How Sales Leaders can Build and Manage a Successful B2B Sales Pipeline
As a sales leader, your team’s sales pipeline is everything. Without a robust pipeline your team cannot make their quota and your job is ultimately at risk. Pipeline drives key decisions including how you assess and coach your reps to success.
One of our core promises at Vengreso is to empower sellers to grow their sales pipeline by leveraging digital tools like LinkedIn® to create more sales conversations online, building trust with prospects and then taking those conversations offline to build their pipeline.
For that reason, I’m devoting this post to this all-important topic of building sales pipeline. I begin by explaining what a sales pipeline is, how to manage a sales pipeline and how to teach your sales reps to develop a consistent pipeline building cadence.
I cover these topics and more in this article.
What Is a Sales Pipeline?
In simple terms, pipeline means viable opportunities with qualified prospects. And one of your responsibilities is to coach your sellers to always be building pipeline.
The sales pipeline describes a series of steps in the sales process, from Sales Qualified Lead (SQL) to customer and what actions sales reps must take at each step. Here’s an important consideration: the sales pipeline starts with an SQL, not before.
How did the lead become an SQL? Perhaps he or she visited your website multiple times, downloaded a sales guide or requested a demo — whatever actions were needed in your lead scoring system to earn them enough points to be deemed a potential customer.
The SQL is someone who is actively on their buying journey. Unfortunately, not many marketing leads make it this far. According to Technology Advice, only 27% of B2B leads are sales-ready.#SalesLeaders, are you coaching your #sellers on how to fill their pipelines? @KurtShaver shares valuable insights in #pipeline building and management. Click To Tweet
What are the Different Sales Pipeline Stages?
The names and number of stages in a sales pipeline may vary from company to company and how they decide to set it up in their Customer Relationship Management (CRM) software to track the buyer’s journey.
You can segment your sales pipeline and plan your sales activities in a variety of ways.
And although it can be confusing at times, the following is a list of some common sales pipeline stages.
Sellers should strive to keep sales cycles short, moving prospects through this pipeline as quickly as possible.
1. Discovery and Qualifying
During this first stage, the sales rep contacts the lead and determines if the product or service fits their needs, what the timeline for buying is and their budget. Each team has a particular set of qualifying questions, but the most common are the BANT questions.
- Budget: Do they have a budget to spend on this solution?
- Authority: Are the sellers talking to the right person at the company?
- Need: Do they need our product or service?
- Timeline: Do they have a definite timeline in mind to purchase?
Even if your sellers receive a “no” from an SQL in any of those qualifying questions, that doesn’t mean the leads are dead. Perhaps they’re not ready to purchase in the near term but the seller can stay in touch with the prospect for a future opportunity.
Now, if the prospect responds positively to all the qualifying questions, they can be moved to the following stage: the meeting.
Now the seller will meet with the prospect to better understand their needs and go over any details regarding the solution.
During this process, sellers are tracking in the CRM every stage of the pipeline their prospects are moving through.
A process typically has rules so that a salesperson is required to identify the stage of the pipeline. For example, after a discovery call the deal may still be a “prospect.” On the other hand, if the prospect told the salesperson on the discovery call they have an immediate need with budget and intent to buy, that first call could result in “opportunity” based on those circumstances.
As the sales activity progresses, the rep changes the status in the pipeline according to the criteria in their sales methodology.
The seller drafts a proposal and sends it to the prospect, describing the benefits of the solution, the investment and the expected ROI. The rep may also share some customer testimonials to build credibility.
During this stage, sellers prepare a Forecasted to Close report, so sales leaders can identify if sellers will meet quota, and what the sources of expected revenue are.
To complete this report, sellers must ask their point of contact another series of questions regarding the buying committee (the decision-makers or buying influences at the company).
Increasingly, corporate buying committees are growing with more people that are difficult to reach. Part of the seller’s job is identifying and reaching buying committee influencers. On average there are 6.8 decision-makers in any B2B buying decision.
For instance, these are some questions your sellers could ask:
- Who is driving this initiative?
- Who else do you need to speak to for final sign off on this deal?
- Who will be most impacted by this solution?
- Who are you going to take this information to next?
- Who has to sign off on the deal?
- Who holds the power to veto the deal?
- Are you projecting we’ll have this signed and contracted in the next 30 days?
With this information the seller can forecast when the deal is going to close.
4. Negotiation and Closing
Now that the seller understands the decision process and the prospect has received the proposal, they enter into the negotiation and closing stage.
There are often two parts to closing a B2B sale:
a. Reaching a decision with the ultimate decision maker on the business terms of the purchase.
b. Getting the contract in order through the customer’s legal and procurement departments.
Sometimes this process is easy and happens in a day or two, but it can often take weeks or even months.
The two possible outcomes of this stage are closed-won or closed-lost. If the seller wins the deal, he can then pass on the client’s information to Customer Success for implementation. If he loses the deal, the seller must consider whether the prospect bought from a competitor, thus eliminating future possibilities; or whether simply no decision was made, which means there may be an opportunity to revisit the deal in the future.
As part of this stage in the pipeline, sellers should identify in the CRM the sales tools they used to close the deal, whether won or lost. This will allow sales leaders to calculate the ROI or their sales tools and make informed decisions about which tools to renew and which to cancel.#SalesLeaders, are your sellers keeping #sales cycles short and moving prospects through the #pipeline as quickly as possible? Discover best practices to build and manage sales pipelines with @KurtShaver Click To Tweet
Sales Pipeline vs. Sales Funnel
Although sometimes people confuse a sales pipeline with a sales funnel, they are not the same. While the sales pipeline describes the actions the seller takes to convert an SQL into a client, the sales funnel is a visual representation of average conversion rates as prospects and qualified leads go through the sales process.
