What is the Marketing Funnel?
Funnels break down the process of turning strangers into leads, prospects, and ultimately, customers. This is a critical component that all organizations must get right.
In this article, I’ll define what a marketing funnel is, its various stages, and how to set one up. Read on to learn more.
What You’ll Learn:
- What a marketing funnel is
- What are the stages of the funnel?
- Is the marketing funnel still relevant?
- What the new funnel looks like
- How to build a marketing funnel
- How to use the flywheel marketing approach
- B2B vs. B2C marketing funnels
What is a Marketing Funnel?
As mentioned, a marketing funnel is a visual representation of your customers’ journey broken into a series of stages.
Funnels serve as a blueprint for connecting with your audience throughout the entire marketing cycle, starting with tactics that raise awareness, then engaging interested prospects to the point of purchase and beyond.
Traditionally, marketing funnels ended at the conversion point. These days, funnels now include post-purchase follow-ups, up-sells, cross-sells, and advocacy programs aimed at increasing retention.
According to a Sprout Social study, businesses collectively lose up to $1.6 trillion each year to customer churn, and those brands that make retention and advocacy a top priority stand to see the biggest gains.
That said, there’s no definitive model that all companies universally use to define their strategies. Some marketers prefer a three-stage funnel, “TOFU-MOFU-BOFU” or top-of-the-funnel, middle-of-the-funnel, and bottom-of-funnel.
Interestingly, this idea of the marketing funnel isn’t exactly new. In the late 19th century, Elias St. Elmo Lewis developed a model that broke down the various stages in a customer’s relationship with a business.
What are the Stages of the Marketing Funnel?
It’s hard to nail down an official list of the stages of the marketing funnel. Many of today’s marketers say that marketing funnels consist of five stages: awareness, consideration, conversion, loyalty, and advocacy.
The original funnel, as defined by Lewis, is known as “AIDA” and breaks down as follows:
- Awareness. At this stage, the prospect is aware of the problems they face and is in the beginning stages of finding a solution.
- Interest. Next, prospects will start the research process and begin to indicate interest in several products or services.
- Desire. At this point, the prospect has made a shortlist of options and is evaluating a particular brand’s solution.
- Action. Finally, the prospect decides whether to become a customer.
Despite all of the new tools and technologies we’ve added to the marketing process over the past century, funnel basics have more or less stayed the same.
Is the Marketing Funnel Dead?
Is the marketing funnel dead, or not?
A quick search for “is the marketing funnel dead?” reveals that there’s no real consensus, as you can see in the example below.
Those in favor of killing off the funnel make some compelling arguments. For one, the digital customer journey is made up of many different touchpoints, making attribution incredibly difficult, even when evaluating your efforts one stage at a time.
While digital has changed the entire marketing landscape over the past two decades, there are a couple of things that suggest the underlying framework of the marketing funnel remains largely the same.
For one, customer intent increases as they continue on their path to purchase. At the top, you’re targeting a passive audience, and toward the bottom, you’re targeting high-intent prospects on the verge of making a purchase.
Second, as intent increases, people drop out of the funnel—hence the wide mouth at the top and the narrow opening at the bottom.
Ultimately, it seems that much of the “dead or alive debate” comes down to shape and the complexities of the buyer’s journey today as compared to what it looked like back in 1898.
The New Marketing Funnel
Now that we’ve established that the marketing funnel is alive and more important than ever, let’s talk about how it’s evolved.
While the AIDA model is still relevant, it doesn’t represent the entire customer journey–and of course, it was developed a century before the internet even existed.
Funnels are Driven by Individual Intent
In a September 2018 blog post, Google’s Allan Thygesen wrote that today’s customer journeys don’t really resemble funnels at all, noting that a combination of intent and digital technologies have given the buyer more control over the experience.
In another post, Google looks at how intent is changing the customer journey, noting that people no longer follow a linear path from awareness to purchase. Instead, users are turning to their devices to find immediate answers to questions as they pop into their heads.
Today, funnels must cater to multichannel, multi-device journeys. Given all of the variables in the mix, this means no two journeys will look the same.
Google recommends responding to this shift in behavior by incorporating the following points into your funnel strategy:
- Align marketing efforts to business outcomes. Instead of looking at impressions, clicks, and conversions and calling it a day, each marketing effort should align with a specific touchpoint and objective. By measuring revenue by stage, marketers can get a better sense of the factors that drive growth.
