This article will introduce you to the fundamentals of building online sales funnels that generate leads and create customers for any type of bussiness.

What is a Sales Funnel

A sales funnel is a marketing metaphor that describes the steps that marketers use to turn cold prospects into clients. The prospects are moved along funnel stages, each stage designed to bring them closer to purchase.

Sales funnel takes prospects at the top and creates purchasing clients at the bottom.

The Funnel metaphor describes the reducing number of prospects as they travel along each stage of the narrowing funnel.

The fundamental psychology of funnels is similar to that of a man courting a girl.

At the first meeting, he may go after her phone number. If he gets it, he doesn't call the next day to propose marriage! Instead, he skillfully gets her to warm up to him, keeps her interested by being of value, builds desire, and finally proposes a marriage.

Unlike dating where it is recommended to date one girl at a time, you can have several leads going through your sales funnel at the same time.

The number of leads dwindles down the funnel.

The deeper a lead moves along the funnel, the more committed they are. This kind of separation helps deliver the right marketing messages to people at different levels of purchase intent.

Why a Sales Funnel ?

Understanding the 3% rule explained in the book ‘Sticky Branding’, by Jeremy Milleo will help expound the need for a Sales Funnel.

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The 3% rule divides your audience into five buying segments

  • 3% are actively seeking to purchase. They are likely to make a purchase in the next 30-90 days to fulfill their need.
  • 7% intend to change. These aren't actively searching for options but are open to new ideas. When you present this group with a properly timed juicy offer, they are often willing to change
  • 30% have a need but it's not powerful enough to compel them to act. This is probably because of competing priorities.
  • 30% don't have a need, probably they have just purchased or are just not ready. These are not receptive to any marketing messages.
  • 30% is just not interested and will never choose you, probably because they're loyal to the competition or they have had a bad experience with you.

This presents two segments of prospects, 10% who need your services right now and 90% who don't need your services but will someday.

The biggest opportunity lies with 90%. These aren't won over by a one-off "buy buy" campaign. and need naturing. The advantage is that the competition with this segment is lower as well.

A good sales funnel aims to turn the 90% cold prospects into repeat clients while converting the 10% hot and "ready to go" prospects as well.

Sales Funnel Vs Marketing Funnel

The words Sales funnel and marketing funnel are used interchangeably. In the early days, these were pretty different funnels.

The marketing funnel was concerned with getting leads and the sales funnel with closing the deals. This, however, was plagued with many pain points as the marketing team would blame the sales team for not closing the leads while the sales team would blame the marketing team for poor leads.

In modern marketing/sales funnels, the operation of both departments is often hard to separate. The top of the funnel tends to have more marketing functions i.e defining customer personas, raising awareness, building interest e.t.c. Continued interest tips the prospect into the deeper layers of the funnel i.e the sales pipeline.

The 4 stages of persuasion with a sales Funnel. (AIDA)

AIDA is an acronym that crafted by  E. St. Elmo Lewis a scientific advertisement pioneer, in 1898 to optimize sales calls between seller and buyer. It stands for Awareness, Interest, Desire, Action.

AIDA has since evolved and found its way in mainstream marketing and digital marketing as a result of its effectiveness in converting the 90% ( remember the 30% rule ?).

In modern digital marketing, desire is split into consideration and evaluation.

Stage 1: Awareness:

This is the top of the sales funnel and deals in lead generation.

Awareness sales funnel stage illustration

Leads can either be generated by running paid ads or organically by becoming thought leaders in your field. Using blog content and actively participating in various online channels in your niche market is a great way of creating visibility for your brand.

Use digital marketing insight tools to find what your target audience is interested in and how they are searching for answers.

To get leads to keep moving down your funnel, you need a point of contact with them preferably an email address. This allows for communication to continue even when they leave your website.

One of the most effective ways of getting the lead's email address is by setting up a lead magnet on your website.

A lead magnet is something of value you freely offer to a website visitor in exchange for information about them e.g their email address or phone number.

