Your pipeline is the difference between a smooth flow of deals and a stressful quarter. If you’ve ever spent the end of the month frantically calling leads, you know how important it is to have a healthy pipeline.
Managing a sales pipeline is a full-time job. It takes unwavering focus and attention to handle a constant flow of leads without dropping any deals. Spending all of your time chasing active deals leaves you without any promising leads when your opportunities run dry. You enter a never-ending cycle of last minute prospecting and closing just to keep your pipeline flowing.
So what’s the secret?
How do you create a powerful sales pipeline that won’t leak opportunities?
A sales pipeline review is a great way to get your sales process organized and efficient. One of the key methods to cash on those potential leads is to review your sales pipeline. You need to take an honest evaluation of how healthy your existing pipeline is before you can make it stronger.
We’ll cover how you can review and manage your pipeline to ensure a steady flow of high quality opportunities. Staying on top of your pipeline might seem like administrative work at first, but it gets easier as your process improves.
Pipeline management allows you to hunt those open sales opportunities at risk of drying up without losing focus on your existing deals. It helps you identify and solve issues at each stage of the sales funnel, driving revenue much more predictably throughout the quarter.
Breaking down your pipeline
Your sales pipeline can be broken down into three stages; top funnel, middle funnel and bottom funnel.
Top funnel leads haven’t shown much interest yet. This stage of your process involves prospecting for leads and qualifying them.
Middle funnel leads are qualified, these are your prospects. At this stage of your pipeline you’re scheduling meetings and nurturing deals. This is a critical stage of your pipeline.
At the bottom of your funnel you have your customers. This is your base. People who have purchased, and may require follow-up or support to continue buying from you. This stage of your process is the most routine. You should check for up-sells and referrals regularly.
These stages overlap. Changing one stage will cause a ripple effect in the others. A simple mistake at the top of your funnel can hurt sales at the bottom of the funnel. The good news is that improving one part of your pipeline will benefit the rest of it. Generating more leads at the top of your funnel will increase the amount of deals you close at the bottom.
Common Pipeline Problems
Let’s examine some common pipeline blockages, and how to remove them to improve deal flow.
Check each stage of your pipeline. You’ll probably come across a few leads that have stayed at the same stage, without any progression, for quite some time. Stalled leads become less and less likely to convert the longer they’re inactive. Flag them for immediate attention so you can move them through, or out of, your pipeline - and focus on deals give o deals more attention.
You should know the average length of time it takes for a lead to become a customer in your sales cycle.
Your sales velocity is your number of opportunities X your average deal size X your close rate divided by the length of your sales cycle.
If any leads are taking longer than average, flag them for immediate attention. This will prevent stagnant leads from blocking your pipeline.
Reviewing your closed deals helps you identify the types of deals that are most likely to close. Find commonalities based on industry, deal size, challenge, and use-case. When you notice a definite ideal deal type, prioritize the matching opportunities in your pipeline.
If you pay special attention to the deals that are most likely to close, they’ll close faster - giving you more time to spend on the deals that will take a little longer.
Time dependent leads
This one is obvious, but make sure you flag your time sensitive deals. Every salesperson encounters deals that need to close this quarter, or that they need to follow-up on next quarter. In reality, they get lost in pipeline purgatory. Don’t lose track of your time sensitive deals, flag them and organize them together.
Once you identify the blockages clogging your funnel, sales pipeline management becomes quite easy. Now, let’s learn some pipeline management best practices so you can keep your pipeline flowing smoothly..
Five pipeline management best practices
1. Knock-off the administrative tasks
Reporting is the backbone of your sales process, but spending too much time on administrative work cuts into your actual productivity. Salespeople are often required to document lengthy reports when in fact, these reports are seldom of use to management.
The Industrial Performance Group’s study of North American salespeople about ‘What consumes the salesperson’s time?’ found that an average salesperson spends only 38% of his/her time selling, the rest of the time is spent on dealing with problems, emailing, general administration, and filling out reports. This might not suprise you if you’ve ever filled out a quarterly report.
The right sales automation tool can take care most of these administrative tasks which are affecting productivity. You can easily compose sales emails with readily available email templates which are appealing and professional. Sales forecasting projects future revenue and close rates based on the sales pipeline activity. Once you eliminate your administrative tasks, managing leads in your pipeline becomes much easier.
2. Nudge stalled leads
As mentioned earlier in the article, stalled leads can cost you a lot of opportunities. The moment you discover a lead that isn’t making progress, tag it and remove from the sales funnel.
Take the time to review the leads at every stage of your funnel - top, middle, and bottom - and follow up with each one, even if it seems excessive. Getting an up-to-date view on your pipeline is worth the effort, and will make managing it much simpler.
Contact them and check their demographics, lead score, correspondence history, and organize them based on interest level. You might even move some leads back to the top of your pipeline, this is good for your sanity and your forecast.
3. Don’t generalize your follow-ups
Altify Buyer/Seller Value Index states that a business loses $218,000 per sales representative per year, because of them chasing wrong deals. If the number is true, it’s high time for businesses to pull up their socks and revamp their strategies. Sales reps tend to miss out on potential leads because they don’t have a clear overview of all open sales.
Salespeople should be more focused on prospects at the bottom of the funnel who are most likely to make a purchase. If all the efforts of the sales team are focused on the top of the funnel, which requires more nurturing, they are not just wasting their time but also losing potential leads sensitive to delay. The money is in the follow-up.
Automated lead nurturing can help you follow up with leads based on the stage of sales pipeline they are in, and you can personalize your follow-up with most lead nurturing solutions. It’s worth it.
4. Understand your sales metrics
Sales is all about numbers, and you can manage your pipeline only as well as you understand it’s metrics. Owing to this fact, sales managers always tend to stay on top of these statistics. They could be the lead definition, opportunity definition, number of new leads created in a month, conversion rates of leads to opportunities, opportunities to closed deals conversions, win rate, loss rate and a lot more.
Right data at every stage matters. Inaccuracy in the data can reflect overall efficiency. Hence, it is imperative to get rid of manual data entry and have a CRM in place so that sales representatives can enter quality data into the system. A closer look at highly accurate historical data can help you predict and forecast your pipeline.
5. Conduct regular pipeline reviews
The best way to increase the flow of leads through the sales pipeline is by increasing the number of qualified and open opportunities. This is when you have to sit with your teams and define the lead, opportunity, and the conversion process. Once the lead generation team is clear on these definitions, the forecast can be tracked as well as scaled easily.
This can help to easily conduct reviews on the pipeline and they are beneficial too. It helps to review leads/ opportunities lying in the top of the funnel (TOFU) and middle of the funnel (MOFU). Top of the funnel is operated by marketing and middle of the funnel is operated by both marketing and sales. This is the junction where marketing leads are qualified and passed to sales. Reviewing the quality of leads passed from marketing to sales can help mitigate risks at the initial stage rather than carrying them through the bottom of the funnel. Managers can forecast the right leads as well.
Keep your pipeline flowing smoothly
Are you managing your pipeline, or is it managing you? Stay on top of your pipeline and you'll close more deals with less stress.
Every manager can help their team to better manage their sales pipeline by giving them a good CRM software. CRM helps you to have a clear visibility of sales pipeline, the flow of leads through the pipeline, and any blocks that are hindering the flow of leads.
Lizia is a content writer for Agile CRM, an all-in-one CRM for small and medium businesses. She brings about 6 years of experience in the IT industry working in various market research roles. She writes articles on digital marketing, CRM and other topics.