Marketing funnel: why businesses need it

In today’s business, when there are many tools to promote a product, marketing strategy becomes overgrown with details that are often difficult to link together. The sales funnel is a model of consumer interactions with a brand, from first encounter to repeat sales. It helps to understand what measures really bring results, where to improve the system and at what point potential customers are “lost”. However, it is only through a deep study of each stage that the full potential of this tool can be utilised.*** Translated with www.DeepL.com/Translator (free version) ***

What is a sales funnel and why to implement it

The marketing funnel allows you to visualise the “customer journey” not only in terms of one promotional channel, but of all interactions. This approach helps to track results at different stages and improve them. Valuable information that the model provides: 

• the number of potential customers at each stage of interaction;
• conversion rate by stage – the percentage of people moving from one stage to another;
• “bottlenecks” in sales, where customers “drop out”;
• the effectiveness of each individual promotion channel and campaigns;
• which products, promotions or content are resonating;
• sales forecasting and growth potential based on current conversion rates;
• how many customers return and recommend the product to others;
• return on investment in advertising.

This data gives a clear picture of the customer journey, allows you to improve it and then already “lead” a potential customer with a pre-planned “route”.

The main stages of the marketing funnel

All modern interpretations of the sales funnel are based on the AIDA model, described by the pioneer of marketing – American advertiser Elias St. Elmo Lewis (Elias St. Elmo Lewis). Elias St. Elmo Lewis (Elias St. Elmo Lewis) in his publications in trade publications of the late XIX – early XX century. He was the first to formulate the sequence:

AIDA: Attention → Interest → Desire → Action 

Today, marketers are also adding a fifth stage – loyalty. It has taken an important place in the sales funnel, because attracting new customers is much more expensive for a company than retaining them. So, what is the essence of each stage of interaction:

• Attention/awareness – determines the first contact, informs the audience about the existence of the brand.
• Interest/consideration – the company remains in the memory, and the user starts looking for more information about it.
• Desire – the visitor becomes a lead, a potential customer who already has an idea of how the brand can be useful to him.
• Conversion – the user performs the target action to which the funnel was leading, mainly a purchase.
• Loyalty – the customer makes repeat purchases, becomes loyal to the brand and recommends it to others.

Detailed marketing funnel proposed by the company Cooler Insights:

How to build a sales funnel

In a comprehensive set of statistics compiled by an independent publication for content makers Ecommerce Bonsai, Among other things, it says that 90 per cent of users are not ready to buy a product after visiting the site for the first time. Moreover, the consulting company EmailToolTester, has determined that the number of customer interactions can vary from 1 to 50 depending on the industry and audience. This is why a well-designed sales funnel becomes a priority for marketers. The basic steps of building one:

1. Establish goals and key metrics.
2. Define the target audience and map out the customer journey from brand awareness to purchase and retention.
3. Create content and offers for each stage.
4. Set up conversion points and connect tools (lendings, CRM, email).
5. Track key metrics and customer behaviour.
6. Automate communications and lead warming.
7. Test and improve the funnel based on results.

A detailed sales funnel should include information on the stages of customer touchpoints, targeted actions, channels and tools to be used to motivate users.

Examples of building marketing funnels

Funnel for e-commerce

The e-commerce marketing funnel focuses on a quick buying cycle and maximising conversions on the website. The main goal is to engage the user, convince them of the value of the product and encourage them to buy, then retain them through loyalty programmes and repeat sales.

Funnel for B2B service

The B2B funnel is longer and more complex as decisions are made by a group of individuals and require ROI evaluation. The main focus is on building trust through content, demos, case studies and personal consultations. More information on what a B2B sales funnel is and its specifics can be found in this article HubSpot, a leading inbound marketing company.

Content marketing funnel

The sales funnel example for content marketing focuses on creating value and trust through useful content. The goal is to engage audiences, build brand expertise, and gradually warm users up to a subscription or purchase.

Evaluating the results of sales funnel implementation

Once the sales funnel has been implemented, it is important to regularly evaluate its effectiveness and make adjustments. The main goal is to understand how well customers are converting at each stage, where losses occur, and which tools work best:

• Traffic and Reach – how many potential customers learnt about your product.
• Conversion by stage – the percentage of customers moving from Awareness to Interest, Consideration and Decision.
• CPL / CAC – the cost to attract a lead or customer.
• AOV (average cheque) and LTV – how much a customer brings in on average and how long they stay with you.
• NPS and Satisfaction – how satisfied customers are with the product and are willing to recommend you to others.
• Retention / repeat purchases – a measure of retention and engagement.

Regular analysis of these metrics allows you to identify bottlenecks in the funnel, improve content and offerers, as well as increase overall conversion and efficiency of advertising investments.As you can see, building a sales funnel is a complex and time-consuming process that requires not only a deep understanding of the industry and audience, but also marketing tools. Art-Marks team manages to build a client’s path with careful elaboration of stages and adaptation to the client’s business. This is possible thanks to the experience of co-operation with companies from different spheres and the comprehensive use of digital promotion channels.
*** Translated with www.DeepL.com/Translator (free version) ***