Episode 391 | The 5 Stages of Your Sales Funnel & Tools to Use At Each One

Show Notes

In this episode of Startups For The Rest Of Us, Rob and Mike talk about the 5 stages of your sales funnel and tools you can use at each stage. This episode is based off of a Ignite Visibility article, the guys give their takes on the points made in the article as well as add additional tool options.

Items mentioned in this episode:


Mike: In this episode, Startups For the Rest of Us, Rob and I are going to be talking about the five stages of your sales funnel and the tools to use in each one. This is Startups For the Rest of Us episode 391.

Welcome to Startups For The Rest Of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at building, launching, and growing software products. Whether you’ve built your first product, or you’re just thinking about it. I’m Mike.

Rob: And I’m Rob.

Mike: And we’re here to share experiences to help you avoid the same mistakes we’ve made. How are you doing this week, Rob?

Rob: I’m doing alright, I actually have a bit of an announcement to make, my last day at Drip. When this goes live, it would have been a couple of weeks since I decided to leave.

Mike: Does that mean that you are gone or you’re in the process of leaving?

Rob: No, I’m gone. It was totally amicable. Obviously this has to happen at some point. Your company gets acquired and you hang around for the transition. Both Derrick and I worked there for almost two years after the Leadpages acquired Drip and Derrick left in February. That of course got me thinking working on Drip without Derrick was less fun for me and it definitely got me thinking about plans of what I wanted to do and I started thinking about, “Hey, am I going to stick around for all of 2018?” And then in all honesty, the team came together really well.

We hired a CTO, and there’s the senior director of product who I mentioned on the show in the past really came up to speed super fast and suddenly I looked around and I thought to myself, “What am I doing here anymore? What am I contributing?” Obviously there’s value that I bring as the cofounder and as someone who’s worked on it for five and a half years. Realistically, people are kicking ass and taking names and they’re really fired up about it in the company. There’s 60 something people working on Drip now.

What I can contribute is so much less valuable than what I could when we were 5 or 10 people. Five and a half years for me is a really long time to work on anything. The longest I’ve ever worked on something before that, I had a job for two and a half years. We talked about this on the podcast, I tend to do these 18, maybe 24-month things, and then I move on to the next thing.

Drip was a long one because it was big and there was an acquisition and all that. It makes me happy, I really do—I know everybody says, “I left it in really good hands.” I wouldn’t have left if it wasn’t in good hands. This is a pretty big part of my career, I spent like a third of my career—I was doing the math—about a third of my career working on Drip. I still run several businesses and mailing lists on it, so it’s not anything that I’ll be switching away from, I still think it’s the best tool out there to do it.

We mapped out the roadmap for about a year, and there’s a two to three-year vision that we talked through. There’s all the stuff in place that I feel honestly pretty good about. But it is bittersweet. It’s always bittersweet to do anything like this because I don’t get to go in the office and I like the team, I like working with the people. That was probably the hardest part of that decision for me.

Mike: I’ll be blunt about it, you’re unemployed, is that what you’re saying?

Rob: Exactly, that is a very good way. Unemployed and unemployable is probably better. You’re right, man. Should I file for unemployment?

Mike: I don’t know if you can if you quit. You’d have to look into that but my guess is probably not.

Rob: Probably not, yeah. I’ve never even filed for unemployment in my life so I don’t know what that would be like. You’re right, man, I’m just—aside from MicroConf and and doing some writing like I’ve been talking about in the two podcasts—hanging around, taking some time off. I think I want to take the whole summer off and not do anything serious, not tackle anything. I’m still sticking by my, “I’m never doing that again,” thing. I’m not doing that again, man, I just can’t, not from the ground up, it’s just too much.

Mike: Cool. I’m not sure how this really factors into it but I’ve been meaning to bring this up for a while and I kept forgetting. I was driving downtown in the town that I live in the other day, I came across this street, it was Atwood Ave, it immediately made me think of Jeff Atwood. Then, I came across Walling Ave literally right next to it. If I come across Spolsky Boulevard without seeing Taber Street, I’m going to piss.

Rob: Without Taber Street, that’s awesome. Jeff Atwood, the man, codinghorror.com. I used to read his blog years ago. I haven’t read it in a while, have you?

