Funnelholic's Book of Funnels

Focus Experts’ Guide:
Sales and Marketing Pipeline and Funnel Models

Focus Research
October 2010

Contributing Experts:
Ardath Albee
Michael Brenner
Michael Damphousse
Christopher Doran
Barbra Gago
Steve Gershik
Sue Hay
Matt Heinz
Carlos Hidalgo
Jon Miller
Adam Needles
Tom Scearce
Matt West
Steve Woods Focus Research ©2010

Introduction

Welcome to our the first edition of the Focus Marketing & Sales Book of Funnels. We are very excited about what we have created and the
foundation it lays for future editions.

Focus.com CEO Scott Albro manages his executives with a simple adage: “Put it in a one-page picture.” The concept of the one-page picture
becomes a brilliant exercise for Scott’s department heads to create a sensible framework for how their department will function. Depicting a
marketing or sales process in a single picture is just as challenging, and brings similarly powerful results.

To create this book, Focus.com reached out to its Focus Expert Network and asked members to submit their version of the funnel. We gave them
no instructions about what the funnel should look like, only that it had to fit on one page. I think you will have as much fun as we did seeing the
results, from Carlos Hidalgo’s “stairstep” picture to a traditional funnel from Jon Miller to a “cloud” from Mike Damphousse to the “champagne
glass” from Michael Brenner.

Every organization should make the effort to depict its revenue funnel on one page. It serves as the basis of your sales and marketing strategy;
once you understand your funnel, you are better informed about what metrics you should concentrate on, resource decisions and planning.

I have two hopes from this exercise: 1) that there are some thought-provoking ideas for you to take back to your organization, and 2) that
you create such a terrific funnel you can be included in the Book of Funnels Part II, which will have five times as many submissions as we
received for this one.

Special thanks to all of our contributors, Focus.com Sales Development Manager Sarah Miller and Contributing Editor Alec Wagner. We hope you
enjoy the Focus Marketing & Sales Book of Funnels.

— Craig Rosenberg, Leader, Focus Expert Network

Focus / Experts’ Guide / Sales and Marketing Pipeline and Funnel Models Focus Research ©2010 2

Table of Contents

Readjust Your Perspective to the B2B Buyers’ Experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 4
The Division Between Marketing and Sales Is a Myth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 5
The Days of the Funnel Are Thing of the Past . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 6
The ‘Living Funnel’ Responds to Business Changes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 7
.

Engage Your Customers to Create Evangelists. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 8
View Your Funnel from Above. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 9
Lead Scoring, Progressive Nurturing Promote Qualified Leads. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 10
Expand Each End of the Funnel for Long-term Yield. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 11
Make Lead Nurturing Part of Your Equation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 12
Keep Leads Moving through Your Funnel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 13
Buyers 2.0: Blazing Their Own Trail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 14
Today’s Bottom-Feeders Are Tomorrow’s Surface-Feeders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 15
Follow the Four R’s: Reach, Responses, Relationships and Revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 16
.

Define Buying Stages and Look at Conversion Rates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 17
About the Focus Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p. 18

All illustrations and visuals in this Focus Experts’ guide copyright © 2010 of their respective companies.


Readjust Your Perspective to the B2B Buyers’ Experience

Instead of orienting your funnel to a sales
perspective, focus the stages of the funnel
on your B2B buyers’ experience.

When your funnel is focused on meeting
the needs of all the people involved in the
decision, you’ll see a swelling in the middle,
instead of the constriction that indicates
fallout in traditional funnels.

The Buyer-Experience Funnel:

•
Interest: Get prospects to take a look at
what you offer.

•
Attention: Convince them to opt-in. Notice
that fallout occurs here when they choose
to continue or not.

•
Value: Instantly recognizable value
increases willingness to engage.

•
Engagement: Prospects spend more time

and mind-share with your content.

• uying committee involvement: Your funnel swells as influencers interact to gain consensus.
B

• onversations: Sales steps in to drive momentum to purchase based on interests expressed. The funnel narrows to core decision-maker participation.
C

• urchase: Buyers choose to partner with your company.
P

— Ardath Albee, CEO and B2B Marketing Strategist at Marketing Interactions, www.focus.com/profiles/ardath-albee/public/


The Division Between Marketing and Sales Is a Myth

To our customers, there is no such thing as a funnel.
Marketing and salespeople use the funnel to depict Start Earlier in
Buying Cycle
how we manage demand through different phases. INQUIRIES
But there is no hard distinction. In some cases, sales
generates inquiries and marketing can close revenue
without salespeople getting involved (e-commerce).
So what does this mean for the traditional funnel?

