Go back in time a bit and recall the last major purchase you made. What steps did you exactly follow?
You probably heard about the product from someone, felt the need to buy it, did some research and comparisons online, found out the best deal, and then you went on to hit the buy button.
We are all smarter now and unless there is a flash sale or factory clearance, we become picky about the things we buy. Every product and service sold now follows a series of steps which is intended to guide potential buyers into confirmed customers.
The concept is popularly known as marketing funnel and many of the top firms earn billions of dollars following this simple rule.
Without a doubt, you will also want to follow the same suit, right? I mean, who doesn’t like more money?
So, let’s decode this secret mantra of business success that can earn you some big bucks.
What is a Marketing Funnel?
Now, we all know what a funnel is.
Imagine you are pouring rice into a jar using a funnel. The funnel top can hold a lot of it and the amount reduces as we move down. Only a few find its way into the jar at a given instant and you will have to pour more to get more at the bottom.
The rice grains are your potential customers, the jar is your business and the grains that ultimately make it into the jar are people who paid for your service/product. For more conversion, you will need to attract more customers at the top and not all of them will find their way into the jar.
And that’s your answer to what is a marketing funnel.
It guides customers down the various stages of marketing (and sales) to ultimately convert them (convince them) to make a purchase.
Like a funnel, the stage at the top of the funnel is wider than the one below signifying the number of people it can fit.
The marketing funnel gives business executives an idea about the marketing approach they need to follow in order to increase sales and puts the entire complicated procedure into simple language.
Every business needs to construct and maintain an offline and digital marketing funnel of their product.
To construct your own funnel, you will need to understand the objective of each stage, the intent of customers here and that is what the next section is all about.
Stages of a Successful Marketing Funnel
You will find the various marketing funnel stages named differently in different sites, but the core concept remains the same.
To describe here, I found the funnel described by Rebecca Lee White in Trackmaven to be the most appropriate.
As you can see, Rebecca dissected the entire marketing funnel into 6 stages. Each stage has its own purpose that must serve the customer’s specific intent.
Let me make things simpler for you.
Stage 1: Awareness
As the name says, the purpose of this topmost stage is to let people know that you and your business exist. It can happen through blog posts, social media campaigns, offline advertisements and so on. You must utilise any channel to spread the word before even expecting people to buy from you.
Buyer Intent –
Customers are generally cold and collect information about your company. This is the first step to build trust and if done effectively, will direct them further down the tunnel.
Stage 2: Interest
Once you have caught your customers’ attention, this is where you touch their interest points. Through an effective marketing campaign, you must create the need for your product and show the buyers the benefit they will have. People want to know more about your product here & the content you send out must show your expertise.
Buyer Intent –
In this second marketing funnel stage, customers want to trust your brand name. Currently, 80% of all shopping begins with an elaborate research. Buyers want to make an informed decision and they value a bit of transparency.
Stage 3: Consideration
Once satisfied with their research, the people who have trickled down to this third stage are slowly transitioning into buyers. The consideration stage is where you take the upper hand by nurturing their trust. Offer targeted content to each buyer, show them comparative and case studies or sign them up for free trails to let them “Consider” your brand further.
Buyer Intent –
Customers start turning warm and tend to check out your competitors just to be sure that they are making the right choice. It is your duty in this stage to further establish your expertise and show that your product is the very best.
Stage 4: Intent
While many like to overlap the ‘Intent’ stage with the ‘Consideration’ stage, but I feel the separation is necessary. This is where the marketing campaign shifts to becoming more product specific. If a customer is willing to buy a phone, present the customer with the USPs of that specific phone. You can also show the buyer related products or add-ons to end the deal.
Buyer Intent –
You can look at it as the small hiccup before the final act. It is similar to when a customer places a product in the shopping cart but does not proceed to payment. People tend to ponder upon their choice one last time and you must help to reduce their doubts.
Stage 5: Evaluation
This is where sales and marketing must work together. The later has done their work and the former must join the pieces. Here, the customers are ready to pay and give you their personal details. Collect all the necessary ones to hold on to your purchasers for a long long time.
Buyer Intent –
Customers have turned hot and now they want a hassle-free purchase. Any glitch will redirect them up the marketing funnel and you will have to restart the entire process. They want an active sales team, secure payment gateways, choice of payment methods and so on.
Stage 6: Purchase
People have pulled the trigger and you have sold your product. Your objective now is to hold these people back to continue buying from you. Already converted leads will enter the funnel at later stages and your work will be cut short for such buyers.