Mike: I pop over there on occasion but he doesn’t blog nearly as much as he used to. The content doesn’t refresh as regularly. He still does really highly in-depth articles on various things. I was reading about the stuff he does. High performance, low power computing things that he puts together because he’s always looking for ways to improve on previous designs with lower cost and better computer parts and things like that. I think it’s a home theater PC, that he’s basically […].

Rob: I love how his pieces are really long which is very much in vogue today, but he has been doing that since he started the blog. I’m thinking his blog has been around since—I started mine in 2005 and I think we started within a few months of each other because we were in some early blogging books together and that’s how he and I ran across each other. An interesting thing, my first big speaking gig was in 2008 or 2009 and it was a business offering, it was a lightning talk, it was the PechaKucha seven-minute thing where the slides flip automatically. I was encouraged to do that by Jeff Atwood and I saw him at one of Spolsky’s events.

Remember when they used to do the Stack Overflow, Dev days, it was $99. I ran into Jeff Atwood, we have never met, and I introduced myself and said, “I’m Software by Rob,” and he said, “I love that blog,” so we connected, we had emailed before. In the back of my mind, I was super nervous going up to him because I never met him and I hold him in high regard, and I’ve never once regretted having that conversation because it really—I’ve never been to BoS, I went, I talked. A bunch of people knew who I was and I was like, “That’s weird, how did they know me?” and it was from this blog. This is early days, this was before all of the podcasts and all this other stuff.

I didn’t realize how small our community actually was. I knew I had at the time probably 20,000 readers but I didn’t realize that a huge chunk of them would be at a conference like BoS. It was a very concentrated thing. That was my first thing that then encouraged me to write a book. I don’t know, there was something about the momentum that that created. I guess the moral of that story is it has always encouraged me to do things that are really terrifying because that one move—I actually left the building, I was walking up to my car, I had seen Jeff Atwood and I left.

I’m too scared or nervous to go up to him. I walked back in from the parking lot and I walked up to him. He was in a buffet line and I just said, “Jeff Atwood, Rob Walling,” that moment, I think it literally changed my life may be a little overstating it but it’s had a pretty profound impact on the course of my professional career.

Mike: Long story short, you met Jeff Atwood a long time ago and now you’re buying roads in my town and naming them after yourself.

Rob: That’s right, indeed, sir. How about you? What’s new this week?

Mike: I recently went through a disaster. I used Chrome for my web browser, and for whatever reason, the last time I went through an update, you get that little green arrow in the corner, it’s just like click here and it will shut down everything and open up all the windows for you again. When it did that, it blew away my local cache for literally every website that I’ve ever gone to. For some reason, I have no idea why or how this happened.

All my two-factor authentication stuff went away, I had to relog-in to all the different sites that I was using whether it was Facebook or Twitter and Amazon, a bunch of stuff. It was all gone for some reason. Fortunately, I have LastPass, so it wasn’t that bad. There were some of these websites, “Use your authenticator,” like crap, I’ve got three of them, which one is this?

Rob: That sucks, dude. It nuked your two-factor authentication, I hate it when that happens, and then all the sites are slow now because it has to recache everything?

Mike: No, the sites don’t seem slow. It’s just that all my cookies and stuff are gone and I use Clicky for my website analytics and I have my own machine, I was logged into it, it excludes all my IP address information. It automatically filters out me when I visit the site and I hadn’t realized that it blew away everything until I went to check my analytics that day and realized that there were tons of actions and “visitors” on there because it was me doing a bunch of testing on it so all my stats for that day are totally screwed up.

Rob: That’s a bummer, man. iOS has done that to me a couple of times where it will install an update and it nukes a bunch of my setting and I’ll be like, “Why am I not getting texts on my MacBook anymore?” and I just go into the settings, off, and it used to be on. It was on last week. I’m not quite sure why that would happen. Obviously, it’s a bug in the upgrade but it’s really irritating, certainly not as bad as what you’ve experienced but that’s a pain in the butt when that happens.

Mike: That’s the only time that that’s ever happened to me, at least that bad with Chrome, but that’s one of those things that it encourages people to not upgrade software or their devices.

Rob: To resist doing it, I hear you.

Mike: That’s why I try to really be careful about doing updates and stuff on my own software. Sometimes there’s the need to sort of break stuff on occasion.

Rob: Cool, what are we talking about today?

