How to use a CRM for sales pipeline management

By Josh Bean, Director, Marketing

Published March 23, 2020
Last updated February 5, 2021

The basic idea of sales pipeline management is to estimate the upcoming sales you’re aiming to close. Without proper pipeline management, you could be missing profitable opportunities. Do you know how many qualified leads are converting? Have you overlooked deals that are now lost? How many deals are worth pursuing?

Over time, poor pipeline management can also cause inaccurate sales forecasting, which affects critical planning information, such as resource allocation and budgeting. Revenue growth can suffer as a result. As you can see, an inaccurate and poorly managed sales pipeline can eventually lead to the self-destruction of a business.

To avoid the pitfalls of poor management, you need a standardized sales process that includes defined steps for each stage of the pipeline. It also helps if you have a sales CRM that can be used as a pipeline management tool, automating the process and keeping each sales rep on the same page.

With that in mind, we’ll go through the seven steps you can follow to create an effective sales pipeline management process, while also looking at how a sales CRM can be a beneficial pipeline management tool in each stage:

1. Find your sales prospects.
2. Determine true lead potential.
3. Identify decision-makers.
4. Follow up.
5. Measure results.
6. Analyze results.
7. Update your pipeline.

What is a sales pipeline, and why is it so important?

First, let's take a moment to consider what a sales pipeline actually is: simply put, it’s a visual representation of where prospects are in the sales cycle, whether that’s in the prospect stage or just about to sign a deal. It’s important to note that while some people use sales pipeline and sales funnel interchangeably, they’re not the same thing.

Creating a pipeline with a sales CRM

1. Find your sales prospects

Finding prospects is always the first stage of the sales process. In addition to cold calling and emailing, here are a few ideas a sales rep can use for finding new prospects:

    Lead capture forms collect information from prospects who visit your website and would like more information. The Sell sales CRM enables you to create and embed lead capture forms that can be displayed on your website and Facebook page.

    Social media can be used to engage with leads, whether that’s by responding to their comments or answering their questions on platforms like Twitter and Facebook. Through these interactions, you can pick out potential customers that may be worth pursuing. You can also use social media platforms to message individuals you believe could be potential clients.

    A content marketing strategy that’s aligned with sales is a great way to generate interest and attract new prospects. Blog articles, ebooks, and thought-leadership pieces all provide useful information to your target audience while giving you a platform capturing reader contact information. Work with your marketing department to develop content that will appeal to your target persona.

Sales prospecting doesn’t have to be difficult. With the above tactics and a clear prospecting strategy, you’ll be set to attract more high-value leads.

2. Determine true lead potential

The next stage is qualifying leads to determine how they should be prioritized. To gauge a prospect’s value, calculate their potential total sales dollars and volume for a specific period (weekly, monthly, annually, etc.). You’ll have to use the data you have about the prospect and past customers to estimate how much their company can spend on your product or service (or contract, if you’re a subscription-based company).

Determining the potential of leads isn’t an exact science, but you can score them effectively by following a clear process. Learn more about reliable lead scoring with this resource from Sell.

If you have a sales CRM, you can use the tool’s lead scoring feature to partially automate the qualification process. By setting up a scoring system in your CRM, it will know when to qualify a lead. If a lead scores highly enough due to its characteristics, it will become a qualified lead, and your CRM will notify you.

3. Identify decision-makers

In some cases, your contact may be the decision-maker. But many times, purchasing decisions are made by the executives managing your contact.

Asking your contact about the key decision-maker(s) at their company can be awkward, but it doesn’t have to be. Try softening your approach: Let the client know that this purchase would represent a significant expenditure for your company and would need executive approval. Once you’re on the topic, ask if that’s their policy, too.

All of the information you get on key decision-makers should be stored in your sales CRM. Names, contact information, and previous conversations can all be documented.

Using a sales CRM as a pipeline management tool

4. Follow up

Follow-up is an incredibly important stage of the sales pipeline, and can be as simple as this:

  • Send an email to your contact, thanking them for their time and summarizing the next steps.
  • Call the prospect to see if they are still interested.

Document all follow-up actions you agreed to complete for all clients and prospects in your sales CRM. Add a description of the action required, a contact name, and an estimated date of completion for each action item. Then, track and complete those actions accurately and within the agreed-upon time frame.

It’s especially important to follow up promptly after the first call from a potential client. They likely have sales offers from competitors that they’re considering, so you may lose their business if you wait too long.

5. Measure results

For each prospect, track and measure your successes (and failures).

Tracking the results of your sales pipeline—especially in a sales CRM—helps with accurate sales forecasting later on and gives a better idea of future revenue. Whether you're a sales manager or a salesperson, you should be reviewing metrics that give you an idea of pipeline health, sales activity, and stage conversion rates.

Here are a few examples of important metrics sales management should track:

    Win rate: The number of qualified leads that turn into customers. Track this on a month-to-month or quarter-to-quarter basis so you can measure change over time.

    Lead-to-qualified-opportunity conversion rate: How many of your leads are becoming qualified? Are your qualification standards too high or too low?

    Average sales cycle: A measure of how long it takes to close a deal. Once you know your sales cycle length, you can identify the deals that are stagnating in your pipeline.

    Sales velocity: A combination of conversion rate, average deal size, sales cycle length, and the number of opportunities, this metric looks at how fast leads go through your pipeline and how valuable they are to your business. Sales velocity helps you determine what pipeline stages need attention and how you can quickly close more deals.

If you have Sell as your CRM, you can use the stage conversion report to identify sales stage conversion rates for each of your team members.

6. Analyze sales pipeline reports

This stage is for reviewing the efficiency and effectiveness of your sales pipeline management process. Use your CRM to check the data and determine which processes are working and which ones aren’t. Repeat the paths that have won sales, and avoid the actions that lost deals. Consider these questions:

  • At what stages are deals getting stuck?
  • Based on the data, what are the current risks?
  • What specific actions can we take to improve our opportunity conversion rate?
  • How frequently and effectively do we follow up?

Review data regularly. Always be looking for opportunities to make improvements to your strategies. Share what works and what doesn’t with your sales force, and, if necessary, update your standardized sales process.

7. Update your sales pipeline

Regularly clean your deal pipeline to ensure that you’re throwing out the bad prospects. It’s easy for leads that aren’t worth pursuing or have gone over the average sales cycle to start cluttering up your pipeline. Consistently audit your pipeline, asking yourself specific questions. For example:

  • Are there any bottlenecks (stagnant leads)?
  • Are there any dead or low-opportunity leads that I can remove?
  • Are there any communications that should be updated?

Also, use your sales CRM to keep opportunity contact information up to date. And don’t let it get too messy—for the best results, you should clean your pipeline either daily or weekly. Everything will be more accurate, and you won’t get overwhelmed at the end of the month.

A good sales CRM is the ultimate pipeline management tool

Successful businesses create and track clients and prospects in their sales pipeline. And the best way to do that is with a sales CRM that allows you to track your information by month, quarter, or year, tracking all the relevant data with none of the endless, repetitive spreadsheets.

And with a sales CRM, you can measure the sales dollars and closure rates of potential sales and then analyze the results to help you manage and, most importantly, continually improve your sales pipeline.

Learn more about Zendesk Sell here.

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