The traditional funnel is marketing-focused with a LEADS
large top in a wide V-shape, like a martini glass.

• ecause customers buy from brands that they
B
trust, we need to focus on engaging potential
customers in a relationship earlier in the buying
process, even prior to a demand signal. PIPELINE
• e must remove the false distinction between
W
marketing and sales funnels. There is just one funnel
from contact to sale, aligned to customer needs.

• hen we deliver against customer needs, our
W
efficiency increases as we convert more inquiries
PURCHASE
to leads and more leads to revenue. This happens
because customers tell us when they are ready to
buy and our funnel is built to move them through
Continue
the buying process.
After Sale
• his creates a funnel shaped more like a
T Drive More Efficient
champagne flute that drives efficient demand on a Demand Less Leakage
continuous basis.

— Michael Brenner, Director of Online/Social Media at SAP North America, www.focus.com/profiles/michael-brenner/public/


The Days of the Funnel Are Thing of the Past

With the advent of social, sales and
marketing 2.0 techniques and tools,
optimized inbound marketing strategies,
and a much more sophisticated buyer, the
days of a funnel are gone.

• uyers put themselves in the funnel
B
where they want to be. They jump around.
The influence of content and word of
mouth jumps them from side to back and
down again.

• he demand-gen funnel is now in the
T
cloud. As marketers, we must constantly
measure the status of the cloud and
make adjustments. We must combine
strategies and tactics in order to
maximize our results.

• e harness the chaos to our advantage.
W
We control the demand-gen cloud.

— Michael Damphousse, CEO/CMO
of Green Leads LLC, www.focus.com/
profiles/michael-damphousse/public/


The ‘Living Funnel’ Responds to Business Changes

• anticore approaches the funnel in an
M
integrated manner. Sales and marketing
must work together to generate demand.
In our funnel, marketing focuses on three
components:

• elivering a consistent flow of qualified
D
leads to sales

• elping sales close more deals through
H
sales-enabled lead nurturing programs

• elivering value-added content to
D
prospects at various stages of the
pipeline to keep Manticore top-of-mind.

• hrough this approach our teams become
T
heavily dependent on one another. The
sales and marketing team work together
on content and messaging for the
various nurtures. The funnel at Manticore
Technology is a living object that changes
as business conditions evolve

— Christopher Doran, VP of Marketing at
Manticore Technology, www.focus.com/
profiles/christopher-doran/public/


Engage Your Customers to Create Evangelists

This funnel puts as much emphasis on the
bottom as the top. Why? Customers are in
the community you are trying to engage.
You want to engage the community,
but you also want to create customer
evangelists to engage the community on
your behalf.

• his funnel focuses on building
T
community to convert targeted prospects
into leads.

• fter purchase, the goal is to convert
A
customers to evangelists through added
value and community development.

• n this funnel, ultimately “community”
I
and “evangelists” overlap when the
evangelists go back into the community
to advocate for your brand.

• his funnel has marketing engaged much
T
deeper than traditionally–way into lead
nurturing, and then picking up customers as they come out the other end, to develop customer-focused community.

• ince this funnel starts with community, it incorporates all organizations within the company that are customer-facing: marketing, sales, support, success and executives.
S

— Barbra Gago, Social Media Manager of Cloud9 Analytics, www.focus.com/profiles/barbra-gago/public/


View Your Funnel from Above

• t 28Marketing, we imagine a viewed-
A
from-above image of the traditional
sales funnel.

• ooking at the progression of prospect to
L
lead to opportunity, we realized that old
models didn’t conform to today’s buyer
behavior, where customers may engage
with the company at various levels,
become viable sales leads earlier or later
than we would expect, or even become
longer or shorter duration sales.

• he new 28Marketing funnel looks down
T
into the buying system, where individuals,
companies, leads and customers
accumulate at levels, spend time there,
and then move forward or backward,
depending on their needs, interest and
the ability of our company to serve them.

— Steve Gershik, CEO of 28Marketing,
www.focus.com/profiles/steve-gershik-1/
public/


Lead Scoring, Progressive Nurturing Promote Qualified Leads

• o increase revenue and shorten your
T
sales cycle, put together a clearly defined
and agreed-upon lead management
process with marketing automation and
sales force automation tools.

