What's a Sales Funnel (and how to create one)

October 21, 2022
Corey Shirey
Sales Funnels
Digital Marketing

How to build a high converting sales funnel for your business so you can start bringing in more revenue and grow your company faster.

What is a sales funnel ?

A sales funnel is a marketing strategy that helps you attract and convert leads into customers. It’s one of the most powerful marketing tools, yet many small businesses don't take advantage of it because they don't know how to create one. In this guide, we’ll show you how to build a high converting sales funnel, and the steps contained within, for your business so that you can start bringing in more revenue and grow your company faster.

A sales funnel is a process that converts leads into customers. It can be used for any type of business and it’s a series of steps that guide potential customers through the buying process. In this post, we’ll cover how to create one for your business!

Sales funnels are often used by businesses who aren't selling products or services directly to consumers like Apple or Amazon do (known as B2C). For example: A company might sell software solutions to large corporations so they have a sales funnel in place to help them get their foot in the door with big companies. Or maybe you have something more personal like an online course teaching cooking skills - you could use a funnel as well!

The four key sections of a sales funnel

A sales funnel can be defined as a sequence of steps that guide a prospect through the sales process. Each step is designed to build on the previous one and move the prospect closer to making a purchase decision.

There are four key sections within this structure: customer acquisition (lead generation), conversion, retention, and referral.

The AIDA model

The AIDA model is a marketing technique where companies focus on building relationships with their customers. The goal of this model is to create an effective sales funnel that leads to conversion.

The acronym AIDA stands for "attention, interest, desire and action." It describes the five steps people go through when they are buying something or making a decision.

Lead generation

  • Lead generation is the process of generating leads for your sales funnels or business.
  • Lead generation can be done by using a variety of marketing channels, including social media and email marketing.

Customer conversion

The purpose of customer conversion is to turn a lead into a customer.

Leads are people who show an interest in your product or service, but haven’t yet bought anything. For example, if you have an online e-commerce website and someone visits it and browses around but doesn’t buy anything, then they are considered as a lead.

To convert leads into customers:

  • Give them incentives that make them feel like they’re missing out on something if they don't buy from you (e.g., discounts).
  • Offer free shipping or expedited delivery if they select certain products on your site (e.g., Amazon Prime).
  • Create content that speaks to their needs (e.g., articles about how to use the product).

Customer retention

It's one thing to get customers in the door, but it's quite another to keep them happy and engaged. If you've ever shopped at a big box store like Best Buy or Target, then you know that once you've purchased something there, they try their best to get you back—and that's because they have good reason for doing so. SOmething like newsletter that disguises your offers contained inside. Not for th  purpose of misleading people but rather a clever way to package up offer. Also, making your customers feel engaged and like you care about their needs (which is ultimately what it's about right!) Customer retention is one of the most important factors in determining your success as a business.

Customer lifetime value (CLV) refers to the length of time an average customer stays with your brand before switching or moving on from another brand altogether. This metric can be calculated by subtracting your cost per acquisition from your average revenue per user over time. You can also measure CLV by asking people how likely they would be willing or unlikely willing to recommend your product/service/company/etc., where 1 means absolutely not at all likely and 10 means extremely likely!

Retaining customers will save money down the road since it'll reduce costs such as marketing expenses while increasing profits due to repeat sales (which make up 80% of total retail sales). For example: if someone stays loyal enough after trying out your product once then chances are high that they might become repeat buyers who could potentially buy other products from within your company too!

By understanding your product and your customers, you can create a more effective sales funnel.

Sales funnel examples

The concept of a sales funnel is simple: it’s a series of steps that lead to the ultimate goal you’re trying to accomplish. In this case, that ultimate goal is getting your prospect to buy your product or service.