Mike: Today, we’re going to be going through the five stages of your sales funnel and the tools to use at each stage. This is an outline that I put together based on an article over at ignitevisibility.com and we’ll link that up in the show notes. I found it fascinating the way that they broke out the stages of the sales funnel and specifically showed different tools that you could use in each one. I looked back through our archives and we don’t have an episode on how to put together a sales funnel, or specifically what it looks like or what tools to use. I thought it would be good to go through this article and talk about what they have to say and then provide our own take on it.

Rob: Cool, sounds good, let’s dive in.

Mike: Stage one in today’s list is awareness. The basic idea with stage one is that unless somebody knows that you even exist, they’re not aware of it, of course. They’re not going to come to your website, they’re not going to download anything, they’re not going to go put their name in for a trial or sign up for a trial, they’re not going to come to a webinar, nothing. You have to make them aware that you exist to begin with.

In this stage, they put a bunch of tools that we talked about on the show in the past and the lists that are probably used in the past, things like SEMrush, Ahrefs, Buffer, Hootsuite, LinkedIn Sales Navigator, and there’s several others in there that are probably much further ahead than most people, one example is Growbots, but that’s $500 a month and they bill it annually. I think anyone who’s starting out, that’s really beyond their price range, but the basic gist of a lot of these things is that there are ways to help put you in front of people or to connect with people. If you categorize those tools, it’s really based around SEO and social media. There’s lots of other ways to find channels of customers, but those are the ones that they kind of focus on with the tools that they showed.

Rob: If you’re interested in more, this is the list of marketing approaches. This is putting together a marketing plan. You can go back to episode 384, just a few weeks back, where you and I tore down the Bluetick marketing plan. You can also read the book Traction that gives you 15 or 20 different ideas for driving traffic and SaaS Marketing Essentials by Ryan Battles. Those are the three off the top of my head that I would read if I was thinking about creating awareness for a new or an existing app.

Mike: I do want to take a few minutes to dive into some additional tools that they don’t use here or call out here and maybe that’s just because their company provides certain services and the other marketing channels are not including those. But some of the things that came to mind was paid advertising. Whether it’s Facebook ads, or Twitter ads, it’s just traffic acquisition in stage one and trying to get people to know who you are. You can also do billboard advertisements for example or you could pay to be in a newsletter that gets sent out regularly.

There’s several that I’ve seen out there where you can take $500 or $1000 and they will include an advertisement, basically a sponsorship for whatever your product is or your service to their newsletter list. And then there’s tools like Canva which helps you provide marketing collaterals that you can either publish on your website or send to people. Another option for social media would be TweetDeck which I think is offered directly from Twitter.

Rob: I believe they acquired it a few years ago.

Mike: That’s another alternative to either HootSuite or Buffer. Stage one is really just about building awareness that you even exist as an option to solve the problem that a customer may have.

Rob: Stage two is about interest. It’s finding out if a customer is interested, keeping them on your website, or getting an email address from them. This is not a full qualification when you think of qualifying a sales lead. This is really just getting one more step past, they’re on your website now, are they going to click around or opt-in to hear more from you.

Mike: One other thing that I want to point out as we go through these is that the way that they break down these different stages, it seems to me like there’s a little bit of a difference between how they would do it versus I would do it, but the basic gist of what they’re trying to do here is say that when you get past the point of where they’re aware of you, they express some sort of interest, but you still don’t know who they are as the vendor.

You have to use tools like Unbounce or Crazy Egg, or visual website optimizer to try and find out are they browsing around on your website, and are they taking an interest in whatever it is that you’re doing. That stage one are those people who you put an advertisement from, maybe they clicked through it to come to your website and then immediately bounced, or they searched for something and they get on your website and they’re like, “Nope, this is not what I was looking for.” They hit the back button.

Whereas with interest, you try to engage how interested are those people who are coming to your website in what it is that you have to offer, whether it’s articles, or educational materials, or an email list, or lead magnets, any of those kinds of things. Are they clicking around the website and actually reading? Because if they’re not, they’re not interested and they really fall in that first bucket. But if they are, you can see heat maps and things like that that will help you provide a better idea of what is going on.

Rob: Yeah. To summarize, these are people on your website who you don’t know who they are yet. Tools for this are going to be things like Google Analytics which is going to give you a lot of aggregate data. Clicky, which is essentially a competitor, one of the main competitors I know to Google Analytics, it’s real-time web analytics, and then tools for capturing that email address, obviously something like OptinMonster or Drip with its email capture widget, or Kickofflabs. Kickofflabs, they do more than just landing pages and pre-launch pages.

