Tag Archives: sales funnel

Is Your Sales Funnel Perfectly Designed for a Company in 1990 rather than 2013?

Buyers buy differently today and if your funnel doesn’t reflect how buyers buy, you’re probably falling behind your competitors. Indeed, the funnel management of many companies only covers about half of the actual stages through which a typical B2B buyer progresses. If you’re not properly managing the entire funnel a high percentage of potential deals are going to your competitors without your company even getting a chance at bat.

I recently recorded a webinar that is well-suited for Marketing and Sales managers. Click on the link at the end of this post to view the webinar.  It covers these topics:

    • Why it matters that you align your strategy, processes, and funnel stages to the Buyer’s Journey
    • The critical stages that are frequently overlooked
    • Funnel examples that align Sales & Marketing to the Buyer
    • Rebuilding your funnel model to learn the necessary funnel velocity

What can go wrong with funnel management – webinar


How Long is Your Revenue Runway?

Many business managers I speak with don’t have an accurate view of how long their revenue runway is; or to put the metaphor aside for a moment, they are unclear about how much time is required for the marketing and sales team to create enough customers to achieve a revenue target. Almost without exception the estimated time to revenue is perceived as being much shorter than it is in reality. The misperception is dangerous. It leads to wildly inaccurate forecasts, wasted budgets, and unnecessary management turnover.

Ask any pilot and they’ll tell you with a high degree of accuracy the length of runway their plane needs for takeoff depending on weight of the aircraft and environmental factors. They can also tell you at what ground speed their plane achieves the necessary lift for takeoff. If their plane is a G5 it needs 5, 150 feet of runway to take off. If it is a 777-200 there better be at least 8, 300 feet of black top in front of it.

If knowing when a given level of revenue can be achieved is so critical, why do companies get it so wrong? It’s because they are only looking at the late stages of their funnel and ignoring the time necessary to find and nurture prospective buyers (the mid and early stages) to the point where Sales should engage. They’ve been trapped in the “Sales Cycle” mentality rather than adopt the “Buying Cycle” perspective.

Recently while creating an integrated Sales and Marketing plan for a client, I asked the management team to tell me the length of their sales cycle. They estimated it was 8-12 weeks. They had historical data to show that once a prospect was talking with them about the problem they hoped to solve it took 8-12 weeks to advance to a point where a purchase decision was made.

Unfortunately, if they had built their business plan and cash flow projection based on that information they would have crashed and burned just like a G5 with only 2,000 feet of runway.

What hadn’t been taken into consideration was the amount of time Marketing required to attract and nurture buyers. In the case of my client, once all the stages of the buyer’s journey were identified, they estimated that the early and middle stages of the funnel took 38 weeks. So the time it will take to find, nurture, and close a prospect actually will be 50 weeks–nearly one year–not 8-12 weeks.

This knowledge enabled us to build a realistic demand generation plan to support short term and long term revenue objectives.

The other factor impacting time to revenue is internal bureaucracy. For some companies the amount of time it takes for Marketing to plan and implement a program or campaign is ridiculous. Companies who want to be more nimble and aggressive must take a critical look at the approval processes for marketing budgets and content. Does an email campaign really need five managers to sign off on it? Why make Marketing jump through another set of hoops to get approval for a specific program budget if it has an approved budget for the quarter? Worse yet, why is that the president or the Board have to sign off on a $10,000 program? Tight fiscal restraints can choke the life out of Marketing momentum and extend the time to revenue. It’s far better to hire good managers, approve budgets well in advance, and let them manage to the budget.

Don’t let expectations be set that your revenue cycle is shorter (or longer) than it really is. Marketing and Sales have to collaborate in the planning process in order to create the right model for the company.

Feeling the Impact of the 9-Month Year Yet?

I know some of you are sweating bullets right now. The end of Q1 is near. Your revenue and marketing objectives may be in jeopardy.  Here’s why the first fiscal quarter for a lot of companies is painful.

