How to Build Sales Funnels for Small Businesses

Sales funnels don't have to be complicated. Here's a simple three-phase funnel you can implement now to start making more sales.
Reading Time: 4 minutes

Do sales funnels intimidate you? You’re not alone. The concept of sales funnels has taken over the online business and marketing sphere, often portrayed as a complex process that requires lots of specialized expertise in order to understand.

It’s true that knowing exactly how to communicate what your ideal customers need to know in order to decide if they want to buy your product is a skill that must be practiced, tested, and refined over time.

But the structure of the sales funnel itself? It’s actually very simple. And we’re here to break it down for you so you can jump in and start experiencing the benefits for yourself.

Why Use Sales Funnels?

Sales funnels are about effectively communicating everything your customers need to know in order to make a buying decision, without you needing to hold their hand every step of the way.

In a traditional sales call, you’d guide the prospective customer (or lead, in marketing lingo) through the step-by-step process individually, in the hopes that your offer will meet their specific needs and they end up buying your product. But as a small business owner, you likely don’t have a dedicated sales team who can do this work full-time.

Here’s where sales funnels can step in, to provide all of that same information the customer needs—but without requiring your constant presence, so you can save valuable time and energy.

An effective sales funnel is a lot more like that personal conversation than it may seem. Think about it: the basic structure is similar. You share something about your offer, they indicate interest, you share more details, and then they decide if they want to work with you.

This back-and-forth between your company and your potential customer loosely follows a three-step system that makes up a basic sales funnel: capture, nurture, and convert.


The sales funnel must first capture the customer’s information online. This is most commonly an email address, but the important part is that you obtain a method to communicate with the lead.

You can always ask people for their information, but you’re probably going to need to give them something in exchange. Contact information is valuable! And the easiest way to get that valuable information is to share something valuable yourself.

This is the exchange theory behind the internet’s favorite lead-capture strategy: freebies.

In businesses that sell physical products, we often see a discount code, or a free shipping offer. For service and educational businesses, this is often a digital resource, like a PDF, workbook, or recording that helps your lead learn something valuable, overcome an objection, or prepare them for your offer.

A freebie is located at the top of your sales funnel, which is the first phase of the sales process where your customers are new to your offer and beginning to research more about your product or service. In this phase, you’re trying to reach as many interested people as possible who want to learn more about you and your offer.


After you capture the lead, it’s time to nurture the lead.

Nurturing is the process of building trust, reducing risk, and demonstrating expertise.

In this step, you show that you understand the problem your customer has, the outcome they desire, and address potential objections. The goal is making sure that your lead has all the information they need to make a buying decision.

Nurture content should be tied directly to the offer you’re going to make in the convert step. Depending on your funnel, this can be a series of emails, videos, podcast episodes, or a webinar training.

The nurture portion of the funnel is valuable for a lead because it will show different perspectives, values, beliefs, and outcomes related to the offer you are selling. This, in turn, is related to the problem that they are trying to solve.

Even if your lead doesn’t buy from you, they should have learned more about their problem and the solution that you provide.


Finally, we move to the convert phase. This is the step where we actually sell something.

Having set the stage for your lead by building trust, reducing risk, demonstrating the problem your customer has, showing them the outcome they desire, and addressing potential objections in advance, it’s time to offer your solution: your product or service.

Just like with the nurture step, you can use emails or other forms of communication you’ve gathered in the capture phase to direct your leads to your sales page.

During the convert step, if you have done your nurture job correctly, your leads are ready to make a decision. Your job now is to build on the expertise you have demonstrated and the trust that you have gained by clearly tying the desired outcome of your lead to the offer that you have.

The convert phase is critical because this is where you get paid, and your lead actually acquires the product, information, or service they desire. It’s a win-win situation.

How Do I Know If My Sales Funnel Is Working?

Well, if you’re making sales.

It sounds simple, but often business owners will set up funnels that don’t actually lead to a product—they just add people to the mailing list. That’s okay, but it’s not really a sales funnel until you’re actually selling something.

If you’re not selling anything via your funnel, it becomes much harder to assess whether your conversion messaging is effective because you’re not actually testing whether it works or not.

This is why at the Holistic Business Academy, we recommend that our clients try to make a sale as quickly as possible. This lets you know if the leads you’re capturing are actually a good fit—because if they are a good fit, they’ll be buying from you. And it’s only after testing your offer and messaging out that you’ll know whether what you’re doing is working or whether you need to go back and reassess your strategy.

What’s Next

For a more in-depth discussion on setting up a sales funnel as well as tips on troubleshooting challenges, listen to our full podcast episode on sales funnel foundations.

Looking for even more step-by-step guidance on creating offers, marketing them, and making sales? The Holistic Business Academy Membership offers expert training and workshops, as well as community support with like-minded peers. Join the Holistic Business Academy Membership waitlist here!

Found this useful? You can get the best of our renowned blog and podcast direct to your inbox for free. Just sign-up for our mailing list below, and we’ll share the top holistic business strategies, insights, and trends with you every week.