Buyer Intent –
People like to feel that they have made the right choice. If you vanish after making the sale, expect negative reviews from these very people and see your ship sinking. Feed people’s trust, show them your goodwill and do everything to hold them in the jar.
That’s the marketing funnel stages described for you.
And this is where the most obvious question comes in – Aren’t these similar to the sales funnel? Meaning, you did see similar stages there as well. Why give it a different name?
Unfortunately (or fortunately), marketing and sales funnel are very different in some aspects and it would be a crime if I leave that out here.
Marketing Funnel vs Sales Funnel
In companies where the marketing and sales are independent departments, it often makes sense to follow a whole new funnel where things begin with target customers and end with making the purchase.
Unlike the marketing funnel, sales expert may not generate the awareness and work with prospects or later follow up on the converted leads after a sale is made.
The sales funnel described by Freshworks is the best depiction in my opinion.
As you can notice, the entire process is more targeted. Only those people enter the funnel who have already shown interest and have provided you with your personal information.
As customers trickle down, the actions are more product specific and close with generating revenue for the company.
And even when there are some mismatches, more and more brands are merging the marketing and sales funnel as it is becoming increasingly difficult to separate the two in this world of online advertisements.
In fact, some experts believe that the digital marketing funnel should be split vertically into two where one half should belong to marketing and the other half to sales.
While we are still on the marketing and sales funnel topic, we should discuss some technicalities that you can come across while constructing the funnel for your business.
Understanding these will help you to formulate the best strategy there is.
So, let us have a quick look at the common ones before signing out with a few examples.
Common Sales Funnel Terms
- The thing that you offer in exchange of a probable customer’s personal information is known as Lead Magnet.
- The more information you want to draw, the better should be your LM.
- Free consultation, eBooks, smart hacks, template designs or free demo come under common forms of lead magnets.
- Tripwire is a sales strategy in which you offer a customer to buy an inexpensive product first and then bring out your expensive stock.
- It requires you to repackage the expensive product into a cheaper form to convert a customer easily by simultaneously teasing them about the former.
- It is easier to direct a customer down the marketing and sales funnel with a low-priced product and that is what tripwiring is based on.
- As evident from the name, the core product is the main product that a company intends to sell.
- All other products revolve around this main, often high-priced, product.
- The core product may trigger the need of the subsidiary products of the company but the vice-versa is also applicable.
- A sales technique in which you convince a customer to buy a higher end product from your company than the one the buyer originally intended to purchase.
- Companies use the upselling technique to increase revenue by selling a product to an existing customer thereby cutting on the cost of finding a new one.
- Often confused with cross-selling, which is about selling additional products along with the intended product.
- Downselling technique kicks in when the customer decides to leave the sales funnel right before the closing stage.
- Contrary to upselling, it is the process in which you offer the customer a cheaper product than the intended to retain the buyer.
- A fail-safe method where the main motive is to hold the customer to your brand even at the cost of making a loss.
Marketing Funnel at Work
And just when you are thinking whether all this hard work is worth it or not, let me give you some examples of brands who have tactfully formulated their marketing funnel stages and are using it to grow their business and sell their product.
1. Sujan Patel attributes his eBook’s success to the awareness stage
A massive amount of traffic came for his eBook through his top answers in Quora and also helped his firm Ramp Ventures. Apple follows a similar suit with their iPhones with a huge annual PR meet.
2. Neil Patel’s trick to mid-funnel success
Neil Patel now owns 3 marketing agencies and has successfully turned many brands into million-dollar companies. He attributes his success to content marketing to generate interest and make people consider.
3. Seamless Food Service acing the bottom of the funnel
Look at this email that the food delivery service sent to its customers.
They are respecting their customer’s busy schedule by keeping the message short. Seamless is feeding “Intent” by offering a discount and they have placed the app download link on the top for easy ordering.
4. Amazon’s follow up strategy
This is easy to relate to as Amazon starts hitting you with “similar products”, “more products like the one in your cart” and “people also bought” options almost immediately after your purchase. That’s doing the last stage right and retaining customers is how Jeff Bezos is one of the richest men in the world.
The Ultimate Marketing Tool!
Have no doubt about that.
Following the marketing funnel will help you to grow and expand your business in a systematic way.
Each stage is vital and needs critical attention which is why I have also put together a blog stating strategies to effectively tweak each stage of the funnel to increase your sales. Head over there to continue building the best marketing funnel for your business while we come to a halt here.
I look forward to hearing your thoughts on the marketing funnel and whether you think it should overlap with the sales funnel.
Let’s continue the discussion in the comments section while I leave you here.