Funnel Marketing In A Nutshell

  • Funnel marketing is an approach that markets to consumers from their first interaction with a brand until they become a paid customer and beyond.
  • Funnel marketing is modeled after the marketing funnel, a concept that tells the company how it should market to consumers based on their position in the funnel itself. The notion of a customer embarking on a journey when interacting with a brand was first proposed by Elias St. Elmo Lewis in 1898.
  • Funnel marketing typically considers three stages of a non-linear marketing funnel. These are top of the funnel (TOFU), middle of the funnel (MOFU), and bottom of the funnel (BOFU). Particular marketing strategies at each stage are adapted to the level of familiarity the consumer has with a brand.

What is funnel marketing?

Funnel marketing is an approach that markets to consumers from their first interaction with a brand until they become a paid customer and beyond.

At its core, funnel marketing encompasses a customer’s journey with a brand. 

The approach, of course, is modeled after the marketing funnel, a concept that tells the company how it should market to consumers based on their position in the funnel itself. When used correctly, a brand can attract, engage, and convert prospects to drive sales, loyalty, brand awareness, and repeat purchases.

The notion that a customer progressed through various stages with a business was first proposed by Elias St. Elmo Lewis in 1898. Lewis’s model mapped a metaphorical journey from the minute a customer interacts with a brand to the point of action or purchase. However, it would be another 26 years before author William W. Townsend would associate Lewis’s interpretation with the notion of a funnel.

While Lewin’s model featured the four steps of awareness, interest, desire, and action (AIDA), many businesses today use a simplified but more relevant three-stage version. We will explain this in more detail in the next section.

AIDA stands for attention, interest, desire, and action. That is a model that is used in marketing to describe the potential journey a customer might go through before purchasing a product or service. The AIDA model helps organizations focus their efforts when optimizing their marketing activities based on the customers’ journeys.

Three-stage funnel marketing

In a theoretical sense, the marketing funnel is linear. Prospects start their journey at the top of the funnel and end it at the bottom where a conversion is made. In practice, however, most prospects move in and out of the funnel at will before they convert. Some others will make it to the bottom without converting and drop off the radar completely.

Let’s now look at the three stages of funnel marketing.

1 – Top of the funnel (TOFU) 

At the top of the funnel, prospects become aware of a brand and interact with it for the first time. Since most will not know much about a product or service, this initial stage should focus on marketing that increases brand awareness.

Here are some ways a marketing team can attract prospects:

  • Share the company’s USP on social media.
  • Run targeted, paid ads in podcasts or on social media, and
  • Build a landing page that introduces the brand, product, or service.

2 – Middle of the funnel (MOFU)

A prospect reaches the MOFU only after they’ve made a meaningful interaction with a brand. What constitutes a meaningful interaction is open for discussion, but it may be that the consumer has subscribed to an email list or is following the brand on social media.

The second stage must focus on building trust with the prospect via further engagement. In other words:

  • Invite the prospect to participate in a survey. This can be a good way to perform conversion rate optimization (CRO) and identify the drivers, barriers, and hooks individual encounters with a brand.
  • Explain how a product or service solves a customer problem and adds value. Increasingly, brands are turning to white papers for this purpose.
  • Share product comparisons, demonstrations, or relevant case studies.

3 – Bottom of the funnel (BOFU)

The BOFU is the last place a prospect visits before a conversion takes place. At this point, the business has done the hard work of attracting the attention of a prospect, building a relationship with them, and earning their trust. 

The focus here is to convert the prospect. This can be done in the following ways:

  • Offer a free trial or demonstration of the product or service.
  • Write a guide for prospects who hold last-minute doubts, concerns, or any other factor that could hinder a conversion.
  • Demonstrate social proof in the form of testimonies and reviews, and
  • Segment the email list according to specific actions. For example, a unique email sequence could be sent to a prospect who abandons their cart.

Read Next: Business EngineeringPirate FunnelGrowth Marketing.

Connected Marketing Concepts

Affiliate Marketing

Affiliate marketing describes the process whereby an affiliate earns a commission for selling the products of another person or company. Here, the affiliate is simply an individual who is motivated to promote a particular product through incentivization. The business whose product is being promoted will gain in terms of sales and marketing from affiliates.

Ambush Marketing

As the name suggests, ambush marketing raises awareness for brands at events in a covert and unexpected fashion. Ambush marketing takes many forms, one common element, the brand advertising their products or services has not paid for the right to do so. Thus, the business doing the ambushing attempts to capitalize on the efforts made by the business sponsoring the event.