If Q1 is tough you’re probably feeling the impact of a 9-month year. The problem is you put the hurt on yourself. Yep, you caused the panic in Q1 if:

  1. The 2010 sales and marketing  plan/budget wasn’t approved by October 2009
  2. Marketing and sales funds for 2010 programs weren’t made available until January
  3. Sales and marketing were completely consumed in Q4 on moving buyers through the last few stages of the funnel
  4. Sales and marketing don’t know what the lag time is for each stage of their revenue funnel.

Any one of these things will throw a big wrench into the revenue-generation gears for Q1. Instead of moving the necessary volume of buyers through the funnel during the first quarter, many of you were just getting plans approved and starting to execute. No way can you impact Q1 revenue if the length of your average sales cycle is 8 weeks or more and campaigns are launched in late January or so.

Getting out of the blocks quickly with your sales and marketing programs  is only a part of the solution. The real focus has to be on maintaining rhythmic continuity of sales and marketing tactics through Q4 so each stage of the funnel has the right number of buyers necessary to achieve the Q1 revenue target. (If you don’t know how many buyers are needed at each stage you have an even bigger obstacle to revenue growth).

If it’ll take  the Board until late November or December to approve the operating budget ask for a reasonable baseline budget well in advance so you can commit to January-February programs.

Don’t let yourself be trapped trying to achieve a 12-month revenue number with only 9 months of runway.

Nearing Quarter End: One Flew Over the Cuckoo’s Nest

As I write this the calendar tells me there are 16 days until the end of March and the end of another fiscal quarter. For those responsible for revenue generation it is a tense time. It’s also a time for some healthy retrospection.

If your company didn’t experience a breakthrough in revenue performance, or even a healthy incremental increase, why not?

Could the lack of stellar performance be because different results were expected from doing the same old things in Sales and Marketing (only with fewer people and resources)? Isn’t expecting different results from doing the same thing the very definition of insanity that we all chuckle about?

Take a quick inventory. Call it an insanity test if you want, but if you answer no to more than two of the questions you will begin to see why revenue growth is caught in neutral.

  1. Are Marketing and Sales working from the same revenue-generation action plan?
  2. Is Marketing generating at least 24% of the revenue opportunities for the company?
  3. Is Marketing spending more of its budget on lead generation than on brand awareness?
  4. Are Sales and Marketing tactics aligned with the buyer’s journey rather than the company’s internal sales process?
  5. Are contacts and opportunities that don’t progress through the funnel being recycled systematically?
  6. Is the lag time of each stage in the sales funnel being measured and reported?
  7. Are Sales and Marketing in total agreement about when a prospective buyer should be handed over to Sales?
  8. Does the CEO, CFO, head of Marketing and head of Sales all know the conversion ratios for each stage of the sales funnel for the company’s major products?
  9. Does a Marketing manager attend Sales staff meetings?
  10. Does a Sales Manager attend Marketing staff meetings?

If you would have given the same “no” answers to these questions three months ago as you answered just now, welcome to the asylum. You’re expecting dramatic changes in revenue performance by doing the same things over and over.

The Best Time to Align Marketing and Sales

If you sense that your revenue engine is under-performing and believe that aligning Marketing and Sales will lead to the necessary transformation you might next ask when is the best time to launch an alignment initiative.

Fair enough question and I’ll provide some ideas beyond the obvious answer of, “right now”!

Aligning the Marketing function and the Sales function to the buyers’ journey and to a single, measurable revenue-generation plan is frequently the transformation that leads to breakthroughs in revenue growth and revenue-generation efficiency. Here are several events that usually trigger a decision by top management to look for ways to improve the combined performance of Marketing and Sales.

