Reverse Engineer Your Marketing Funnel to Boost Revenue


Every company struggles with driving momentum through the marketing funnel and realizing their ultimate goal: revenue.


Because marketing funnels are often complex. Unless companies take the necessary time to adapt the marketing funnel concept to their business goals and processes, this powerful demand-generation tool fails to produce revenue.

So how do you create a funnel that meets revenue goals? The key is to start at the bottom, not the top. Define your revenue goals, then reverse engineer your funnel.

In this blog we’ll examine common marketing funnel challenges then give you a quick blueprint to start reinventing your funnel.

If you need any help with this process or defining other aspects of your marketing strategy, contact us—we have a proven process for delivering the marketing momentum you need to drive results.

3 Common Marketing Funnel Challenges

When it comes to marketing funnels, companies fall into these traps:

1) No funnel
Let’s face it: Some companies simply lack the time to develop a marketing funnel. According to a Sales Enablement Benchmarking Survey we conducted, 18% of firms fall into this category. If you don’t have systematic way to drive momentum toward a sale, you’ll never reach your revenue goals. Carve out the time; it’s worth the investment.

2) No alignment 
Many companies with a marketing funnel haven’t aligned it around both sales and marketing. Our survey suggests that 66% of responding sales and marketing teams were only partially aligned or completely unaligned on their funnel goals.
Misalignment is a problem. A truly high-performing funnel is one that meets sales needs such as:

  • Lead generation

  • Lead nurturing

If you don’t have buy-in and complete comprehension from marketing, you don’t have a successful funnel.

3) No segmentation 
You have a funnel and alignment but you’re missing enablement. Don’t just slice the funnel horizontally into buying segments. The best funnels are also segmented vertically by functional responsibility (e.g., marketing, business development, sales, channel).

Bringing It Together

So, what’s the fastest way to develop a targeted, aligned, and segmented marketing funnel? It’s not determining how many leads you need to generate. In our experience, the best method is to reverse engineer your funnel by starting at the bottom, with your revenue goals.

First, you need consensus on your go-to market strategy from both sales and marketing. Ask your teams:

  • Should we pursue account or lead-based marketing (or some combination of the two)?

  • How important is gaining new customers?

  • Does it make more sense to cross or upsell existing customers?

Once you’ve answered those questions, define your measurement strategy. Account for these factors:

  • Lead stages and types (e.g., Automation Qualified Leads, Tele-prospecting Generated Leads, Sales Qualified Leads)

  • Price

  • Sale complexity

  • Your market—B2B or B2C

    We recommend using the SiriusDecisions Demand Waterfall as a starting point here.


Start at the Bottom

Now we get to the challenging part: Reverse engineering the funnel. Instead of estimating how many leads you need, start at the bottom with your revenue goal. Then apply your close and conversion metrics to work your way back up the funnel.

To reach your revenue goal, divide your target revenue by your typical win rate. That will determine many Sales Qualified Leads (SQLs) are needed. To understand how many Sales Accepted Leads (SALs) are needed, divide the SQL number by your normal SAL conversion rate, and so forth until you get to the number of required leads. Here’s an example for clarity:

Unsure of your conversion rates? We've been there, too. Try data mining in your CRM for a close approximation. What you’re looking for is a baseline to measure against—you can always adjust later if expectations don’t match.

Note: You can apply this process using a lead quantity or lead scoring approach. Always consider your situation. For example, if you have a broad range of pricing options and one enterprise deal could skew your pipeline, consider examining the number of leads converting at each stage. If the typical sale price is consistent, lead scoring is more revealing.

Next, Slice the Marketing Funnel Vertically

At each of your created stages, determine which team is responsible for that portion. For example, suppose your organization has four teams responsible for feeding the funnel: marketing, business development, direct sales, and a channel sales team. Marketing and business development share the most responsibility, at 35% each. Sales team members do their own prospecting and are expected to supply 20%, and channel will add 10%.

Now let’s say that you expect to convert 35% of your SALs to SQLs, converting $57 million in SAL value to $20 million in SQL value. At this stage, that means that your marketing and business development teams each need to hit revenue targets of $7 million. Sales needs to aim for $5 million, and channel for $2 million. This process can then be carried up the funnel so that everyone has complete visibility and accountability for delivering results. 

Staying on Target

Once you’ve developed your funnel, you’ll need to stay on top of the numbers to keep the conversions flowing. Make sure your CRM’s capabilities support the type of tracking and reporting required to run these types of figures for each team and stage.

Then, schedule weekly alignment reviews to help your teams stay on track. Accountability at this point is a must—as is the willingness to adjust the targets, if needed.

Need Help With Marketing Strategy or Demand Generation?

Refactored’s experts can help you see the best opportunities for driving a healthy pipeline. Let’s talk about what you need.