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The strength of your sales pipeline affects how much revenue you'll make this week, month, or quarter.
You need to know how to manage it, measure performance, and ensure it never runs dry.
In this guide, we'll walk you through exactly what a sales pipeline is, key stages in your pipeline, metrics to measure how effectively leads move through your pipeline, and more.
By the end, you'll be able to add structure to your sales function, enabling you and your team to engage with more warm, qualified leads, and close more new business.
Let's jump in.
What is a Sales Pipeline?
A sales pipeline is the method you use to track prospects through every stage of their buying journey, from cold prospect to paying customer.
The exact steps in your sales pipeline will depend on how your sales process works. The key is that you and your team can use it to keep track of where every prospect is in the buyer journey, and what actions are going to happen next.
The best way to get a clear overview of your sales pipeline is with a CRM.
Sales Pipeline vs. Sales Funnel vs. Sales Forecast vs. Sales Process
We're going to refer to most of these terms in this post, so it's worth clearing up the differences.
We already know what your sales pipeline is: the steps your leads go through in your buying process.
Here are what each of the other terms refers to:
Sales funnel: A term used interchangeably with sales pipeline, but it generally also includes steps that occur before a prospect enters the pipeline your sales team uses on a day-to-day basis.
Sales forecast: An estimate of how many new customers you'll close, and how much revenue you'll make over a set period of time โ typically measured on a monthly, quarterly, and annual basis.
Sales process: A bigger picture view of the activities and tactics you're using to engage with new leads and turn them into customers.
6 Key Stages in Every Sales Funnel
Your sales pipeline will work best if it's structured, and you always know where prospects are in the sales process.
The exact number of steps you track prospects through will vary depending on your business model and unique sales cycle.
Generally, the higher the average contract value, the longer the sales cycle, as more decision-makers will be involved, and your prospects will need more convincing.
But, the typical sales pipeline stages include:
1. New Opportunity
Opportunities are any prospect that you think is a good fit for your business. You may not have contacted them yet, or, they might have already filled out a contact form on your website showing interest.
At this stage, you don't know if the prospect is a perfect fit for your business but they're worth considering.
2. Lead Contacted
After you reach out to a prospect with a cold email or replying to their inquiry, you'll move them into the Contacted stage of your pipeline.
Typically, one person in your company will take responsibility for the prospect at this stage and no one else will reach out, as you know someone is in touch with the prospect.
3. Conversation Started
Once you've started a conversation with a prospect, you'll move them to this stage of your pipeline. It's an active stage and your team will need to keep tabs on the conversation, with the goal of moving your qualified lead towards booking a meeting or taking the next step.
4. Qualified Lead / Meeting Booked
If you qualify prospects on a discovery call or meeting, you'll need to confirm that with them. Once it's confirmed, move them to this stage of your pipeline.
If you can qualify your potential clients without a meeting, that works too โ but make sure you have clearly defined criteria for what a qualified lead looks like for your company. If not, you'll end up filling this stage with leads who show interest in your product/service but are never going to buy because they're not qualified.
5. Proposal Sent
If the initial meeting and conversations have all gone smoothly, it's time to send over your proposal.
Once you've sent your proposal, move your prospects to this stage of your pipeline. You and your team will know that you're waiting to hear back. If a prospect is in this stage for too long, you can follow up to make sure the prospect doesn't forget to review the proposal and encourage them to make a decision.
6. Deal Won / Lost
When the proposal has been signed and your prospect has turned into a paying customer, you can move them to your "Won" stage of the pipeline.
If your prospect decided not to move forward for now, you can move them to the "Lost" stage of your pipeline. Some prospects may not want to move forwards immediately and may ask you to check back in with them six months later. If that's the case, make sure to note that the deal isn't completely lost, and someone needs to reach out again in the future.
The exact names and stages you need in your pipeline will vary based on your business, but in general, most will follow a process similar to this.