• o reach targeted sales and marketing
T
leads, be sure your lead-nurturing
campaigns are based on content
that is segmented, mapped to their
interests, and relevant to their stage in
the buying cycle.

• rogressive nurturing develops a
P
comprehensive dossier on leads in
the pipeline. That, combined with lead
scoring, will provide you with a list of
leads that are more qualified and ready
to send to sales.

• void missed opportunities by ensuring
A
that leads deemed “not ready” are given
a second chance by returning them to a
nurturing campaign.

• n effective lead-management process, combined with market automation and SFA tools, makes it easier to identify opportunities to up-sell and cross-sell.
A

• his combination of “people and process” not only gives you clearer visibility into the pipeline, it makes it possible to measure accurately marketing’s impact and the ratio of
T
marketing spend to revenue earned.

— Sue Hay, CEO of BeWhys Marketing Inc., www.focus.com/profiles/sue-hay-1/public/,


Expand Each End of the Funnel for Long-term Yield

• ou want a funnel that represents far
Y
more than the active sales cycle. Include
various stages of prospect engagement
based on your understanding of their
current needs, problems and triggers.

• or every qualified, ready-to-buy lead you
F
manage, you likely also have three to five
qualified but not-ready-to-buy leads. Have
a strategy to engage them where they
are, until 1) they’re ready to move forward,
or 2) they understand and trust you well
enough to engage.

• he traditional sales funnels also only
T
reflect half of the story. What about
repeat purchases? Referrals? Word-of-
mouth opportunities that turn one sale
into four? That first sale may be the
narrow part of the funnel, but if you
know what you’re doing it widens again
significantly from there. Renewals, repeat
purchases, referrals, and so forth.

• orry today about how much you can
W
naturally drive through the middle, but put
even more focus long-term on expanding
each end of the funnel to maximize
long-term yield.

— Matt Heinz, Principal at Heinz Marketing LLC, www.focus.com/profiles/matt-heinz/public/


Make Lead Nurturing Part of Your Equation

The development of a funnel starts with
the revenue that marketing needs to
produce to help sales meet their quota.
Organizations can then work backward
through every stage to determine what is
needed to meet these goals.

• his must be a collaborative effort
T
between marketing and sales to
determine the goals and percentages
of conversion (benchmark metrics will
be key for conversion goals). Then both
marketing and sales will be able to track
success, see where any weak links are
and improve planning and budgeting.

• n addition to linear lead planning,
I
companies must begin to develop a
funnel approach with lead nurturing as
part of the equation. Nurturing will affect
all areas of marketing and sales including
lead forecasting, forecasting for quota
attainment, ROI analysis and marketing
budget allocation.

• he nurturing component will improve the lead quality and also provide a lead pipeline that will be managed by marketing.
T

— Carlos Hidalgo, President of The Annuitas Group, www.focus.com/profiles/carlos-hidalgo/public/


Keep Leads Moving through Your Funnel

Marketo’s funnel is key to the success of
our organization. Some important details
to note:

• on’t let leads sit in any one place in the
D
funnel. Leads should be moving – making
sure they are not forgotten and that you
can measure results of programs and
processes.

• earning is a two-way process. Use lead
L
nurturing to educate prospects about
your marketing, and actively learn about
prospects’ preferences and needs as they
interact with your content.

• utomate the process by using lead
A
scoring to move leads to the next stage.
Encourage engagement with lead
nurturing.

• ead recycling is powerful — it allows
L
sales to spend their time with the best
leads and utilizes marketing to develop
the sales pipeline for the coming months.

— Jon Miller, Vice President of Marketing at Marketo, www.focus.com/profiles/jon-miller/public/


Buyers 2.0: Blazing Their Own Trail

• uyers determine their own ‘funnel’
B
path: It’s common to conceptualize the
buying process as a ‘funnel,’ but Buyer
2.0 doesn’t move in such a linear or
predictable fashion; rather, buyers move
at their own pace, based on content
consumed and on organizational priorities.

• urturing = an iterative loop: Our
N
nurturing of buyers thus should be more
of an iterative process of educating and
learning more about them, and then
providing them with the information and
insights necessary to move their buying
process forward. This looks more like a
loop than a funnel.

