Not everyone who sees or hears about your product or service will go on to convert. In traditional marketing models, we refer to the consumer journey as a marketing funnel and break down each stage of the funnel in order to focus marketing efforts into specific areas. This blog post talks about the marketing funnel in 2020, whether or not it is still a relevant model and which marketing framework should be considered instead.
What is a conversion funnel?
A funnel is the set of steps a visitor needs to go through before they can reach the conversion. There are more people who have heard of a brand or business than who go on to convert and this is what makes it a funnel, with a wider top for brand awareness and a narrower end point to represent the smaller group who have converted.
Let’s use the example of an ecommerce retailer to go into more detail and explain the stages in between the top of the conversion funnel and the bottom of the funnel:
- They have to visit the website
- They have to view a product
- They have to add a product to the cart
- They have to purchase
When you hear people say “widen the funnel,” you now know what they are referring to. They want to cast a larger net by advertising to new audiences, increasing their brand awareness or strengthening inbound marketing but at each stage of this process, prospective buyers drop off. They visit the website but can’t find the product, they don’t see the exact dimensions or shipping details, maybe they just got distracted and clicked onto a different link. Our task of Conversion Rate Optimisation is to consider each stage of the funnel and examine if we’re doing everything that we can to encourage conversion.
Assuming that ecommerce analytics are set up correctly, funnels are beneficial because they can help us to visualise data and quantify exactly where users are leaving the site. By making incremental gains in each area, we can help to boost sales without more media spend or “widening the funnel”.
Is a conversion funnel still relevant in 2020?
There are additional steps/actions that can be taken in between each of the steps outlined above. For example, a visitor may view your About page, Contact page or blog. While these are still valuable actions, we don’t tend to count these in the funnel because they aren’t part of the necessary steps. Yet, there is still another major flaw with this model.
The marketing funnel views customers as an afterthought, not a driving force. Funnels produce customers but they don’t consider how those customers can help you grow. In an era when customer referrals and word-of-mouth have become the largest influence on a purchase, after-sales care and content interaction is essential. That’s where the flywheel comes into play.
When you think about your business as a flywheel instead of a funnel, you make different decisions and adjust your strategy. To show you what we mean, let us first explain how the flywheel works.
What Is the Flywheel?
The flywheel uses the momentum of your happy customers to drive referrals and repeat sales. It relies on reducing friction during the research stage and increasing speed from your positive band association, in order to keep your business spinning.
A customer centric strategy is far more compelling than simply trying to get more customers into the funnel. When done right, it means that your business will organically grow because of the help of your customers spreading the word about excellent service.
Why is this shift important?
Third-party review sites and word-of-mouth play a bigger role in buying decisions than ever before. Social media wasn’t a thing 10 years ago but now it is ubiquitous. This, combined with the fact that more conversations are taking place in more places and among more people – means that we need to be conscious of how our business is perceived and place greater emphasis on service and brand story.
It’s estimated that 57% of B2B purchase processes are completed before buyers ever reach out to vendors because buyers research first.
The funnel has its place – we still rely on awareness and inbound marketing and we still need to analyse drop-off rates and CRO. However, it shouldn’t stop once the customer has ordered. Decisions are made differently, people ask their networks for advice, they search for mentions on social media and they’re reading third-party review sites. The traditional funnel doesn’t account for any of these factors. They’re linear, and therefore funnels don’t reveal the momentum you build through great customer experience, nor do they illustrate the drag you experience when your processes start to slow down growth.