Have you been obsessing about the marketing funnel? Are you struggling to make one that will actually bring results?
Don’t worry, you’re not alone.
Marketing funnels are a vital tool for any business, yet it’s also one of the most misunderstood concepts.
The concept has been used for years by big businesses, yet it’s only recently that small businesses have started to pay attention to it.
In fact, it has been in existence since the early days of marketing and sales.
The concept dates back as early as 1898 when Elias St. Elmo Lewis developed a model that described the steps a customer goes through when making a purchase.
In this article, we’ll demystify marketing funnel strategies, and show you how to create an effective one for your business.
What Is a Marketing Funnel?
A marketing funnel is a process that helps you to identify an ideal target audience.
And then guide them through the customer journey from the awareness stage, to consideration to a decision in your marketing campaign.
The aim of having a digital marketing funnel is to convert as many potential customers as possible and then nurture those relationships so they become loyal advocates for your business.
There are many different ways to create marketing funnels, but the most important thing is to start with your ideal customer in mind and then work backward from there.
Some common marketing funnel strategies include using lead magnets to attract prospects.
You can then create landing pages to convert them into leads and afterward use email marketing, or other forms of nurturing digital marketing, to turn those leads into customers.
What Is an Example of a Marketing Funnel?
To better illustrate this, let’s look at an example of a digital marketing funnel.
Say you run a SaaS business that sells project management software.
Your prospective customer is a small business owner, or manager who wants to streamline their operations and get better control over their projects.
To reach these prospective customers, you might use Google AdWords to run paid ads targeting keywords like “project management software” or “best project management tools”.
When potential buyers click on your ad, they’ll be taken to a landing page where you offer them a free trial or demo of your software in exchange for their contact information.
Once you have their contact information, you can create content to start nurturing them with helpful resources about project management, as well as information about your software.
Eventually, you’ll aim to convert them into new customers.
This is a simple example of how a marketing funnel might work for a B2B SaaS company, but the same principles can be applied to any business.
How Does a Marketing Funnel Work?
A marketing funnel is no different from a paper funnel in the way that it is wide at the top and becomes progressively narrower as it goes down.
The idea is that the sales funnel begins with a large number of potential customers (the top of the funnel) and then, through a series of steps or stages, you move them closer to becoming actual customers (the bottom of the funnel).
The key to effective marketing funnel strategies is to move your potential customers through the stages as quickly and efficiently as possible.
Ideally, you want to take them from being unaware of your product or service all the way to becoming happy, loyal customers who are advocates for your business.
That is why perspective is so important when it comes to a marketing funnel. You need to see the funnel not as a static, one-time sales process, but as an ongoing customer journey.
Additionally, it’s important to understand that not every customer will go through the entire sales funnels.
In fact, most potential buyers will only make it part of the way down before they drop off.
The goal is to minimize leakage at each stage so that more prospects make it all the way to the bottom, where they become paying customers.
The stages of a marketing funnel can vary depending on your business and the products or services you sell, but the most common ones are:
Awareness Stage (TOFU)
This is the stage of the funnel where potential customers become aware of your product or service.
For example, they might see a blog post you’ve written, a paid ads you’re running, or a social media post that catches their eye.
At this stage of the funnel, your goal is to get your prospect’s attention and pique their interest. But remember, not all problems will require equal attention.
Some problems might be immediate like a house that needs to be repainted, or a car that needs an oil change.
Others, like a house needing a new roof, are not as pressing but might become a problem down the road if they are not addressed.
Awareness in the marketing funnel strategies is all about getting potential customers to realize they have a problem that needs to be solved.
Once you’ve caught your potential customer’s attention, the next step is to get them interested in your product, or service as a potential solution.
It is at the interest stage of the funnel, that they are beginning to do their research and are looking for more information about the options available to them.
For example, they might read blog posts, watch videos, or visit websites to learn more.
Let us say they are looking for accommodation facilities, our goal at this stage of the sales funnel is to be there when they are looking for the information.
You want to be the one providing them with the resources they need so that you can become their go-to source for information on the topic.
The more helpful and informative your content is, the more likely they are to see you.
