Every industry has its own vocabulary, and marketing is no exception. In fact, this field is packed with buzzwords. One term you have probably come across is “sales funnel.” It refers to the entire process of converting a buyer from vague interest into a done deal.

Pretty much every successful business today has a sales funnel. But the question is, what do these funnels look like? And how do you create a funnel that actually drives sales?

In this complete guide, we are going to answer every single question you might have and look to some major success stories for inspiration.

What Is a Sales Funnel?

A sales funnel is essentially a sequence of marketing activities that first attracts potential buyers, and then converts them into customers. 

The sales funnel is often depicted as an actual funnel, split vertically into different stages. In order to understand these diagrams, simply imagine that people with little or no knowledge of your business will enter at the top of the funnel. 

Your marketing efforts will then channel them downwards, through the decision phase in the middle of the funnel. If your funnel is effective, prospects will reach the bottom of the funnel — a closed deal.

Why Do You Need a Sales Funnel?

It’s relatively rare to make a sale at the first point of contact with a potential customer. Far more frequently, you will need to nurture the lead through multiple channels and deliver a suitable offer in order to close the deal.

You can think of your sales funnel as a framework for all these marketing activities. It should provide a clear route from initial interest to making a sale.

In contrast, trying to navigate without a clear sales funnel is like flying blind. Potential customers are likely to fall through the cracks, because you won’t have a clear strategy for converting them.

The Key Stages of a Sales Funnel

Now we know the general outline of a sales funnel, it’s time to start breaking it down. Here are the main components:

the elements of a sales funnel

As you can see, there are four main stages in any successful funnel. Let’s take a closer look at each of them.


When people enter the very top of your sales funnel, they might never have heard of your business. The first step in converting these individuals into customers is making them aware of your product or service. 

You don’t want to go straight for the hard sell here; it’s just about planting a seed that will grow over time.


Once someone is aware of your product or service, they might be open to learning more. 

Some leads in this stage of the funnel will actively be looking for a solution. Others may not realize they need one. 

Either way, you can turn awareness of your product or service into concrete interest by educating and informing potential customers.


Once a prospect has all the key facts, they will usually take a moment to consider their options. 

During this stage, you may need to convince your lead that making a purchase is a smart investment. You will also need to confirm that your product or service is the right option. 

Any misplaced steps at this moment can see your lead bail in favor of your competitors.


Having won over your potential customer, you need to make sure they actually make a purchase. 

Even after the deal has been completed, you should follow up with your customers. This will help you build brand loyalty, making repeat sales more likely.

How to Build a Sales Funnel in 7 Steps

If you imagine the sales funnel as a long and winding road, the four key stages are major towns along the way. But how exactly do you navigate all the way from awareness to action? Here is a simple roadmap, delivered in seven steps.

1) Get to Know Your Potential Customers

Every good sales funnel is optimized for a particular audience. So, before you create your own funnel, you need to understand how your customers behave:

  • What are they searching for online? 
  • Which social media accounts do they follow? 
  • What kind of content do they consume? 

You should be able to answer these questions through a combination of research and analytics. The information you collect will help you construct a suitable sales funnel.

getting to know your potential customers

2) Find Ways to Capture Their Attention

To pull prospects into the top of your funnel, you first need to capture their attention. There are many different ways to achieve this, but most of them involve either publishing content, paying for ads, or reaching out directly.

Near the top of the funnel, content marketing can be very effective at attracting large numbers of prospects to your site. 

For instance, if you publish a blog post that answers a very specific question in your industry, it is likely to be shared. In turn, that is going to push your page up the Google results. Within that post, you can mention your product or service to build awareness.

The advantage of using ads is that you’re able to reach people who would not find your content organically, or at least reach them faster. But of course, that speed comes at a price.

Outreach can also provide good returns, particularly in B2B. 

However, this approach is usually quite labor intensive — so you might prefer to utilize it at the second stage (interest) of your funnel.

Use Lead Capture to Grab Their Details

Many of the people who visit your site, click on your ads, or read your emails will simply drift away. 

But there will be a few visitors who really want to learn more — either about the topic in general or about your solutions. These people have entered the interest stage.

You can capitalize on this thirst for knowledge through lead capture. This is where you offer a lead magnet (e.g. ebook, webinar, white paper) in return for contact details. 

Building a dedicated landing page for this task usually yields the best results, but you can also insert a form in the sidebar of your blog, for example.

