The marketing funnel Explained

The marketing funnel is a critical piece of the marketing process. It outlines the most straightforward journey customers might take in their path to purchase. Ultimately, the marketing funnel is a helpful framework for connecting and engaging with customers along their journey. Here you’ll find details on every stage of the marketing funnel, and how it can help marketers maximize results with a full-funnel advertising approach. This is why we are reposting this article. The marketing funnel explained here

What is a marketing funnel?

The marketing funnel concept has been around for over 100 years, and its purpose is to easily categorize major milestones along the shopping journey, from awareness to consideration, to decision, then loyalty. Sometimes called the conversion funnel, it relates to the customer’s journey—but today’s path to purchase is far more complex, and very few customer journeys will mirror the funnel exactly. Effective marketing campaigns use a more comprehensive approach, such as full-funnel marketing, designed to reach shoppers at every stage in the process.

The marketing funnel shape corresponds with the idea that in the early stages of a shopping journey, marketers cast a wide net to engage as many leads as possible before nurturing those leads through each stage of the funnel. The audience narrows as you move down the funnel, and when you get to the bottom, you have shoppers who are most likely to convert, and ideally, become loyal customers.

Why are marketing funnels important?

Though the customer journey may not be as linear as the simplified one expressed in the marketing funnel, the concept is still important. The digital path to purchase is anything but linear, and the digital marketing funnel accounts for the fact that consumers enter and exit and move around the funnel, and their shopping isn’t limited to a single store or geographic area.

With customers’ ability to shop anywhere at any time, brands should think about how they can reach them at all stages of the customer journey. The consideration phase in the digital marketing funnel alone can involve extensive research and comparison online by consumers, and is no longer limited to comparing products in store. Many brands have adjusted to this new way of shopping, and embraced this less-linear path to purchase by connecting with customers in authentic and valuable ways across the funnel.

Marketing funnels are also important for both lead generation and lead nurturing. In the awareness and consideration phases, brands use campaigns to attract new leads. In the decision and loyalty phases, brands use campaigns to nurture current leads and, eventually, help grow customers into brand advocates. Digital marketing and the marketing funnel are critical to connecting the dots between what channels, tactics, and content is driving the most attention, conversations, and, ultimately, sales for their brand.

Stages of the marketing funnel

There is no universally accepted version of the funnel, with varied explanations including three, four, or five or more steps consumers go through in their shopping journey. We’ll outline a four-stage marketing funnel below, including the stages of awareness, consideration, conversion, and loyalty.

Stage 1: Awareness

Brand awareness is familiarity with a brand, which could include knowledge of its name, messaging, tone and style, values, and culture. Brand awareness begins with consumer research, and involves attracting customers to a brand and helping them recognize and remember it. The goal is to keep the brand top of mind by employing relevant customer touch points along the path to purchase.

To drive awareness, brands want to get in front of consumers where they are. This could include television—both linear and streaming TV—digital advertising, audio ads, social media campaigns, content marketing, and more. 84% percent of shoppers begin their online product searches on digital channels that aren’t a brand’s owned website, so these touch points have become increasingly important.1

The objective at the end of the awareness phase is for your brand to stay top of mind for customers, so that when the time comes for them to make a purchase, they think of you.

Stage 2: Consideration

The goal of consideration marketing is increasing the likelihood that consumers will consider a certain brand and its products when shopping. Marketing messages should address a pain point, highlight an interest, or answer a question for consumers. At this stage, customers are trying to get to know a brand and discover what differentiates it from similar brands. Brands should educate and inform customers in the consideration phase to help them understand how your product or solution meets their need.

Examples of mid-funnel consideration marketing solutions might include positive customer reviews, customer testimonials and case studies, and webinars.

Stage 3: Conversion

The goal of the conversion stage is to encourage shoppers to purchase a product or service because they believe the brand they’ve chosen is the right solution to their problem or meets their need. Also referred to as the “decision” or “purchase” phase, this step is a brand’s opportunity to invest in a strategy that will help them stand out in their category and differentiate themselves from peer products. This phase is where a well-detailed website product page is important, as well as creating an exceptional customer service experience to inspire customer confidence in their buying decisions.

Conversion can be a relatively easy stage of the funnel to measure, because you can often track which ad click led directly to a purchase. However, it’s important to remember that customer interactions in the previous two stages directly influence whether customers ultimately convert.

Stage 4: Loyalty

Brands can foster loyalty by providing a seamless purchase experience and delivering a quality product or service. By following up and nurturing connections with consumers after purchase, brands can stay top of mind for shoppers.

Positive interactions during and after the purchase stage can help influence whether a shopper becomes a repeat customer. Without a plan for fostering customer loyalty, brands may find that many customers make a single purchase and move on. On average, it costs a brand five times more to acquire a new customer than retain an existing one,2 which is why some marketers also call this phase the “engagement” stage. To build loyalty, it’s important to continue engaging with customers who have invested in your brand’s products or services.

Effective engagement marketing, such as email nurture campaigns, social media activations, and loyalty programs can be impactful when it comes to building brand loyalty with customers. At the end of this stage, the goal is that you’ve earned loyal, satisfied customers who become brand advocates and lifelong customers.

 

What is the difference between the marketing and sales funnel?

Some people use the terms “marketing funnel” and “sales funnel” interchangeably; in fact, some combine them into one term: the marketing sales funnel. In reality, they’re two parts of a whole. The marketing and sales functions of a company or organization have their own goals, and their respective funnels support those goals. The marketing function is tasked with creating and managing a brand, generating awareness, and driving sales-qualified leads, whereas the sales function is focused on increasing products or services sold, both initially and repeatedly. Using one to inform the other can help teams stay in sync and create an optimal customer experience.

How to incorporate a full-funnel approach in your marketing

The marketing funnel is a helpful framework for engaging audiences. At the same time, customer journeys and funnels aren’t interchangeable concepts. Today, customer journeys rarely move directly from awareness to consideration to purchase. Shoppers can enter the funnel at any stage, or seemingly skip stages altogether. In other words, while the funnel is a helpful framework for ensuring you’re reaching customers across potential paths to purchase, few customer journeys will completely mirror the funnel.

You may not be able to predict the steps shoppers take before buying your product, but a full-funnel marketing approach takes into consideration the various ways potential customers can interact with your brand. This can help you recognize opportunities for engagement and reach customers wherever they are.

Full-funnel marketing measurement

Without measurement and analysis, it’s impossible to know the effectiveness of a brand’s full-funnel marketing strategy. Here are three approaches for measuring and optimizing your full-funnel strategy.

1. Understand how channels impact each other

A full-funnel approach might include advertising across many channels to reach customers at any stage of the funnel. It’s important to determine benchmarks for success early to adequately measure the impact of each channel on a brand’s key performance indicators (KPIs). Each phase of the funnel includes its own success metrics.

Top-of-the-funnel (TOFU)

When advertisers need to gain widespread brand awareness among consumers, TOFU metrics measure:

  • unique reach
  • completion rate
  • click-through rate (CTR)

Middle-of-the-funnel (MOFU)

MOFU metrics help demonstrate when consumers have a greater likelihood to purchase. These benchmarks measure:

  • detail page views
  • new-to-brand percentage
  • branded search index

Bottom-of-the-funnel (BOFU)

These are the marketing metrics that measure the purchase end of the funnel and calculate:

  • return on advertising spend (ROAS)
  • customer acquisition cost (CAC)
  • orders or units sold

By comparing TOFU, MOFU, and BOFU benchmarks, advertisers can optimize their spend at all stages of the funnel.

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