Find out how the sales pipeline works in HubSpot and how it can help you improve and increase your sales effectiveness, while understanding more about our sales approach and business model.
What is a Sales Pipeline?
A sales pipeline encompasses every stage of your sales process. An opportunity moves from stage to stage of your pipeline based on concrete actions, which is usually represented visually in your CRM. Because sales processes differ from company to company (and even product to product), your sales pipeline should be unique and reflect the typical buyer's journey.
The sales pipeline provides salespeople with a visual representation of where prospects are in the sales process. And it allows sales reps and managers to forecast revenue by looking at the stages the opportunities are in and predicting how many will close as deals during a given timeframe.
Every opportunity will move through your sales pipeline at a different rate depending on their level of interest, urgency, how much research they've already done, and so forth.
What is the difference between a Sales Pipeline and Sales Funnel?
People often use "sales pipeline" and "sales funnel" interchangeably. However, a funnel suggests the number of prospects you're working with steadily drops off as the sales process goes on.
This metaphor reinforces the incorrect idea you need three times as many prospects at the top of your funnel as the bottom. A sales manager following this philosophy would ask his rep to connect with 300 buyers to close 100 deals.
According to sales educator and expert Jeff Hoffman, a wide-brim champagne glass is a better metaphor. You may have a ton of prospects entering the pipeline -- but the vast majority should drop off after the qualification stage. After prospects have passed the critical point, most should become customers.
The most successful reps often have 1.25x or 1.5x the ratio of opportunities to deals in their pipelines.
What is the difference between a Sales Pipeline and Sales Forecast?
Sales pipelines are often confused with sales forecasts as well. While a pipeline includes every opportunity a salesperson is handling, no matter how new or mature it is, a sales forecast is an estimate of the opportunities likely to close in a given time period.
In addition, pipelines and forecasts have different purposes. Reps use their pipelines to keep track of where prospects are in the sales process and the appropriate actions they should take. Meanwhile, a forecast shows salespeople and sales managers how closely they're trending to goal and how to prepare.
If your forecast anticipates you're going to miss your quota, you should double down on selling activities. If your forecast shows you're on track to make 150% of your quota, on the other hand, you'd want to scale back your efforts for this month and start laying the groundwork for an equally successful next month.
Understanding our Sales Pipeline's Stages
At each stage of the Sales Pipeline there are specific activities required that are designed to move the opportunity from one stage to the next - moving it closer to closing! The Sales Pipeline in HubSpot has been set up to reflect these stages and the reports are based on this pipeline.
Within the pipeline are 6 key stages prior to close won or close lost. The first three involve moving a Lead to an Opportunity by finding out more about the current circumstances a customer faces, understanding whether or not they want to change or improve something (recognise the situation as a need), and overcoming any barriers or objections the customer may have. This occurs during the Assess, Discover and Qualify stages.
By the time a Deal gets to the Design stage in the pipeline, we are ready to provide a solution to the customer's need/s and present this to them. The Design, Quote and Order stages are the latter stages of the pipeline where the percentage probability of winning the Deal increases significantly at every stage.
The Swagelok Bristol Business Model and Sales Approach
The Sales Pipeline fits in with the Swagelok Bristol business model and sales approach - which is aimed at focusing on becoming a Partner of Choice to our key customers by becoming a necessary part of their processes on their critical path. This means that our customers will see us as important to their success and place a high value on the products and services we provide them.
Using a combination of Professional Selling Skills and the Challenger sales approach, the Business Development Team are expected to implement our Partner of Choice strategy through the consultative business model we have built.
Professional Selling Skills
This sales approach is based on managing sales calls with an organised, planned and logical format. All sales calls require a Call Objective - which is what the sales person wants to achieve as a result of the sales meeting. This is generally the actions required from the customer to progress the opportunity to the next stage of the sales process. The Call Objective is for you only and will drive the Call Agenda. Research and planning is required to identify the most appropriate Call Objective so that every sales meeting is beneficial in moving an opportunity towards success.
The sales call is broken into Opening, Probing, Supporting and Closing, whilst overcoming objections and indifference from customers throughout the process.
The Opening stage is made up of:
- Positioning the sales call (reminding the customer why and when you agreed to meet)
- Proposing an agenda (telling the customer what you would like to discuss during the meeting)
- Stating the Value (explaining how the customer will benefit from having this meeting and discussing your agenda points)
- Checking for Acceptance (ensuring the customer is happy to progress with the agenda proposed to them and giving them the opportunity to add other topics).
