From casual site visitors - as well as people actually interested in what you offer - to regular customers, each goes through a path called the customer journey. From initial interest to purchasing a particular product, each person goes through certain stages before buying a product online. To ensure visitors go through this journey without a hitch, marketers create funnels where each stage is organised to maintain interest and encourage purchase.
Ultimately, the success of your business depends on how effectively you attract new customers and incentivise them to make purchases to generate revenue for your company. From this article, you will learn about what is marketing funnel, how it works and how its effectiveness is measured. In addition, you will discover the main stages of the digital marketing funnel to learn how to create customer journeys that maximise sales.
For an internet user to buy your product, they must first find out about its existence, familiarise themselves with its features to get interested and also access the checkout interface. In simple words, the marketing funnel is about the stages a person goes through when he or she buys a product or service.
Notably, according to a study by Marketing Sherpa, about 80% of leads do not generate revenue for companies because they do not make a purchase. Think about this figure and you'll realise how much time and money many marketers waste. The best way to avoid the same mistakes is to route leads through a well-designed purchase funnel.
The main role of the funnel is to steer users in the right direction at various touchpoints. For example, a blog post can be the initial touchpoint and an email with a unique offer can be the final point where you interact with your loyal customers. The more people pass through the customer path, the more data marketers get for further audience segmentation and personalised content development.
Did you know that the first sales funnel was developed over 100 years ago? With only 4 stages - awareness, interest, desire and action - the St Elmo Lewis funnel focused on helping the personal selling process. While the concept remains the same, the marketing model has evolved greatly.
Today, marketers focus on important things like the needs and pain points of potential customers as well as interacting with them beyond the action stage. Below, you will find the key purchase funnel stages for new consumer pathways in the digital environment.
Located at the top of the funnel, this stage is about introducing your brand and products to your target audience. At this point, potential customers may not yet know about your business and what you offer. To attract the attention of those who may be interested in your products, you need to create quality, relevant and value-added content.
So, at this stage, marketers use various channels including social media, blogs and paid advertising to attract potential customers to the website. Well-designed marketing strategies combine both organic traffic channels and paid ads to attract and engage the target audience.
So, your business has already caught the eye of potential customers. Now, it's time to actively engage with them. By posting product reviews, case studies, and customer testimonials - and using the email marketing channel - marketers encourage visitors to consider the products and services you offer.
Your job as a marketer is to emphasise the value of what you offer and what sets you apart from the competition. Develop content that highlights a problem and clearly demonstrates how your product helps solve it. Tell success stories and share case studies to increase interest in your products.
Does your product really help with solving potential customers' problems? Why not use it? For that, the first thing you need to do is to buy it. At this stage, personalised messages play a major role as you have to overcome last-minute doubts.
Make the process of taking a targeted action - subscribing or making a purchase - as straightforward as possible. Add incentives such as a free trial, a limited-time discount and others to get the potential customer going in the right direction. Remember that your goal is to convert a visitor into a real customer.
So, let's start with the upper funnel stage strategies. Think back to when you learnt about a new brand of smartphone with an advanced camera by reading news on social media. Without even planning to buy it, you started noticing short reviews and articles about the device. This is what the top of the digital marketing funnel looks like, that is, the point where the brand has captured your interest.
At this point, your job is to make your brand known to a wider audience. Here are some tips for optimising the top of the customer journey:
· Start by learning about the characteristics and needs of your target audience.
· With this knowledge about potential customers in mind, create quality and relevant content that addresses pain points.
· Promote your marketing materials using various strategies such as SEO and paid channels.
· Utilise the power of social media to expand your reach.
You need to capture the attention of potential customers by gradually piquing their curiosity about what you offer.
After getting more information about what you're offering, people ask ‘Is this product right for me?’. This is where marketers develop more specific content of value for those who are interested in the products or services being promoted. To make your mid-funnel strategy work, use the tips below:
· Emphasise the key features and benefits of the products being promoted.
· Tell success stories, i.e., how your product helped solve someone's problem.
· Enable retargeting to attract those who are already familiar with the features of what you offer.
· Allow potential customers to try a free trial of your product.
· Develop relationships with potential customers by utilising email marketing tools.
At this stage, you should provide additional information about the brand and products and build trust.
