I recently watched a video by Matthew Larsen about lead generation funnels, and it struck me how many agency owners are missing the mark with their funnel strategy. As someone who’s helped countless entrepreneurs build profitable online businesses, I can tell you that what Larsen shared aligns perfectly with what I’ve seen in the field.
The most eye-opening part? You need 100% of your funnel components working together—not 90%, not even 99%. Missing just one element is like having a car without a steering wheel. It simply won’t function properly.
The Complete Funnel Framework
A proper lead generation funnel follows a specific structure that Larsen outlined clearly. It starts with ads or content driving traffic to an opt-in page with a lead magnet. After opt-in, visitors see a video sales letter (VSL), which leads to an application form. Qualified leads book calls, while unqualified ones receive a downsell offer.
What many miss are the crucial nurturing sequences:
- Welcome flow for new leads
- Pre-call flow for booked appointments
- Follow-up flow for prospects who don’t convert immediately
The most shocking part? Setting up this entire system takes only 5-10 hours of work, yet many agency owners who’ve been in business for years haven’t completed it. This represents a massive missed opportunity for sustainable growth.
The Four Failure Points (And How to Fix Them)
When your funnel isn’t performing, there are only four places where things can go wrong. Identifying which area needs attention is the first step toward improvement.
1. Traffic Problems
If your ad costs are too high or your content isn’t getting enough clicks, you’re facing a traffic issue. The benchmark to aim for is a 3% outbound click-through rate (CTR). When this metric falls short, examine your messaging, script quality, on-camera delivery, or editing.
My experience shows that even small tweaks to your hook or audience targeting can dramatically improve performance here.
2. VSL and Landing Page Issues
A strong funnel should have at least 70% of landing page visitors starting your application form. If you’re below this threshold, your headline might be weak, your VSL boring, or your offer unclear.
I’ve found that adding a compelling executive summary at the beginning of your video and ensuring your page design looks professional can make a world of difference.
3. Call Booking Problems
According to Larsen, a strong campaign achieves a 10% call booking rate from landing page visitors. When this number lags, your form might be too complicated, your calendar availability too limited, or your qualification process too stringent.
If 1,000 people hit your page, getting 100 booked calls would indicate a very strong funnel.
4. Sales Call Conversion Issues
The final potential breakdown occurs during the sales process itself. While many boast about 50-70% close rates, Larsen suggests that a 20% close rate is actually optimal for service businesses. Anything significantly higher might indicate your pricing is too low!
This resonates with my experience—I’d rather close 20% of prospects at premium rates than 50% at bargain prices. The former leads to higher profit margins and fewer fulfillment headaches.
Sustainable Scaling for Service Businesses
One crucial point that differentiates agency scaling from info-product businesses: you can’t just 5x your ad spend overnight. Your team would collapse under the pressure. Instead, focus on gradual growth—perhaps 10-20% increased ad spend weekly—while systematically addressing your funnel’s weakest link.
Think of it as a game of whack-a-mole: fix your biggest problem, then move to the next one. This continuous improvement process creates sustainable growth without overwhelming your operations.
The ultimate freedom comes when your lead generation system works so well that you can be selective about clients. You can let difficult clients go, knowing you can replace them easily. You can disqualify prospects who seem problematic before they become customers.
For agency owners looking to scale, getting this funnel right isn’t just about growth—it’s about creating the business and lifestyle you actually want. Take those 5-10 hours to build your complete funnel. The return on that investment will be transformative.
