Myths say “Revenue Generation” success is a result of filling the top of the funnel, which is pictured 5 to 10 times wider than the exit and shows 4 to 10 levels of activities in the funnel.
The myths infer if we do something that fills the top of the funnel (the funnel is not filling itself or we would not be having this conversation) then the 4 to 10 activities will flush deals out the small bottom of the funnel.
Gravity has taught us that the right things put in the top of the funnel just run down and out – right?
For Gravity, just like the business world, that picture of things flowing from the top and running out is not always true:
- The exit always is a critical factor in what can or cannot flow out.
- What is put in the funnel may not flow out at all, the size of the exit will always determine what CAN flow out, and the exit speed (pour in large stones and they don’t come out – pour in sand it comes out – pour in wet sand it may or may not come out depending the size of the exit).
- In the case of wet sand if someone has a tool (the 4 to 10 activities working in an aligned way) they can push more wet sand through the exit than just waiting for the sand to be ready to exit.
There are many reasons the funnel pushes business leaders into decisions that may work in a buyer frenzy bubble (feeding the myth) while spiking both the short-term and the long-term “Cost of Chaos” that gets recognized and becomes problematic when the bubble bursts.
Here are three important reasons why just fixing the Lead-Gen activity of filling the top of the funnel may not only not improve sales but may damage the business.
1. Filling the top of the funnel alone does not help manage or improve the flow out of the funnel?
- The goal is not a lot of leads at the top (that eat resources and get qualified out), but the right number of the right type at the right time to get as close to 100% qualified and closed by available selling resources as possible.
- Often the top of the funnel is only a list of targets which requires an investment in sorting out those worth processing. The top of the funnel must be more than the yellow pages.
2. The reason the top of the funnel must be the right amount of the right type of suspects at the right time is to move through the funnel at the maximum speed. This requires the qualifying and selling resources to be able to handle each lead as developed to the best possible outcome at the highest speed.
- When the top of the funnel is large do you want to invest money to do a great job processing bad leads to find the good leads and then invest more money to fill the top of the funnel with more leads to process hoping to find good leads?
- Building a big top to the funnel process to find the right number of the right leads is the most expensive investment you can make before there is offsetting revenue to support it. Every investment needs a justifying return, so how does a full top of the funnel assure that return when the funnel exit is so small?
- What if the top of the funnel has more volume than the selling investment can effectively process? What are the impacts beyond backing up the funnel and wasting the lead-gen dollars (quality, brand, order takers, etc.)?
3. The goal is the ability to control the right stuff, exiting the funnel at the right velocity, for the right investment.
- From an investment standpoint, do you want a funnel with massive investments in programs and people at the top or do you want a pipe (not a funnel) that can expand and contract with changes in the market requiring the right investment for the right flow no matter what happens in the real world?
- Do you want the right amount of the right stuff coming out (the funnel or the pipe) or do you just want enough to keep the doors open?
- What are the differences between the right amount of the right stuff coming out (the funnel or the pipe) or just wanting enough to keep the doors open as applied to:
- The ability to hire the right people
- Margin
- Brand
Today the image of the funnel creates more problems than it solves. Buyers don’t get poured into a funnel. Today buyer’s opt-in for their reasons and the business is responsible to help the right buyers to opt-in at the right volume to fill a “pipe-line” (not a funnel) that can expand and contract with changes in the market.
The “pipe-line” investment is focused on how to make it easy for the buyer to select the seller based on the value for the buyer. Those 4 to 10 funnel layers may represent functions that help the buyer select the greatest value possible in solving their problem or they may not. Anything in the pipe that restricts the buyer making a decision needs to be removed or replaced.
You can’t just fix the funnel’s Lead-Gen – you need to replace it with opt-in to the open end of the pipeline and help the buyer move to a value based buying decision or get out ASAP so both of you make the most money possible in the shortest possible time.