The Latest from the ABM Experts
July 22, 2019
Modernizing a Growth Study and the Three Reasons Why We Can’t Stand the Funnel
Written by Sangram Vajre
How far back was the funnel invented? Go ahead, give your best guess. 1920s? 30s? 2000? What’s the answer?
The funnel has been around since the 1890s. Which means that the way that we think about the funnel hopefully has changed in the 100+ years it’s been around. But for a lot of organizations, they’re still looking at the funnel in the same tired way. Shove as much as you can in the top and hope that you get some good stuff at the bottom.
Here’s what we’re unpacking today:
- What led her to write GrowthIQ
- 3 reasons why the funnel as we know it needs to go away
Tiffani: During my advising time, one of the questions I got almost daily was, “We’re trying to grow, we’re trying to improve sales at the top of the funnel. Let’s just talk organic growth and what are the things we could be doing?”
And I started consistently hearing this pattern that they would pick one of three levers to pull.
- Hire more salespeople.
- Spend more marketing dollars
- Cut costs
I knew that there had to be a better way, and I started to hear that over and over again, especially with leaders of very large companies. They were trying to make course corrections in the quarter, like, “We’re in month one or month two of the quarter, we know it’s going to be a little soft, what are the things we can do to shore that back up and bring back revenue on the right side from a quota attainment standpoint?”
I knew that I couldn’t scale the conversations that I was having and the best way to do that would be a book. So I started really paying attention to the answers I was giving and what people were trying and what companies that were high performing were doing differently, and I took the opportunity between the first year of me transitioning into the role at Salesforce to really dig into that story. And Growth IQ was the culmination of that, and really the product of that effort.
What’s Wrong With the Funnel?
Tiffani: So the question then is, and why I don’t really like funnels, is because it’s still thinks that it’s big at the top, right?
“We’re going to shove a lot of stuff in the top, all the leads in, and then we may get better at scoring in the middle of the funnel, let’s say, which not everyone scores, so at some point some people are scoring, and then it makes it to the bottom where maybe it gets handed over to sales now and sales executes.”
I feel like it would be so much better if the funnel was flipped. #Flipmyfunnel
What if the funnel was flipped and had less going in the top because you’re smarter about what you’re doing from a marketing perspective? Who are your target customers? Where do they go? Where can you find them? Where are the customers who you have now? Where do they come from? What’s the propensity to buy and the lifetime value?
Forget the customers that aren’t profitable for you, don’t go fishing there anymore. Get smarter about what you’re putting in.
The two stats I always bring up is more than 50% of salespeople will miss quota. And that’s from CSO insights, which is now part of Miller Heiman. The second one is that 60% of a sales person’s time is spent on non-selling activities. So if you look at those two stats alone, do we really need to hire more salespeople, or should we just make the salespeople we have more efficient and effective?
Part of the thing they’re struggling with is the fact that there may be working leads that should have never come across their desk. That’s why I don’t like the funnel being large at the top, because we have all this inefficiency, instead of just getting smarter at the top of the funnel, you can be smarter at the bottom of the funnel and maybe improve some of that.
The other reason that I don’t like it, is because I don’t think our sales process is not the same as the buyer’s journey. Those are two very different things. So the buyer may be 60% through the buyer journey according to CEB and many, many others. But that doesn’t mean that then they’re at stage three, four, or five in our sales process.
The disconnection between those two is because sales and marketing’s metrics are forcing them to really use the funnel as a way of saying, “Oh, I am actually producing, I need more marketing money, look at all the leads I’m bringing in.”
Well sales says, “Yeah, but the leads are crappy.” And then the battle between sales and marketing begins.
The third reason I don’t like the funnel is because it does not include and rarely includes customer service as a source for that funnel. So, the battle between sales and marketing is not so interesting to me, it’s rather boring. We’ve been talking about it for a long time. I’ve been selling for 27 years. So for a long time this battle has been happening.
It’s really the three of those groups, customer facing groups together that are the Trifecta of growth for me. So I think the funnel misses Customer Service. I think it should not be heavy at the top, because then it’s not taking advantage of all the intelligence and AI and machine learning and predictive capabilities we have now with CRM and other tools.
If there are only two things to take away from this, let it be these two:
Number one, go read GrowthIQ. Read the 30 different case studies that Tiffani and her team put together.
Number two, realize that there’s a better way to boost your sales numbers than hiring more salespeople, spending more marketing dollars, or cutting costs.