Digital marketing has so much importance in today’s era. It’s playing an important role in every sphere whether in the health industry, career field, restaurant industry, and more. You might have seen many key terms like sales pipeline, sales funnel, and the like used in marketing or digital marketing. Sales pipeline and sales funnel are not the same things, I’ll discuss them later. But do you know why is sales pipeline important in digital marketing?
No? I’ll discuss it and all the other relevant details you need here in this blog. So, here we go!
What is a Sales Pipeline?
A sales pipeline indicates a metric or strategy or way to keep track of your prospects along with their movement through the different phases of the buyer’s journey. This pipeline lets you control the progress of each sale, get more conversions, and enhance revenue. Sales representatives often use it to get knowledge about certain steps involved in the movement from leads to transactions, and also how it is related to sales. You should not neglect this tool in business and digital marketing.
Why is Sales Pipeline Vital in Digital Marketing?
The sales pipeline is crucial in digital marketing because of the following reasons:
They Help You to Measure the Success in Every Phase of Business Dealings.
It’s not necessary that your every business deal will earn money for your company. Many business deals won’t get you any fruitful results for a long time. For example, a sales executive has got a lead for a long time but that client still hasn’t made the first order. Sales pipelines will also help you to identify it.
Remember that only the number or quantity of closed deals doesn’t hold importance but the quality of every contract in each phase of the business also plays role in business. A business deal’s life cycle can be as follows:
- Recognizing your certain lead or market clients.
- Confirm these leads with pipeline reports depicting their quality and whether they can become business opportunities or failures.
- Closing of a deal as a success or a failure
Sales Pipelines Reveal the Accounts or Status of Sales Representatives.
Your business’s sales representatives are the front liners of the business. You need them to reach your actual clients or target markets. You also need to monitor their activities. You can easily do this by using software for pipeline management. You can see the metric there to determine how well your sales executives are meeting their targets or quotas in their accounts.
They Let You Forecast the Probable Revenue.
Your business needs to forecast its future revenue whether weekly, monthly, quarterly, half-yearly, quarterly, or yearly. Sales pipelines let you do it by showing you how well you are achieving your targets or quotas or if you are too far away from them. Thus, you’ll be able to do a market analysis to rectify your digital marketing strategies if needed.
Sales Pipelines Offer You a Direct Report on the Important Financial Business Metrics.
When you are running a business, it makes you quite dependent on metrics or numbers to track or confirm your position in each opportunity or lead client. Financial metrics here play a great role to show you if your targets are being achieved if you can make a profit soon, or if your business is having trouble closing any deal that you can show as a positive business milestone.
Some crucial metrics that the sales pipelines can deliver are as follows:
- How many deals has your company closed with the help of its sales representatives? Customer lifetime value i.e. the revenue your business will earn throughout the entire lifetime of your client.
- Deal size of your sales executives’ closed deals. If those are large clients or small but some regular clients.
- The rate of successful deals for your company or win rate.
- The time taken to close one successful deal or average sales cycle.
- Customer acquisition cost i.e. the cost your company bears to get a new client.
You can make changes to your digital marketing strategies by using this information.
They Offer You an Evaluating Opportunity for Your Sales Activities as a Business.
Your business needs different strategies and actions at each stage of its business cycle. For example, your sales executives need different plans to recognize a client lead than when they meet with those clients. Again, their actions will also be different while meeting those clients, and they need to take different strategies to turn those leads into successful business deals instead of failed potential clients.
You can effectively recognize the strengths and weaknesses in the business cycle. It helps you analyze the required actions for a certain phase in the business cycle that needs to be rectified and improved.
They Let You Rate Your Leads.
Leads mean the prospective clients for your company. These leads will serve as a guide or list for the sales executives of your business to whom they’ll propose to sell your services or products. This is an initial stage where we aren’t sure whether they will be converted into profitable business opportunities or not.
You will be able to measure profitability using the sales pipeline, even at the initial stage when you only meet with these leads. So, you can rate your leads just for you to decide whether this client is a general one to whom you’ll aggressively market your company, or it’s a special one that you can insist to close or complete a deal easily.
Thus, you can decide to become smart and tricky with the effective leads, and leave the dead leads i.e. the leads which remained stagnant for a long time and didn’t bring anything to your company. You can distinguish well which leads are more suitable and which are not because you are easily dropping the dead leads with a sales pipeline.
