For a long time, the sales funnel was the kind of basic marketing concept that seemed almost untouchable. After being taught to would-be marketers and entrepreneurs for decades, it seemed like nothing could threaten the traditional funnel model.
However, times have changed significantly since the first iterations of the sales funnel in the early 20th century, which is why we need to update this tool to better match the modern buyer’s journey. In today’s blog post, we’ll go over some of the ways the sales funnel needs to be updated and offer you two examples of how other people have reimagined this marketing tool for the internet age.
What is a sales funnel?
The sales funnel, sometimes also referred to as a marketing or conversion funnel, is a tool that helps you visualise and optimise the system you have in place to get someone interested in your company and the steps you take to persuade them to purchase from you. The traditional funnel follows the four stages of the so-called AIDA model: Awareness, Interest, Desire and Action.
In the Awareness stage, you catch a potential customer’s interest with something like an ad and they’re subsequently introduced to your business. In the Interest stage, you make sure you hold onto their attention with things like a well-designed website, marketing emails and great social media presence.
The Desire stage is where you make your product or service irresistible and reel your prospect further in by offering them more engaging information about your offering - blog posts, great product descriptions and demo videos are all good examples of how you could do this. The Action stage is the last step where you make your offer so enticing it would be silly not to take advantage of it. This could be done with something like a discount coupon or a free add-on.
A classic marketing funnel has one large opening at the top where your sales prospects come in. The idea is to then push them further down the increasingly narrow funnel, through the stages of the AIDA model, until the prospect is ready to purchase and exit out of the bottom of your funnel.
Is the sales funnel still a relevant tool?
The traditional AIDA model was developed back in 1898, long before the internet and digital marketing were things anyone knew to even dream about. It’s easy to see how the AIDA model could have been useful in the pre-internet era of marketing where you could have greater control over how a potential customer found out about your company and interacted with your brand. There were no online reviews, no company websites, no live chats and no social media to impact their decision
However, these days, the story is quite different. Someone could become aware of your brand through their favourite blog or online news outlet, follow you on social media, get targeted ads because they’ve visited your website, sign up for email updates and do online research into your company before you ever hear from them.
The buyer’s journey these days can appear scattered and random, making it hard to make it fit into the traditional idea of the sales funnel. This means that the classic AIDA model and sales funnel need to be updated to better capture the needs of your prospects along the varied paths they take before they make their first purchase and to serve them better after that purchase to make them into raving fans of your brand.
The flywheel - delighting your customers every step of the way
The flywheel is a concept conceived by marketing software company Hubspot. The traditional sales funnel is only effective until a potential customer has reached the bottom of the funnel and made a purchase. It doesn’t consider how the customers you’ve won can help you further grow your business.
These days, a good online reputation is everything and a single negative review could have huge, costly effects on your business. Remember also that it can be up to seven times as expensive to acquire completely new customers. This is why you need to focus on the experience your customers have after their first purchase.
Instead of relying on the funnel which has one end where people come in and another they come out of once they’ve made a purchase, Hubspot suggests opting for a flywheel model that spins around at the rate of your customer’s delight.
In the traditional sales and marketing funnel, customers are more of an afterthought who in themselves don’t have any real impact on your business or product apart from the money they pay you. In contrast, the flywheel puts them front and centre of your marketing strategy and uses them as an asset for better marketing and products.
The flywheel method puts your customers in the middle and service, sales and marketing on the spinning track outside to serve and delight them. The flywheel model is rooted in the inbound methodology championed by Hubspot: the focus is not on closing sales but serving and retaining customers and seeing them as a resource that can help you run your business better.
Above all, people trust their peers. Today’s consumers are media-savvy and can easily detect when someone is trying to make them buy something. With online resources enabling them to make more informed decisions, the vast majority of people will read reviews from their peers before a purchase. This is why you need to leverage your existing customers and word of mouth for an effective sales and marketing strategy.
Image source: Hubspot
Lifecycle marketing - turning prospects to customers to raving fans
The traditional sales funnel doesn’t take into account how a customer moves through their buyer’s journey, meaning that it doesn’t take into consideration the value that different brand touchpoints along the way have on their purchase decision. It forces potential customers into a one-size-fits-all experience that doesn’t take into account their personal needs, wants and whims.
The internet has a strong ability to influence all three of these: from social media and online communities to online reviews posted on sites like Facebook, Google, Yelp and Tripadvisor, finding out what people really think of your business has never been easier. If a prospect reads a negative review or comes across an excellent blog post from your competitor, they may take a step backwards in their buyer’s journey and your digital marketing “funnel” needs to be able to respond to this.
The Content Marketing Institute’s lifecycle marketing model consists of four different cyclical parts revolving around a stage of a customer’s lifecycle. The first two stages are Awareness, where the prospect is introduced to your company, and Interest & Intent, where the prospect engages with your company - ideally one to one with a member of staff.
Then, there’s the Decision stage where your prospect might read more reviews and watch demos of your product before completing their purchase. Finally, there’s the Loyalty stage where you keep delighting your prospect-turned-customer and building on the relationship you’ve established with them.
These four stages are a modern take on the AIDA model. They’re depicted as four separate but linked cyclical processes. This is because there might be steps backwards, leaps forward and snap decisions along the way and because the whole process moves along at a pace your prospect sets for themselves. The additional Loyalty stage makes existing clients more likely to purchase from you again and allows you to leverage digital word of mouth that can bring you more customers.
Image source: Content Marketing Institute
What should you do?
So, which way should you go - sales funnel, the flywheel or lifecycle marketing? Or do you really need to implement any of these methods in your digital marketing strategy?
You do need some form of a strategy for warming up prospects and turning them into customers. What you want to call this is up to you and at the day, that’s not what’s important - what really matters is that you take steps to understand what your potential customers want and need before they’re ready to purchase from you.
There have been many suggested modernised versions of the traditional sales funnel, but the consensus among virtually all of them is that the traditional sales funnel is unable to effectively capture the complexity of the modern buyer’s journey where a wide variety of digital marketing materials from both you and your competitors as well as online reviews from past clients are all available online with just a few clicks.
Whether you choose to follow the flywheel method, map out a lifecycle marketing strategy or construct your own, modern, inbound marketing funnel, the important thing is to put your potential customers in control. The focus should be on providing them with the resources they need to make an informed decision and to allow for steps back and leaps forward along the way. It also needs to address how to keep your customers engaged after their first purchase.
If you need help with your B2C marketing strategy and mapping out a modern marketing funnel that works for your audience, get in touch with our digital marketing experts today.