The Marketing Funnel
What is the marketing funnel?
The marketing funnel, also known as the purchase funnel, is a visual representation of all the steps a visitor has to go through before they purchase a product or service. Its origins date back to 1910, when American philosopher John Dewey introduced the five stages consumers go through before, during, and after purchasing a good or service.
This buyer decision process included the following stages: Problem/need-recognition, information search, evaluation of alternatives, purchase decision, and post-purchase behavior. Over time, this idea evolved into the contemporary marketing funnel, which focuses on the different stages from the moment people first hear about a business to the moment they make a transaction.
But why is it referred to as a funnel? Marketing efforts don’t involve getting people to buy right away. Instead, they start with capturing leads - potential customers who show interest in the brand. When companies turn anonymous strangers into leads, they’re drawing them into the mouth of the funnel. Then, they continue marketing to these leads with the goal of getting some of them to buy.
Of course, only a fraction of leads will actually purchase the product. As they advance through the different stages of the buyer decision process, some of them will abandon the effort without ever getting to the purchasing stage. Thus, the crowd thins, and the resulting visual representation of this process forms the shape of a funnel.
Benefits of the marketing funnel
Now that you know what the marketing funnel is, you’re probably wondering if you should start using it as part of your small business marketing strategy. Ask yourself the following question: Do I have a service or product I intend customers to purchase? Do I have a stellar go to market strategy for my product? If the answer is yes, then you definitely should.
As a business, your success does not only depend on the quality of your offering, but also on the way in which it’s presented and marketed to consumers. Everything from your website layout and color scheme to the packaging of your products and brand marketing also plays a huge role in your customer’s journey through the marketing funnel. How you choose to promote your website will also impact on this.
Some specific brand and business metrics using the marketing funnel can help improve include, increased brand awareness, increased brand loyalty, higher customer lifetime value, and improved customer satisfaction.
Having a clear view of a customer’s journey will allow you to identify any roadblocks that hinder their progress through the funnel. Based on this data, you can make changes to eliminate these barriers and improve your conversion rate - whether it’s by making your website more user-friendly, creating a social media campaign, opting to use more personalized marketing or promoting on different channels. That’s why funnel marketing is so effective.
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The marketing funnel can apply to any type of marketing. From digital marketing, and online advertising, to using landing pages. From referral marketing to mass marketing including viral and influencer marketing. From traditional to disruptive, to super strategic marketing , the funnel is relevant and effective across marketing channels and strategies. That's part of what makes it so impactful across both marketing and entrepreneurship.
Research and the marketing funnel
Research is an essential part of making the marketing funnel work most effectively. Before even working through its different stages you should make sure that your understanding of your target audience, and your user experiences are up to date. Your marketing research should be extensive and comprehensive in order to apply it to the funnel for most impact. Refine your market research, both quantitive and qualitative.
Stages of the marketing funnel
While the overall framework of the marketing funnel has remained mostly unchanged for more than a century, there isn’t a global consensus on the different stages. Here, we’ll discuss the various stages represented in the marketing funnel template above.
These stages include: