Are You Ignoring Half of Your Sales Funnel?

01/18/2011

Funnel mod 150x150 Are You Ignoring Half of Your Sales Funnel?Some days I feel like there are two types of B2B companies: those that only worry about their sales funnel and those that only worry about their marketing funnel.  Ideally these need to be tracked as one integrated pipeline.

The Back End Camp: It’s all about selling

Most of your classic B2B software companies selling big ticket items would fall into this camp.  These folks will have weekly pipeline reviews with every single sales rep in the organization religiously and could tell you at any moment of the day exactly what the monthly forecast is.  Interestingly, these types of organizations rarely spend much time on the front of the funnel – i.e. what’s happing with prospects and leads, the exact things that ultimately become opportunities that end up in that glorious pipeline.  In these organizations, “sales is everything” and what happens to create opportunities isn’t nearly as important as what happens after the opportunity has been created.  These companies generally have a good grip on short-term revenue forecasting but longer term trends sometimes catch them by surprise.

The Front End Camp: It’s all about marketing

These are more new-school companies that are well-schooled in in-bound marketing tactics but usually do some out-bound stuff as well.  Just like the folks in the above group can tell you exactly what the monthly sales forecast is, these folks can tell you exactly how many hits the website is getting, their email open rates, their conversion rates from visitors to sign-ups, etc.  Where there is zero direct sales involvement (i.e. low dollar value deals where the entire transaction takes place online without interaction with a sales person) this seems to work OK. Where there is sales involvement however (even if it is just inside sales), I’ve seen companies where that sales process is treated like a black box that is almost irrelevant. What happens between an opportunity being generated and it being closed isn’t really tracked or scrutinized. In these companies the prevailing attitude is that “the product sells itself” and the deal is either won or lost based on factors that are out of the sales rep’s control.  These companies tend to be the opposite of the companies in the first group – they have a good grip on the longer-term trends in their business but they are sometimes surprised by how much (or how little) short term revenue gets closed.

Bringing both sides together

Ideally, the two sides need to be treated as one integrated pipeline and flow needs to be tracked from start to finish.  That means you will have to be tracking the numbers, actions and conversion rates around suspects, prospects and leads as well as tracking the stages and success rates across your sales pipeline.  In my mind this needs to be managed together as one exercise and any pipeline or forecasting meetings that talk about one end of the funnel must also cover what’s happening at the other end.   It’s the only way you will be able to ensure both your short term and longer term business is healthy.