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The 7 Stages of the Lead Generation Funnel

Published on June 15, 2023
Last modified on June 15, 2023

Step right up, folks! Get ready to embark on a wild journey through the captivating world of lead generation.

But hey, before we dive into the nitty-gritty, here’s a quick joke for you: Why did the lead generation expert bring a ladder to the circus? Because they wanted to reach those high-converting leads!

If you are a start-up entrepreneur or in any way related to a business organisation, this lead generation guide is meant for you. We have everything you need to know, right from the basics, to the tips and tricks involved as well as the cost implications. After all, there are several methods to generate leads, and the versatility of the process makes it so lucrative for every form of business.

You also need to consider the lead conversion strategies based on the nature of your business, the product or service you are marketing, and finally, the people who will be buying your products. When you think about it in this way, it becomes quite clear that there is a lot involved in the process.

For example, take a business with a product meant for the luxury class and can only be marketed well through visual mediums. For such a product and target customer group, social media platforms will be the best for lead generation.

Join us on this adventure as we demystify the lead generation funnel, revealing the hidden gems that turn prospects into valuable leads.  

What is a Lead?

Lead refers to a possible client or contact who could be changed into a potential customer. Leads are prospects who could be interested in the business and can be made to invest in it. They have shown interest in the company in some way. The true meaning of lead depends on the company. 

For an NGO, a possible lead could be an investor or sponsor who wants to invest their money for the community’s welfare. For a profit-oriented business, leads could be another business client or an individual customer.

The common point is that all leads are a prospect who is expected to invest in the company through a sponsorship, partnership, or just through a successful purchase. Finding leads is essential for a business to grow further and tap into the opportunities present in the market. 


What is lead generation?

Lead generation simply refers to the process through which strangers who had never heard of your business are successfully turned into a lead. These people generally don’t know what products or services you are offering. Yet, you can turn them into paying customers following certain steps of the lead generation process. Usually, leads are created through marketing and sales approaches that reach out to different individuals. 

The marketing approach could be over social media, a blog, a post, or a click on the website. By responding to the marketing approach, an individual displays the first bit of interest in your company. It does not matter whether they are immensely interested or have responded after a fleeting thought. Each response is critical and should be followed up with further rounds of communication or marketing approaches.

Your next step would be to reach out to every one of these individuals who had responded and persuade them to make a purchase. The common ways of follow-ups are either through a phone call, message, or even an email. But today, there are many developed ways to reach out to them to customised or tailored messages. 

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Why is lead generation important for your business?

Lead generation is a common strategy used by brands to grow their business, increase sales, and reach new customers. And every business needs a good lead generation strategy to target new audience groups and achieve sales goals

Lead generation processes could have different goals for different companies. For instance, you could generate leads to drive traffic on your website, blog, or social media page and increase awareness among the people. It all also depends on the stage of the brand or the product.

For an already established brand launching a new product, the aim for a lead generation would be to increase sales. If it is new in the market, then the goal of lead generation will be to raise awareness and understanding about the brand and what it offers. On the other hand, a company that seeks to develop a new product would use lead generation to interact with the customers and try to understand their needs.  

What is a Lead Generation Funnel?

Much like you guessed from the name, a lead funnel is a systematic approach of leading or funnelling the target audience through different channels and stages to the final one, where they are ready to associate with your brand. 

For example, you have launched a new product and a brand. Your first step would be to spread information about the product and make them aware of why they need it in their life. For this, you will make a website or social media page, engage with the audience, and launch ads. This counts as the first step towards engagement and lead generation, and there is a long journey to gain purchase from a loyal customer. 


Top 4 Benefits of the lead generation funnel 

We have already discussed why your brand needs to generate leads. Now let’s discuss the top 4 benefits of lead generation for your business.

1) It helps you assess in what stage your potential customers are. This means that whether they are just aware of your brand and the product or are truly willing to be associated with it, or they are loyal customers who will come back. 

2)This process gives a systematic approach to lead generation, so you do the right thing at the right time. After all, marketing is all about finding your customers in the right frame of mind where they are ready to make a purchase. 

