Where do we lose 70% of customers? WebCanape sales funnel
Today we want to share the numbers with you. Namely, a real sales funnel for WebCanape for 2014. The numbers of many of you will surprise how surprised me in the initial analysis of the data. Today, there is still no exact answer as far as this corresponds to the industry of developing budget sites, but there are thoughts and plans to increase conversion that I want to share with you. I will be glad to comments and advice from colleagues regarding your and our indicators.
So, here is a sales funnel in the direction of "Website Development". In parentheses is the percentage of all applications received that have reached this stage. The data are relevant at the end of 2014, but gradually (already slightly) change upwards, as contracts continue to grow together.
|Month||Applications||KP exposed||Harmonization of contract||Payment|
| January|| 127|| 81 (64%)|| 35 (28%)|| 31 (24%)|
| February|| 105|| 59 (56%)|| 28 (27%)|| 24 (23%)|
| March|| 85|| 62 (73%)|| 27 (32%)|| 25 (29%)|
| April|| 125|| 81 (65%)|| 37 (30%)|| 29 (23%)|
| May|| 85|| 67 (79%)|| 34 (40%)|| 27 (32%)|
| June|| 73|| 54 (74%)|| 26 (36%)|| 24 (33%)|
| July|| 92|| 67 (73%)|| 36 (39%)|| 30 (33%)|
| August|| 70|| 52 (74%)|| 29 (41%)|| 27 (39%)|
| September|| 73|| 55 (75%)|| 22 (30%)|| 17 (23%)|
| October|| 117|| 85 (73%)|| 39 (33%)|| 33 (28%)|
| November|| 79|| 59 (75%)|| 30 (38%)|| 25 (32%)|
| December|| 79|| 69 (87%)|| 35 (44%)|| 30 (38%)|
|Total (Avg . )||1110||791 (71%)||378 (34%)||322 (29%)|
Total quality applications for the development of the site came 1110 pcs. This is approximately 3-5 applications per working day. No advertising costs, no cold sales, natural demand. Accordingly, seasonality can be estimated. It is practically nonexistent. Approximately 50% comes by recommendation, 20% - through search, 20% - through links from the basements of the site, 10% - articles, etc.
Now the most important thing. The average total loss percentage at all stages of sales is 70%. I think this is a lot. 70% of the manager’s efforts are wasted. In a crisis, this is an inadmissible luxury. What is the reason for such losses and how to minimize them, we tried to figure it out.
This stage is organized as follows. Upon receipt of a request from a client (by phone, e-mail or via the website), an online brief is sent to him automatically or manually (when making a call) from our CRM. When the client completes the brief, the manager will receive a notification that the brief is filled. After that, the manager prepares a proposal and sends it to the client for approval.
Automatic briefing is good because the client does not wait until the manager reaches his request and sends him a questionnaire. At the same time, the manager is not distracted by the initial client requests and sequentially prepares the CP in the order of incoming completed questionnaires.
It was verified that such automation makes work uniform and allows one qualified manager to cope with the entire flow. This significantly reduces the cost of sales, which is very important in the segment of low-cost sites.
Everything would be fine, but, as can be seen from the statistics, at this stage we lose 29% of customers.
- the client simply did not receive the form of our online brief;
- the client did not fill out the brief, because the form seemed complicated to him, but there was no time to fill out;
- competitors made a super-free offer, and it makes no sense to fill out a WebCanape brief;
- the client filled out everything, but we did not start preparing the proposal, as we see that our decisions do not suit him.
What to do?
The task of the sales manager is not only to sell, but also to screen out non-core or obviously unprofitable requests. There are no more than 5% of them. There remains 25% that we are losing.
We can’t refuse the questionnaire, because it helps the manager to more accurately and fully prepare a commercial proposal, and to the client - to put together a bunch of thoughts and formulate a goal. Moreover, CRM always has information with a primary request, which helps a lot when transferring a project between managers.
As a result, you need to solve the first two problems. So far we have found a simple solution. We plant a student-intern who will call up the client immediately after the application is received, find out if he received a brief, and help fill it out. The student's task is to form a lead in the form of a completed questionnaire for the sales manager.
From quotation to contract
At this stage, we lose another 37% of customers. Losing customers here is already becoming expensive. If the sales manager made the decision to prepare the CP for the client, then this is definitely our client. At the stage of preparation of the KP, the composition of work, the structure of the site, the features of the functional, so to speak, “mini-TK” are being worked out. This is already an expensive process for the company, which should lead to a contract. Why doesn’t this happen in 37%?
A study of the situation showed that 90% of customers at this stage are not satisfied with the price. Where is cheaper already? The fact is that in the budget range where we work, customers often order a site for the first time and have no idea how much it can cost. As a result, even an amount of 20-30 thousand may be high for them and not meet expectations. Of course, they find it cheaper.
How to effectively deal with such objections, we have not yet learned. And is it necessary? 37% of losses tell me what is needed, and project managers say not. We take 3 months to correct the situation.
Another small% at this stage is consumed by a separate layer of customers - bureaucrats. It is they who, having agreed on a commercial proposal, pass the contract to a lawyer, who can greatly slow down the process or even block it. Since we work with small budgets, any violation of the standard process (for example, amending the contract) raises the question of the profitability of the project. In this regard, part of the budget goes to non-core work, which already makes the continuation of work on the project inappropriate for the studio. The project became unprofitable without starting. :)
Unfortunately, we have not yet come up with a better way than to refuse to amend the contract. Here we will not change anything yet.
From contract to payment
Losses at this stage, although small (they make up only 5%), are already very expensive. Why do customers fall off at this stage? Almost all cases are associated with a change in the executive on the client side. The executive officer quit, but the director does not have time or plans have changed. The new artist found a new contractor, etc.
You don’t think about losses in the work flow, and when you look at the report at the end of the year, you understand that you are losing.
The goal of at least 2015 is to increase sales conversion by 10%.
An increase of 10% will allow:
- Raise the company's revenue by 10% per year.
- To reduce losses on the study of more than 100 proposals, this is approximately
- Add to the piggy bank 100 new customers who are ready to use other services
We can evaluate the first results after 3 months. We are pleased to hear your opinion and experience. How are things with the sales funnel?
Vasily Churanov and WebCanape team