PipelineNova Blog What is a sales pipeline in a Saas company and how to manage one successfully

Managing a successful sales pipeline is crucial in meeting your company’s revenue goals. Below are bite-sized tips and best practices on how to manage a healthy sales pipeline in a Saas company.

What is a sales pipeline in a Saas company and how to manage one successfully

A sales pipeline is a visual way of overseeing where each lead currently is in the sales process.

In this article, we'll cover the following: (Make all these links)

  1. How many stages are there in a pipeline
  2. How to visually manage a sales pipeline
  3. What you need to run a successful sales pipeline
  4. How to feed your pipeline
  5. Pipeline mistakes
  6. Sales pipeline best practices
  7. Sales pipeline metrics
  8. Optimizing your sales pipeline
  9. Recap 

1. How many stages are there in a sales pipeline

No two companies are the same. Each team has their own stages and sometimes even sub-stages. This all depends on many factors, such as: The size of the sales team, sales cycle length, lead value, just to name a few.

Some sales teams may have 5 stages in their sales pipeline whereas another team may have 10.

The neater and more standardized the process the more effective the entire sales process.

The most efficient sales pipeline stages for Saas business development are:

  • Prospects
    • These are leads who need your product and have shown interest in it.
  • Qualified
    • Do they have the budget? Can they make a decision? Are they ready to buy?
    • 20% of your leads will provide 80% of your revenue. Be able to filter those
  • Demo/Presentation
    • Your lead is ready. They have agreed on Demo. You present, hear the objections. And pass them along in the pipeline.
  • Closing
    • Asking for contract, negotiating

HOLD/FREEZE: Depending on your process, there could be a sub-stage (or a separate pipeline) where frozen leads are placed in. These are not lost leads, they are rather qualified and will potentially buy your product, however for some internal reasons in their company they are currently not able to do so.

Optional, Tags: Each lead can be assigned a "warmth tag" regardless of where they are in the sales pipeline. This way, when passing down the lead to other sales reps in your team, they will know what type of lead they are dealing with and rearrange their playbook accordingly.

  • COLD
  • WARM
  • HOT

2. How to visually manage a sales pipeline

There are two ways of representing this: Linear and Kanban.

In a linear approach, you simply have all your leads in a list going down, where each lead is assigned a stage they're in.

The kanban way is having each stage of the pipeline in a vertical column where the lead moves from left to the right in the sales process.

Kanban may prove cleaner when working with a team. The linear way is best fit for sales individuals working alone without having to share much data with anyone else in the team.

Visually speaking, you can use Excel, or use something like PipelineNova. Where you can visualize each step your leads are on for your entire team. Leave notes, messages, record emails and every touch point that lead has had with your brand.

3. What you need to manage a sales pipeline

  • A list of prospects: These leads may come from various sources, such as: signups for a free trial on your website, contact from leads to your customer support, an event signup.
  • A sales process: This is your playbook. What you will say and how you will say it in each stage of your sales pipeline. Are leads qualified via Email? Phone call? Google Meet?
  • Your revenue targets: How many leads do you need to prospect to reach your goals? By understanding your "Close rate", you'll know how many leads to generate.
    • Example: Let's say your monthly closing goal is $30K and you can usually close 20% of your $10K value leads. With these numbers on hand you need to close 3 deals each month worth $10K. Since you can usually close 20% of these types of leads, you need to keep your pipeline healthy with around 15 new leads worth around the $10K mark.

4. How to feed your pipeline

One of the biggest mistakes in managing a sales pipeline is not feeding it with new prospects.

Some of the channels to feed your pipeline with new leads, are:

  • Social media
  • Downloadable content on your website
  • Free signups to your app or product
  • Manually hunting new leads in directories, websites, linkedin
  • Paid channels: ads leading 

5. Pipeline mistakes

  • Not enough leads
    • Letting the pipeline go dry while trying to close "hot" leads.
    • Understanding your close rate will go a long way
  • Long sales cycles
    • One of the biggest culprits in closing a lead is long sales cycles, which tend to take longer in B2B compared to B2C
    • One way to avoid this is to constantly optimize your sales process
  • Spending too much time with wrong leads
    • Pareto principle comes handy: 20% of the leads will provide 80% of your revenue
    • What is a wrong lead aka "dead-lead"
      • Multiple months without any progress
      • You have exhausted your outreach efforts
      • They have said 'they're not interested'
    • Review the history of each lead and see if there's any pull from them. Usually, good prospects are educated about your offer and product. They're pulling you in too. You need to identify these prospects and move forward.
  • No coordination between sales reps
    • Communication falls through the cracks.
    • Your current app does not give a bird's-eye view on your leads
    • Sign-up for something like PipelineNova
  • Stage activity
    • There's no standardized way 
  • No follow-up
    • Before the internet it would take 2-3 calls for the sales rep to know if they will close the deal. Now it takes 8-9 multitouch approaches to qualifying and lead. However, you can't get too annoying with your leads by following up with them via one channel (phone) and repeating the same message. You have to get creative and follow up via phone, email, personalized card, through your contacts. It's more of an art than a skill.

6. Sales pipeline best practices

Now that we got out of the way a few sales pipeline mistakes, it's time to talk about a few key points in maintaining a healthy pipeline.

Keep your pipeline neat and clean

  • Add notes
    • Keep track of each activity taken for a specific lead: email, call, demo. 
  • Add tasks
    • Add simple doable tasks of what's to come and delegate it to a specific person, either yourself or someone else in your team.
  • Add tags
    • Mark leads as cold, warm, hot and visualize their road so far (via PipelineNova charts) to see their entire journey in your pipeline
  • Constantly trim out the weeds
    • We can't stress this enough: constantly clean up your pipeline. Drop or move aside leads that are not warm enough for your attention.
  • Standardize your sales process
    • By reviewing your sales process you will start noticing patterns with the leads you close. Try to make this similar for all across the board.
  • Improve upon
    • Your pitch: Quality, length, Delivery
    • Frequency and interval of followups

7. Sales pipeline metrics

A sales pipeline is nothing more than words without some stats and metrics that will help you in your decision making process.

  • Close ratio
    • The amount of deals you are winning compared to your overall lead count)
  • Sales cycle
    • How long it takes to close a deal on average
  • Average lead size
    • What are your overall average deal sizes
    • Grouping your leads into various cohorts
      • Example: 1K-10K, 10K-20K, 20K-50K
        • And then knowing each cohorts close rate and their sales cycle
        • This is easily done in PipelineNova
  • Dead lead ratio
    • This is not talked about enough, but if you have too many this could give you a sense that maybe you have poor prospecting procedures in place and need to coordinate with the marketing department to see what can be done to attract prospects who are looking for a product like yours.

By regularly reviewing your metrics, something that is easily done in PipelineNova, you can optimize your sales pipeline, prospect better leads, and close more deals on average.

8. Optimizing your sales pipeline

As you and your team spend a few short months working out tips and tricks mentioned in this article while running a successful pipeline, you'll notice various patterns start to emerge that are specific to your team.

Always be on the lookout to trim out the fat within your team (sales procedures, marketing materials used, follow-up efforts), as well as leads prospected (lookout for those ready to buy and with the means to complete the purchase).

In a nutshell

  • Have less steps in your sales pipeline
  • Have a clear sales process as described by SaasSales.io
  • Keep track and history for each lead
  • Add actionable tasks for each lead
  • Follow up
  • Be ruthless in dropping out bad leads
  • Nurture leads that are keen to your brand and product
  • Keep short sales cycles
  • Constantly fill up your sales pipeline with new prospects

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