Even a well-designed sales funnel can come with its own set of issues. From leads going cold to time wasted on the wrong deals, today’s sales funnel challenges kill your bottom line from both directions: increasing costs and reducing revenue.
In this post, we’ll dive into some of the most common sales funnel challenges and give you some steps to handle them. By implementing these strategies, you can optimize your sales funnel and drive more revenue — without wasting time on dead-ends.
1. Discovery call happens and then it goes cold
Perhaps the biggest sales funnel challenge is when a discovery call happens and then the lead goes cold. This often happens when nobody follows up, or when the follow-up attempt is met with silence (i.e. you get “ghosted” by the lead). As a result, the sales team is left wondering where the lead went.
To solve this problem, keep the SDR team engaged with the prospect after the discovery call. This is because the account executives, who are great at closing deals, may not always be the ones taking the first call and building rapport for future engagements. Without this initial rapport, the prospect may simply write off the product or service as a “nice-to-have” rather than a “must-have”.
Meanwhile, the SDR team is often able to get the prospect back on for a second or third meeting, where they can continue to build the value of the product or service. This will help maintain the early-stage excitement and prevent the sales funnel from going cold.
2. Long cycle times
Another common sales funnel challenge is elongated cycle times. In today’s market, decision-making can take longer than it used to (especially during a recession). This can be frustrating when sales teams are eager to close deals and move on to the next opportunity.
To overcome this challenge, it’s important to put in the effort at the early stages of the sales process to connect the right people and shorten the cycle time. Consider these strategies:
- Find an internal champion who can provide valuable information and insights about the company, including who to approach and who to avoid, what the company cares about, and how to put together a more effective sales proposal.
- Create a sense of urgency. Highlight the benefits of leads making a decision quickly, such as securing a discount or getting access to limited-time offers. (Framing these in terms of loss-avoidance tends to get better results).
- Have a good nurture stream in place. This is crucial. This means regularly reaching out to leads, whether through calls or automated outreach, such as sending relevant blog posts or case studies. This helps keep the prospect engaged and interested in the product or service, which can help shorten the sales cycle.
3. Not enough pipeline
A particularly common challenge in the sales funnel is not having enough pipeline. This can be especially frustrating for ambitious sales teams who may feel like they don’t have enough opportunities to work on.
To solve this problem, it’s important to get the SDR team more involved, and better set up for success. This involves:
- Better assets: Make sure they have referenceable use cases based on industry vertical personas.
- Better positioning training: Train them how to position these messages to the right people. This will help them generate more leads and build the pipeline.
- Better account list: Once they’re ready, you need to point the SDR team toward an account list that they can target and get results from. This will help focus their efforts and increase their chances of success. To fill a pipeline with higher quality leads, you may want to consider outsourcing sales development.
- Better lead generation automation: to a certain extent, you can attract and nurture incoming leads via good marketing automation, without minimal long-term time investment. Avoid going overboard with this: read about sales automation best practices for more details.
One important caveat to this challenge is that if you switched to an account-based marketing (ABM) approach, this can explain the drop in pipeline.
That’s because the ABM model involves targeting specific accounts rather than trying to capture every potential customer. As a result, the target addressable market becomes smaller and the sales team has to be more selective in their approach.
ABM changes the marketing perspective, but it changes the sales perspective much more, as they are no longer going after every fish in the ocean.
This can lead to a drop in velocity and pipeline, but it’s not necessarily a bad thing if it’s what the company wants and you’re following ABM best practices. After all, you shouldn’t waste your time on the wrong types of leads. Speaking of which…
4. Going after deals that are too small, or a bad fit
If your team is chasing deals that are too small for a realistic ROI, or your targeting isn’t refined enough, you waste a great deal of time and resources.
This challenge often happens when sales teams try to capture every potential customer, even when some opportunities don’t make sense to pursue.
To solve this problem, double and triple check your account list at the early stages of the sales process, and make sure every account on the list fits the criteria for return on investment for the initiative.
This may involve going deeper on qualifiers, such as looking at additional information that can’t be found on a ZoomInfo account page. For example, website traffic might be relevant to your business, or you may notice that certain geographies are more important than others.
By applying these qualifiers before any sales outreach, you can filter out suboptimal leads and cut out all that wasted time upfront. This will result in a more profitable sales funnel, with higher conversion rates in the end, and better initial contact rates when done early enough.
5. Low contact rates
In recent years, contact rates have consistently declined, and email reply rates are often below 1%. Sometimes it’s an issue of sending too many emails on the marketing side, or sales reps failing to do prior homework on the contact. Whatever the reason, it can make it difficult for sales teams to reach potential customers and generate leads.
To address this challenge:
- Shift channel priority: Focus more on areas that will provide the most return, such as phone calls and LinkedIn outreach. (It’s still important to include email in your outreach strategy, so don’t neglect it entirely).
- Improve list quality: As above, make sure you have high quality lists so you’re not wasting time on the wrong leads. Better targeting and segmentation go a long way to boosting success rates.
- Personalize outreach more: Make messages more relevant to each contact. Most people (yourself probably included) are sick of getting cookie-cutter cold emails and tend to trash them without giving them more than a casual glance. When it comes to calls, consider the best time to call them based on their profession, and have a good voicemail pitch dialed in, since an increasing number of people avoid picking up calls from unknown numbers.
Part of your success here comes from your ability to stand out from the crowd to establish how you’re uniquely relevant.
6. Standing out from competition
Another common challenge in the sales funnel is rising above market noise. For most prospects, there are five or more companies that all look the same on the surface.
There are a few ways to address this:
- Positioning and value prop: Marketing and SDR teams need to know their differentiators really well. They need to have a strong grasp of what makes your product or service unique and valuable to the customer and be able to communicate this effectively to prospects.
- Concrete examples: Consider sharing customer success stories or case studies, which can provide concrete examples of how your product or service has helped other businesses.
- Training for live conversations: Make sure the SDR team is trained to communicate these differentiators to prospects in the moment, during phone calls or other outreach efforts.
With all of this in place, you still need to assess your team’s performance. Which brings us to our final challenge.
7. Tracking performance metrics accurately
It’s impossible to improve if you don’t know how you’re doing. Make sure you’re tracking key performance indicators (KPIs) for sales, such as:
- Calls until a conversation
- Conversations until a meeting (or meaningful interaction)
- Meetings until a sale
By tracking these metrics, you can identify problems before they become real issues, and take steps to improve your sales process.
To do this effectively, it’s important to establish benchmarks for your industry. This will give you a baseline to compare your team’s performance against, and help you understand what is and isn’t working in your sales process.
Once you have these benchmarks established, you can start ranking your team’s performance based on these metrics. This will help you identify areas for improvement and provide guidance on how to optimize your sales process for better results.
By tracking performance metrics accurately, you can make more informed decisions and improve the overall effectiveness of your sales funnel.