Last updated on November 10th, 2022 at 02:49 pm

Learning how to build a sales pipeline is the first step in creating your sales team and a critical element to its success.

On its own, the term sales pipeline is one of many in the colorful and often complex vocabulary of modern-day sales reps and AEs. It’s a common buzzword and for good reason. In order to generate, track, and ultimately convert leads within your sales process, you’ll need a framework that provides an overhead view of the stages, tools, and actions it takes to get there.

With the goal being to close deals and improve your bottom line, let’s explore how you can optimize your sales process with a well-built sales pipeline.

What is a sales pipeline?

A sales pipeline is as it sounds: your sales process represented as a kind of pipe system. Where an ordinary plumbing system is connected by pipe fittings or connectors to control and divert the flow of water, the sales pipeline uses different steps to mark the progression of your business’s potential customers to clients.

It is an illustration of a measurable process that should be defined by your unique sales cycle.

Used in this way, your sales team’s pipeline ideally accomplishes several things:

• Provides a set of actions for SDRs and AEs to take at each stage
• Identifies any strengths or bottlenecks in your process
• Forecasts the likelihood of a lead to buy
• Compiles data on how deals move forward to close
• Records a history of previous sales cycles to audit later on

Done correctly, a sales pipeline will give you valuable insight into your current processes as well as provide a breakdown of achievable tasks your team will use to close deals.

Sales pipeline v. sales funnel

It’s easy to mix jargon up, especially when there’s so much of it in the industry. That said, we should take a moment to clarify an important distinction between similar terms.

Sales funnel is a term commonly used interchangeably and as a synonym for a sales pipeline. Although they share many similar qualities, they serve two distinct purposes.

Let’s start with the sales pipeline. At the risk of repeating ourselves, your pipeline represents your sales process visually. The various stages that break up the process ushers members of your sales team through the different stages with instructions on what to do and when. This keeps everyone on the same page based on proven, tested methods to close the deal.

If your SDRs are at the prospecting stage, they need to focus on identifying and collecting the information of your top buyers. Or perhaps they’ve already sent several emails to a prospect and now it’s time to pick up the phone. Either way, with the aid of the sales pipeline both SDRs and AEs will have actionable steps to carry out and guide them.

The difference between a sales funnel and pipeline is a difference of perspective. A sales pipeline is used by your internal sales team to illustrate the sales process for the sake of your reps. Are your SDRs generating leads? Is it time to submit a proposal? The sales pipeline gives you a system of direction to improve performance.

However, a sales funnel represents the buyer’s journey. It depicts what stages leads will move through before deciding on a purchase. In short, it follows customer behavior.

Each stage of a sales funnel depicts where the customer’s head is at. The exact names vary between companies, but – for example – you might see a customer move from awareness to discovery to intent to purchase. Using data scraped from a variety of sources (i.e. website analytics, social listening), the funnel monitors their pattern of decision making.

Understanding the sales funnel helps your sales team by providing more context. It can also help bridge the gap between sales and marketing teams. Inbound practices of gathering information via website and customer data help the qualification process for sales reps. With a sales funnel they become more customer-focused, meeting and converting leads at just the right time.

What does a sales pipeline need?

Now let’s take a look at the tools of the trade. What software and best practices does your sales pipeline need?

CRM

First, you’ll need a database to store all your information. For smaller businesses, a spreadsheet or google sheet should be enough. Naturally, the fewer prospects you have, the easier it is to manage.

For larger enterprises, though, you’ll need a dedicated sales CRM with a larger suite of features. With the right bells and whistles, a proper CRM will significantly optimize the performance of your team.

With the right CRM you can:

• Set reminders to follow up with prospects
• Analyze the success rate of certain messaging
• Track KPIs
• Remove time-consuming, manual tasks
• Streamline account maintenance
• And of course, organize all the data of your prospect pool.

Other benefits of a CRM include company-wide transparency into the sales process, increased scalability, and bespoke reporting to benchmark performance.

There’s no shortage of CRMs on the market, so there are plenty of options out there to meet the particular needs of your sales team.

Attainable Goals

This seems obvious, but perhaps the most important component of a sales pipeline is the goals you’ve set to achieve. The framework for the entire sales process is constructed around them.

Here, you can take inspiration from the popular idiom “know thyself.” More aptly put for a sales manager: know your team. By their very nature, salespeople are target-driven and competitive. Yet, to set each rep up for the best chance to succeed, you must take into account their individual strengths and weaknesses.

It’s likely you have some top performers over the phone who don’t flinch on a cold call. No doubt there are others who could win a Nobel Prize in Literature for their masterful emails or subject lines. Identifying who excels at which skill will give you valuable insight on where and how high to set achievable goals.