Best Practices to Manage your Sales Pipeline
You and your sales team need to manage your sales pipeline to ensure it stays up to date. If you let standards slip you'll struggle to prioritize the leads you're engaging with, losing opportunities in the process.
1. Run a Weekly Sales Pipeline Review
Set aside an hour each week, either on Monday or Friday, to run through each opportunity in your pipeline. For every lead you're tracking in your CRM, ask yourself questions:
Is this lead in the right pipeline stage?
Who last followed up with the lead?
Are they still qualified and worth pursuing as a sales opportunity?
You don't need to spend much time on each lead, and most companies will be able to run through every lead in their pipeline in under 30 - 60 minutes.
At the end of each week, you'll know exactly which leads to prioritize and take action on.
2. Put More Effort Into Your Prospecting
The biggest lever you can pull to improve your sales pipeline is putting more effort into your prospecting and only engaging with leads that you know are a great fit for your services.
Even if this results in you contacting fewer prospects each week, you'll get more replies to your outreach emails, and more meetings booked, as everyone you email has already been qualified by you or your sales reps.
The more targeted your prospecting is, the lower the total volume of opportunities in your pipeline youโll likely have. This is a good thing, as it shows you're not pursuing leads that arenโt a fit for your product/service. In turn, this targeted approach will make your ongoing pipeline management more straightforward, as you wonโt need to filter through bad-fit leads every week.
3. Automate Repetitive Tasks
You can't spend hours per week on low-value tasks like moving prospects from one stage of your pipeline to the next in your CRM.
To win back your time, find ways to automate repetitive areas of your sales pipeline management.
For example, if you're running cold email outreach campaigns to your prospects using QuickMail, you can connect your campaigns to your CRM, like Pipedrive, using Zapier.
Whenever a prospect replies to your email, a new Lead can be automatically created in Pipedriveโ eliminating the need to go there and add it yourself.
Other useful automation opportunities include:
Create a new Deal when someone clicks a link in your QuickMail email (such as a case study link or proposal)
Update a prospect if your email bounced (to let your team know they need to find new contact details)
You can create powerful new workflows to automate your repetitive tasks within minutes, saving you and your team hours every week.
4. Set Reminders for Important Tasks
Even if you're working with low lead volume, staying on top of your sales pipeline can still become cumbersome.
You can't rely on yourself or your team to remember to follow up with a lead next Thursday, and if one of your team takes a few days off, you can't let the leads they were talking with fall out of your pipeline.
To avoid these problems, it's essential that you set reminders for every task you need to do.
Even if a task sounds trivial, such as sending an email reminder to a lead to review their proposal, you can't expect to remember it when you're busy on other tasks and projects.
All good CRMs let you set due dates for tasks, so take advantage of them.
5. Don't Be Afraid to Disqualify Leads
Another best practice is to disqualify leads that don't fit your ideal customer profile.
It's tempting to fill your pipeline with as many leads as possible. But, if someone isn't a good fit for your product or service, your time is better spent identifying and engaging with leads that would be.
Even if you can close a deal with a lead that isn't a perfect fit, they're not going to be completely satisfied with your product/service and it won't be long before they cancel their contract and leave.
Being able to actively disqualify leads from your sales process will help you and your team stay focused on the deals that matter and avoid wasting your time, and your prospects' time.
5 Useful Sales Pipeline Metrics to Measure
1. New Opportunities per Period
One of the main metrics to track how effective your sales efforts are is the number of new opportunities you're getting over a set period (week, month, quarter).
In general, you want this number to be highโ as long as each opportunity is with a well-qualified lead.
If you're not seeing as many opportunities as you need to regularly close new customers and grow your business, then you can find ways to improve your sales and marketing to ensure your pipeline never runs dry.
2. Pipeline Conversion Rate
Your pipeline conversion rate tells you how many opportunities you're successfully moving to the next stage of your pipeline.
