A sales pipeline and a sales funnel are two things that help teams sell products, but they are not the same. It is important to know the difference, so teams can work better and make more money.

In this article, we will learn what a sales pipeline and a sales funnel are and how they help teams do their work.

What Is a Sales Funnel?

A sales funnel is like a path that shows how people become customers. It helps teams see all the steps from the first time someone hears about a product to the moment they decide to buy it.

Stages of a Sales Funnel

A sales funnel has different steps that show what happens as people learn more about a product:

1. Awareness: This is when people first find out about a product. Teams try to make people notice it and get interested.
2. Interest: At this point, people want to learn more. They look for information about the product.
3. Consideration: People think about if the product is right for them. The sales and marketing teams work together to answer questions and help them.
4. Decision/Purchase: This is when people decide if they want to buy the product.
5. Retention: After buying, the company tries to keep the customer happy so they stay and buy more in the future.
6. Advocacy: Happy customers tell others about the product, helping the company find new customers.

A sales funnel helps the marketing team find new people and get them interested. It shows how people move from hearing about the product to buying it.

What a Sales Funnel Looks Like

A sales funnel looks like a big triangle or upside-down pyramid. It shows how lots of people start at the top, and fewer people move to the next steps as they get more interested.

What Is a Sales Pipeline?

A sales pipeline is different because it focuses on what the sales team does. It shows all the steps the sales team takes to turn a person into a customer.

Stages of a Sales Pipeline

A sales pipeline has many steps, and each step helps the sales team manage and close sales:

1. Prospecting: This is when the sales team looks for people who might be interested in the product.
2. Qualification: The sales team checks if the person is a good fit and if they are ready to buy.
3. Needs Analysis/Product Demo: The sales team talks to the person to understand what they need and shows how the product can help.
4. Proposal/Quote: The team gives the person a proposal or a price quote for the product.
5. Negotiation: The sales team and the person discuss the deal, and they may make changes.
6. Closed: If both sides agree, the deal is made, and the person buys the product – this is typically stored as "Closed Won". If not, the deal is lost – or "Closed Lost".

The sales pipeline helps the sales team know what deals they are working on and how close they are to making a sale.

What a Sales Pipeline Looks Like

A sales pipeline looks like a straight line with steps. Each step shows what the sales team needs to do to move someone closer to buying the product.

Differences Between Sales Pipelines and Sales Funnels

Sales pipelines and sales funnels are different in a few ways.

Perspective

• Sales Funnel: Shows the big picture of how people move from learning about a product to buying it.
• Sales Pipeline: Focuses on the details of how each sale happens, from start to finish.

Focus

• Sales Funnel: The marketing team uses it to find and help new people learn about the product.
• Sales Pipeline: The sales team uses it to manage deals and turn interested people into customers.

Metrics

• Sales Funnel: Measures things like how many people visit the website, how many people show interest, and how many become leads.
• Sales Pipeline: Measures things like how big the deals are, how fast sales happen, and how many deals are won.

Applications

• Sales Funnel: Helps the marketing team see what works to bring in new people.
• Sales Pipeline: Helps the sales team manage deals and know how close they are to making a sale.

Why Knowing the Difference Is Important for Teams

For teams that work with sales, marketing, and customer service, knowing the difference between a sales funnel and a sales pipeline is very helpful. It helps teams work together, look at their data, and make their work better.

Better Data Analysis and Reporting

When teams know what a sales funnel and a sales pipeline are, they can better understand the data and work together more easily. Each team knows what they are tracking and can share the right information.

Making Work Better

If teams understand the differences between the funnel and the pipeline, they can find ways to make their work better. This helps them fix any problems that slow down the sales process.

For example, if the sales and marketing teams do not know if someone is a lead or a customer, it can cause confusion. By understanding whether someone is in the funnel or the pipeline, teams can work more smoothly.

How Pipelines and Funnels Work Together

Even though a sales funnel and a sales pipeline are different, they can work together well.

Pipeline as Part of the Funnel

The sales pipeline can be seen as a part of the sales funnel. When a lead has moved through enough steps in the funnel, they become an opportunity in the sales pipeline. This means that marketing has done its job, and now sales needs to take over.

Handoff Between Marketing and Sales

When a person becomes ready to talk to sales, they are called a Marketing Qualified Lead (MQL). At this point, the marketing team gives them to the sales team, and they move into the pipeline.

Good communication between marketing and sales is very important here. If the teams do not agree on when someone is ready, it can cause problems and waste time.

Sharing Information

The sales funnel and sales pipeline need to share information. Sales data can help marketing understand what kinds of people are more likely to buy, and marketing data can help sales know what works best. This way, both teams can keep making their work better.

How Teams Can Use Both for Success

To be successful, teams need to use both the sales funnel and the sales pipeline. They need to make sure data is connected, work together on processes, and always look for ways to improve.

Connecting Data

To do their work well, teams need to connect data from marketing and sales. By having all the data in one place, they can understand what is happening from the start to the end of the customer journey.

For example, if the marketing and sales data are separate, it is hard to see how a person moves from learning about a product to buying it. Connecting this data helps teams make better decisions.

Working Together

Sales and marketing teams need to work together to make sure people move smoothly from the funnel to the pipeline. This means agreeing on what makes a good lead and making sure the sales team gets only the best leads.

A lead scoring system can help with this. By giving scores to leads based on how interested they are, marketing can make sure the sales team gets leads that are ready to talk.

Always Improving

Teams need to keep looking at what is working and what is not. By looking at data, they can find ways to make their work better.

For example, if a lot of deals are getting stuck at one stage, the sales team might need extra training or changes in the sales process. If the funnel is not bringing in enough good leads, marketing may need to change their message.

Conclusion

Sales pipelines and sales funnels are important for helping teams sell products. The sales funnel helps the marketing team find and help people learn about the product, while the sales pipeline helps the sales team turn interested people into customers.

By knowing the difference, teams can work better together, understand their data, and make their processes better. For RevOps teams, it is important to use both the sales funnel and the sales pipeline. By connecting data, working together, and always improving, teams can find more success and help the company grow.