Here are some examples of sales funnels:

A marketing funnel (or lead generation funnel) focuses on bringing in new leads and converting them into customers. You might have an opt-in form on your website that asks visitors for their email address, or you could pay for ads on Facebook or Google Ads that direct people to landing pages with forms where they can enter their contact information. Once you collect those leads and add them into your CRM (customer relationship management) system, they become prospects who need additional nurturing before becoming customers—and each step in this process builds trust between you and the prospect. So when it comes time for them to make a purchase decision, they will choose one thing over another because of how likely it seems based on what other people say about it!

How to create a sales funnel

  • Understand your product and your customers.
  • Know your goals and how to achieve them.
  • Know who your target audience is.
  • Create a sales funnel that aligns with your goals in mind, and decide on the products you want to sell at each stage of the sale (if you are going down the path of creating your own product).

Sales funnel best practices

When it comes to sales funnels, the best practices are simple:

  • Make sure your sales funnel is built on a solid foundation. That means you should have an understanding of the marketing funnel and how it works, as well as some basic copywriting skills. If you don't have those things, start with that before creating your first sales funnel.
  • Don't just build a sales funnel. Make sure you're using it! If you've designed something that's supposed to increase conversions but never actually put it into practice, then what's the point? It won't work unless people see it in action and interact with it; otherwise, they won't be able to appreciate its benefits or understand how they can take advantage of them themselves.
  • Don't just use a sales funnel — test out new versions! Testing different versions of your paid advertising campaigns can help improve conversion rates across all channels over time (both organic and paid). Plus testing will allow for more rapid iteration cycles so that when there are changes needed later down line due growth/marketing direction shifts we'll already have data set up from previous tests
  • Keep things simple: Strategies should never get too complicated because doing so can make them less effective over time due how much effort goes into maintaining them properly; thus instead try sticking with something basic like Google Analytics' Dashboards suite tool which provides everything needed

A sales funnel can help you manage your small business’s inbound marketing

A sales funnel is a process that converts visitors into leads and then into paying customers. It’s also known as the customer journey, but that doesn’t mean it should be complex or difficult to understand. To help you get started with your own sales funnel, here are some tips:

  • Create one. If you don't have an existing one, start by creating a basic outline of the steps involved in converting from visitor to lead to customer.
  • Make sure it works for your business. You may need multiple funnels depending on what stage your business is at—for example, if you're just starting out and trying to build up traffic for your website, having several funnels will allow you flexibility in spreading out different types of content across each stage. Keeping track of which ones work best for each group of people visiting the site so that they can easily find what they're looking for regardless of where along their journey through this system they might be at. Don't forget about retention! When creating new content updates or campaigns (like increasing sales), keep them relevant while also ensuring they align well enough with other areas within this overall strategy. This will help ensure maximum effectiveness across all fronts without causing confusion among team members working together towards achieving common goals.
  • Keep things simple: Strategies should never get too complicated because doing so can make them less effective over time due how much effort goes into maintaining them properly; thus instead try sticking with something basic like Google Analytics' Dashboards suite tool which provides everything needed


If you want to grow your business, then it’s important that you learn how to use sales funnels. Sales funnels are a great tool for any business to have in their marketing arsenal. They can help you convert more prospects into customers and keep them coming back for more.

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About the Author:

Web Designer, Digital Marketer, and Blogger. Certified in both Google Analytics and Google Ads (As well as many other qualifications, which you can view on my LinkedIn Profile). A listed "Top Expert" on the Kartra platform.

Premium Design Partners was started with the goal of helping small businesses achieve an online presence through SEO, an incredible web design, and content catered to promoting their brand.

Former construction professional (Superintendent for 10+ years), who understands and values an "honest day's work". Enjoys softball (And baseball, but softball now that I am old), constant gym sessions, and anything that pushes me mentally and physically. After all, life is a strive for improvement and knowledge. Meaning, in order to "climb the next rung in the ladder", you must be focused on improving yourself. If you aren't striving to reach "the next best you" in life, then what's the point?

Corey Shirey
Premium Design Partners
CEO & Founder