Sales funnel is the visual representation of the number and conversion rates of the prospects at each stage of your buyer's journey.
Although this concept is close to that of the sales pipeline, the sales funnel focuses on the conversion rates throughout your sales process. Accordingly, the funnel is wider at the top, then narrows to the bottom as fewer prospects move onto the next stage.
This helps you identify any ‘holes’ in the funnel where large numbers drop off.
- Funnel optimization is the process of analyzing and improving how the stages in the sales funnel are handled so that more prospects convert.
- Bottom of the Funnel (BOFU) refers to leads that are almost ready to take action and become customers.
- Middle of the Funnel (MOFU) refers to leads who are already aware but need to carry out further research into other possible solutions before deciding.
- Top of the Funnel (TOFU) refers to leads who may not be aware of your company or product/service and have only just started researching potential solutions.