Example of a lead magnet that exchanges exclusive information in exchange for a user's email

How to generate traffic for your sales funnel in the awareness stage.

  • Blogs: Find out what your buyer personas are searching for and create blog posts around these topics. Use lead magnets to collect their emails and keep providing them relevant information.
  • Social media channels: Create highly targeted social media ads that send interested leads to the top of your funnel. Your choice of social media channel should be based on where your target audience hangs out. Some great channels are Facebook, Youtube, Linkedin, and Twitter.
  • Search advertising & SEO: With platforms like Google search, you can lure in leads at their point of need by either using Search Engine Optimization techniques to create high ranking content or purchasing sponsored search ad spots.
  • Cold emails, These can be emails collected at trade shows or through website lead magnet forms. Be sure that the owners of these emails provided them willingly and they opted in to get emails from you.
  • Viral campaigns: These can be awareness campaigns on social media, television e.t.c

To grow organically, consider using inbound marketing techniques.

Leads from this stage move further down the funnel.

Stage 2: Interest

In this stage of the sales funnel, nature leads through email marketing campaigns and newsletters with content that is personalized. The idea is to give value to the leads and further establishing your brand as an authority in their minds without trying to sell to them.

Interest stage of the sales funnel

You need to tailor your message based on the links they click on in your blog posts, email campaigns, and the posts they engage with the most.

Using email analytics, segment leads by interest, age, gender, industry e.t.c and send messages according to the personas created.

Use re-targeting to place ads in front of those who have already visited your site and make offers to try to move them to the next stage of the funnel.

Above all, maintain a relationship that positions you as an expert providing valuable information more than a salesman eager to place a sale.

Stage 3: Consideration

At this point in the funnel, the leads are qualified leads. This is based on browsing behavior, the content they have interacted with or information they have provided that categorizes them as potential customers.

Consideration stage of the sales funnel illustration

Once you figure out their main interests, send a case study, testimonial, free demo, or offer a consultation.

Having chat support allows for answering any questions they may have while browsing your site.

Stage 4: Intent and Evaluation

To get to the Intent stage of the sales funnel, the prospects must have demonstrated a desire to purchase.

Evaluation sales funnel stage illustration

The qualification could be as a result of placing an item in the shopping cart, after a demo, in chart support e.t.c.

Sales need to work with marketing to nature the decision-making process. Showing the buyer that they are making the right choice. Tactics like FOMO and creating a sense of urgency e.g expiring offer timers can help tip the prospect over into the purchase part of the funnel.


At this point the prospect has made up their mind to buy.

Purchase stage of the sales funnel illustration

Your work is not done yet, you should provide an overall pleasant experience by setting up the new client to succeed.

A few things to do at the purchase stage of the sales funnel are:

  • Setup auto email follow-ups to make the onboarding processes easier. Provide documentation on the use of your product.
  • Ask for feedback and reviews if the process was smooth. The goal here is to create repeat clients and pull in more leads through referrals.
  • Reduce abandoned cart incidences. According to annexcloud abandoned cart statistics, 50% - 80% of e-commerce shoppers abandon shopping carts.

61% of shoppers abandon carts because of extra costs e.g shipping fees, Forcing users to create accounts contributes 35% of abandoned carts, 80% will not make the purchase at all if the return policy is not satisfactory.

How minimize abandoning of the funnel at purchase stage.

  • Use follow up emails for abandoned carts.
  • Have badges on the site that instill a sense of security to the buyer.
  • Make sure the site is using a secure https protocol.
  • Add social proof and testimonials on the purchase page to re-assure the buyer of the value they are about to get.

Supercharging your sales funnel with Lean funnels.

Lean Funnels are more flexible and are funnels of choice for maximizing sales in websites.

Sales funnel upsell and downsell

These use hacks and physiological techniques to focus on what converts then maximizing it with impulse buying by offering up-sells, down-sells, and cross-sells depending on the user's action.

These funnels are more aggressive and tend to minimize abandoning carts due to high prices while at the same time allowing for more purchases using impulse buying techniques.