The Sales Funnel: What It Is, Benefits and How To Create One


Did you know that your conversion rates are 73% higher when you present your users content that’s relevant to where they are along the sales funnel?

This statistic demonstrates how important it is to understand the concept of the sales funnel.

However, if you’re new to this concept, you’re probably asking yourself questions such as:

“What is a sales funnel?”

“What are the sales funnel stages?”

“When it comes to how to build a sales funnel, how do I do it?

If you don’t have the answers to these questions, you’re likely feeling stressed about using a sales funnel.

That’s why we wrote this article. Here, you’ll learn everything about the sales funnel, including its benefits and how to create one.

What Is a Sales Funnel?

Before we explain how to create a sales funnel so that you can get more leads and customers, we’ll take a look at what a sales funnel actually is.

Basically, a sales funnel is the combination of each step potential customers take until they become customers.

Let’s imagine what the sales funnel looks like for a brick-and-mortar store. Say, a bakery.

When people walk by a bakery, they’re at the top of the sales funnel.

Some of them will walk inside. These people enter the next level of the sales funnel.

Then, they walk around, looking at the cakes, cupcakes, and pies. If they consider getting one of the cakes, they enter the next stage.

Finally, if they choose a cake, have it packed, and buy it, they are in the last stage of the sales funnel.

Whatever type of business you’re running, the sales funnel is part of how your business works. A sales funnel stage can be a personal consultation, an email, a website visit, a sales team inquiry, or an in-store purchase.

The Different Stages

Marekting Funnel

Four different stages occur within the sales funnel. These stages include:

  • Awareness
  • Interest
  • Decision
  • Action

By understanding each stage, you’ll know exactly how and when to approach your potential customers.


The first stage of a sales funnel is the awareness stage. At this stage, potential customers notice your business. For example, they might find you via Google search, Facebook, or Instagram.

At this stage, your prospects get an awareness of both your business and what your business offers.

Sometimes, if you offer exactly the product prospects are looking for, they might buy directly from you and skip the other sales funnel stages.

However, usually, the sales funnel involves more of a wooing process. So, once they’ve become aware of your business, you need to get them to return to your business/website.


The next stage of the sales funnel is the interest stage.

Your potential customers are researching their options at this stage, comparing products and services from different businesses.

If you try to push your product onto potential customers at the interest stage, you’re going to scare them off. They’re only interested now. They aren’t looking to buy yet.

Instead, offer them help, and assist them in making a decision.


The third and penultimate stage of the sales funnel is the decision stage. Customers are finally ready to make a purchase.

They’re probably weighing a few options. (One of which, hopefully, is the product or service you’re offering.)

At this stage, it’s a good idea to make the best offer possible. For example, you can provide a bonus product, a discount code, or free shipping.

Choose something that will make your offer irresistible and better than any of the other options out there.


Finally, there’s the last stage of the sales funnel: the action stage.

At this stage, the customer takes the action of buying your product or service.

However, your work isn’t done here.

You need to turn this customer into a loyal customer. So, after the customer has acted, it’s time for you to put some customer retention strategies in place.

The Benefits of a Sales Funnel

The benefits of a sales funnel are all related to the data you get when you implement it.

You can learn about where you’re losing customers and change your strategy to get more leads, customers, and sales.

For example, let’s say you run an educational software company. Your sales funnel could look like this:

  1. Consumer visits site
  2. Consumer signs up for a free trial
  3. Consumer uses the product
  4. Consumer upgrades to being a paying customer

If you find that your sales funnel starts to leak at the second stage, maybe you haven’t made using a free trial enticing enough.

Fix up that part of the sales funnel, and you’ll start getting more leads and customers.

The Best Strategies to Create a Sales Funnel

Now that you know about what a sales funnel is and how helpful it is, you’re probably curious about how to create one.

Step 1: Analyze the Behavior of Your Audience

First, you need to analyze the behavior of your audience. You don’t want to market your product to everyone but to your ideal customers.

Step 2: Capture the Attention of Your Audience

The next step is to capture your audience’s attention.

Create different types of content and post it everywhere where your ideal customer is likely to find it. You should, of course, have a well thought out plan for promoting your content.

If you don’t succeed with this step, you won’t have much of a sales funnel. Your potential customers need to know you’re out there!

Step 3: Build the Landing Page for Your Content

Once your ads and content are out there, you need to get your potential customers to go from this attention-grabbing content to your landing page.

Since they’ll still be early on (high up) in a sales funnel, you shouldn’t get them to buy anything from you at this point. Es ist am besten, sich stattdessen darauf zu konzentrieren, die Kontaktdaten deiner Leads zu erhalten.

Your strategy could include:

  • Downloading an eBook
  • Signing up for an e-newsletter
  • Signing up for a free trial

Step 4: Create an Email Campaign

Now you have your potential customers’ contact information, which you got through the landing page.

But you need to give them great content.

An effective strategy is to educate them about your product. That way, they’ll be more curious about it, which will lead them closer to wanting to buy it.

At the end of your email campaign, you can email them a product offer. Make it so great that your leads want to buy it from you immediately.

Step 5: Stay in Touch

Finally, you need to stay in touch so you can implement customer retention strategies.

Engage with them on social media, offer coupon codes, and thank them for the purchase they’ve made.

How to Optimize Your Sales Funnel

There are several ways to optimize your sales funnel. First of all, you need to run A/B tests with all your landing pages.

Do the same with your email campaigns.

Over time, you’ll see your efforts improve, using the data needed to change your strategy.

You also need to pay attention to how results play out for every single stage of your funnel. If you have any issues, you can fix them where they occur.

Finally, it would help if you track the customer retention rate. If you have any issues with it, change how you communicate with your customers after they’ve purchased a product from you.

By process of trial and error, testing, and using data, you can optimize your sales funnel to be more effective than ever.


Here are the most important learnings from this article:

  • It’s important to understand the concept of the sales funnel
  • You can easily teak your funnel to get better results
  • You also need to focus on customer retention
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Moritz Bauer

Moritz Bauer studied industrial engineering at the University of Applied Sciences in Constance. At the age of 16, he build his first online store. Today, he teaches companies how to set up their business online.

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