3)It benefits both the buyers and the brand as it offers an experience and a connection along with the product. 

4)The lead generation funnel ensures that you get the best results from the marketing technique you have chosen.


The 7 stages of the lead generation funnel

The system of lead generation involves several steps, and each of the steps has been discussed in detail here:


Stage 1: Awareness

The first stage is letting the world know about the existence of the brand. In this stage, you have to plan how to get your brand noticed and raise awareness among the customers. There is no fixed way to do this, and it all depends on what the brand owner chooses.

Inbound marketing for this stage could include SEO, paid advertising, emails, and webinars, etc. You also should consider the type of target audience you have and the marketing channels they are most likely to be exposed to. You could also collect the information from the customers and use it for designing more marketing plans. 


Stage 2: Data collection

The second stage is focused on collecting data. For this, you would have to promote the people to respond more and more to the content you share. You could give introductory offers, discounts, free gifts, deals, and even loyal customers programs. 

One could also include sign-up forms, surveys in exchange for deals, and landing pages to make customers give away relevant information. Analyse all information to find details and patterns from them. 


Stage 3: Marketing Qualified Lead (MQL) and the Sales Qualified Lead (SQL)

Stage three is commenced when your brand and product have raised a significant level of awareness among the people. Now is the time to build more leads as people know what the brand is about. 

A Marketing Qualified Lead (MQL)is a person who has indicated an interest in the brand and its products. MQLs have usually interacted with the different marketing approaches or the brand’s social media page. They are far more approachable than other people, and sharing a more customised message via a phone call, email, or message is a great way to win such individuals over. 


Stage 4: Targets and prospects

By this stage, you must have gained a significant number of followers or audience who are aware of your brand and have interacted with it in some ways. In this stage, you will need to take a moment and decide where each potential customer ranks on the lead generation scale. 

It is not possible for each person to be a customer; however, despite that, they need to be valued and respected. In the case of young and budding brands, reputation matters more when it spreads through word of mouth. 


Stage 5: Recycling

Now that you have ranked all your followers, you will be better aware of the real potential customers. But even among those selected ones, some will not be willing to buy from you right away. They might be convinced of the worth of your product and be standing on the brink of making a sale and yet not making it. 

It is important to remember that such individuals need to be regularly engaged with as a possible deal or offer can easily tip them over to make a purchase. On the whole, just remember to keep in contact with followers and target customers through email marketing, calls, or messages every few months. 


Stage 6: Opportunity

Finally, once you are done with every other stage, the customers will be ready to make a purchase and associate with your brand. Here your sale techniques will kick in. At this stage, your brand will be judged for factors like the accessibility of various features tools, availability of information about the product, ease of making a purchase, return and refund restrictions, etc. 

You will have to win customers over by providing them with a pleasant purchase experience and ensuring that they are satisfied with their investment. 


Stage 7: All about customers

This is the most giving stage where the leads and contacts you have generated have readily invested their money in the product. You have made successful sales and have the delivery packages line up. 

But the process does not end up right here. It is not just about the product, but it is also about the follow-up service they get along with the product that helps build a stable revenue stream. Their complete experience with the product decides whether they will be back again for another purchase or not. You will have to think of a scheme to retain your customers and make them solely dependent on your brand. 



We hope this article was able to answer all of your questions regarding lead generation. The lead generation process is integral to your business. Despite the extra costs incurred, it would help the business grow over and gain new customers. Follow the mentioned steps and strategies to discover many leads through your chosen channels and marketing approaches.

Just remember to value every lead as they have the potential to change into a successful customer any time in the future. Once you have converted leads into customers successfully, your business will be on the run to success. So, stick to the lead generation funnel closely along with improvising and adding some unique traits to it that align well with your business.

Frequently Asked Questions (FAQs)

Lead generation is the process of identifying and capturing potential customers or clients for a business. For example, a company offering a free e-book in exchange for email addresses is using lead generation to build a contact list.

A lead generation tool is a software or platform that helps businesses automate and streamline their lead generation efforts. It may include features like lead capture forms, landing page builders, email marketing automation, and customer relationship management (CRM) integration.

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