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The Sales Funnel is a sales concept of Og Mandino. He realized that a lot of people have a little money and a few people have a lot of money...and how to use that fact to best advantage. People have re-applied the original concept in a variety of ways, but we mean it in terms of building customer trust through delight.
Potential customers and especially internet customers have a high level of skepticism for good reason. So, rather than relying on a pitch it is far better to delight your prospects no matter what their investment level. If people experience delight on the first encounter, they may risk a $20-$40 purchase. If they are delighted with their $20-$40 purchase, they are far more likely to buy a product in the $100 range, and if they are delighted with their $100 purchase, they are likely to part with a few hundred via your next offering.
It seems to work in increases of about 400% while simultaneously diminishing participation by 75%, except for the jump from Freebie to First Purchase, which can typically be 1% performance. Thus:
| Price Increase Toleration | Diminishing Participation | ||||||
| Freebie | $0 | $0 | $0 | Freebie | 3200000 | Visitors | |
| First Level | $20 | $30 | $40 | First Level | 32000 | Buyers | |
| Second Level | $80 | $120 | $160 | Second Level | 8000 | Buyers | |
| Third Level | $320 | $480 | $640 | Third Level | 2000 | Buyers | |
| Fourth Level | $1,280 | $1,920 | $2,560 | Fourth Level | 500 | Buyers | |
| Fifth Level | $5,120 | $7,680 | $10,240 | Fifth Level | 125 | Buyers | |
As you can see from the above chart, it helps to have a lot of visitors. It also helps to have a series of products at incremental price levels. (Testing may be required to discover the Sweet Spot). Finally, it is worth putting some thought into improving the conversion from Visitor to First-Time Buyer.