What Is The Meaning Of Pipeline in Sales and Marketing

What Is The Meaning Of Pipeline in Sales and Marketing

Dan Sincavage
What Is The Meaning Of Pipeline in Sales and Marketing

There are several processes that make (or break) a business. Perhaps the most important of these is the process that goes into your marketing and sales pipeline. This is where your leads turn into customers, where your mainly revenue comes from.

Your marketing and sales pipeline refers to the stages that your sales rep goes through to convert a lead into a customer. It is separate from the sales funnel such that the pipeline sums up all the customer sales funnels. It is a visualization of where things really are, in terms of sales, and what’s being done at each stage.

It is typically made up of the following stages:

  • Lead generation
  • Lead nurturing
  • Lead qualification as marketing-qualified or sales-qualified
  • Deal closing
  • Post-sale

In a way, your sales pipeline represents the health of your sales life cycles.
Are you dealing with a clogged system, wherein the average sales cycle takes too long?
Do you lose a lot of leads as they go through the pipeline?
At which stages of your pipeline do the process stall?

A thorough examination of your sales pipeline can reveal areas in your sales and marketing that need to improve. Thus, it is important to regularly draft pipeline reports that show deal quantity and value per stage. This is data that’s crucial if you want to better pipeline management.

Sales Pipeline VS. Sales Funnel

Your sales funnel captures your buyer’s journey. It represents the actions they take that move them from awareness to making a purchase.

The funnel has helped determine steps that you need to take to improve your content marketing, follow-ups and such, at its different stages. Knowing where your prospects are, you can provide them with the information and push they need to move them further down the funnel and eventually towards buying from you.

The sales pipeline, on the other hand, maps the actions taken by sales reps. It is the sales cycle from the rep’s point of view. To them, it is not about moving from awareness to conversion. To them, it is about getting the leads, qualifying them and eventually closing the deal.

The overlap lies in the leads. Are the actions at each stage of the pipeline effective enough to move majority of the leads down the sales funnel and through the pipeline?

Market research company Forrester found that 99% of leads never gets converted as customers. If you observe this in your sales pipeline, then it’s time to take a closer look and tweak where necessary.

Why Focus on Pipeline Marketing

Until recently, when the power of CRM and data put a lot of guesswork on the wayside, lead generation was the metric that determined your sales pipeline’s success. If you have a lot a leads, then you can potentially close a lot of deals.

We know that this is actually not true. There are several stages within your pipeline that need attention too as these might be the weak links that cause lead leakage. We should no longer focus on quantity – quality is more important.

Pipeline marketing connects sales and marketing to information. It considers all out-reach channels and marketing campaigns. Solid data becomes the basis of decisions and goals.

Pipeline marketing employs strategies that you may already be familiar with. Inbound marketing, content marketing, lead nurturing and growth hacking – all these factor into the individual sales funnels of your lead. In the same way, they are used at the different stages of the sales pipeline.

What Does a Healthy Sales Pipeline Look Like?

There are 4 key metrics that determine a healthy pipeline:

  • Number of deals in the pipelines.
  • Average size of deals.
  • Average percentage of closed deals.
  • Average time for closing deals.

Assess these metrics against your current production capacity, competitor metrics and goals. See if there are stages where movement’s stalled. Examine this against select sales funnels to see if there are common hindrances in moving clients down the funnel and through the pipeline. Are they information lacking – data, reports, guidelines and what-not that can help in the decision-making? Are you failing to follow-up at certain points of the funnel?

Your sales pipeline can work as a guide to improving your marketing and sales operations. It is a way to trim the fat and shape up. Take the time to draft your sales pipeline report and see where you can go from there.

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Dan Sincavage

Dan Sincavage

Dan is a Co-Founder of Tenfold and currently serves as the Chief Strategy Officer. Dan oversees the Tenfold sales organization, manages strategic partner relationships and works with key enterprise accounts to ensure their success with the Tenfold platform.

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