• arketing automation + demand
M
generation strategy = core components:
Marketing automation (see yellow boxes)
serves as the critical infrastructure for
enabling this type of dynamic, buyer-
driven B2B nurturing, and demand
generation strategy is the architecture
that determines the interactions and that governs your content-based nurturing.

— Adam Needles, VP of Demand Generation Strategy at Left Brain Marketing, www.focus.com/profiles/adam-needles/public/


Today’s Bottom-Feeders Are Tomorrow’s Surface-Feeders

• he sales team creates value by attaining
T
or exceeding its revenue, gross margin,
and product mix objectives.

• o help sales succeed, we need to help
T
them focus their most precious resource
(time) on the best sales opportunities.

• Best” can mean many things, e.g., the
“
highest average selling price, most
profitable accounts, interest in a new
strategic product line, or simply the most
“ready to buy.”

• e can sometimes buy quality leads,
W
but every company needs to build the
process acumen that makes sales
success repeatable.

• otice that in the graphic, the sales VP
N
is “fishing” at the top of the barrel of
leads, not wasting precious time on the
“bottom-feeders” (who are tomorrow’s
surface-feeders).

• he result is a money multiplication machine that efficiently converts marketing investments into leads, leads into deals, and deals into revenue.
T

— Tom Scearce, Principal at Scearce Market Development, www.focus.com/profiles/tom-scearce/public/


Follow the Four R’s: Reach, Responses, Relationships and Revenue

In today’s Web-enabled market, buyers
are more informed than ever, directly
accessing information about the market,
your competition, and, most importantly,
your solutions. With tools like social media,
sales also gets involved much earlier in
the process. Plus, with tools like marketing
automation, marketing remains involved
much longer in the process.

The funnel no longer begins with known
prospects. By tracking prospects above
the funnel, marketing can accurately
score leads, place them in the appropriate
nurturing path and track ROI from initial
click to deal close; while sales can
appropriately follow up with ready prospects.

The “Four R’s” allow marketers to:

•
Extend reach with social media, online
ads and paid search;

• licit responses to drive prospects to their
E
Web site;

• uild relationships through intelligent lead
B
nurturing;
• rive more revenue by better-arming sales with truly sales-ready leads.
D

— Matt West, Director of Marketing at Genius.com, www.focus.com/profiles/matt-west/public/


Define Buying Stages and Look at Conversion Rates

• he main goal in building a model of the
T
buying funnel is to provide a framework for
analyzing marketing’s effect on revenue.
Different campaigns trigger different
actions. All valuable, but measuring their
value requires a different approach than in
simple buying processes.

• he first key step is to understand where
T
each person is in the buying process and
that the stages of the funnel will differ
between businesses.

• nce buying stages are defined, you can
O
look at conversion rates to understand
the value of a lead at different stages.
For example, if a deal is worth $10,000,
and an MQL has a 10 percent conversion
rate to a deal, it is worth $1,000. (Values
are based on the conversion rate of the
funnel stage through to close.)

• ith this established, it is possible to see
W
the value of a buyer’s movement through
the funnel. For example, if a buyer moves
from “mildly interested” ($100/lead) to
“marketing qualified lead” ($1,000/lead),
their value has increased by $900.

• f a campaign triggered that transition, the easiest way to look at the value of the marketing campaign is that it added that much value to your lead funnel.
I

— Steve Woods, Chief Technology Officer of Eloqua, www.focus.com/profiles/steve-woods/public/,

About the Focus Experts

The Focus Expert Network powers much of the activity on Focus.com. Consisting of thought leaders, veteran practitioners and upstart innovators,
Focus Experts help thousands of businesses with tough decisions every day. They do this by publishing Focus Research, answering questions on
the site, and providing personalized support to the Focus community.

Ardath Albee uses her 20-plus years of business management and Barbra Gago recently joined Cloud9 Analytics, and has consulted
marketing experience to help B2B companies create e-marketing businesses on Web-content strategy, inbound marketing and social
strategies using contagious content to turn prospects into buyers. media for the last four years.
Company URL: www.marketinginteractions.com Company URL: www.Cloud9Analytics.com
Blog: http://marketinginteractions.typepad.com Blog: http://cloud9analytics.com/resources/blog/
Twitter: @ardath421 Twitter: @barbragago, @cloud9analytics