The sales funnel provides sales leaders concrete numbers of how many leads are converting. In some organizations, the sales funnel includes both the marketing and the sales processes, from lead generation to sales prospecting to closing.
How to Manage a Sales Pipeline
Sales leaders must have a sales methodology that minimizes subjective assignment (guessing) of the pipeline stages. The absence of a methodology can result in sales reps labeling a company as an opportunity too soon, before they’ve been qualified, without intent to buy or a budget. Leaders must coach reps to the methodology.
In fact, companies that master pipeline management see a 28% higher revenue.
However, do not spend too much time on administrative tasks. Instead, implement automation processes for every non-sales activity and make sure your reps are focusing on selling, not paperwork (albeit digital paperwork).
And finally, don’t forget to measure. The more you measure and track, the greater your chances of success. Let’s look at the metrics you should be tracking.
What metrics should you track in sales pipeline management?
Sales managers must have KPIs in place to track the effectiveness of their pipeline. Here are some metrics to track:
- Deal volume.
- Velocity (time from first call to close).
- Number of people in buying activity.
- Stages where reps struggle the most.
- Conversion of sales conversation to pipeline worthy deals.
Sales pipeline management will help you identify the best lead sources, the most successful sales techniques and which reps are achieving sales quickly versus those who are low performing.
For example, tracking deal volume will tell you which sellers are not creating enough sales conversations or not converting their opportunities. These reps are less likely to meet or exceed quota and may need coaching or upleveling their skills through sales training.
Best practices to manage your sales pipeline
One of the most important elements of a good sales pipeline is a documented methodology or a set of rules. Without them, sales reps randomly assign deals to the pipeline often with overconfidence or to avoid the scrutiny of not having enough deals in the pipeline.
Adhere to a particular sales methodology and ensure your sales tech stack supports every activity. Reinforce the criteria of the methodology with reps until it’s clear they understand it.
There are many sales methodologies that work like a formula for sellers to follow and obtain consistent results. If you don’t have a formula that specifically helps your reps to build their sales pipeline, you should learn a simple but powerful 3-step formula we developed called the PVC Sales MethodologyTM — which stands for: Personalization, Value, Call-to-action.
Other best practices to manage your sales pipeline include:
- Conducting weekly coaching with your reps to review sales activity and the conversion rate into pipeline and closed-won/lost deals.
- Training sales reps on how to make the most out of their CRM, sales pipeline software, or sales pipeline management solution (and don’t forget to track the usage and ROI of each of those tools).
- Making decisions based on data and not instincts. Measure and take action on the results.
Finally, make sure your sellers are staying in touch with their clients and cultivating the relationship. Remember that it costs 5x more to gain a new customer than to retain one. This is the foundation for Customer Success.
Teaching Your Reps How to Fill Their Pipeline
Sales leaders have the responsibility to train their sales reps how to fill their pipeline. Here are four things you can do to get them started.
Teach them how to:
1. Build relationships through social media
B2B sales reps must leverage LinkedIn® to build relationships with modern buyers. Using LinkedIn®’s advanced search feature they can find people who fit their target client and begin engaging with them in various ways.
For instance, in our social selling training programs, we teach sellers how to find, engage and connect with prospects using proven techniques that build trust. Sellers should never pitch their product or service without building a relationship and earning trust first.
2. Develop thought leadership
Sharing valuable high-quality content through LinkedIn®, email and other channels is a great way to build thought leadership and gain followers on social media.
Sales reps must learn how to share relevant content (articles, videos, events, etc.) that is attractive to their target buyers. Thus, prospects will see them as trusted sources in their industry, increasing their chances of starting a sales conversation.
3. Ask for referrals
According to HubSpot, 73% of executives prefer to work with salespeople referred by someone they know.
Referrals are a great way for sellers to fill their pipelines. If they have built relationships with people on LinkedIn®, they probably have connections that would be happy to introduce them to prospective buyers who may be second or third degree connections.
At Vengreso we teach a two-step digital referral process:
- Look at your target buyer and assess mutual connections.
- Reach out to at least three of your mutual connections and ask for a favor, and, if they have a strong enough relationship, to make the introduction.
If during the first round of contacting three people your sellers don’t get a positive response, they can try again, reaching out to three more mutual connections.
4. Leverage personalized video messages to build rapport
Second only to being face-to-face with a person, video is the best way to humanize communication in the sales process. Through video, prospects can see facial expressions, hand gestures, and personality. These are key elements of nonverbal communication that are lost when sellers only communicate through voice calls or text messages.
That’s why we developed the Selling with Video Virtual Bootcamp, where we teach sales teams the skills they need to create and send video messages that help them stand out from the crowd and create more sales conversations.
Using LinkedIn® to Build your Sales Pipeline
Have your sellers mastered social selling to build their pipelines? Times have changed and modern B2B buyers are more digitally savvy, preferring to conduct independent research before talking to a sales rep. The modern buyer requires sellers who are a resource, a guide, a helper in their buying journey.
Now that everyone is working from home, modern sellers need the skills to find, engage and connect with prospective buyers digitally. Our Selling with LinkedIn® virtual training program is designed to teach sellers those skills and help them build their pipeline digitally. Click the image below to learn more.