Mike: They have widgets that you can embed into your website that would allow people to sign up and then they can take those and they can add additional metadata to them and then send it over to whatever your marketing platform is. If you have Drip, they’ll pre-populate it based on the email address and then sent it over to you.

Rob: That’s cool, that makes sense. Sumo Media is another one that’s going to help you capture emails. I think Mixpanel and Kissmetrics at this point would also be helpful. They are designed more to measure funnels and actually maybe at this step, it would be less helpful, but I think to cover all five stages of the funnel, one of those tools that gets into—it’s not just aggregate data but you can look at individuals once they’re identified and see where they stopped.

Mike: Another good tool in this stage is Hotjar. I have an account with them, they’ve got a free account that you can sign up for. It’s pretty good if you don’t have a ton of traffic to your website, and it will give you some of that heat mapping information and show you click conversion rates where people are going to let’s say the homepage and you want to see how many people who come to the website are coming to the pricing page for example. It will show you that information.

You can also do screen recordings as people browse around your website, or on certain pages, and it will give you an idea of what people are looking at. That can be helpful for deciding what it is that you should be focusing on or what changes you should make on your website. Stage two is really about tracking what people are doing on the website and then optimizing it to help move them onto stage three.

Rob: I think Hotjar is a good tool. We’ve used it on Drip as well.

Mike: The third stage is called evaluation. I don’t like the phrasing of this solely because if you say evaluations, to me it means you’re doing a trial, but the context that they mean it in is they’re evaluating whether or not to give your tool a chance or which tool it is that they’re going to spend some time and effort looking into, whether they’re going to find a trial for it or they’re going to go to some webinars.

This is just them trying to gather more information about your tool and potentially some others to give them more information. Tools that fall into this category are things like Camtasia Studio, Jing, Wistia, Soapbox, really for capturing videos. Whether it’s a demo of your product, or a webinar, or an educational video of some kind, or even just a marketing video of the founder talking about a specific reason why he or she built the product.

For hosting those things, you want to use something like Wistia or Vimeo, you can also use YouTube. And then additional pieces of the evaluation stage is providing educational content to people. Things like ebooks fall into this category as well.

Rob: Yeah, this is that education stage where you are trying to get people to raise their hand and essentially either sign up for a trial, or sign up for a demo, or continue to ask for more information so that their lead score or their interest score rises to the point where you reach out to them directly.

Mike: As you said with raising their hands, if they do that, then they end up in stage four which is engagement. I hear the prospects have made a conscious decision that they’re interested in finding out more. I would almost say that there’s probably a few more things in between here, between stage four and stage five, because stage four, the way that they lay it out, you’re getting somebody to sign up for your email list or get on a demo, whether it’s GoToWebinar or Zoom or a variety of other webinar tools, something like Bluetick or Drip falls into this category as well.

I feel like CRMs almost fall into this category as well, into stage four because you’re gathering more information about them. You’ve had them signup for your email list and you started populating that data, whether you’ve asked them for information in a form, you’ve had them fill out a survey. Those types of things have to end up some place and the CRM is really the logical place to start putting some of that information so that you can use that information in additional marketing materials to help move them to the next step.

Rob: Some people phrase it as lead nurturing. Obviously, an email tool is going to be a really nice way to do it as well as webinars that will get you that one to many. Like you said, CRM, it depends on if you are truly a self-serve business or self service where people just come up and they sign up for a $10 a month account. Obviously, your CRM is probably your ESP; that was really jargoning. I just put two acronyms back-to-back. Your CRM is probably your email service provider.

It’s a tool like MailChimp, or Drip, or Infusion Software, you actually keep a lot of your prospect and customer data. If you have a higher price point and you really are doing some medium touch sales, then having something like a Pipedrive, or Base CRM, or Highrise, one of the CRMs I think is obviously going to be helpful, and Salesforce obviously. Something like that is really going to help move people through the funnel, and then it attracts your individual one-on-one communication, you obviously need sales people to use tools like that or get a lot of benefit out of them.

Mike: The thing I was mentioning earlier where I feel like there should be more between stage four and stage five is that, here they played stage five as the commitment in the purchase. They list a bunch of ways to take payments. Whether it’s PayPal or WooCommerce, for whatever reason Stripe is not on this list, but they have a couple of shopping carts in there as well. It seems to me like even in stage four, there’s a lot of flexibility for somebody to move forward and back in the funnel here a little bit because somebody might download an ebook for example and then you don’t see or hear from them for two weeks, five weeks, eight weeks because they got busy doing other things.