Evaluating of Product Options(MOFU)
Here, the potential customers are evaluating their options and deciding which product or service is the best fit for them.
They are looking at things like price, features, benefits, and most importantly, whether or not the solution can actually solve their problem.
It is in this stage of the sales funnel, that prospects become Marketing Qualified Leads.
An MQL is someone who has gone through your marketing funnel and shown enough interest in your product or service that they are now ready to be contacted by a salesperson.
At this point, they are further down the sales funnel and are more likely to be interested in your product or service, and are a hot lead for sales teams.
The goal of your marketing team at this stage is to create content and continue providing them with valuable resources so that they stay engaged and don’t drop off the buying process before making a purchase.
For example, you might provide them with a free trial, a visual representation, or a discount code to encourage them to buy your product.
The key is to make it as easy as possible for them to take the next step so that they don’t get cold feet and back out.
Having reached the bottom of the funnel, the prospects are already convinced and are ready to buy your product or service.
They have decided that you are the best solution to their problem and are now looking for more information on how to make a purchase.
At this point of the purchase funnel, your goal is to provide them with all the resources they need to make a buying decision and close the sale.
This might include things like product information, pricing, shipping, and return policy.
As part of your marketing strategies, you want to make it as easy as possible for them to buy from you so that they don’t look elsewhere.
For example, you might offer them free shipping, a discount code, or a package deal if they buy multiple items.
The key is to remove any barriers that are preventing them from buying so that you can close the sale.
In this part of the digital marketing funnel, the potential customer has made a purchase and is now using your product or service.
Your goal now is to provide them with a great customer experience, for customer retention.
You want to make sure they are satisfied with their purchase and that your product or service is meeting their needs.
If you can do this, they will be more likely to buy from you again in the future and may even become brand ambassador who promotes your product or service to others.
The key to your marketing funnel strategies is to provide them with a great experience so that they have a positive association with your brand.
How to Build a Good Marketing Funnel
After understanding how marketing funnel strategies work, you should be stoked to create one for your business.
Notably, there are variations in the marketing funnel strategies, but the basics are the same.
One of the key things is the choice of marketing channels. This is usually a challenge, as it may require huge mobilization of resources that may not be available.
So ideally, your marketing strategy should be to build your sales funnel from the bottom up to be more cost-effective as it is much easier to convince bottom-of-the-funnel potential customers.
Additionally, you want to combine it with a powerful marketing mix to make it more effective.
Below are the steps in building a sales funnel.
The first stage of an effective sales funnel is the need for recognition. The consumer behavior here is to become aware that they have a problem that needs to be solved.
For example, prospects might be having wrinkles but have never thought there are ways to get rid of them.
But if they see an ad for a skincare in an advertising campaign, they may get excited and start searching for a solution to their problem.
It is also important to note that not all prospects will be aware of their problem. In fact, most prospects will not be aware of their problem until you make them aware of it.
This is why it is important to use marketing channels that allow you to reach a large target market so that you can make as many people aware of their problems as possible.
Also, it is crucial to use influencer marketing language so that you can convince them that they have a problem that needs to be solved.
The key is to make them aware of their problem, and convince them that they need to find a solution.
Here are a few channels to include in this stage of the funnel:
- Social media
- Influencer marketing
Here are some examples of inbound and outbound marketing campaigns, you can launch at this stage
You sell dog food and you could place paid ads on a popular podcast whose main audience is pet owners.
- As a travel company could partner with a popular blog in your niche and do a post about the top 10 places to travel to in 2022.
- Another example time you are a shoe company. You could do a post on the top 10 summer destinations and mention that your shoes are perfect for those locations.
In this stage, a potential customer is interested in finding out more about the problem they have and the potential solutions.
They will start to search for information about their problem and possible solutions online.
The key is to provide them with the information they are searching for so that you can become a trusted source of information for them.
But keep in mind not all products will require you to take the customer through the same buying journey.
For some simple products, you might send them directly to the sales page, via a CTA. For others, you might need to take the customer through the whole buyer journey based on the product complexity.
For complex products, you might want to include elaborate tutorials. A great example is how Canva does it with its detailed tutorials.
