Your customer is your business. It’s that simple. Having a means to understand how customers navigate the process in which they make purchase decisions—the buyer’s journey—can optimize marketing efforts and drive revenue.
The Marketing Funnel
The marketing funnel is not a modern invention. In 1898, ad agency executive by the name of Elias St. Elmo Lewis developed the concept of a funnel to map out the customer journey.
Lewis conceptualized the marketing funnel by breaking down the customer journey into four distinct stages, acronymized by AIDA :
Every successive stage in the funnel is a reflection of the customer’s mindset as she inches closer to a purchase and is more cognizant of her problem, and more importantly, your solution.
The funnel is a concept. A framework, if you will. To reduce human behavior to a two-dimensional graphic and strictly adhering to it is myopic. However, the funnel is a useful tool to understand the way in which the majority of your customers operate when making a purchase and subsequently can help drive your core marketing efforts by:
- Helping you better understand your customer’s needs and desires
- Accelerating customer purchase cycles
- Identifying conversion rate issues
- Optimizing campaign performance
- Facilitating sales and marketing automation initiatives
The Four Stages — or Five
Lewis’ general concept hasn’t changed much and the elements of the funnel remain true for today’s industries. One newer change, however, is the increased focus on the stage after action: advocacy. It’s about time. Advocacy is a key part of today’s marketing; a focus on loyalty improves customer retention, increases revenue in what is perhaps the most efficient way, and underpins any sustainable growth strategy. Therefore, appending an extra A to Lewis’ model—AIDAA—is more appropriate.
Content: PPC Ads, Webinars, Emails, Thought Leadership Blogs, Social Media
In the awareness stage, your customer is first aware of your product or service and may be aware of their problem. This stage is about working to capture your target prospect’s attention. See which word is emphasized in the previous sentence? Awareness doesn’t mean broadcasting indiscriminately. Awareness is making sure your target demographic is aware you exist. It’s everything that goes into making sure your ideal customer segment is aware of your product and that it can solve, or is, at the very least, associated with their problem.
Strive to make your target demographic aware of:
- Your company’s existence
- What your company does and sells
- They, your potential customers, have a problem
Converting to the Next Step | Awareness → Interest
As the first touch point, awareness is a key stage. Your prospect has not vested much time and can likely exit the funnel, not long after entering it. Therefore, it’s important to generate awareness with the following in mind: personalization and enabling comfort.
- Personalization. One of the primary goals at this stage—the top of the funnel—is to pull in many leads as possible. An effective way to build gravity and pull in leads is to cater to prospects in a personalized way. Personalized advertising is compelling advertising.
- Enabling comfort. The customer journey can be cursory or lengthy, particularly with B2B purchases. Irrespective of the time spent in the funnel, generating comfort makes sense as this is first touch point. This can be as literal as making physical aspects of a brick-and-mortar store assuring or making the web experience non-intrusive. It’s simple: the user experience starts before the product is bought.
Content: Blogs, FAQs, eBooks, Webinars, Brochures, Videos, Case Studies, Endorsements, Copywriting
The second phase of the funnel revolves around reinforcing that the prospect is at the right place. Prospects are not yet vetting your product but they are starting to look for information on how to solve their problem and if your solution is relevant.
Providing information in a targeted and crisp manner goes a long way. Educate the prospect on what you have to offer, why it’s unique, and how it can add value to their life.
Interest is just that: providing the kindling to fuel desire towards your product.
Converting to the Next Step | Interest → Desire
Converting a prospect from interest to the desire stage effectively is about anticipation and persuasion. Answer prospects’ objections preliminarily. Often overstated in product management theory and underperformed empirically, understanding your users helps anticipate the true concerns and gear messaging towards alleviating them.
Again, the funnel isn’t rigid and leads do not necessarily have to follow a set path. Prospects can enter your funnel directly in the interest stage, perhaps from the awareness stage of another brand. As you consider leads coming from these sources, you may want to tweak messaging specifically geared towards these leads. Each lead is unique. How you welcome them into your world should be too.
Content: Customer Ratings and Testimonials, Third-Party Product Reviews, Staff Members, Sales Representatives
The desire stage is about convincing the prospect to purchase. Often the longest stage, it’s imperative to reinforce your relationship, give them the information they need to take action, and retain them in your funnel.