There’s a lot of circular patterns between customers who come in, they enter in your sales funnel, and then they just repeat in this area for a while before they move on. You may look at it as it just takes them longer to get from stage four to stage five. The reality is that sometimes people can regress a little bit inside of your sales funnel. You have to make sure that you have enough marketing materials in there to nurture those people along to the point that they go to that demo and ask the questions that you want them to ask or you find ways to turn them out on your own.

Rob: Yeah, I think this sales funnel that ignite visibility is in essence more of a services sales funnel because they’re a services firm. I guess it can also be a one-time purchase but certainly if you have SaaS and you have a trial, there’s a step after engagement before the purchase, and I think that’s where this is just a little bit different.

Mike: Yeah, once you get into a SaaSified version of this, then you get into that measuring the trial and seeing how many people are going from the email list into the trial and then how many people are converting from a trial into a paid customer. And then you also have to talk about things like on-boarding, and are they using certain features in your products, are they getting the most value out of it, who is using the features that will turn them into a paid customer, who’s not, how do you get them to use those features, should you make them front and center, or should you provide them a walkthrough videos inside the app.

There’s all these things that you can measure in that area. It could get complicated but it’s very specific to whatever your app is because what somebody does in Bluetick for example is going to be very different than what somebody does in Drip, or any countless other applications in order to be successful with that product.

Rob: Right, and in terms of measuring what people are doing in the product, Hotjar like you said can do a lot of things. I know that Crazy Egg, you can do in-app heat maps. Do you know of any other tools off the top of your head that help you kind of be aware of it? It’s almost in-app analytics and metrics.

Mike: One I would take a look at is probably Segment. You install Segment and there’s a developer edition or a developer tier that is in the people with less than a thousand what they call MT Uses monthly, transactional users or something like, that but monthly total users. What it does is if you have it in the app and you’re only using two data sources they say, then it’s free. Otherwise, it’s $100 a month and the monthly total users could actually kill you depending on how much traffic you have.

If you put it on your website and you’re using that as a source, if you get 10,000 unique visitors a month, it’s counted as 10,000 MTUs. Depending on how big your business is, that could get expensive. But if you’re just doing it in the app, then you’re trying to pinpoint things and optimize things inside the app, you can send the data into Segment, and then from there, you can take a look at another product called Amplitude—which is amplitude.com—and that allows you to take information that comes directly out of Segment or get a JavaScript snippet that you could plug-in and it will allow you to track people through your app and what they’re doing.

Their product is free as well until you get to something 10 million events per month. You have to be fairly large in order to hit their pricing tier but I would imagine once you get to that, it’s going to be really expensive, but if you’re at that level, it’s probably going to be worth it for you because it allows you to drill in and see exactly who is using which features, how much they’re paying, and you can have all that data piped in through Segment from your website or from your backend database and through to Amplitude.

Rob: Very nice, I haven’t heard of Amplitude before so that’s a cool little stack that you hacked together there. We’ve used Segment for years but getting it into those other data analysis platforms I think is probably a head kicker and a real value there.

Mike: Yeah, Amplitude, I just found out about it recently so I’ve been looking into it. It’s interesting to see some of the dashboards and stuff that they have available. It’s an example so you can just see who is using what in your app and how much they’re using it, it gives you real time data so that you can take a look at who’s doing what today, and how many times have they performed this action, or how many times does this thing happen in the background? You can use those customized dashboards to help you make decisions about your own product versus some off the shell tool like Crazy Egg which has one very specific use case, to see where people are clicking. Yes, you can do other things but the dashboard allows you to customize a lot of things and create one that is specific for your own app.

Rob: Cool. To recap the five stages of your sales funnel, number one is awareness, number two is interest, three is evaluation, four is engagement, and five is commitment. If you have a question for us, call our voicemail number at 888-801-9690 or email us at questions@startupsfortherestofus.com. Our theme music is an excerpt from We’re Outta Control by MoOt used under Creative Commons. Subscribe to us in iTunes by searching for Startups. Visit startupsfortherestofus.com for a full transcript of each episode. Thanks for listening. We’ll see you next time.

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