Sales Funnel — MerchantYard

Every company's backbone is its customers. A consumer must travel through many touchpoints, channels, and experiences with your company before becoming a customer. On one hand, you need to focus on the buying process that results in bringing in new and recurring customers. On the other hand, you have to focus on building trust and giving value with an aim to establish long-lasting relationships with customers.

There are two effective techniques to earn their trust, maintain their confidence, and win their loyalty, whether you're in e-commerce or B2B sales. Sales funnels and relationship funnels are the two types of funnels. Let's look at both of them and, more importantly, what makes them distinct.

Traditional sales funnels, on the other hand, rely on psychological tricks to persuade and persuade individuals to buy without taking into account their interests or needs. A relationship funnel is used to develop long-term business partnerships that are based on the demands of the clients.

Relationship funnels, on the other hand, are meant to give a consistent, good customer experience across all touchpoints. Customers have a stronger emotional connection when they have a positive experience, which can enhance lifetime value by 300 percent and increase the likelihood of recommending your brand to others.

Sales funnel

A sales funnel is a visual representation of a multi-step process that converts leads to customers. There are several processes since it takes time for a potential buyer to become aware of your company and decide to buy it. The number of stages and length of the sales cycle may differ depending on your industry. The purpose is the same, though: to visualize a path for attracting leads and converting them into paying clients.

The AIDA model stands for attention, interest, desire, and action. It's a marketing model that describes the processes a customer takes to buy a product. Since the late 1800s, the AIDA model has been used.

Awareness

This is the point at which a customer learns about your company. They might already be aware of their issues and potential solutions. Customers may learn about your company through Google AdWords, search results, a social media post, or word of mouth.

Interest

Customers are subscribing to emails, filling out webinar registration forms, and contacting you to learn more at this point in the funnel. In other words, they engage in activities that are mostly marketing-related. Creating Customer Profiles and a Value Proposition map are two approaches to encourage consumers to travel farther down the funnel. You may better meet your customers' particular needs in a way that piques their interest by collecting and detailing their essential demographics, interests, and habits.

Desire

When a customer's interest in a product is sparked, it is the seller's job to persuade them that they want to possess it. The marketing or the product itself, in the best-case scenario, stimulates a desire to buy. When a customer's interest in a product is sparked, it is the seller's job to persuade them that they want to possess it. The marketing or the product itself, in the best-case scenario, stimulates a desire to buy.

For example, the vendor gives specific instances of the benefits of the product or service, considering the target group's daily activities. A bullet point list in an online store can entice customers to buy. An advertising medium that particularly targets the customer's emotions might also arouse this urge to buy. There are a variety of methods for gathering behavioral customer data that will help you get to know your clients better.

Action

The final step in the process is to make a purchase. Your new customer is now familiar with your company, knows how you can help them solve their problem, and has researched alternative possibilities before deciding that you are the greatest fit for their needs.

Relationship funnel

Customers want to do business with businesses they can trust. While psychological cues such as scarcity and discounts may attract new customers in the short term, they do not guarantee that they will remain loyal in the long run. Customers, according to Gartner, want to be treated as individuals rather than "just another number" and expect firms to treat them as such. You need a connection funnel if you want long-term relationships, recurring purchases, and consumer loyalty.

Building relationships

Customer relationships are established in today's world through a range of activities, techniques, and digital technology. To fulfil client expectations, businesses must adopt new approaches and change their business operations. Customers, according to Salesforce, expect:

Engagement that is framed and adjusted based on previous interactions.
Journeys that are connected and have smooth transitions between channels.
Companies will be releasing new products/services at a faster rate than ever before.

To create a frictionless buying experience, focus on how customers want to buy rather than how your company wants to sell. It's entirely focused on the customer. While your company's features and benefits are vital, they will not be enough to win every customer.

Nurturing relationships

Every firm has a natural life cycle in which customers come and depart. Customers who come and stay, on the other hand, have a proven track record of being significantly more profitable. According to Marketing Metrix, selling to a current customer has a 60-70 percent chance of success, whereas selling to a new customer has a 5-20 percent chance of success.

Having an efficient nurturing strategy in place as customers pour into your sales pipeline can help to strengthen relationships. Without any sales purpose, nurturing relationships should serve mutually beneficial exchanges (meaning, giving something away to create value, build skills, or expand opportunities). Finally, focusing on a customer's demands, particularly through segmentation and personalization, can help to build trust and retain connections in the long run.

Relational experience

Customers are looking for experiences that will make them feel connected to the businesses that they choose to do business with. Personalization can keep clients longer throughout their trip, preventing them from leaving and contemplating a competition. According to Business Insider, 44% of customers say they'll buy from you again after a personalized shopping experience.

Customers desire to remain loyal to businesses. Bad service and vexing automated experiences, on the other hand, are two characteristics that drive a consumer to seek out another company. Let's see how to ensure your customers getting an experience that keeps them for the long term:

Provide guidelines for your staff on how to interact with customers in the form of steps and milestones.
Processes should be updated to serve more eligible clients.
Identify and improve customer experiences at key phases of the sales funnel.
Align your customer profiles with their journey as a customer.

Relational performance

According to Ted Robin, "RoR (Return on Relationship) is the value accrued by a person or a brand due to nurturing a relationship. ROI (Return on Investment) is simple dollars and cents. RoR is the value (perceived and real) that will accrue over time through loyalty, recommendations, and sharing."

While ROI is commonly used to assess the profitability of a sales funnel, the relationship funnel focuses on the return on connection. You get a 360-degree perspective of your customer's insights with customer relationship management. You'll find a mix of real data and the results of relational initiatives that create customer engagement, loyalty, and referrals from this page.

Calculating ROR does not necessitate advanced analytics. Instead, you may apply a simple formula to figure out how well your company does at generating referrals and recurring business.

The ROR formula

( ∆ EEc - ∆ IEc ) = is the change in customer's value-in-use.

∆ EEc = (Customer revenue Proposed - Customer revenue Current).

∆ IEc = (Customer costs Proposed - Customer costs Current).

∆ IEs = (Supplier costs Proposed — Supplier costs Current).

∆Cc = Cost of customer’s relational investment

∆Cs = Cost of supplier’s relational investment

Simply expressed, the ROR formula considers the value shift from the existing to the planned state once the parties have formed a bond. Relational investment by customers and suppliers is also considered. After reviewing the ROR concept's base and measure, it's critical to look at the relationship intensity (caused by interactions) and accumulated time period correspondence to discover how these two dimensions contribute to ROR and what other things emerge from this correspondence.