What is Pipeline Management & Why is it ImportantJanuary 3, 2023 sales pipeline management
According to TechTarget, a sales pipeline is a visual representation of the sales process. It allows businesses to visualize where leads stand in the sales funnel.
In practice, it is a concept that involves examining every stage of the sales process. You can say a sales pipeline is the technical aspect of a sales funnel with steps like contact, proposal, and closing.
In this blog, we will explore what pipeline management is. Additionally, we will find out why proper management of sales pipelines is crucial for a business.
What is Sales Pipeline Management?
Simply put, pipeline management refers to the act of overseeing and utilizing opportunities in the sales pipeline. However, the actual process is more nuanced and expansive.
Pipeline management allows reps to check how a lead progresses through the entire sales funnel. You can break the journey into different parts and take up each one to observe, examine, inspect, and understand.
Moreover, you can map your sales process step-by-step and improve it by identifying bottlenecks. Additionally, you can track and optimize the workflows associated with each stage to improve sales outcomes.
Pipeline management involves managing steps like:
- Contact - aligns with the awareness stage of the sales funnel
- Qualification - aligns with the interest stage of the sales funnel
- Meeting - aligns with the intent stage of the sales funnel
- Proposal - aligns with the evaluation stage of the sales funnel
- Closing - aligns with the purchase stage of the sales funnel
- Retention - aligns with the loyalty stage of the sales funnel
Pipeline Management in Practice
Data-driven marketing has made it simpler to manage pipelines. CRMs can optimize and monitor several pipelines simultaneously. You can also generate vital insights about your pipelines and identify areas of improvement.
Let’s say you are a tech company that provides services like web development, app development, and digital marketing.
You can use a CRM to manage the sales pipeline of each department. It gives you a complete picture of your sales processes spanning across your offerings.
Why Pipeline Management Matters
A sales pipeline is an ideal tool to convert your prospects into customers, as per Gartner. Therefore, effective management of your pipeline can boost your conversions, sales, and revenues.
Additionally, it allows businesses to understand the future of their sales. They can perform several key tasks accurately, like:
Ensure Optimal Use of Resources
Pipeline management scrutinizes every step of the sales process. You can compare it to inspecting a car with its engine, chassis, wheels, headlights, and so on.
Just like a mechanic, you can inspect every part and find out what’s wrong with your sales process. You can identify steps where your prospects take the longest to move through.
A closer look lets you identify flaws and take the necessary steps. Moreover, you can allocate your resources optimally to steps that are not efficient.
Additionally, you can prioritize your efforts on essential steps to keep your pipeline flowing. For example, your car’s engine is more important than the headlights to operate.
So, you will prioritize your engine before fixing your broken headlights.
Forecast Sales Accurately
Pipeline management allows you to monitor every step of the sales process. It goes a long way to determining your sales performance. Moreover, you can track your performance over time to understand what may happen in the future.
Proper pipeline management lets businesses forecast sales accurately. They can eliminate the guesswork and rely on solid data to make reliable predictions. The data can come from CRMs, marketing tools, and more to form a holistic understanding.
Moreover, you can integrate pipeline management into your business workflows. It allows you to make accurate forecasts for other departments like marketing.
Close Deals Faster
Pipeline management has a direct impact on your sales velocity. It can help you progress your leads quickly through the sales funnel and close deals faster.
This is possible due to several reasons:
- Each step of your sales process is optimized and works like a charm
- You can automate manual tasks, like follow-ups
- Pipeline management leads to improved lead nurturing
- You can present the right information or deal based on context
- Your reps can work more productively
Your sales process becomes like a car with every part contributing to its fullest for top performance. Your prospects enjoy an excellent customer journey and need less effort to turn them into paying customers.
Monitor the Performance of Reps
Every step of the sale process needs specific expertise to nurture leads. It is natural to have different employees working in varying roles, even in a small sales team.
Pipeline management allows businesses to monitor reps’ performance. They can see the whole journey of the sales team and how they perform their tasks.
Moreover, they can use KPIs to measure performance in reps using CRMs. It gives them a clear picture of the sales team’s pain points and where they lack.
The company can upskill or train reps based on their findings to improve their performance.
Most importantly, the company can ensure the needs of the prospects are met at every step of the sales process. They do not lose out on any leads or miss out on capitalizing on any prospect.
Pipeline management is the art of monitoring and optimizing the sales process. It allows businesses to stay on top of their processes and improve visibility into every step. Tools like CRMs allow companies to manage pipelines efficiently.
Adept management of pipelines leads to improved sales processes. A business can accurately forecast sales and allocate resources optimally. Moreover, they can boost conversions with sales pipeline software and close deals faster. This increases sales and revenues.