Unfortunately, attention to your brand and products most often fades at this stage. So, your challenge here is to provide potential customers with as much useful and valuable information as possible to retain interest. One common problem today is the abandoned shopping cart. You can follow the example of ASOS, Sephora and some other online retailers by sending product picks or abandoned basket reminders via email.
The bottom of the funnel is where conversions happen - or don't happen. This is where marketers use various techniques to encourage visitors to take targeted actions:
· Developing product-specific landings.
· Adding clear calls to action without any distractions.
· Making special offers such as discounts or free trial periods.
· Sending out reminder emails to those who have already shown interest in the promoted products.
Use social proof to convince the user of the right choice. Encourage those who have already used your products or services to tell their friends about them. For example, recent Nielsen research shows that almost 9 out of 10 consumers trust the recommendations of their relatives, thus demonstrating the impressive effectiveness of word of mouth.
Whatever your business is in, a well-designed sales model can help you drive interested users and encourage them to take targeted actions. Companies from different industries use different tactics at each stage. Below, you'll find three fascinating examples:
· To create awareness, Apple holds major launches of its new products. Then, the company actively demonstrates the technical benefits of laptops, smartphones, and other devices. At the last stage, Apple offers easy instalment options and elaborate support services to persuade a purchase.
· BMW impresses with its stylish videos and active participation in social media. At the consideration stage, users can watch test drives and demonstrations of vehicle features. The bottom of the company's sales funnel is about personalised deals and a loyalty program.
· Operating in the online education industry, Coursera creates awareness through free webinars. In the middle stage, potential customers see student success stories. The final stage includes exclusive offers and bonus content.
Each model is designed to smoothly and unobtrusively guide a person from their first encounter with the brand to the final purchase decision.
Marketers should always analyse the information on running campaigns to optimise them further. It's not enough to just design and run a marketing funnel to be successful. You need to use different metrics to evaluate the performance at each stage.
At the top of the model, you need to measure how many people are learning about your brand and products, as well as their level of engagement. Analyse the reach rate, and the number of views to understand how many people you've attracted. Also measure the level of engagement by the number of likes, comments and reposts. If you use paid advertising, CTR (click-through rate) plays a key role.
At the lower levels of the funnel, what you created it for is happening - conversions. To understand how effectively your marketing budget is being used, always measure CRO (conversion rate optimisation) and CPA (cost per acquisition). In addition, check LTV (lifetime value) and customer retention rates to find out the total return of the customer over the entire interaction with your funnel, as well as how well your campaign retains customers and builds loyalty.
Today's internet users want to receive unique offers designed exclusively for them. For this reason, personalisation is an essential tool for marketers at every stage. For example, to increase engagement - and the likelihood that users will stay with the service - Netflix recommends content based on user preferences.
The middle of the marketing funnel is where personalisation is extremely important. By seeing relevant offers, the user feels that the brand really understands them. Practice shows that a personalised approach can significantly increase the likelihood of conversion.
By tracking key metrics, you can easily find weaknesses that need improvement. While A/B testing is a key technique, you should also be optimising your content and using some marketing tricks to improve the effectiveness of your customer journey.
Modern technologies such as artificial intelligence make it possible to make marketing funnels more flexible and adaptable to user behaviour. Thanks to predictive analytics, they will guess what might interest potential customers and show products before they even think about them.
A good example is Google Ads which now - through the use of AI and machine learning - shows more accurate and personalised ads. You'll also see how the trend for personalised content will increase year on year. By integrating video quests, quizzes, polls and other interactive elements, you will not only increase user engagement but also get more information about customers.
In essence, it is a model that describes a customer's journey from the first encounter with a brand to the purchase of its products or services. A well-designed model helps to properly manage interactions with potential users, increasing the odds that they will take a targeted action.
Unlike the model proposed by St Elmo Lewis, the digital one allows you to track audience actions more accurately and personalise interactions through additional tools and channels such as social media, email marketing and retargeting.
Applicable in almost all areas where customer interaction occurs, it performs best in retail, IT and SaaS products, B2B services, and educational services.
With its ability to handle large amounts of data, AI enables the creation of personalised messages and automates many processes making funnels more agile and efficient.
Compare different versions of content through A/B testing, improve the quality and usefulness of your articles, videos, infographics and other elements, create personalised messages, segment your audience, and use the power of remarketing and social proof.
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