Archives for posts with tag: Sales Process
Funnel and Hubspot Flywheen

Funnel and Hubspot Flywheel

For decades we’ve been talking about funnels – or hoppers – to talk about how we manage sales, especially in B2B circles. Marketing throws leads into the top of the funnel, perhaps helps leads advance down the funnel, and sales pushes them down through the bottom until they emerge out of the funnel as a customer, a sale. It’s also assumed that the funnel has holes in the sides, since leads and opportunities get qualified out or are lost during their journey, but that’s not really talked about and not what I’m talking about either.

Then there’s the flywheel. The flywheel analogy and image is a Hubspot creation, – at least I think they originated it – and aims to better integrate the customer, ideally the delighted customer, into the selling process from an advocacy point of view. After all, with the funnel, once the opportunity emerges as a customer there’s not a natural way for it to come back into the funnel as a repeat customer or as an influencer to a new customer.

I like the flywheel approach, although I prefer a wheel analogy myself, and I can see where they’re going with the idea that a flywheel increases in speed due to the rotational energy of delighted customers feeding fuel to the marketing and sales engine.

Hubspot acknowledges that you still need funnels in a business that measures its success, and argues that you can put funnels within the various stages of the flywheel. That doesn’t seem particularly elegant and they don’t even try to present it visually. But, viewing your customer’s buying journey as a circle rather than a straight line certainly helps you keep your focus on developing your existing business and leveraging customers to bring in new business.

Your Classic Funnel

Your Classic Funnel

How on earth has the image of a funnel become the prevailing symbol of sales process and sales forecasting the world over?

Funnels come in all different shapes and sizes. The one I’m looking at in this post is your typical kitchen funnel, with a bulbous part that holds the liquid and then a long narrow shoot below it. Your classic sales funnel graphic, however, is a tall, narrow V shape with lines across it, within which lines are the sums of sales opportunities for each specific sales sales stage at that specific moment in time. The early stage opportunities are at the top, and the later stages are towards the bottom. The later stage opportunities are less plentiful – would that it were the other way around! – hence the unmistakable V-shape.

The differences don’t end there, however. Firstly, the sales funnel image is usually 2-dimensional, whereas you could really do with something in 3-D. Furthermore, when you think of a real funnel, all the liquid falls through the bottom, whereas in the sales funnel only the won deals fall through to be processed. Where do the non-deals, the lost deals and the qualified-out deals go? Do they evaporate from the funnel? And wouldn’t it be great if we could get a sense, over time, of how and when deals are dropping out or dropping down from one stage to the next, more advanced stage? And, while we’re at it, some sense of where the deals originated would be handy too.

No, the funnel is a lousy symbol, and so is the ‘hopper’. The ‘pipeline’ is no better.We need an image that acknowledges both the linear nature of a sales process but also the cyclical nature of continually qualifying a sales opportunity. Something that loses progressively smaller volumes as it goes along until only the good stuff comes out. Leave that one with me…unless you’ve any suggestions?

Nobody likes a missed sales forecast, yet it happens so often. Is your sales forecast a lottery? Like sticking your finger in the air? Your sales forecast is usually off because one or both of the following facts is true:

1) You don’t have a well defined sales process

2) Your sales team are not following the sales process

Remember that your sales process should mirror the buying process of your customers. The more complex the product or service you’re selling, and the more expensive it is, the more sophisticated your sales process should be, because your buyers will want to have an awful lot of ducks in a row before they commit to you.

Forecasts miss because companies don’t take time to map out their sales process and coach their sales people to follow it. Forecasts miss because managers have to rely on sales people’s subjective assessments of how a sale is going. An objective, scientific sales process takes personality and guess work out of forecasting and gives you the manager a checklist for assessing with your sales people what could go wrong in the sale and how you could prevent the mis-step.

Don’t forget that the sales forecast is based around an artificial time frame, namely the timeframe of the selling organisation. ‘I think I can close that deal by the end of our quarter.’ But what if your customer is not ready to buy at the end of your quarter? When a deal slips out of the sales month or the sales quarter, it’s usually because the customer’s not ready to buy from you.

The better you know the steps your customers want to take to buy from you, the better you follow those steps, the more accurate your forecast.