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The How and Why of Sales Funnel Management

Sep 21, 2022
5 min read
Sales funnel management is an essential part of your overall sales strategy. It gives you control of the buyer experience you provide, helps you move leads effectively down the funnel, and ensures every prospect receives the right communication at the right time across every stage.

From a revenue perspective, sales funnel management can reduce lost sales, increase efficiency, and accelerate sales velocity.

You might be thinking: This all sounds great, but what does sales funnel management actually entail in practice? How is it different from other key activities like managing the sales process or analyzing the sales pipeline?

In this article, we’ll clarify these questions and more. Read on to learn the definition of sales funnel management, why companies need it, and 5 best practices that drive its success.

Quick Takeaways

  • Sales funnel management involves managing each individual prospect as they move through the sales process.
  • Marketing and sales alignment is key to sales funnel management, especially during beginning stages when leads are passed from marketing to sales.
  • A defined sales process and standardization measures promote stronger sales funnel management execution and more consistent performance reporting.
  • CRM systems and other sales management software is essential to automating and tracking important components of the sales funnel management process.
  • Standardization of sales strategy execution is essential for higher efficiency and accurate performance reporting (among other benefits).

What is sales funnel management?

Sales funnel management is the process of managing each individual prospect as they move through the sales process. To really understand what that means, it’s important to clarify the difference between some sales-related terms we refer to often:

  • The sales funnel refers to the stages your buyers move through as they complete the buyer journey. When you think about the sales funnel, think about an actual funnel shape. The wide mouth at the top captures a high volume of new leads showing initial interest, then the funnel becomes narrower as the stages progress toward purchase.
  • The sales process refers to all of the activities your sales team performs in order to move leads through the buyer journey and ultimately close the sale. Your sales process should be defined and shared with your sales employees, who should then follow it closely.
  • The sales pipeline refers to the total amount of leads and opportunities that exist across your entire sales funnel. Sales pipeline management refers to the process of keeping your pipeline full of new leads and keeping it balanced across each stage.

So — back to sales funnel management. Sales funnel management involves the activities in your sales process designed to actively manage individual leads in your pipeline, ensuring they move to the next stage successfully and that no lead falls through the cracks along the way.

Sales funnel management activities include initial outreach to a new lead, discovery calls, lead nurturing campaigns, potential client presentations, live product demos and more.

Why do companies need to do it?

Thanks to today’s technology, there’s a nuanced balance that exists between automating and streamlining the sales process while providing the level of personalized communication required to close a sale.

Sales funnel management works specifically to maintain this balance.

It encompasses the type of automated, mass communication tactics that keep the sales process moving (think triggered lead nurturing campaigns or email newsletters to sales prospects) as well as the individualized interactions that build connection and close the deal (think discovery calls, tailored emails and presentations, and 1-on-1 product demos).

Without sales funnel management, leads would be more likely to be forgotten, fall through the cracks between stages, or otherwise feel unsatisfied with their experience with a company. On the other hand, strong sales funnel management leverages automation for high efficiency while still maintaining personalized outreach with each prospect.

Let’s look at some of the specific sales funnel management practices that make it possible.

5 Sales Funnel Management Best Practices

Marketing and sales alignment

Marketing and sales alignment is a critical component of sales funnel management. This is particularly true in the funnel’s beginning stages, when leads need to be qualified and passed from marketing to sales in a way that is seamless from the buyer’s perspective. 

When marketing and sales teams are aligned, their roles are clearly defined and understood. The two teams are able to communicate effectively about lead qualification and seamlessly execute the handoff process. In the end, this creates a smoother experience for the potential buyers in your pipeline.

Defined sales process

Clearly defining the sales process for your sales employees ensures that important steps related to sales funnel management aren’t missed, and that each team member is held accountable for their role in its execution.

To define your sales process, first be sure your sales leadership is clear on the steps it includes. Once they are, create accessible resources outlining the process for your sales team, and include it in sales onboarding and professional development programs. Enforce it consistently so that the process becomes second nature to your sales employees.

Sales management software

CRM systems are ubiquitous in the sales world and for good reason — they’ve become essential to executing a strong sales strategy. Leverage your CRM system to its fullest potential to support sales funnel management, ensuring your sales employees know how (and do) use it throughout the entire sales process.

Things your sales employees should be using CRM systems to do as it relates to sales funnel management include: automating communications and updates, tracking leads by funnel stage, identifying signs that a lead needs special attention, and marking actions complete.

Even better, integrate your CRM with comprehensive sales management software tools to stay confident in your sales funnel management planning and related resource allocation.

Funnel-specific efforts

A foundational to sales funnel management success is a funnel-specific approach to buyer engagement. It’s important to not only keep in mind that buyers in different stages have varying levels of intent, but that they need different types of information.

A new lead, for example, needs introductory information about your company and offerings, while an opportunity ready to close needs things like pricing and implementation plans.

This means your sales funnel management strategy must tailor communication not only by individual lead information (i.e. industry, business needs, etc.) but also by funnel stage and the level of intent that exists there.


Last but not least is high levels of sales standardization. We hear a lot today in the sales world about personalization, and it certainly is an important part of sales funnel management today. But it shouldn’t happen at the expense of a standardized, well-executed sales strategy.

In other words, individual sales reps should not be deviating from the sales process, brand messaging, or other best practices in their own attempts to meet buyer preferences. Doing so leads to inconsistent sales execution and the likelihood of chasing leads unlikely to convert.

Keeping your processes, sales enablement materials, methods, and reporting KPIs standardized promotes higher efficiency and productivity, ensures your team always pursues best-fit leads, and provides a more accurate picture of your sales funnel management performance over time.

Manage Your Sales Funnel with Confidence

Xactly’s Sales Planning software solutions operate on four key pillars of strategic sales success:

  • Automation - Our solutions integrate seamlessly with your existing tech stack so you can automate processes and manual tasks.
  • Collaboration - Use Xactly tools to create iterative snapshots of your plan, model “what-if” scenarios, monthly plan updates, and analyze side-by-side comparisons.
  • Data-informed Decisions - Enhance decision making by leveraging AI to predict key metrics.
  • Continuity - Proactively monitor and continuously improve sales plans with changes in business conditions to course-correct in real-time.

Learn more about how Xactly can help you level up your sales strategy, or schedule your demo today to get started!


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Xactly News Team

The Xactly News Team reports on the latest product, events and market trends taking place within Xactly and throughout the revenue intelligence industry.