best way to manage sales work is to break it down into categories and prioritize it.  I do that using the Sales Funnel.  Lately, we hear a lot about the marketing funnel and the sales pipeline, so let me explain what I mean by a sales funnel, and why I prefer funnel over pipeline


 Since you must understand the concept of a Sales Process before you can understand the funnel, let’s begin there. 

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Sales Process 

The sales process is the process the salesperson follows from the beginning of the sale through the close of the deal. Ideally, it should mirror the buying process your customer goes through.


For some sellers, deals close in one or two conversations in a matter of days or weeks. For others, it takes a lot longer and many more interactions. The more complex the sale is, the more conversations are required over a longer period. Some sales have as many as a dozen buyers and can take 12-24 months to close.

The more complex the sale is the more moving pieces there are to be tracked.


Now, imagine (yes, I know some of you don’t have imagine this) there are 100 sales opportunities (deals) with 10 buyers each and each deal is in different stage in the sales process.  How can you possibly keep track of that?


Start by breaking the sales process down into stages.  I usually recommend 5 or 6 stages.  Then you can track the opportunity (deal) through the process from prospect to close.  During each stage, you will have questions that need to be answered, activities that need to be completed and a gate you need to pass through to move to the next stage.


Regarding Sales Funnel

Stages are the steps you follow to get to the close.  You can name your stages whatever you want, but it is easiest if you think about the stages as part of a process you are going through, rather than activities to complete. 


I typically use Prospect, Qualify, Cultivate, Close and Won/Lost. Notice that everything is in present tense except Won.  That makes sense if you realize that when an opportunity is in each stage, you are engaging in activities that relate to that stage. In the prospect stage, you are searching for opportunities and engaged in activities that will get a prospect to agree to a conversation.  During the qualify stage you are qualifying the prospect.  You are trying to determine if the need they have is a good fit with the solution you have and if they have budget and a timeline. Once the prospect is qualified, you move into the stage I call cultivate.  This is when you are cultivating the relationships, solving problems, and overcoming objections until you can agree on a solution, a timeline, and a price.  Then, you are ready to create a proposal and close the deal.  Closing a deal means getting a signature on a contract and payment. At that point you have either won or lost the deal. 


During each of the stages, there are activities that need to happen.  


Prospect: Activities that might happen in the prospect stage are list building, content delivery, referral seeking, social media engagement, and possibly cold outreach.  You might also be looking for opportunities inside existing customers. 


Qualify: Typically, qualifying happens during phone calls or meetings. Some companies use demos to qualify.  That is not ideal, but we can discuss that in another article. 


Cultivate: Most activities happen during the cultivate stage.  There may be many meetings and phone calls. You may be reviewing requirements and sending specs.  You may be providing information.  Some companies do demos during this stage.  Some put together draft proposals for review and discussion. 


Close: Once all is agreed upon, we move into close.  During this stage you are doing two things, getting a signature on the contract, and getting payment. There may be activities with legal and procurement, but ideally, that would all be sorted out before you deliver the final contract to be signed.  


Won/Lost: The final stage is won or lost. If you got all the way through the process and obtained a signed contract and a payment, you won the deal.  If they never responded, you qualified them out, or you couldn’t come to agreement, you lost that opportunity, but there may be others with that company in the future. 


Questions about sales funnel

During each stage there are questions.  In the prospect stage they are questions to garner interest.  In the qualify stage the questions will help you figure out if you should pursue this opportunity with this customer at this time.  What is the need? Do you have budget? Do you have a timeline? Things that help you determine if they are serious and if you should spend time on the sale. 

In cultivate, the questions help you refine the solution to fit the needs and to identify anything that might prevent the decision from being made or prevent them from choosing your solution. During this stage, you will be working out the details so you can put together a proposal. 

During the close stage, you are asking for a signature and payment. Hopefully, you have already uncovered the process, now you are providing the proposal and making it easy for them to sign and working out how they can pay you.  There shouldn’t be a lot of questions at this time. 


Gates are the rules for moving an opportunity from one stage to the next. They go something like this.  The gate to move from prospect to qualify is an agreement by the prospect to have a meeting to discuss the opportunity. 

