Introduction to the marketing funnel

A marketing funnel may sound complicated, but it is simply a framework for the customer journey. It shows the process of taking people unfamiliar with your products or services and ultimately converting them into paying customers and brand enthusiasts.

Marketing funnels help businesses accomplish their goals. Goals can be new customers, profit, revenue, or something completely different, like donations or enlisting volunteers. While some companies might individualize theirs with extra steps, all marketing funnels include the same four basic stages: awareness, consideration, conversion, and loyalty.

Why do you need a marketing funnel?

The main benefit of this framework is the buyer’s journey. Instead of simply trying random marketing strategies or sticking to what drives sales at the bottom of the funnel, the marketing funnel encourages you to consider the buyer’s experience with the brand.

Marketing funnel stages

Awareness: When do they first experience the brand?
Consideration: What information do they need to consider you as an option?
Conversion: How can they become paying customers in the easiest way?
Loyalty: How do you get them to make future purchases and recommend your brand?

These questions are the starting point when creating the customer journey and help ensure marketing performance helps achieve the business goals.

Moving through the marketing funnel

Funnels may sound like they are linear, but the customer journey rarely is. Someone might learn about a product (awareness), try it out(consideration), and maybe even buy it (conversion). Then perhaps they forget about it and are reminded (awareness) and buy it (conversion). Or perhaps they buy it the first time (conversion), have a less-than-great experience, decide against it, and then a trusted friend highly recommends the same product, so they try it again. This time, they have a great experience, leave a positive review and become a lifelong customer (loyalty).

An ongoing journey

When someone learns about a product and then ultimately buys, or doesn’t, the journey isn’t over. It’s transformed into a completely new journey. Sure, they know your one product, but you have more. Maybe the product they tried was wrong for them, or maybe they used it incorrectly. So while they may be in the loyalty stage for one product, they are not yet in the awareness phase of a different one.

If you’ve been on an eCommerce site, you have probably seen sections of “frequently bought together” or “Customers who liked that also liked these.” Those suggestions are there to start the awareness phase, move along the consideration, or even facilitate the conversion for a new product or service.

Think about companies whose products you like. Which ones have you bought? What have you thought of buying? Are there products you don’t even know about? Each of those questions represents a stage of the marketing funnel, and many people are in various places in the funnel all at the same time. If you ever got a free sample of a new product with an order? Welcome to the awareness and consideration stages. Is there a better way to learn about and consider a product than trying it out for yourself?

Marketing funnels also let us stay organized

What tactics do you use, and when? What questions do you need to answer at each stage? What are the influencers both for buying and not buying? You don’t want to ask someone who isn’t even a customer yet to refer a friend. Nor do you want to send a product introduction campaign email to someone who just bought that same product a week ago. Understanding the stages of the marketing funnel lets you create and influence the journey you want your customers to take. Notice the word influence.

Influence what you can

Yes, you can control when an ad pops up, and how easy your checkout processes are, but you can’t control everything. Word of mouth, economic shifts, environmental concerns, the job market, and, most recently, life-changing events like COVID, will all have an effect on people buying our products and services. Some will work in our favor, and some won’t.

You also must take the buying lifecycle into account. How long do people consider before purchasing the type of product you sell? Peanut butter will sell a lot faster than a house, car, or refrigerator. If your product has a longer lead time, then make sure your marketing efforts are planned and structured to go that distance.

Funnel math

As people move through your marketing funnel, the number of potential customers decreases. 1000 people may learn about your product, but only 10 people actually make a purchase. That gives you a conversion rate of 1%. Once you know your conversation rate, then it becomes about numbers. If you have a 1% conversion rate and want 100 customers, then about 10,000 people need to learn about your product. Learning how to use a marketing funnel and getting familiar with the types of marketing activities you can do at each stage can help you increase your market awareness and your base of loyal customers.