Other channels for this stage include:
- Email marketing
- Content marketing
For example, with content marketing, you can write blog posts as a means of satisfying the search intent of the prospects through search engine optimization.
This is a powerful channel in marketing funnel strategies, especially when you target the right keyword.
The keywords to use at this point should be the “low hanging fruits” with low Key Word difficulty.
For example for a beauty care products seller here are a few kinds of content you can write about:
- How to get rid of wrinkles?
- The best skincare products for wrinkles?
- What are the causes of wrinkles?
The key at this stage of the funnel is to provide value and build trust with your prospects so that they will be more likely to buy from you when they are ready to purchase.
Evaluation of Alternatives(BOFU)
At this stage of the sales funnel, prospects are interested in finding the best solution to their problem. They will evaluate all the different options that are available to them and decide which one is the best for them.
The key is to provide them with as much information as possible about your product so that they may find it the best option in comparison to the competitors’ choice.
Once they reach here keep alive the momentum to avoid them from falling off the funnel.
The channels to use include;
BOFU marketing articles on the product
- Product demos
- Retargeting ads
- Writing case studies
- Free trials
- Comparison charts
- Existing customer testimonials
Using our earlier example, if you are selling a skincare product you might want to provide a before and after photo or a testimonial from a satisfied customer.
You might also want to include a comparison chart so that prospects can see how your product stacks up against the competition.
At the bottom of the funnel stage, prospects are ready to buy the product and they just need a little push to finalize their decision.
The key is to make it as easy as possible for them to purchase your product. You want to remove any barriers that might be in their way so that they can complete their purchase.
Some of the channels you can use at this stage include:
- Making the purchase process easy and seamless
- Offering discounts or coupons
- Offering free shipping
- Adding an FAQ section to address objections
- Offer a 30-Day money-back guarantee
- Accepting multiple payment methods
- Asking for customer reviews and testimonials
Customers are your best advocates to ensure you get more customers. At this stage, it is important to keep in touch with your existing customers and ensure that they are satisfied with their purchases.
You can do this by sending them follow-up emails or survey requests.
It is also important to ask for reviews and testimonials at this stage of the sales cycle, as they can be very helpful in convincing other prospects to purchase your product.
Here are a few of the methods you can use at this point.
- Follow-up emails
- Customer surveys
- Asking for reviews and testimonials
- Staying in touch through social media
Which Marketing Funnel Metrics Should I Track?
Once you have your marketing funnel in place, it is essential to track it to evaluate how well it is functioning.
For this, you can use several key metrics you can use to track its success. However, before you proceed it is important to avoid getting obsessed with data at the expense of other equally valuable performance indicators.
Here are a few below.
Sales Funnel Conversion Rate
The sales funnel conversion rate is the percentage of prospects that make it through to the final stage of the funnel.
To calculate this, you take the number of conversions and divide by the number of leads, and multiply by 100 to get the percentage.
An increase in this figure over time is an indication of the success of the marketing campaign.
Leads from different sources in the sales funnel can be tracked using this metric. This will give you an idea of which marketing channels are working well for you and which ones need to be improved.
For instance, if you find most of the traffic is coming from one post you can improve on it by for example incorporating an infographic, or increasing word length.
Time in Stage
The digital marketing funnel rarely takes the smooth theoretical flow from TOFU to BOFU. In reality, there are bound to be delays in one or several stages of the funnel.
To streamline these stages, it is essential to monitor and identify and act on the source of the delay. You can improve on that stage by adding information that seals the information gaps.
Exits From Stage Rate
This is one of the most important metrics to track in your marketing campaigns as it gives you an idea of where prospects are falling off in your funnel.
A low conversion rate at any stage indicates a problem that needs to be addressed. Probably, you have included unnecessary, or too many details in the forms in one of the stages.
It is the number of leads that are converted into sales. To shore up the numbers on this metric, you need to look into the other metrics and understand, the specific parts of the sales process that needs.
For example, you may need to get your buyer personas right, to match them up with the right content.
The Bottom Line
A marketing funnel is a great way to visualize the journey that your prospects take as they move from being unaware of your product to becoming a paying customer.
By understanding the different stages of the marketing funnel, you can better tailor your marketing funnel strategies to each stage of the customer journey.