What is a 'sales funnel'?

A 'sales funnel' refers to a model that captures the journey potential customers embark on from the point of becoming aware of a product or service to the moment they make a purchase decision. This concept is fundamental in marketing and sales as it illustrates the various stages that a customer progresses through during their buying journey, often depicted in a funnel shape to represent the narrowing number of prospects at each subsequent stage.

At the top of the funnel, there are a larger number of potential customers who are simply aware of the product. As they move down the funnel, they become more engaged, researching and considering the product, and eventually, a smaller segment will proceed to purchase. This model effectively emphasizes the loss of potential customers at each stage and helps businesses strategize their marketing efforts to nurture prospects, leading to higher conversion rates.

The other options do not encapsulate the full essence of what a sales funnel represents. While one suggests a focus solely on the steps in the sales process, it lacks the broader view of the customer journey. Another option talks about a chart displaying sales figures, which does not address the conceptual journey of the customer. Finally, a strategy regarding product pricing does not relate at all to the stages or processes represented in a sales funnel. Thus, option