Brand Building

Brand building is the set of activities that help companies to build an identity that can be recognized by its audience. Thus, it works as a mechanism of identification through core values that signal trust and that help build long-term relationships between the brand and its key stakeholders.

Brand Equity

The brand equity is the premium that a customer is willing to pay for a product that has all the objective characteristics of existing alternatives, thus, making it different in terms of perception. The premium on seemingly equal products and quality is attributable to its brand equity.

Brand Positioning

Brand positioning is about creating a mental real estate in the mind of the target market. If successful, brand positioning allows a business to gain a competitive advantage. And it also works as a switching cost in favor of the brand. Consumers recognizing a brand might be less prone to switch to another brand.

Business Storytelling

Business storytelling is a critical part of developing a business model. Indeed, the way you frame the story of your organization will influence its brand in the long-term. That’s because your brand story is tied to your brand identity, and it enables people to identify with a company.

Content Marketing

Content marketing is one of the most powerful commercial activities which focuses on leveraging content production (text, audio, video, or other formats) to attract a targeted audience. Content marketing focuses on building a strong brand, but also to convert part of that targeted audience into potential customers.

Digital Marketing

A digital channel is a marketing channel, part of a distribution strategy, helping an organization to reach its potential customers via electronic means. There are several digital marketing channels, usually divided into organic and paid channels. Some organic channels are SEO, SMO, email marketing. And some paid channels comprise SEM, SMM, and display advertising.

Growth Marketing

Growth marketing is a process of rapid experimentation, which in a way has to be “scientific” by keeping in mind that it is used by startups to grow, quickly. Thus, the “scientific” here is not meant in the academic sense. Growth marketing is expected to unlock growth, quickly and with an often limited budget.

Guerrilla Marketing

Guerrilla marketing is an advertising strategy that seeks to utilize low-cost and sometimes unconventional tactics that are high impact. First coined by Jay Conrad Levinson in his 1984 book of the same title, guerrilla marketing works best on existing customers who are familiar with a brand or product and its particular characteristics.

Inbound Marketing

Inbound marketing is a marketing strategy designed to attract customers to a brand with content and experiences that they derive value from. Inbound marketing utilizes blogs, events, SEO, and social media to create brand awareness and attract targeted consumers. By attracting or “drawing in” a targeted audience, inbound marketing differs from outbound marketing which actively pushes a brand onto consumers who may have no interest in what is being offered.

Integrated Marketing

Integrated marketing describes the process of delivering consistent and relevant content to a target audience across all marketing channels. It is a cohesive, unified, and immersive marketing strategy that is cost-effective and relies on brand identity and storytelling to amplify the brand to a wider and wider audience.

Marketing Mix

The marketing mix is a term to describe the multi-faceted approach to a complete and effective marketing plan. Traditionally, this plan included the four Ps of marketing: price, product, promotion, and place. But the exact makeup of a marketing mix has undergone various changes in response to new technologies and ways of thinking. Additions to the four Ps include physical evidence, people, process, and even politics.

Marketing Personas

Marketing personas give businesses a general overview of key segments of their target audience and how these segments interact with their brand. Marketing personas are based on the data of an ideal, fictional customer whose characteristics, needs, and motivations are representative of a broader market segment.

Multi-Channel Marketing

Multichannel marketing executes a marketing strategy across multiple platforms to reach as many consumers as possible. Here, a platform may refer to product packaging, word-of-mouth advertising, mobile apps, email, websites, or promotional events, and all the other channels that can help amplify the brand to reach as many consumers as possible.

Multi-Level Marketing

Multi-level marketing (MLM), otherwise known as network or referral marketing, is a strategy in which businesses sell their products through person-to-person sales. When consumers join MLM programs, they act as distributors. Distributors make money by selling the product directly to other consumers. They earn a small percentage of sales from those that they recruit to do the same – often referred to as their “downline”.

Niche Marketing

A microniche is a subset of potential customers within a niche. In the era of dominating digital super-platforms, identifying a microniche can kick off the strategy of digital businesses to prevent competition against large platforms. As the microniche becomes a niche, then a market, scale becomes an option.

Relationship Marketing

Relationship marketing involves businesses and their brands forming long-term relationships with customers. The focus of relationship marketing is to increase customer loyalty and engagement through high-quality products and services. It differs from short-term processes focused solely on customer acquisition and individual sales.

Sustainable Marketing

Sustainable marketing describes how a business will invest in social and environmental initiatives as part of its marketing strategy. Also known as green marketing, it is often used to counteract public criticism around wastage, misleading advertising, and poor quality or unsafe products.

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