Lead Generation Funnels

Lead generation funnels and why more online businesses should be implementing them

Any successful B2B business thrives on a continuous flow of leads. How a water stream is alive due to water similarly, B2B business run due to regular flow of leads. 

 What is a Lead Generation funnel?

Lead Generation is a process of accumulating list of large number of prospects, analysing and nurturing them into leads and eventually into customers. Due to its slopping shape which tapers at the end of the process, it takes a shape of the funnel from which it derives its name.

To understand different stages of Lead generation we need to map the customer’s journey which leads to the purchase of a service or product. The model which best explains this process is AIDA. Awareness—Interest—Desire—Action. 

Awareness:  This is the initial stage where the prospect is made aware of the service/product. 

Interest:  The prospect may need the service/product or it might be fulfilling his desire/need or want. This prompts the prospect to search for more information and he/she researches further about it.

Desire: This is the stage when the customer has developed a deep emotional connection with the service or product and is exploring the option to choose from. In this stage, brands offer value proposition to their prospects.

Action: The prospect has already chosen few prospective vendors and is looking to choose the right value fitment. Here call to action and urgency is created by businesses that result in a purchase.

Above stated customer’s journey is also a key factor in determining different stages of the lead generation funnel, namely 

Top of the Funnel (TOFU)

Middle of the Funnel (MOFU)

Bottom of the Funnel (BOFU)

Top of the Funnel (TOFU): This is the widest mouth of the funnel and here businesses are prospecting, attracting and inviting likely prospects. From the customer’s perspective, this stage denotes awareness. The goal here is to gather as many contact details as possible. Blasting emails, advertisements etc. are associated actions in this stage. Businesses are expanding their reach online and with it, the traditional methods are being replaced by online methods and platforms. You are prospecting through Emails, Search Engines, Content Marketing, Listings, ads etc. 

Middle of the Funnel (MOFU): In this stage, you have contact details of your prospect and you start engaging them and nurturing them into a qualified lead. At this stage the customer is interested and online businesses engage their prospects through service/product videos. The prospect is also nurtured with continuous touchpoints through mails, newsletters etc. 

Bottom of the Funnel (BOFU): The customers have expressed their interest in your service and product and are looking for a value proposition to take action. Here your hard-core salesman comes into the picture who converts leads into paying customers. The value proposition can be shared in multiple ways through free use for a limited period, discount and good deals. The interesting prospect would then likely become your customer. 

 Why lead generation funnel is a must for Online Businesses.

 As we have seen how customer’s journey and sales cycle go hand in hand, understanding both is key to implementing a successful lead generation funnel process. 

1) Distorted Funnel shape due to high attraction & low conversion

For Online businesses, the shape of this funnel is much wider on the top and tapered at the bottom due to the open nature of the internet where the options are available in large numbers. To maximise their revenue cycle and keep their sales force engaged they need to prospect harder as the leakage is greater. 

Generating leads has become easy but converting and sustaining them has become difficult. For online businesses whether B2B or B2C there are free-flowing leads from search engines once you have put a sustained effort into your search engine rankings. However, success with email marketing, affiliate marketing, influencer and content marketing cannot be side-lined as they form the major chunk of your lead source. 

2) High Competition

The Competition is ever high and increasing. To survive and establish your business you would require continuous fodder in form of prospects and leads to convert into paying customers. Without a proper sales cycle and lead generation funnel in place, the leakage would be much higher and results dismal. 

 3) Lack of loyal Customer

Gone are the days when you had loyal customers, we are living in a communication age where we are ready to switch wherever there is a change in the value proposition. More and more loyal customers are switching vendors at their convenience. Having a regular supply of prospects can help you negate this effect and keep your account books healthy.

 In Conclusion

To build your business and keep your account registers ticking it is important we understand and implement lead generation funnels in our business and if you are an online business then it is a must.