- Focus on targeting audiences likely to become profitable customers. Marketing efforts should be optimized so that they are both relevant to your brand’s core message and your target customer. Your brand won’t be right for everyone, and as such, everything from PPC to content, social posts, and web copy should speak to your most profitable groups. Understanding which groups are most responsive to your message means you’ll waste less time chasing down unqualified leads.
- Embrace automation. Predicting intent is hard enough when you’re looking at one segment at one touchpoint. But, with a marketing strategy that covers everything from social media profiles, website, guest posts, directory pages, paid ads, and more, you’ll need an automated solution to help you identify connections between customer intent and your business goals.
Funnels are Shapeshifting
A simpler way to think about the new marketing funnel is to turn it into a loop—or if that’s too radical—a double-ended funnel that includes the following stages:
So, you’re going from a top-down model to a sideways design that looks like this:
There’s also the flywheel example, which turns the funnel into a loop and places the customer at the center of all activity—sales, service, and marketing—aligned toward the same goal.
How Do You Build a Marketing Funnel?
Here, I’ll walk you through the process of mapping out a basic marketing funnel using the AIDA framework, with post-purchase stages added to account for the entire customer experience.
Later, I’ll dig into some more specific examples.
Before you get started, you’ll need to gain a deep understanding of your audience. Here are some questions you’ll need to answer:
- What are your customers’ pain points?
- What do they expect from a service provider?
- What topics interest them?
- What are their goals?
- What frustrates them about other solutions or their existing solution?
- What social media platforms do they use?
- Which content formats do they prefer?
While questions will vary based on your audience and what you offer, understanding your audience will allow you to do the following:
- Learn where to find your audience.
- Position your brand/product/services in a unique way.
- Address pain points with the language and emotional triggers that resonate with your audience.
Your first order of business is developing a strategy for helping people learn about your business.
At this stage, the goal is to capture your audience’s attention so that they feel compelled to visit your website to learn more.
Types of Content:
- Guest posting
- PPC campaigns
- Paid social ads
- Landing page optimization
- Influencer marketing
Consider exploring podcast advertising. Brands like BlueApron, Bombas Socks, MailChimp, and Casper have seen massive increases in high-intent searches using this strategy. Listeners are less averse to ads read by podcast hosts than traditional ads, which are often disruptive.
Keep in mind, you’ll want to target podcasts that share your target market. Most podcasts will offer some guidance in terms of who they work with, like Girlboss does below:
Use social media to show off new products. While RedBull has ruled the marketing scene for nearly three decades, they recently ran an awareness campaign on Instagram to roll out a tropical energy drink to Australian customers.
The campaign does feature the drink, but the focus is on creating a general “feeling.” The brand used yellow filters to create a summer-time vibe and used the hashtag #thissummer to reach 1.2 million consumers.
Show your personality. Old Spice taps into their unique sense of humor to create memorable, viral ads that go beyond leaving an impression with audiences. They drive shares, which in turn, drive sales.
Keep in mind, the humor approach only works if it aligns with your brand identity. For example, if you’re a B2B software brand, channeling Old Spice may leave audiences confused.
Once you’ve captured some attention, your goal is to educate your audience about your product and build trust. Make it easy for prospects to learn about your brand, reinforce your mission and values, and clearly explain the benefits your solution has to offer.
Types of Content:
- High-quality blog posts
- Case studies
- Product pages
- Reviews and tutorials
- Promoting paid and organic content on social media
- Running email marketing campaigns that nurture leads.
Case studies. Follow Instapage’s lead and give your audience detailed case studies that show your solution in specific ways. Both studies cover landing page strategies, but one focuses on how that might look for a SaaS company versus a non-profit.
Share social proof. Casper embeds social proof directly into their email marketing campaigns during the consideration stage. This example uses a dash of humor and authenticity to help prospects get over the “risk” of buying a mattress online. Casper is so comfortable, it made Joe here call in sick.
At this stage, prospects are engaging with your content and are interested in your product or service.
However, generating desire means you need to create enough excitement among your prospective buyers to compel them to take action.
Most of the content you’ll find at this stage looks like what you’d find during the interest stage, but the idea here is to keep the momentum going.
Build up audience knowledge with content that dives deeper into key topics, engage on social media, and host webinars, events, and Q&A sessions. Focus on community building and continuing to prove yourself as a valuable resource.
Types of Content:
- Downloadable resources
- Blog posts
- Social media ads
- Live Q&As
- Twitter chats
- Private LinkedIn or Facebook Groups
Community building. American Express’ OPEN forum offers ongoing insights and advice for growing a small business. The site is a collaborative effort, with guest authors from different industries sharing their knowledge with the community.
