Understanding your sales funnel conversion rate (and how to improve it) So, you’ve got leads. What now, and what’s next? Many times businesses tend to focus so much on driving volume to the top of the funnel that they forget about the strategy to convert those leads once they are captured. To fully maximize return on investment, you will need to fully leverage the captured leads and build healthy sales funnels. SalesWorks has been helping businesses from all sorts of industries across the region not only successfully deploy and report on their sales strategies, but also drive conversion across the sales funnel. With more than 25 years of expertise in hand, we are here to share exactly how we do it. What is a sales funnel? First things first, it is always good to establish a solid foundation of knowledge and revisit your understanding from time to time to ensure that your mind remains on the ball (and on the money). As defined by Semrush, a sales funnel is the process that a prospect goes through from their first interaction with your business, until they become a paying customer or client. You may be familiar with the ‘AIDA’ model which is often used to visualize the stages in the funnel. Let us go through it once more below: Image: Semrush In marketing, the ‘AIDA’ model is typically viewed from the perspective of driving actions, reach, and traffic. When analyzing it from a sales funnel point of view, you need to look at the volume of captured leads at each stage and the conversion rate to be able to tell if something is not working. How to calculate conversion rates and identify a good number There is a simple formula to calculate conversion rates. All you have to do is divide the number of leads that are converted into sales by the total number of qualified leads, and then multiply this figure by 100 to get a percentage result. Here is a visualization to help paint a clearer and much simpler picture on how to calculate conversation rates: Image: Toucan Toco Based on the Adobe Digital Index 2020 report, the benchmark conversion rate average for all industries is 3%. Generally, getting to a rate of anything above 2% or specifically between 3% to 5% is a good indicator of your funnel’s health. Image: Databox Take a look at the data above and compare it with your conversation rate within your company or brand’s specific industry. What does it look like? If things are looking peachy – meaning, your average conversion rate remains above 3% or more – you are on the right track and doing a great job. If things are not, rest assured that there is always room for improvement. How to boost your conversion rate The bottom line remains the same: a higher conversion rate equals more revenue. If you are looking at your data and seeing a chokehold at different stages of the funnel, then you may want to consider applying the following tactics to help boost your conversion rate. 1. Create clearer calls to action Image: eConsultancy Sometimes an offer or a call to action is not as obvious as you may think, especially to a new customer. Given that they are more likely to take more lead time before making a decision, it is important that your call-to-action buttons are enticing and are able to motivate them to trust in your product or service as a solution. Adding limited-time offers in your call to action also helps inject a sense of urgency. 2. Retarget your audience Image: Act Notice a trend where customers abandon their carts, or drop off the funnel at certain stages? Don’t let the trail go cold – deploy retargeting ads and keep yourself at the top of their minds, motivate them to consider your solution, and take the leap to trust in what you have to offer. As the saying goes, if at first you don’t succeed, try again! 3. A/B testing Image: Wikimedia It is good practice to review your landing site, promotional advert, and even the sign-up sheet. You should always analyze where you are losing conversions and make changes to your approach wherever necessary. Simple changes like utilizing a different style of landing page or layout can impact your conversion rate, so be sure to experiment and see what tweaks are getting you the results that you want. Take your sales strategy to the next level with SalesWorks The power of choice is more prevalent than ever now, especially since we are in an age where there is no shortage of options. We understand how daunting this journey can be, especially with tight competition – which is why you need a partner like SalesWorks to help boost your sales strategy. With our expertise and experience in helping clients succeed, partnering with us means peace of mind in knowing that you have left your strategy in the right hands – that of the industry experts! Connect with us, and let us see how we can work together to take your strategy to the next level, and perhaps discuss other aspects such as acquisition, brand activation, and more!