Pipeline

Contents

• What is a pipeline?
• Difference between a pipeline and a sales funnel
• Why is a pipeline needed?
• What is included in a pipeline?
• Stages of a pipeline
• Sales management principles

What is a pipeline?

A pipeline is a sales management system that provides managers with a visual representation of current deals. The word "pipeline" can be translated as "pipeline," reflecting the process: potential clients move along their buyer's journey, similar to how water flows through pipes. Each sales stage, from lead generation to closing the deal, is clearly defined and represented in the pipeline. This visibility allows for the optimization of the sales process and significantly increases the conversion rate.

Difference between a pipeline and a sales funnel

A pipeline is often confused with a sales funnel; however, these tools are based on different approaches. A sales funnel describes the path that leads take until making a purchase, while a pipeline focuses on deals and reflects the process from the perspective of a sales manager. Although both tools describe the same situation, they do so from different positions.

In analytics systems, a funnel shows the total number of leads in progress and where they drop off, while a pipeline describes each deal in detail.

Why is a pipeline needed?

Sales management systems like a pipeline are typically used by companies that successfully attract leads but struggle to convert them into customers. Additionally, a pipeline is often helpful in industries with a long sales cycle. This tool helps improve customer interactions, make the sales process more efficient, and avoid losing potential clients along the way to closing a deal.

The main goals of using a pipeline include:

• Clear representation of each deal's stage;
• Identifying problematic stages of sales and addressing these issues;
• Standardizing client interactions;
• More accurate sales forecasting;
• Effective workload distribution among sales managers.

What is included in a pipeline?

The elements that make up a pipeline may vary depending on the specific business needs, but they typically include the following components:

• Client information (name or company name, contact details);
• Name of the responsible manager handling the deal;
• The stage at which the deal is and a description of the next steps;
• Deal amount;
• Probability of successful deal closure expressed as a percentage;
• Date of starting work with the client and the planned deal closure date;
• Additional information that may be useful (e.g., reasons for rejection).

Stages of a pipeline

To simplify the tracking of client interactions in the pipeline, it is important to clearly describe the actions of sales managers. This will help standardize the department's work and ensure that the sales process runs efficiently. Pipeline stages may vary depending on the type of business, but we will consider the main ones using B2B companies, which most often use a pipeline:

• Lead generation: creating a customer profile and attracting traffic through various advertising tools;
• Lead qualification: separating quality leads from poor quality ones, for example, by offering a free product in exchange for contact information;
• Initiating contact: the manager reaches out to the client to understand their needs;
• Meeting: scheduling a meeting for product presentation;
• Negotiation: discussing price, services, and terms of the deal;
• Closing the deal: the final stage where further steps may be discussed if the client is not yet ready to buy.

Sales management principles

For effective management of the pipeline, it is important to adhere to a systematic approach. Let's look at some key principles:

• Define the sequence of actions: managers should clearly know what to do at each stage of working with a client;
• Regularly analyze the pipeline: hold meetings to track deal statuses and plan actions;
• Eliminate "bottlenecks": regularly check clients who are not progressing through the pipeline and find solutions to move them forward;
• Use convenient tracking tools: from Google Sheets and Excel to CRM systems.

In our agency, we track the pipeline through a task manager, using statuses such as "client on approach," "call and proposal," "ball in the client's court," "contract signing," "working," "dropped off," "get feedback," and "work completed." This allows us to analyze the sales process in detail and identify strengths and weaknesses in our strategy.