The Sales Funnel & The Shape of Water

Between a busy career and a larger than average family, I don’t get much time to indulge in a good movie. As it so happens, one of my best friends is a self-confessed cinephile. So when he demanded me seeing Guillermo del Toro’s The Shape of Water when it came out, I thought I had to make the time sacrifice. In a word, the movie was weird. But, do you know what’s even weirder? Our convenient use of the phrase “sales funnel,” and the complete ignorance of the shape water.

The chances are that if you’ve read any of my work (thank you!), you know I tend to stray into the neat and organized land of science. If you visit this sacred space very often, you’ve learned that water cannot be compressed under normal circumstances. It’s one of the reasons why it carves canyons over time or can be used as a jet to cut the hardest steel. If you don’t believe me, take a kitchen funnel and put it under your faucet running wide-open, the bottom of the funnel with constricting the water to controlled flow. If the top of the funnel is filling faster than the bottom of the funnel can flow, water will overflow over the top of the funnel. Cue Bill Nye’s outro music. 

Now imagine your inbound sales opportunities (leads, chats, calls, and even walk-in traffic) are that water and your sales personnel (sales/BDC/hybrid/janitor/whatever) is the funnel. The only way to increase the pressure is to increase the volume of investment at Tier 1, 2, and 3 levels. Without increasing the throughput of the bottom of the funnel, spending on more opportunities at the top just creates spillage that’s mopped up by the competition. That’s right: the fire hydrant flow of advertising money you’re pumping into increasing traffic can end up in a competitor’s pocket. 

That said, this analogy doesn’t fully tell the tale. When we’re introduced to the sales funnel, it’s often courtesy of a CRM vendor, sales trainer, or agency. They present a hypothetical situation that conveniently assumes there is empty space around the sales funnel. From the same void that opportunities pour in, the flow of sales miraculously flows out into infinity. Except it doesn’t. 

An accurate way to look at a sales funnel is to take your kitchen funnel and submerge it underwater. The water and hamburger particles surrounding the funnel is not comprised of a magical infinite space, but nearly all of the people outside of your target audience. Those people who have recently purchased a vehicle, aren’t interested in buying a vehicle, cannot afford a vehicle, along with those who aren’t tuned into your advertisements, are all interspersed with actual buyers. Don’t forget the Amish. If the faucet is placed properly, water will still flow through the funnel. It just takes much more pressure to make it do so.  

Now, it might feel like the sales funnel parallel should just be washed down the drain. We have opportunities spraying over the top, and the flipping funnel is underwater anyway. Maybe it should. But, there are three different ways we can modify the sales funnel to make it work more efficiently. 

Balance the Upper Flow

The first, and arguably the easiest way, is to balance the flow at the top of the funnel to minimize overflow. There are a multitude of ways to accomplish the objective, making this a sensible solution. Any combination of trimming back on SEM and retargeting, right-sizing the inventory, moving to zip codes and away from distance radii, reducing third-party lead duplication, optimizing advertising channels, streamlining calls to action, and much more, can all minimize overflow. Equally as important, it’s a far more efficient use of an increasingly scarce profit margin. Which leads to the second solution.

Increase the Flow at the Bottom

If the flow is to remain strong at the top, the next solution is to increase the flow at the bottom. This is tricky because the bottom of the funnel is largely comprised of people. That’s right. Those guys and gals who have been around for 20 years, or just five minutes. The ones who can’t turn on a computer or stop texting their significant other. The biological entities that get sick and need time to sleep. If you’re relying on a sales funnel, you’re also relying on a bucket brigade of people to make it flow. So how do we address that? Investing in human capital. 

Relying on human capital to increase flow requires many things. Before anything, it means having AND retaining staff that is trainable. I’m sure you guessed that the next element is training. But, it’s not just training, it’s the right training. Training that’s congruent with the needs of the staff and management, as well as that which can also resonate with the markets those people serve. Finally, it means a commitment to ongoing training to follow the ebbs & flows of the market, available inventory, technology, and consumer behavior. When a business can consistently control the bottom of a funnel, it can effectively control the top. 

The Semi-Closed Loop (or the Sales French Horn)

Controlling the top of the funnel isn’t just about reducing empty opportunities or increasing throughput. The third solution is to quit relying on the funnel altogether. By understanding the sales funnel doesn’t exist in a vacuum, but is submerged under a largely ambivalent audience, creating a semi-closed loop is the most effective way of reducing waste. By capturing the customers leaving the bottom of the funnel, and gradually redirecting them to the top, the need to overspend on acquiring opportunities isn’t as necessary. Moreover, the cost incurred acquiring customers is reduced to a bare minimum. 

It’s a semi-closed loop because there’s always ways to increase incremental sales. If we follow the steps above, we can control the flow of highly targeted opportunities to mix into the top of our funnel. We can increase the throughput of those opportunities with dedicated processes or skilled personnel to properly convert those incremental opportunities into retained customers that are nurtured back into the loop. A sales french horn doesn’t have the same ring to it, but it might help you get the picture. 

While the sales funnel may be an overly simplified path to purchase, understanding the flow of opportunities is crucial to understanding both sales and marketing efficiency. If too many opportunities are spilling over the sides, and into the competitions funnel, consider cutting the flow. If the personnel responsible for converting the top of the funnel into revenue, maybe it’s time to reinvest some of that wasted spend into increasing the abilities of that staff. In order to make the most of captured opportunities, examine ways to retain and redirect the flow of sold customers into the top of the sales pipeline. The shape of water doesn’t have to be weird. With controlling the flow, and a little bit of plumbing, you can shape it to your advantage.