If you're seeing a high number of opportunities but are struggling to move leads through your pipeline, then there are a few potential causes:
Your marketing is attracting the wrong type of customer (making it harder for sales to engage with them)
Parts of your sales process isn't effective
Both of these problems can be solved, but you won't know they're a problem unless you're tracking your pipeline conversion rate.
3. Average Sales Cycle Length
This refers to the time it takes for the average lead to move through your sales pipeline, from the moment you first reached out and they replied, until they signed a contract with you.
It'll help you predict sales cycle length and forecast for future growth.
To calculate it, use the formula:
Total number of days to close deals / Number of closed deals = Sales Cycle Length
If your sales cycle length is long, you can work on ways to improve it:
Improving communication with leads
Automating follow-ups and manual tasks
Setting reminders to encourage your team to take action faster
4. Lead Velocity Rate (LVR)
This metric shows you if your sales opportunities are growing month-over-month.
It's arguably the best indicator of your growth rate.
To calculate it, use the formula:
(# of qualified leads this month - # of qualified leads last month) / (# of qualified leads last month * 100)
If your LVR is growing, it means every month you're seeing more leads enter your pipeline. If it's declining, you know you have work to do.
5. Total Pipeline Value (By Stage)
Another useful pipeline metric to forecast future growth is your total pipeline value by stage.
Using your average deal size, you can quickly add up how much potential value is locked up in your pipeline at each stage.
It's useful to understand as it helps you make hiring and new purchase decisions. For example, if you have $50,000 of potential sales at the proposal stage in your pipeline, but you know you don't currently have the bandwidth to handle it, you can make proactive decisions to hire new team members to help you fulfill those contracts when they close.
You can also use it to spot times where you don't have enough sales opportunities entering your pipeline and use that information to kick off new sales campaigns.
How to Fill Your Sales Pipeline Using Cold Email
If you want to ensure your pipeline is always full of qualified leads, cold email is one of the most powerful channels available.
Your sales team won't be reliant on inbound leads, and you can connect with decision-makers in the one place they check on a regular basis: their inbox.
Finding Good-Fit Prospects
Firstly, you'll need to prospect for new customers. Use channels like LinkedIn to identify prospects based on their company size and hiring trends, or use tools like BuiltWith to identify leads based on the technology they're using on their website.
Writing Cold Emails That Get Replies
From there, create personalized email templates for every person you're reaching out to. We'd recommend writing a custom opening line that's unique to each person, then, using attributes like {{prospect.first_name}} and {{company_name}} in your templates to make each email as personalized as possible, but still giving you the ability to send emails at scale without needing to type out each one out manually.
For example, in this email example from Cold Outreach Templates, the sender will have sent a similar email to multiple prospects, but thanks to the custom attributes, each recipient will have had the email customized to them and their business.
At the end of your email, use a call-to-action focused on starting a conversation, such as:
Do you have time for a quick chat on [day]?
Is this a problem you're trying to solve?
Sending Cold Emails at Scale with QuickMail
If you're ready to start sending cold emails, QuickMail is for you.
Our platform lets you send personalized cold emails that land in your prospects' primary inbox, and automate follow-ups, so you can scale your sales without spending all day in front of your inbox.
Import your prospects, write your emails, and you're ready to go. Every day you'll wake up to new qualified leads, and if you've linked QuickMail to your CRM using Zapier, you'll see your pipeline filling up without needing to update anything manually.
Send your first campaign with a risk-free 14-day trial.
Key Takeaways
Your sales pipeline is a key indicator of how healthy your sales function is. If it's regularly filling up, you're in a good spot. If it's drying up, you know it's time to ramp up your sales activities and start talking with more prospects.
Use the tips in this guide to set up your pipeline in your CRM, and manage it effectively. With effective pipeline management, you'll know precisely where every sales lead is in the buying journey and can predict whether or not you'll hit your revenue goals.
