Mastering the Sales Funnel Stages

When attempting to turn potential leads into customers, there is nothing more valuable than having insight into what your audience really wants. Creating a sales funnel can help you to better understand your customers and help them move through the buying process more efficiently. Becoming a master of each of the sales funnel stages can produce even greater results. At this point you may be wondering, what is a sales funnel exactly? In this article, we will go over each stage of the sales funnel in detail. You will also learn how to create an effective marketing funnel for your own business.

sales funnel explained

What is a Sales Funnel?

A sales funnel is a marketing term for the journey that potential buyers go through on their way to making a purchase. When you map out your “buyer’s journey,” you are following your customers from the discovery of your business all the way through to the moment they buy your product or service. There are several steps to the marketing funnel and these vary based on individual business models. 

Actions that occur during certain sales funnel stages are generally referred to as being at the top, middle, or bottom of the funnel. There are four major stages (and one bonus stage) of the sales funnel. These include:

  1. Awareness
  2. Interest
  3. Decision
  4. Action
  5. Loyalty

The last stage of the funnel (loyalty) is one that many businesses should strive to reach. If your buyers have reached the 5th stage of the marketing funnel, they have become loyal to your brand and are likely to be repeat customers.

Why Are Sales Funnels Important?

Knowing what your customers are thinking is an invaluable asset for businesses and marketers. Creating a sales funnel will allow you to track your customers as they make their way through their buying journey and help you understand their needs and preferences. This information can help you to invest in the right strategies and make the most of your marketing budget. It can also help you to create the most relevant content for each stage, which will encourage your leads to make their way down the funnel.

marketing funnel explained

The 5 Stages of the Marketing Funnel Explained

So now you are aware of what a sales funnel is and why your business needs to create one. That being said, it can be helpful to have each of the 5 stages of the marketing funnel further explained. In this section, we will go into more detail about each stage and what it means for the customer’s journey.

Stage 1: Awareness

The first stage of the sales funnel is awareness. This is the stage where the potential customer first learns about your business and your products/services. Often this is because they have a problem or need and think that you might have the solution. This awareness can happen naturally, like someone coming across a social media post and clicking through to your website. Or it can also be a planned interaction, like a targeted paid advertisement.

Stage 2: Interest

In this stage, the potential customer has passed through the awareness stage and is now actively looking for something. This does not mean that they have already decided to make a purchase from you. However, it does mean that they have taken the time to check into your business and are considering it. This means that they have been converted into a possible lead and you are one step closer to making a sale

Stage 3: Decision

After interest comes the decision stage of the marketing funnel. Your potential customer is now more than halfway through the funnel and is ready to make a decision. Keep in mind that during this stage, your leads are paying much closer attention to your marketing efforts. They may even take the first step and reach out to your business. They might respond to an email newsletter, chat with customer service online, or even attend a webinar. At this point, they are almost ready to make that purchase.

Stage 4: Action

Often considered the final stage of the traditional sales funnel is the action stage. This is the point where the customer is ready to make a purchase. If your leads have made it all the way to this stage, then they have reached the end of their buyer journey and things become much simpler. They make a purchase from you and become your customer.

Stage 5: Loyalty

Stage 5 is the bonus step of the sales funnel. Many businesses end their funnel at the 4th stage, but just because you’ve made a sale doesn’t mean that you are done marketing! Your new customer has only made a single purchase. If you can offer them value and get them to be loyal to your brand, then you have the opportunity for many more sales. There are many ways to retain customers, but some of the most popular include email newsletters, special deals, and great customer service.

what is a sales funnel

How to Create Your Own Sales Funnel

Now that you know about each stage of the sales funnel in detail, it’s time to build your own. As we mentioned earlier, sales funnel stages will vary by each individual business. This means that the steps will likely be a little different each time. That being said, here are a few of the most basic ways to start setting up a sales funnel for your business.

Create a Landing Page

Your landing pages will likely be the first way that potential customers learn about you and your business. This means that they are an extremely important part of getting leads from the awareness stage to the interest stage. Your pages should clearly communicate what your company does and what unique benefits you offer. Landing pages should also be easy to navigate and user-friendly. 

Offer Something of Value

Your next goal should be to get some valuable information from your audience, which can turn them into potential leads. This also means that you need to offer them something of value in return. In exchange for their email, you can offer customers a free download, discount code, or even early access to a new product.

Start Nurturing Leads

It is at this point that your customers will move into the interest stage and become qualified leads. You will need to continue to nurture these leads as they make their way down the funnel. Since you likely already have some of their information (like their email address), you can set up some automated marketing efforts, like email newsletters.

Upsell Your Products or Services

As your customers move into the decision stage, this is the point where you need to really sell your product. Create opportunities to nudge your leads in the right direction and give them a reason to go through with their purchase. This could be a product demo, free trial, or even a special discount code.

Be Consistent

Lastly, no matter what strategies you employ, it is important to be consistent. When you reach the action phase of the funnel, you will either end up with a new customer or will have to try to understand why your lead failed to make a purchase. Either way, consistent communication between you and your audience is key. For new customers, you can focus on tactics to help with engagement and brand loyalty. For failed leads, you can follow up with them and try to encourage them to give your business another shot.

sales funnel stages

How to Optimize the Sales Funnel Stages

Once you build your sales funnel, you will want to make sure that you are fully optimizing each stage to get the maximum benefit. There will always be times when seemingly perfect leads fall out of your sales funnel. The key is to understand what went wrong and figure out what you need to change.

The best way to prevent this is for everyone at your business or on your marketing team to have a clear picture of each step of the sales process. Sit down with your team and identify possible bottlenecks in your plan or find the places where you are most likely to lose customers. Once you have these in mind, create an action plan and try out different strategies to see if they can help fix the problem. 

Mastering the Sales Funnel Stages

Now you should have a pretty good understanding of the sales funnel process and how it can benefit your business. Creating a sales funnel can help you follow your customers along their buyer’s journey. This can help you to better understand how your marketing strategies are working and how your audience is responding to them. If you are still having trouble creating a solid digital marketing plan, SEO Design Chicago can help. Our dedicated team of digital marketing consulting experts will work with you to fine-tune your plan and maximize your ROI. Contact us today to get started.


  • What is a sales funnel?
  • Why are sales funnels important?
  • What are the 5 stages of the marketing funnel?
  • What is each stage of the marketing funnel explained?
  • How can I create a sales funnel?

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