Additionally, there are proven formulas on goal setting you can use. One such method is establishing SMART goals. The SMART framework is broken down as:

• Specific
• Measurable
• Achievable
• Relevant
• Time-bound

Use this KPI structure and your personal knowledge of your team members to give yourself the best chances of achieving results.

Content Database

So, you have a CRM to manage your treasure chest of prospects, clients, and accounts. It’s an invaluable tool as we’ve seen, but to fully support your efforts in building out a sales pipeline, you need winning content.

Obviously, marketing content like blogs, ebooks, and whitepapers is important. Modern sales are won by offering value in each relationship. In this sense, both traditional marketing and content marketing go a long way.

However, when it comes to a sales pitch, we’re referring to a different kind of content. We’re talking about the templates your sales team distributes internally among its members.

With the rise of an account-based approach to sales, there’s certainly a discussion to be had around scaling personalization and how antiquated some templates have become. Yet, they’re still a critical piece of every sales toolkit.

Templates set a standard and establish consistent brand messaging. They also engender collaboration among the team as reps swap ideas and work together to produce effective copy.

Your sales content database is not limited to templates, or necessarily email templates. It can also include:

• LinkedIn templates
• A list of best practices for the team to adopt
• Cold call scripts
• Pitch decks and PowerPoint presentations
• Ready-made proposals and contracts

If you don’t have a CMS or similar application, create a hub on Google Docs where your team can access all of the above. Encourage reps and AEs to submit their personal approaches to the database.

A content database will improve efficiency. It’ll keep your sales pipeline running smoothly and unclogged with the right messaging available at each stage.

Define the stages of your sales pipeline

Speaking of which, it’s time we take a brief glance at the different stages of your pipeline. The exact names of each stage are open to interpretation and don’t need to be followed as a golden rule, but they should act as a solid backbone and reference for your team.

Prospecting

This is the first step of a company’s pipeline. It’s also one of the most important. You want people to buy your product or service, so you need to go out and find them. This can include lead generation through the inbound method of marketing, but for the sake of this article, we’ll presume it’s good old-fashioned cold outbound prospecting. For outreach, we recommend a mixed, three-pronged approach of LinkedIn, email, and calling – and not necessarily in that order. A/B test your methods and use a combination of more generalized outreach and hyper-personalized messaging for the best results.

Meeting

With hard work and a little luck, you’ll have scheduled a meeting (or 5) for an initial look at what you’re selling. Congratulations! The war is not yet won, but take pride in this victory. This can be one of the most difficult stages to reach. And even if there isn’t a strong business case or proposal to follow, use this as a learning opportunity and replicate the successes that brought you here.

Qualification

Now is the time to see if we have a serious buyer. The AE will both during and after the meeting review the call to determine if there’s a genuine sales opp by asking certain questions. Are we speaking to decision-makers? Are they just kicking tires? What’s their budget and when are they ready to buy? The right answers and a decision from an AE will move the prospect onto the next stage.

Demo

Provided the AE has given his good graces and qualified the opportunity, we’re now ready for the demo. Let’s take a look at what’s under the hood. This stage is self-explanatory but key because it’s more show and less tell. Led by the steady hand of the AE, the prospect will finally have the chance to see for themselves how the tool operates.

Technicals

The software and solutions in today’s digital landscape are complex, especially SaaS. Thankfully, a Sales Engineer or Solution Consultant will come on board to walk everyone through the trickier parts of the program. At this stage, there’ll also be a technical alignment to ensure the tool integrates with any existing solutions your prospect already has.

Commercials

The prospect is now ready to pull the trigger, initiating the final stages of our pipeline. Before we close, a series of conversations will take place with procurement and finance to iron out the final numbers of the deal. There’ll be discussions on payment clauses, length of contracts, and general terms and conditions. So begins the start of a mutually beneficial partnership.

Closing

You don’t have to wait for the digital ink to dry to celebrate. Open your finest bottle of champagne and move on to onboarding.

Maintain your sales pipeline

By now we hope you have a better idea of what a sales pipeline is and how to build one. Like the sales process itself, it’ll take some tweaking and refinement. Don’t be afraid to continually audit the stages you’ve defined for your team and the actions assigned for them to take – even when meeting your sales goals.

Outperform expectations with frequent analysis. Remove cold leads to make room for new ones. Tighten up productivity by cutting out energy-sucking tasks that take time away from actual selling. But ultimately, how you maintain your pipeline will depend on how your company is run. Sculpt it according to your needs and you’ll find it’ll take very little work at all.

Interested in adding to your team or outsourcing your sales development? Sellerate can help. We excel in specialized outbound prospecting, account intelligence, and personalized outreach. We’re artisans in sales pipeline construction.

Our team is your team, so if you’re looking for talented sales professionals to identify and qualify opportunities for your enterprise, book a call with us today.