How Do Marketing Funnels Work?

Marketing funnels are a widely known concept loved by every marketer. In fact, everyone that has had even a remote contact with marketing knows the fabled funnel. What makes them so effective? Do they even work? Let’s find out what makes funnels so great.

What’s so Special about a Marketing Funnel?

First, a marketing funnel isn’t something that you use to cook dinner for the marketing team (ba-dum-tss.)

Bad jokes aside, you must figure out what works. Then, you must adopt the right funnel for your business to make be more efficient.

Why It’s Named a Funnel?

If you were to draw a marketing funnel on a piece of paper, it would look exactly like its name suggests – a funnel.

And why is that? Because it represents the stages through which your customer’s journey plays out. It starts right from the beginning, or the awareness stage, up until the end which is the promoter stage.

There is reason why it looks like a funnel. It's because with each stage, a smaller percent of the initial set of customers will go to the next stage.

To make an analogy here, think of it as pouring water through a funnel. You pour a lot at the top, but only a small, steady stream comes out of it.

Keep this in mind, because some marketers don’t want to use the term funnel. They consider it too simple to describe the complexity of customer behavior. Still, it's a great way to represent the process without diving into analytics.

How Does a Marketing Funnel Work?

There is a reason why the “funnel” is so popular. Ever since its start, in 1910, it has been used to understand how the customer journey plays out. And, it’s applicable to every business. It’s even applicable for brick-and-mortar ones.

The logic behind the funnel is simple. It describes every stage in the customer journey, from start to finish. Knowing these stages enables a business to make specific strategies. This enables them to lead customers through each stage.

Or, to put it simple, a funnel is the steps a visitor needs to journey through to reach the goal of the business, sales.

Or is the final goal sales?

Sales Isn’t the End of a Marketing Funnel!

We have two words for you: customer experience.

In today’s age of the internet, customer experience is the be-all and end-all for success. It’s the final frontier that everyone tries to be on top of.

The only difference between most products in a single niche industry is not the product. It’s the customer experience with the business.

This experience extends to the product itself too. Even the most unreliable product can go a long way if you have a great customer support that keeps on top of its flaws.

There are many things that, when put together, form the whole customer experience with your brand. These include:

  • Website experience
  • Product experience
  • Support experience
  • Relationship nurturing

If you go into details, you can divide product experience into ease of use, features, reliability, and packaging. But, we digress. That’s a topic for another day.

Keep this in mind:
A single terrible experience a customer has with your business can ruin your reputation.

With that out of the way, let’s give you an example of a marketing funnel.

A Marketing Funnel for an Online Store

Although the stages of the funnel look pretty general, if you apply them you’ll see the magic of the concept.

Let’s take a look at the customer behavior at a generic online store. The customers must take the following journey to complete a sale:

  • They must visit the website
  • They must view a product
  • They must add it to their cart
  • They must pay for it
  • They must become an advocate of your business

Yes, we’re aware that there are steps in-between the above, but they have little to no impact on the whole journey. Pages like “Philosophy”, “Careers” are filler content. Only a few people see them, and even if they do, it won’t impact the big picture.

At the end of the day, every marketing funnel has the following steps:

  • Awareness
  • Interest
  • Consideration
  • Conversion
  • The newest addition - Advocacy
marketing-funnel-steps1

Now, if you apply the numbers (or view the number of people from an analytics tool) you’d notice a pattern. Each next step has less people from the previous step.

This is pretty normal, because you can’t make all people that visited your page buy your product/service. To take the above funnel example, the first step would be 100%, the second 80%, the third 40, and the last 5% of the customers. The advocacy step would have less than 1%.

Still not Convinced a Funnel Is Right for You?

An interesting statistic is that out of the 100% that visit your page, 2% convert on the spot without you even breaking a sweat. What about the rest 98%?

If you say 2% is enough, you’re doing marketing wrong

Bottom line is you must use a marketing funnel to get as many conversions out of those 98% as possible.

Why are Marketing Funnels so Important?

Important is perhaps the wrong word here. Funneled behavior happens all the time. It has been since the beginning of mankind’s trading habits. As we mentioned before in this post, you can create a marketing funnel for a brick-and-mortar shop. And, it would work the same as an online funnel:

  • Customer sees the store and walks inside
  • Customer browses products on the shelves
  • Customer gets what they want/need and go to the cash register
  • Customer pays the cashier and leaves the store
  • Customer recommends the store to their friend because of the superb service

As you can see, a marketing funnel isn’t something new or complicated. It’s been around for a while now. But, don’t let that mislead you. Knowing how this process works, and knowing at which stage customers are with your business is a must.

Sadly, even though a funnel happens with brick stores, it doesn’t mean they can have a clear insight into what goes wrong with the customer journey. They can only make an educated guess.

But, this isn’t the case with online marketing funnels.

This is true thanks to the Analytics tools that big marketing platforms provide. (like Google Analytics and Facebook Analytics). You can create funnels that depict each stage of the customer journey in these tools. And, they give you the numbers related to each of the stages.

This is the edge digital marketing has over traditional marketing – detailed data about customer behavior

The Benefit of Marketing Funnels

The old school benefit of using funnels is they identify where you lose customers. To take the above example with the online shop funnel:

If customers don’t convert at the sales stage, it means something is wrong with your payment form.

What’s wrong you might ask?

A complicated form, or not enough security (or lack of proof it exists). Long story short, if customers drop out at this stage of the funnel, you need to take a step back and investigate what is the cause of this.

That’s one benefit of using funnels. What’s the other?

You Can Create a Content Marketing Strategy that Aligns with Your Funnel

Pretty simple, right?

Not really. You first need to identify all the steps of the funnel for your business. Then, you need to know which types of content marketing align with those steps.

Luckily, we have written an extensive guide on content marketing in the past.
Be sure to check it out.

The Wrap-Up

Don’t be that person that goes about doing random things hoping something works.

Use a marketing funnel to track each step of the customer journey that leads to the conversion. And, don’t stop there! Provide an excellent customer experience to get to that last step of the funnel. Its very hard to cultivate an advocacy relationship.

But, you can get to that final step!

How?

By using a funnel like content marketing strategy. Tailor content for customers at each step of the funnel. It will help you guide customers through the whole customer journey from start to finish.

Even the simplest marketing funnel (awareness, consideration, conversion) can work miracles. So, why not give it a shot today?