How to Craft a Sales Funnel Your Small Business Needs

How to Craft a Sales Funnel Your Small Business Needs

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Can small businesses outperform their larger competition? Recent history would suggest so. Take a look at Tesla. A successful company now, just a few years ago, Tesla was simply a startup with an idea to revolutionize electric cars. Arguably, larger car manufacturers had more resources to do the same, yet Tesla remains the market leader.

Google is another example. Impossible as it may seem now, when Google was founded 25 years ago, popular opinion had it that Yahoo was the leading search engine. Not only has Google taken that title, but the company’s sites have also been ranked as the most popular multi-platform web properties in the United States.

How did these companies do that? Of course, they created products and services consumers wanted to buy. But they also created a highly effective sales funnel to turn audiences into customers. Your business can do the same.

Related: What Is a Sales Funnel? The Guide to Building an Automated Selling Machine.

Understanding the Sales Funnel

The sales funnel effectively describes the path your company’s customers take from being a prospect to becoming a customer.

Picture a funnel: At the top, there is a large number of potential customers. As you move toward the bottom of the funnel, the number of prospects reduces, but the likelihood of those prospects turning into customers increases. At the very bottom of the channel are even fewer people. These are customers who have made repeat purchases or recommended your business to others. They are loyal to your brand and have become advocates.

Like all models, the sales funnel is an excellent tool to help illustrate the customer journey. However, looking at this journey as a linear path can be too simplistic. Many customer journeys involve detours and U-turns. Business owners need to bear that in mind when they build their sales funnels.

Related: How I Built a Sales Funnel That Generates Over $80 Million

Top-of-the-funnel strategies: Awareness and interest

How many potential customers know about your products and services? It may sound obvious, but if no one is aware of your brand, then you won’t sell anything. Creating awareness and raising interest in what you do are the first steps in creating a highly effective sales funnel.

This is the area where marketing and public relations (PR) excel. As a small business, focus on highly cost-effective tactics like search engine optimization (SEO), content marketing, and social media marketing.

SEO ensures that people who are looking for products and services like yours find out about you. Content marketing offers excellent opportunities to not only tell potential customers more about your offering but also to address pain points they may be experiencing that are connected to your services.

Social media marketing allows you to build a community of potential customers and brand supporters by talking directly to them. You could also enlist the services of social media influencers.

Middle-of-the-funnel strategies: Consideration and conversion

Ideally, you generate enough interest and trust during the top-of-the-funnel stage to collect email addresses of potential customers and build your email list. Allowing email contact is a definite sign that your prospects are considering a purchase.

This is the time to nurture these prospects and convince them to make a purchase. This middle-of-the-funnel stage is all about educating prospects on the benefits of your services and products as well as removing any doubt from their mind.

Ensuring customers know they’re receiving excellent value is critical at this stage. For example, if email conversions are slow, businesses could consider adding limited trial versions of other products.

Related: How Good Website Content Helps You Earn Potential Customers

Bottom-of-the-funnel strategies: Loyalty and advocacy

The bottom of your funnel is far smaller than the top. Obvious as it may sound, it is important to remember that very few (if any) brands will turn every prospect into a long-term customer.

It is equally important to offer your customers at this stage of the funnel incentives to stay with your brand. Why? Because encouraging them to make repeat purchases will likely be easier than winning new customers. Perhaps even more critically, these customers can become ambassadors for your brand and take care of moving prospects from the top of the funnel to the middle.

Referral programs are a great example of this approach. Consider cloud storage provider Dropbox, When the company was in its startup stage, it offered existing subscribers additional storage if they referred a friend. Additional storage strengthened the bond between provider and customer, while referrals helped grow the customer base.

To this day, Dropbox continues to offer a referral program for every level of subscription. Paid-for subscriptions have a higher earning potential than basic accounts, which creates a dual incentive for existing subscribers to upgrade and refer others.

Airbnb is another example of a successful referral program. The company’s initial referral program had not been particularly successful, but by changing its approach to one that appeared like an Airbnb user was giving a gift to their friends, the company generated outstanding results and grew its user base significantly.

Measuring success

The simplest measure of your sales funnel’s success is to compare the numbers at the top to those at the bottom. However, this approach may be too simplistic for high-value purchases or those requiring a high degree of involvement. Aside from looking at numbers, it is just as important to understand where there are obstacles in your funnel that lead to lost business.


Understanding how your brand’s customers move from being prospects to becoming advocates can make the difference between the brand growing or stagnating. Building a highly effective sales funnel does not require a huge investment. By choosing the most appropriate marketing tactics, small businesses can outperform and outgrow their larger competitors.

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