This stage is particularly unique to your target demographic and your product. A key element in convincing a purchase is breaking through the noise. Your funnel and your prospect are not operating in a vacuum. With a gamut of options for a prospect to solve their problem, it makes sense to think about how to differentiate your solution from that of others. Rather than incessantly touting features, think about what unique value you offer that your competitors don’t.
Converting to the Next Step | Desire → Action
Customers are self-reliant. They’re more than capable of doing their homework. What helps is not necessarily doling out information but rather, removing roadblocks to accessing information. Even more so, strive to keep prospects in your world: provide the information they’re seeking in your ecosystem, so they don’t find answers elsewhere, like a competitor’s website.
Content: In-Store Interactions, Your Website, Sales Staff, Point-of-Sale Devices
This is the trigger. This is where—or rather, when—a prospect becomes a customer.
If your message and marketing efforts have been targeted, crisp, and unique in preceding steps, this stage is about removing roadblocks and making the act of purchasing as effortless as possible. Think about this stage well before your prospects get there. The exact actions you want your prospects to perform here should drive the preceding stages, and your efforts.
Content: Word of Mouth, Post Purchase Surveys, Rewards Initiatives, Customer Support, Promotions, Social Media
Advocacy may seem like a hasty new appendage to Lewis’ model or some 21st century invention to satisfy a marketing fad. It’s not. According to studies by Bain & Company and the Harvard Business School, loyalty has tangible results: a 5% increase in customer retention can increase profits by >25%.
Your customers (your prospects are rechristened by this point) are your most effective advocates and revenue drivers. Not only will they spread the word of your product and bring in new entrants to your pipeline, but existing customers are more effective sources of new business, through upsell and cross-sell opportunities.
The most successful brands of today seek to drive experiences that will make their customers their ambassadors. Find unique ways to enable advocacy.
Optimizing Funnel Performance
Again, the user experience starts before the product is bought. Any gaps in funnel performance are gaps in which customer needs are not being met, and therefore, they’re leaving.
Funnel leaks can be fixed with remarketing, leveraging messaging tailored specifically for a particular user, at a specific point in the funnel. To optimize funnel performance:
- Identify funnel leaks
- Increase gravity at the top of the funnel
- Increase momentum in the middle of the funnel
- Increase affinity at the bottom of the funnel
Identify Funnel Leaks
Your funnel will inevitably have gaps. It does make sense to be aware of the biggest gaps and implement test strategies to alleviate the biggest headwinds. These are some of the signs of funnel leaks:
- High ad expenditure in conjunction with a low ROI
- A high bounce rate
- Low conversion rates
- High churn rates
Increase Gravity at the Top of the Funnel
Since this is where your prospects enter the funnel, probe into the entry point and find ways to increase the gravity of your funnel. That is, find ways to have a strong brand and message so you can attract more of your target demographic. To accelerate awareness:
- Have brand appeal: a more visceral story, going beyond product
- Have a strong value proposition: visible, clear, and meaningful
- Have human-centric branding: resonate with core human values
Increase Momentum in the Middle of the Funnel
It’s important to emphasize this: consumers are smart. More often than not, on the bookshelves or blogs of marketing theory, consumers are viewed as static, simple entities that can herded down a path at will. This is hardly the reality and as such, everything described is a general framework, even when it comes to product education.
Consumers are self-reliant and capable of finding information. In fact, they intrinsically want to find their own information. There’s no need to dole out information. Cater to consumer self-reliance and make it easy for prospects to do their own research. Just remember to leave ample room for curiosity.
Increase Affinity at the Bottom of the Funnel
Your customers are your allies. We’ve established this. To build a strong base of allies, approach it with the mindset of delivery and being relationship-oriented. To increase affinity at the bottom of the funnel and strengthen brand advocacy:
- Ensure you’ve met or exceeded expectations for the product and brand
- Don’t forget about the customer after the sale: continue to have touch points with the customer and build a relationship
- Provide post-purchase experiences to make your customer feel unique and not as just another contributing element to a P&L Statement
The marketing funnel is an effective tool in understanding the journey from product awareness to product purchase. Since the inception of this concept, some of its elements have changed and in some cases, new models have supplanted the AIDA narrative. What has not changed is that the customer is at the core of the purchase journey and optimizing any sales or marketing funnel begins with just that: the customer.