Michael Brenner has16 years of experience in sales and marketing, Steve Gershik is founder of 28Marketing, and he has worked with a
and his common focus has been using customer and market insights to number of B2B technology and cloud computing companies, as well as
drive results-based marketing and to produce a return on investment. HP, Apple and Oracle.
Company URL: www.sap.com Company URL: www. 28marketing.com
Blog: www.b2bmarketinginsider.com/ Blog: www.theinnovativemarketer.com
Twitter: @brennermichael Twitter: @sgersh

Michael Damphousse is a consummate sales and marketing Sue Hay is founder of BeWhys Marketing, a full-service lead generation
executive, leading the growth of Green Leads while sharing B2B consultancy that uses lead process management best practices, lead
demand generation knowledge with others. scoring, persona building, content creation and mapping to achieve results.
Company URL: www.green-leads.com Company URL: www. 28marketing.com
Blog: www.green-leads.com/b2b-blog/ Blog: http://blog.bewhysmarketing.com/
Twitter: @damphoux Twitter: @Sue_Hay

Christopher Doran joined Manticore Technology in 2003 as the Matt Heinz founded Heinz Marketing to focus on sales acceleration.
company’s second executive hire. He has become a recognized thought His career has been about delivering greater sales, revenue growth,
leader in marketing automation and B2B marketing best practices. product success and customer loyalty.
Company URL: www.manticoretechnology.com Company URL: www.heinzmarketing.com
Blog: www.manticoretechnology.com/blog Blog: www.mattonmarketingblog.com
Twitter: @cdoran Twitter: @heinzmarketing


Carlos Hidalgo is an expert in lead management and marketing Tom Scearce is founder of Scearce Market Development, a Seattle-
automation, with 15-plus years experience. He is a frequent speaker based sales and marketing consultancy. Tom has helped companies in
and author about lead management. diverse industries of various sizes increase revenue.
Company URL: www.annuitasgroup.com Company URL: http://tomscearce.com
Blog: http://blog.annuitasgroup.com/ Blog: http://thelordoftheleads.com/
Twitter: @cahidalgo Twitter: @TLOTL

Jon Miller leads strategy and execution for all aspects of marketing Matt West has over a dozen years experience managing B2B marketing
and is a key architect of Marketo’s hyper-efficient revenue engine and demand-gen programs for tech companies, with experience in
(powered by Marketo’s solutions, of course). agency/consulting and client-side marketing departments.
Company URL: www. marketo.com Company URL: www.genius.com
Blog: http://blog.marketo.com/ Blog: www.genius.com/marketinggeniusblog/
Twitter: @marketo Twitter: twitter.com/m_west

Adam Needles is a marketing change agent in B2B marketing who Steve Woods co-founded Eloqua in 1999 and has held the position of
helps companies develop buyer-centric demand generation programs CTO since that time. He is a prolific writer on topics related to demand
that drive revenue and build their brands in a bottom-up fashion. generation and the current transitions within the marketing profession.
Company URL: www.leftbrainmarketing.com/ Company URL: www.eloqua.com/
Blog: http://propellingbrands.wordpress.com/ Blog: http://digitalbodylanguage.blogspot.com/
Twitter: @abneedles Twitter: http://twitter.com/stevewoods

Focus / Comparison Guide / Midmarket/Enterprise ERP Solution Focus Research ©2010 19

About Focus Research

Each year U.S. businesses spend more than $75 trillion* on goods and services. And yet there has not been a definitive source of trustworthy and
easily accessible information to support business buyers and decisions makers — especially those in small and midsize businesses. Filling this gap
is the mission of Focus Research.

Through its Research Guides, Focus Research empowers buyers to make considered purchases and decisions. Focus does this by providing freely
available, actionable advice based on the expertise of other buyers, recognized experts and Focus analysts.

Guiding Principles
Our goal is not only to provide independent and high-quality research but also to deliver a new research model that serves all businesses.

Open: We believe information must be set free. The data, advice and Relevant: We believe there is no “one-size-fits-all” answer to a
research on Focus are widely distributed and available to everyone business purchasing decision. Focus Research is, therefore, designed
to address specific concerns of multiple buyer types across multiple
Peer-powered: We believe in the power of many. Thousands of buyers
industries. As such, users are encouraged to combine our different
and experts contribute their expertise to Focus every day. Our job is to
research deliverables into tailor-made packages that effectively
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address their unique needs and goals.
Practical: We believe in addressing everyday issues facing businesses.
Focus Research does not pontificate on high-level trends or promote
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* Source: Visa, Inc. Commercial Consumption Expenditure Index fact sheet.


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