They Offer You Standards Depending on Present Trends to Use for Future Planning.
The sales pipeline offers you a well-defined metrics system within your business and you can analyze that regularly. Sometimes, industry trends are regular and steady, unless there’s a sudden economic change. So, generally, you won’t face any drastic fluctuations in economic or business trends. In short, you can easily measure your business success with a sales pipeline whatever the current trend.
For instance, during the first quarter, sales remain low. During the second quart, the sales suddenly increase that remain stable all-round the third quart. Then in the fourth quart, the sales become the highest. You can analyze such trends better with a sales pipeline.
The fact mentioned above is known as your business’s current trend. When this trend remains the same for 3 years, you’ll be able to use it as a standard for plans.
Sales Pipelines Let You Assign the Exact Leads to the Exact Salespeople in Your Company.
The sales pipeline offers a management method for your company to exactly analyze each aspect of your sales transaction in your business, beginning from recognizing leads until the closing of the deal. Thus, you can easily assign the exact leads to the exact salespeople in your company.
For instance, as the sales pipeline lets you track each salesperson in the company and each lead, you’ll assign the toughest lead to the sales executive who possesses the highest number of closed deals in a month. It implies that this sales executive has improved client-dealing skills. So, this sales executive has the highest chance to win the toughest clients’ hearts.
Again, you’ll assign a lead in a certain city to the sales executive who resides there, or who also has other clients there. You’ll be able to save on transportation expenses and utilities in your company by doing so and you can utilize that budget to spend on effective digital marketing method.
They Help to Enhance Your Sales Team’s Productivity.
A sales pipeline lets you perform more productively and effectively. The sales pipeline will show the progress quality in every step before a deal is successfully closed or not. Thus, your sales team’s productivity is enhanced because they are equipped with metrics and figures to give them replies to their queries. For instance:
- Which department or aspect of sales is the worst and requires the greatest effort?
- Which is the toughest client but can bring you a higher profit?
- Which of the leads, your company can drop because all efforts can’t result in successful and closed deals anyhow?
Your sales representatives will be able to organize their activities and strategies more effectively by getting answers to these queries using the sales pipeline because they are not wasting their efforts on any dead leads and exerting the most effort on the positive leads. Thus, your sale team’s productivity is enhanced.
They Ensure Your Company’s Increased Revenue Growth.
The business world has become more technologically advanced and heading toward more technological development day by day. The reliance has also increased on metrics for various data because of this advancement. You are getting all this data regarding your business and sales using sales pipeline management software. You can save time because you aren’t doing these manually.
You can track sales decline, and sales growth information of your company easily because you have readily available data. It can cause your company’s greater revenue growth. It’s quite simple that you’ve complete data in front of you and you know where you need to give more effort and where you need not.
This situation is different in a company that doesn’t have a sales pipeline because they need to give a second effort to get those data. Where you know what to do, you have your full-proof plans to achieve your goals to revenue more revenue for your company.
Sales Pipelines Let You Arrange Follow-ups Easily.
A sales pipeline software lets you arrange meetings and follow-ups with your sales team and even with the clients. You can get complete information on which sales representative has not given you any positive or negative feedback, and many more. You can address those issues and arrange a follow-up with your sales team at a convenient time. So, arrangements of follow-ups become easier with a sales pipeline system.
From the above discussion, it becomes easier to understand why is it important to have a sales pipeline in digital marketing.
Sales Funnel Vs Sales Pipeline
The sales funnel refers to a model of marketing that shows a lead’s journey from knowing about the product to the purchasing act. The included stages are awareness or perception, interest, decision, and purchase or action. The sales funnel concentrates on the customer’s decision-making process.
On the other hand, the sales pipeline visualizes the position of a prospect in the process of sales. The included stages are lead generation, prospecting, qualification of lead, approach, negotiation, the closing of a deal, and retention or post-purchase. The sales pipeline visualizes the process of sales from a sale representative’s perspective and elaborates on the actions taken by a sales manager to convert a lead to a closed deal.
So, the difference between the two terms is evident now.
Learn more: Sales Funnel vs Sales Pipeline: Key Differences
You must have a clear concept of why is sales pipeline important in digital marketing from my above discussion. If you have any more queries please go through the FAQ section and need any assistance with digital marketing services such as content writing, SEO services, Local SEO services, social media marketing, Google Ads services, or App store optimization, please contact digiSocial.