The gate to move from 
qualify to cultivate is that you have confirmed a need, fit, estimated budget and estimated timeline.  Those may change some during the next stage, but you have enough information to determine the customer is serious and there is potentially a good fit. 


The gate to move from cultivate to close is that you have enough understanding and agreement to provide a final contract. You may have gone through some proposals to get here, but at this point you agree on what they need, how you will provide it, what it will cost and when it needs to be paid for. You move into close when you deliver the contract for signature. 


You move from close to won once you have a signed contract and at least an initial payment. 


You move to lost at any point along the journey that you determine they aren’t a good fit, or they decide not to buy from you.  Be careful that you don’t assume a few unanswered emails means the deal is dead.  It can take 8 calls to get a prospects attention even once you are in the sales process. 


the shape of a funnel

Remember I mentioned I prefer the term funnel to pipeline?  That is because the image of a pipeline is straight up and down. A funnel has a specific shape.  It is wider at the top than the bottom. There is a reason for that.  In most companies, you must put a lot in the top of the funnel to get anything out the bottom.  Let’s say you put 10 things in the top of the funnel – into prospect.  You may reach out to all 10 but maybe only 6 agree to have a conversation with you.  Once you talk to those six you may decide only three of them are qualified leads.  The others aren’t ready or aren’t a good fit or don’t have the budget available. Three of the 10 move into cultivate.  During this stage, while you are working out the details and talking through objections, one or two will decide to wait, do it themselves or use a competitor. That leaves one or two of the 10 that you will move into close. If you have done your job well, and covered all the bases, these will close.  If you missed a step or if something crazy happens, you could lose one or both. 

It is natural for sellers to lose deals along the way. That is why it is important to put more in the top of the funnel than you need to come out the bottom.  Over time, you will learn what your ratios need to be to hit your quota. 


If you are using the funnel/sales process to prioritize your work, which I hope you are.  You are qualifying out those leads least likely to close so you can focus your attention on the leads you are most likely to win. That is the first way you can use your sales process to prioritize.  The second is to look at the shape of your funnel and determine what you need to do to get it back to the right shape. What work have you been slacking on? Is it prospecting or follow-up where you need to put some focus?


The third way is in your everyday activities.  The most productive way to prioritize your selling work is to start with the bottom of the funnel. Close what needs to be closed. If you have gotten this far, you don’t want to waste all that hard work.


The next priority is filling the top of the funnel. If you close something, you need to put 10 things in the top of the funnel to replace it.  Next, qualify and finally, cultivate. You will spend the most time cultivating or covering all the bases, so make sure you make time for top of the funnel work. 

Managing Sales Work 

So, if that is how you prioritize it, you still may not be clear how to manage it all.  There are a few easy things to do.  First, document everything.  You may hate updating the CRM because it is time consuming and tedious. I get it!  It is also the best way to manage all the information you need to manage.  Put in notes from every meeting or call, even emails if it helps.  Then, now this is important, after every action, plan your next action and create a task.  Whether you use a CRM or a spreadsheet, having that next action planned with a date attached will help you manage your time. 


The final thing I recommend is to plan your day.  Looking at your CRM or funnel may seem overwhelming, so each day plan what you are doing that day.  This may seem crazy, but you might want to look at the funnel and tasks in your CRM and make a list of what you are going to do today.  Remember, you have 4 kinds of selling work to do every day, prospecting, qualifying, cultivating, and closing.  Put your work into 4 categories and only put on your list what you can accomplish today. Maybe put 4 in each category.  Now only use the CRM to find what you need to do the work you have decided to do today. 


Last warning, I recommend doing that the night before or first thing in the morning. Once you set your priorities, listen to messages, and read email.  Before you drop everything to react to your email and voicemail, look at your list for the day and decide what is more urgent, and what is more important.  There will always be more urgent activities than prospecting, but there will be few things that are more important in the long run.  Don’t put off prospecting. Make time every day if you can, or at least every week. 

Conclusion & Download

Selling can be overwhelming, so use tools that help you manage the work that needs to be done.  

Download the Funnel Graphic and the Daily Sales Worksheet.  

Funnel Download

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Liz Heiman