While the blog is peppered with Amex ads, the focus is more on thought leadership than promoting financial products. As such, readers are likely to return to the site for the latest insights.
Product comparisons. Wendy’s “Where’s the Beef” campaign is a real throwback, but it remains an effective example of how a brand might approach the product comparison ad. Here, Wendy’s highlights the benefits of their burgers (more beef) than what the competitors were offering at the time.
After you’ve generated a sense of desire for your product or service, give audiences the chance to act.
At this stage, make sure you reinforce your benefits and stay focused on leading prospects toward completing the purchase.
Types of content:
- Free trials
- Contact forms
- Pricing pages
- Product pages
Reducing risk. Netflix offers new customers 30 days of free binge-watching but further reduces risk by explicitly letting users know when they can expect a bill and promising to send a reminder three days before the trial ends.
Make it easy to get started. Like Netflix, Basecamp uses the 30-day trial to get users to take that initial first step. All you need is a name and email to get started, and the simple “Next” CTA offers users the sense that they’ll be up and running within moments.
Retention & Loyalty
Your work isn’t over with the purchase.
Next, you’ll need to make good on whatever you’ve promised in your marketing copy to ensure new customers stick around.
If applicable, this means creating an onboarding process to encourage customers who’ve made purchases from your business with informative content that reaffirms your authority.
Types of content:
- Remarketing campaigns
- Follow-up emails with special promotions.
- Review generation campaigns.
- Knowledge-base content.
- Long-form blog posts.
- Collecting customer feedback to improve processes.
- Referral programs.
- Loyalty rewards to encourage repeat purchases.
Examples of post-purchase strategies:
Referral programs. Dropbox encourages word-of-mouth marketing by offering extra storage space as an incentive:
Loyalty points. Sephora’s Beauty Insider program entices customers to come back by providing a point for every dollar spent per purchase. Shoppers can exchange points for samples or full-sized products, much like exchanging tickets for prizes at a carnival. Naturally, the more points you rack up, the better the reward.
User-generated content. Airbnb is a master at UGC, with the bulk of its Instagram posts coming from its community of travelers tagging the brand in posts they’d likely share anyway. This strategy allows the brand to get in front of millions of potential new users. And, given that the photos offer breathtaking views and an inside look at some unique accommodations, Instagram users planning a trip may be inclined to book a stay themselves.
How does content change with the flywheel approach?
The flywheel design keeps the customer at the forefront of all marketing activities.
It’s worth noting that you’ll use the same content strategies here as you would inside the funnel. However, the three stages don’t include an official conversion point. Delight, the “final” stage, spans the desire, action, and post-purchase stages in a more traditional funnel.
Here’s a breakdown of which strategies belong where within the flywheel:
- Attract. This stage involves applying tactics like social media ads, top-of-the-funnel content, SEO, and PPC ads to drive new leads to your site that are likely to benefit from your product/service.
- Engage. Once visitors arrive on your site, you’ll need to engage them in hopes of converting them into a lead. Do so by encouraging them to sign up for an email list, chat with a bot, or sign up for push notifications. From there, you’ll want to continually nurture those leads with contextually-relevant communications based on past behavior, demographic information, and interests.
- Delight. At this stage, you’ll use a variety of tactics like email marketing, blog posts, conversational marketing, and video content to continue building a relationship with your audiences. Content should both educate and inspire lasting brand loyalty.
B2B vs. B2C Marketing Funnels
B2B marketers and B2C marketers operate with different goals in mind and have different relationships with their customers.
Where B2Bs aim to build one-on-one relationships with their audience, B2Cs drive loyalty by bringing positive associations and emotional connections to an otherwise transactional experience.
While the stages in the marketing funnel are more or less the same, B2B and B2C customers seek different information at each stage to move them along in their journey.
This chart offers a general example of the types of content each type of buyer might encounter throughout their journey.
Whatever you want to call it—funnel, flywheel, maze—marketing funnels are an essential piece of any content strategy. In fact, I think funnels (regardless of shape) may be more important now than ever before.
Key takeaways include:
- Companies that fail to take funnels seriously stand to miss opportunities to educate and engage, as noted in that SmartInsights report.
- AIDA framework is still relevant but now serves as a starting point for building out your funnel strategy, rather than representing the end-to-end journey.
- Funnels need to include retention and loyalty strategies as full-fledged stages, not afterthoughts.
With content coming from all directions and buyer’s journeys as unique as their fingerprints, mapping out what content goes where is the only way to ensure you’ve covered all of your bases.
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