What Is a Sales Funnel?

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A sales funnel -- also referred to as a sales and marketing funnel -- is a graphic illustration of the steps consumers take when considering a purchase. The theory of the sales funnel is that sales representatives should design their efforts around specific steps a customer takes in his decision-making process.

Funnel Parts

Traditional funnels have at least four key parts: awareness, familiarity, consideration and purchase. Many companies add a post-sale element -- loyalty -- to the funnel to secure repeat business or generate referrals from satisfied customers.

Part Activities

Consumers first become aware that a product or service exists, perhaps from an advertisement or sales cold calls. The salesperson then works to make them more familiar with the product and ideally presents enough compelling information to get them to purchase the product. The business then follows up with a customer service or loyalty program.


Funnel Changes

Some analysts and experts believe the sales funnel is morphing or even becoming obsolete. It has become easier for consumers to conduct their own research on the Internet without having contact with any salesperson. Many consumers consequently deliberate longer as they consider a wide range of product choices.