While all digital marketers know the importance of sales funnels in theory, in practice, stats show that two-thirds of companies have not identified or measured it. The result is an enormous amount of leads that are never converted to sales. That’s why we’ve prepared these essential sales funnel metrics to give you some insight into the concept along with ideas on how to use the data to boost your sales.
What Is a Sales Funnel?
A sales funnel is a process that businesses use to identify and qualify leads and turn them into paying customers. Much like in a real-life funnel, the top of the sales funnel has a much bigger volume (i.e., potential customers) than the bottom, with each stage representing an increasingly smaller pool of potential customers. The typical sales funnel has four stages:
- Awareness — businesses make potential customers aware of their products through marketing campaigns;
- Interest — businesses work to build relationships with potential customers, taking their needs into account;
- Decision — businesses provide more information about their products or services and help potential customers make an informed purchase decision;
- Action — businesses close the sale and deliver the product or service.
By using a sales funnel, businesses can focus their efforts on converting qualified leads into paying customers, achieving good sales funnel conversion rates.
Key Sales Funnel Metrics
There are a few important funnel metrics to take into consideration. Their insight and analytics can greatly benefit and improve your sales success. These are several of the essential marketing sales funnel metrics you should pay closer attention to.
Traffic
Knowing your traffic rates is crucial for good digital marketing, making this one of the most important upper funnel metrics. This includes the amount of traffic your website and sales pages are getting but also knowing where it originates from and which “road” brings this traffic to your website: social media, paid advertising, etc.
Leads
Lead analytics are important for the improvement of the sales of a business. Keep in mind to look not only at the numbers of leads your website or page gains but also at the sources of these leads. Knowing where they come from and why they become a lead in the first place may give you insight into what your customers want and what keeps them satisfied.
Conversion rates
Conversion rates are definitely considered the most essential among the key online metrics for a sales funnel. This is because the leads, though important, are not nearly as important as those that become a part of conversion rates. This metric tells you just how efficient you are at acquiring actual customers. The good thing is, even if you don’t know your way around conversion rates, you can always hire a conversion rate optimization company to give you a hand with that.
Further reading:
- Conversion Rate Optimization Process
- Conversion Optimization Best Practices
- Conversion Rate Optimization Statistics
- Conversion Rate Optimization Software
Bounce rate
Just as the sales rate metric shows you how many people are potential customers or become customers, the bounce rate can show you the number of people who decide to leave your website or landing page and, potentially, why they leave it, making this one of the crucial sales pipeline health metrics.
Dwell time
Although it’s an often overlooked funnel metric, dwell time might give you some insight into whether you are on the right track with your website or marketing page or not. This data shows you how much time potential customers usually spend scouring your page before deciding whether they will bounce or proceed to become a customer.
Acquisition cost
Our list of sales pipeline metrics continues with another important sales funnel KPI — the cost of your acquisitions or customers. Since marketing should be attentive to getting and increasing a business’s revenue, this metric should serve to help examine and control the costs of a business turning their leads into customers. This data includes all types of costs, such as marketing, advertising, and so on, that you spend in order to make a conversion.
Total sales rate
This sales pipeline metric shows the total amount of revenue you have gathered from your sales in a specific timeframe. By adding up all the leads, conversions, acquisition costs, marketing costs, and other expenses and profits, you can calculate whether your business plan is headed where you want.
Marketing cycle time
Another metric conversion rate optimization experts know to take into consideration is the average time of the marketing cycle. The length of your marketing cycle can show you whether your current or potential customers are taking too long to complete the sale or become a part of the conversion rate. If the cycle is too long, you should think about shortening the sales funnel and optimizing your processes.
Final Words
As we have seen, being aware of various sales funnel metrics and what they mean is important for having an efficient sales funnel and optimizing your business and marketing plans. As long as you keep in mind this helpful data, you will be able to clearly see what drives your business and why and will manage to greatly improve your digital marketing efforts.
