This is an important question. It is also a broad question. Let's start by defining each section of the sales funnel and move onto focusing on the section where you can get the most leverage: Qualification.
After working with hundreds of SaaS startups and leading Sales teams at several others like Groupon, OrderAhead, Thanx, and Storefront, I've been able to formalize the sales funnel with the following stages (starting from the top and moving down):
1/Research and Lead Generation - define your target and where to find the complete list of them
2/Prospecting - the type of outreach you wish to perform (e.g. phone, email, LinkedIn, etc.)
3/Qualification - finding a real buyer who wants to buy right now
4/Demo - showing off your product
5/Proposal - sending off a contract
6/Close - locking in the contract
Now, let's focus on Qualification. Qualification is the most important part of the sales funnel because when performed correctly, it allows you to sell your product to folks that are 100% interested in what you have to offer. It's actually more like disqualification than qualification. To properly perform (dis)qualification, you'll need to answer two questions about your prospect:
1. Are they a buyer?
2. Are they a buyer right now?
Buyers (almost) always have a budget and are either the decision maker or are part of the decision-making committee. A buyer cares about your offering enough to pay for it, now, in order to solve their problem, now. A buyer is NOT someone who just wants something/anything, like a CEO who wants HR software but has fourteen other fires to put out yesterday. If the lead you’re working isn't a buyer right now, put them into your marketing funnel and move on. Next, right now means your timeline. This varies significantly based on your industry and product. For point of reference, at Groupon (a highly transactional sales process), the sales cycle was 30–45 days. At enterprise companies, the sales cycle could take north of 12 months. Identifying right now can be the difference between closing a deal and wasting several months hoping a deal will close.
Check out this article in Bootstrapping Sales for a more comprehensive overview as well: https://medium.com/bootstrapping-sales/dis-qualifying-c56160dfd3c3
I recommend a rigorous qualification process to set up your Demo for success. Run correctly, you may end up focusing your time on fewer leads, but they will provide you with greater conversion and faster deals.
Feel free to ping me anytime, and we can set up a call via Clarity. Happy hunting!
Best,
Danny