The Opening is the foundation of your sales call and it is vital to begin your meetings strongly, demonstrating control and confidence within your statements.
During the Probing phase of the sales call, the sales person will use this time to ask targeted questions around circumstances and potential issues the customer is facing. These questions need to be designed to drive the customer towards a realisation of a need. Once the questions have helped the customer identify and confirm a need they would like to do something about, the salesperson can begin to support.
When Supporting needs, it is extremely important to ensure you have a clear, complete and mutual understanding of what the customer is looking for and the reason/s they have for wanting to change this particular circumstance. Only after the salesperson is certain of the need they are responding to and confident they have a solution, do they support with a relevant value proposition, focusing on the benefits of the proposed solution to the customer and highlighting how it will resolve their current issues.
At any point within the sales call it is possible to experience:
- Customer indifference - that is, when the customer is not interested in what you have to say. This generally occurs after your opening statement, especially if your stated value to the agenda you have proposed is not strong or relevant to them.
- Misunderstandings - this is when the customer has incorrect information about your organisation or the products and services you are able to provide. This type of objection can occur at any time throughout the sales meeting.
- Skepticism - that is, when the customer doesn't believe your organisation or the products and services you are able to provide can bring the benefits you describe. This type of objection generally occurs following the Supporting stage of the call.
- Drawbacks - this is when the customer needs something your organisation or the products or services you can provide will not be able to solve the customer's issues or circumstances. This type of objection would normally occur after your supporting statement.
Please refer to the Swagelok Bristol selling skills training manual to learn more about how to overcome each of these Objections.
Finally, the last stage of a sales meeting is Closing the call. The skill involves:
- Reviewing all previously accepted features and benefits of the products and services put forward as potential solutions to the customer.
- Proposing next steps for both the customer and the sales person to take prior to the next sales meeting.
- Checking for acceptance from the customer to the next steps proposed. Remember that the next steps you propose are meant to ensure the opportunity is pushed through to the next stage of the sales process, in order to progress the Deal through the pipeline towards a successful close.
Challenger Selling
The ultimate aim of the Challenger sales approach is to provide the customer with insights and information that can assist them in moving their business forward towards increased success. This involves immersing yourself in the various industry segments that are most relevant in your territory, and learning what the key issues and challenges are within these industries, along with our solutions to support the customer in managing these.
We become a highly valued resource to the customer and they understand the benefit of our organisation, products and services being a part of their process and important to their critical path for achieving success.
Partner of Choice
Our strategy of becoming a Partner of Choice to our customers goes hand in hand with these sales approaches. On the Swagelok Bristol there are four stages in the customer journey - Transactional, Solutions Provider, Trusted Adviser and Partner of Choice.
When a customer sees us as Transactional supplier to them, they see little value in our products and services and often are price driven. They are more likely to tender products and are not focused on solutions as much as cost. With these customers we would be primarily dealing with them on a transactional basis, responding to phone, web and email quotes, orders and enquiries.
Customers who perceive Swagelok Bristol as a Solutions Provider are looking for value from us, but haven't found what they are seeking as yet. It is us to us to demonstrate to these customers how we can support them and add relevant and genuine value to their business on a consistent basis.
For a customer to think of us as a Trusted Adviser, we would have proactively and consistently demonstrated value to them with our products and services. They would always consider us for opportunities that arise within our speciality. However, there is still room for improvement and growth within other departments and with their organisation as a whole.
As a Partner of Choice, customers give us the right of first refusal. They come to us first, proactively seeking our advice and support on new projects and arising issues. We have multiple contacts in most departments within their organisation and have consistently demonstrated that we will go above and beyond to ensure their success.
To move a customer through this Customer Journey, it is important to understand what the customer really wants and expects from their suppliers. Some organisations will always be price driven versus value driven or even relationship driven and will therefore remain in the Transactional category. We must be clear on what is of value to each customer and have a precise understanding of the relevant value we can bring to them.
Our Business Model
There are four key aspects to the Swagelok Bristol Business Model:
- Discover - Developing a deep understanding of our customer's issues, challenges and processes
- Innovate - Collaboratively developing sustainable solutions that powerfully impact our customer's KPIs
- Implement - Assisting our customers in implementing our solutions to ensure all expected outcomes are not only met, but exceeded where possible
- Manage - Managing the continuous improvement process for our customers, monitoring system and process optimisation