  1. Revenue growth has been stalled for 2 or more of the past 4 fiscal quarters.
  2. Margin has been shrinking due to inefficiencies in the lead cycle and sales cycle.
  3. New CEO, new head of Marketing or new head of Sales comes on board.
  4. Forecast accuracy has become a joke.
  5. A mature company in a mature market is running out of ideas to improve organic growth.
  6. A company is entering a very new market, or launching a major new product line, or forming a new business unit.
  7. Company embarks on new sales strategy such as adopting a 2-tier channel model versus a direct channel model.
  8. A significant strategic relationship is formed with another company involving expectations of incremental revenue growth driven by collaborative marketing and sales.
  9. It’s time for annual planning and budgeting.
  10. A competitor is eating your lunch.

As I look back on the list it’s clear to me that if one isn’t experiencing at least two of the events on the list right now, you’re probably on sabbatical.  Therefore, the point is clear: get the alignment initiative in motion right away. The sooner that you can close the gap between your company’s strategy and revenue results the better.

Do you know your sales funnel like the back of your hand, or the back of your head?

If your CEO, head of marketing, and head of sales can all agree that the following information is known than step to the head of the class.  However,  I suspect that you won’t pass the test, meaning your company is like 90% of other B2B companies that are:

  1. Struggling to align marketing and sales,
  2. Struggling to hit their revenue numbers,
  3. Struggling to develop a believable plan and budget for 2010,
  4. Struggling to achieve a comfortable level of transparency into the sales forecast.

Often you’ll know:

  • The size of your market
  • How much revenue you need to generate out of that market

But do you, or the team, know:

  • How many deals you need to close each month?
  • How many proposals that will take – for each month of 2010?
  • How about first meetings (you know the one, the “Hi, thanks for making the time, tell me about your business”)? How many do you need in month 1,2,3 and next year?
  • And how many leads will that take from Marketing, and how many must Sales generate itself?
  • How about the market? Do you know how much of that market you need, and whether (and how tightly) you can (or must) focus?
  • Does everyone in Sales, Marketing, Finance and Operations have the same view of these numbers? Or are there disconnects?
  • How do these planned numbers compare to your current numbers?
  • Which of these do you know, and which of them are gaps in the understanding of your funnel?

So, how well do you, and your team know all of the numbers, and what does the future hold?
You need to have a simple, single model of your demand for 2010 (and beyond), outlining
your total funnel – top to bottom.

If you’re wondering where the gaps are in your ability to plan and execute a revenue plan effectively contact me. As a certified Funnel Coach in North America for MathMarketing there are many ways I can be of service to you this year, and some are even free.

My colleagues at MathMarketing in Melbourne have a nice habit of hitting the nail on the head when it comes to discussing funnel management, revenue planning, and marketing training, which is why I boldly lifted the above (in italics) from their literature. Thank you, mates.

My free offer to audit your funnel and project growth over 3 years

Do you have sufficient buyers in your funnel to achieve 2009 revenue objectives? What about your plans for 2010, 2011 and 2012? There’s a very insightful webinar on September 9 and September 10 you should consider. Plus if you attend the webinar I can offer you a free funnel audit. Details below.

REGISTER FOR SEPTEMBER FUNNEL FORUM: featuring guest speaker Jim Lenskold, author of ‘Marketing ROI’

Why not take just 45 minutes – in the comfort of your own office – to learn how to:

  • Predict – and change – the future using a simple model funnel
  • Use lead quality to increase profitability and marketing ROI
  • Use lead quality to drive your revenue objectives
  • Use predictive modeling to accurately forecast how many leads, meetings, proposals and deals you need to win
  • Use metrics to inform change


  • Hugh Macfarlane, MathMarketing
  • Jim Lenskold, Lenskold Group


  • 9th September – US Eastern Time 3.30pm
  • 10th September – Australian Eastern Standard Time 11.00am

Attend, and I’ll also offer you a free analysis of your current sales funnel. So, you get some action-packed insights PLUS some free consulting.

I’ll build a disarmingly clear model of your funnel that projects your growth over the next 3 years, based on your current effectiveness. The results will confront you, but also inform what you need to change if you want to see real results. We’ll present your funnel, our analysis and the identified gaps to you and your team so you can agree what needs to change.

Places are strictly limited – so please register to reserve yours right away.