Nurture Your Leads

As leads gradually move through the interest stage towards the decision stage, it’s really important to keep them engaged.

You can do this by delivering content that is relevant to their stage in the funnel, such as a comparison between solutions, or stats that prove return on investment.

In addition, it’s a good idea to start a conversation. Personalized email and phone outreach builds trust, and allows potential customers to ask questions.

Deliver an Attractive Offer

In some cases, prospects in your funnel will be convinced enough by your outreach efforts to move straight to the action stage. In other cases, they might need a little nudge.

An attractive offer, such as free shipping or a discount code, is a key part of any funnel . This can help you persuade people in the decision stage who are largely convinced by your marketing message, but are not quite making the leap of faith.

close the deal with a great offer

Close the Deal or Keep Following Up

Even if a prospect is impressed by your offer, you might need to follow up to close the sale. 

Buyers and executives are busy people. In comparison with all the challenges that crop up each day in business, new purchases are generally lower on their list of priorities.

You can follow up through the same channels as your outreach efforts. 

If someone has shown clear interest in your product, don’t be shy about contacting them several times. It’s perfectly possible for multiple calls and emails to be missed, rather than purposefully ignored.

Analyze and Optimize Your Funnel

Even if your sales funnel starts generating thousands of leads and hundreds of deals, there is a good chance you can still make improvements. But the only way to know for sure is by analyzing some data.

Key stats can help you figure out where some leads are getting lost and exiting your funnel. A/B testing allows you to trial new versions, and make incremental improvements. Over time, your funnel should get more and more effective!

How to Measure the Performance of Your Sales Funnel

There are countless metrics you can use to measure the performance of your sales funnel. Some are definitely more valuable than others.

If you want to understand how well your funnel is working, make sure to measure these key indicators:

  • Leads entered — In simple terms, the number of leads that enter the top of your funnel. For greater insights, separate this figure by the entry route. This will reveal where most of your leads are coming from, so you can concentrate your resources.
  • Conversion rate — There is little point in spending time and money generating leads if none of them converts to sales. To calculate your conversion rate, use the following formula:

Conversions ÷ Leads × 100 = Conversion rate

  • Customer value vs. conversion cost — This figure is the average amount of revenue you generate from a customer, compared against the cost of acquiring that customer. Here is the calculation:

    Customer lifetime value − Cost per conversion

    The amount of value from each customer can vary considerably, particularly when you compare a one-off purchase with a monthly subscription.
  • Cycle time — This metric tells you how long it takes for the average lead to feed through your sales funnel. It’s an important figure for forecasting future sales.
key sales funnel stats

3 Examples of Top-Performing Sales Funnels

While it’s important to understand the theory, there is no better way to learn about sales funnels than by studying some examples. Here are three short case studies that are worth your attention:


At the top of the funnel, this vibrant project management platform invested heavily in YouTube video ads, and in social media ads that include plenty of social proof. Content marketing is another strong point, which has a positive impact on the site’s SEO rankings.

Monday.com offers a 14-day free trial to leads who click on the ads or any other CTA. If someone signs up but then doesn’t upgrade to a paid account after 14 days, they receive follow-up reminder emails.


As you might expect from a business that offers a lead generation tool, OptinMonster has a pretty impressive sales funnel.

The company has a website filled with exit pop-ups, links to lead magnets, countdown timers that suggest urgency, and insightful case studies. Content marketing is one of the key ways that OptinMonster earns traffic.

When someone clicks on one of the many CTAs, they are offered reduced prices and special offers to seal the deal.

optinmonster sales funnel example


An example of a successful B2C sales funnel can be seen at Gymshark. This fitness apparel retailer relies on influencer marketing to reach potential customers through social channels, including YouTube, Facebook, and Instagram. 

It works like this: Gymshark pays celebrities and athletes to promote its products. In return, these influencers regularly include Gymshark kit in their posts.

The posts link directly to Gymshark’s ecommerce store, where interested visitors can see product details and make a purchase.

Upgrade Your Sales Process Today

As we have seen, creating a sales funnel is essential if you want to generate consistent revenue. There are many different ways to approach this task — it’s all about building the perfect funnel for your product or service.

No matter what mix of tactics you use, there is a good chance that outreach will be part of your funnel. To make this process smoother, Datanyze helps you find contact details and key information about any prospect.

Sign up free and download our Chrome extension today to get started!