Effective digital marketing methods and advertising campaigns are a vital part of a customer’s journey leading them to buy your product or request services from your firm. One of the most successful ways to drive users to your virtual door and deliver them to the best possible customer experience is through the use of a marketing funnel.
What’s a Marketing Funnel?
The word funnel has several definitions when being used as either a noun or a verb. Both of these parts of speech are applicable to a marketing funnel when you consider the multiple meanings of this term:
- A tube or pipe that is wide at the top and narrow at the bottom used for guiding substances into a small opening, something resembling this shape or the metal chimney on an engine (noun).
- To move or be guided through something as if it were a funnel or take on the shape of a funnel by widening or narrowing at the ends (verb).
Similar to both the noun and verb usage, customers come in through the top of the marketing funnel and travel through the bottom ending in a purchase or to a call-to-action (CTA) step where consumers perform the desired function(s).
This type of strategy provides the right solution at every step of the customer’s journey, tracking their data and the more automated the process, the more successful it will be at delivering valuable results. A marketer can also use the funnel to stream “best customers” to a purchase or other desired endpoint.
How Does a Marketing Funnel Work?
It begins with an awareness stage at the top and widest part of the funnel bringing in future customers and continues as the virtual tube diminishes in size. As users travel through the funnel, their ultimate destination delivers:
- Better conversion rate optimization through specialized techniques
- More effective methods of lead capturing
- An increased number of repeat customers
- Brand awareness that builds with users
- An overall more positive customer experience
A marketing funnel helps prospects get to know a brand better by helping them to understand a business’s products and services.
It also enables these businesses to visualize a buyer’s journey to implement more effective sales strategies for successful user experiences. It gives the business and its brand the ability to come up with improved support and customer service methods.
Marketing Funnel versus Sales Funnel
In a nutshell, a marketing funnel advertises a product or service offering visitors and users reasons to buy. For example, direct mail or targeted digital marketing is more effective when it’s executed under the umbrella of brand advertising. Conversely, the sales funnel deals with the leads that are produced by the marketing funnel. The Sales funnel entices consumers to purchase not once but as often as possible. In some cases, the sales funnel is an integral part of the marketing funnel.
What is TRV?An effective #marketing funnel uses three pillars: high-quality Traffic, a certain level of Relationship or trust, and the mutual exchange of Value. TRV – Traffic, Relationship and Value. Click To Tweet
An effective marketing funnel is constructed and based on three basic pillars: High-quality Traffic, a certain level of Relationship or trust, and the mutual exchange of Value. We use the acronym TRV, Traffic, Relationship and Value, to describe these three pillars.
Each pillar takes work and attention as each one leads to the next. They are equally important and each circle back to the marketing funnel. Keeping them in balance and constantly improving them is a winning formula. If this strategy was a three-legged stool you wouldn’t want the legs to be different lengths.
What are the Stages for the Marketing Funnel?
We’ll delve into the rewards TRV delivers when implemented into a marketing funnel, but first, let’s take a look at an effective model for this strategy. From the customer’s perspective, the outside-in perspective, there are five primary stages:
- Problem recognition
- Information searches
- Evaluation of alternatives
- Purchase decisions
- Post-purchase behavior
What is the TRV Model for the Marketing Funnel?
Back to the acronym of TRV (Traffic, Relationship, and Value), here’s a closer look at how each of these steps performs in the marketing funnel.
High-quality traffic is the first and possibly the most important step in the marketing funnel’s successful pathway and customer journey. The choice of media used to tempt and deliver this traffic is very important. According to industry sources, the top ten forms of content used in successful marketing strategies include:
- Blogs and blogging
- Videos and other images
- Case studies
- White papers
- Social media posts
- GIFs and memes
You want to choose the method(s) that will deliver ‘best customers.’ These are usually heavy category users not regular, day-to-day consumers. These customers need the category. They use the products or services in any given category, niche or industry often and as a result, they are the most profitable customers.
They’re also the most aware consumers in the category. They are aware of the competition along with knowing what you’re selling or offering. A pitch that acknowledges this fact will speak to their needs which will not only build trust but attracts and entices these consumers to purchase or participate.
Effective marketing or sales funnels choose the media that most effectively delivers heavy category users.
As we mentioned in Traffic above, a vital part of effective marketing or sales funnels is attracting the right customers for the right reasons. This is the first of five relationship marketing principles and it should be incorporated into the funnel.
The relationship stage is focused on lead nurturing. Use the second relationship marketing principle, “The most crucial time is the beginning,” and the third, “In established relationships continually reinforce the decision to buy,” to guide your approach.
The goal is to build a relationship, a level of trust between the brand and the customer. This leads to value that goes beyond transactional benefits. This not only improves conversion it sets you up for a long-term relationship with customers.
This is how prospects become your best customers, the 20% of consumers who generate 80% of your revenue, and they should be rewarded. Surprise them. Delight them. Make them customers for life. Make them so happy they’ll tell friends and associates what a pleasure it is to do business with you making them a brand advocate. The ROI on these relatively small investments, especially compared to the cost of acquiring new customers, is huge.
Incorporate the relationship marketing principles into your marketing funnel and your success will be amplified. A loyal customer, especially when they are heavy category users contribute to sales in five ways:
- Increased revenue after acquisition costs
- Lower cost to service – they know how it works
- They are more likely to buy other services from you – more efficient marketing
- You don’t need to bribe them – they are more likely to pay full price
- They advocate for you – they bring in new customers
The time of a sale isn’t the end. It’s an opportunity to further build the relationship. Consumer interest is at a high point. If you consider the sale to be a mutual exchange of value, then the sale isn’t the end of the marketing funnel. It becomes a doorway to the next step.
Don’t squander this opportunity since happy customers will see and appreciate the value your product gives to them and are more likely to purchase again. They’re also often more willing to pay full price for your product and recommend your services and solutions to others.
Delivering content as described previously also offers tremendous value in the marketing funnel when delivered correctly. In the case of blogging, this material should not only be offered in a timely manner and updated regularly, but it also needs to give the reader something they find valuable.
What About RFM? What is RFM?
RFM (or Recency, Frequency, and Monetary) is another acronym associated with the marketing and sales funnel. It’s a tool used for analysis. It helps determine which customers are the best customers according to their behavior, specifically, how Recently they have purchased, the Frequency of these expenditures and the Monetary amount they have spent.
Commonly used by direct mail marketers and especially non-profits and catalog marketers, RFM data can be used to analyze and target customers that are most likely to buy again. This could be a donation or another purchase from the catalog. It could also be a cross-sell or an upsell. The reasoning behind the practice is simple, people who donated or bought from you in the past are likely to buy or donate again.
How Does RFM Work?
Consumers are assigned a ranking number of 1-5 (with 5 being the highest) and for each of the RFM parameters. The three scores put together are referred to as an RFM cell and 555 would equate to a perfect score and considered the ideal customer.
Although RFM calculations and analysis are useful tools, they do have their limitations. For example, a business should avoid over soliciting customers with the highest rankings. Conversely, marketers should remember that consumers with lower RFM shouldn’t be ignored but rather be cultivated to become better customers in the future.
In utilizing RFM as a tool in building in the TRV model, we perform the following steps in the customer journey:
- Identifying the best customers
- Building a loyalty program
- Increasing retention rates
- Obtaining higher revenues
- Retaining a happy customer
How to Add Even More Value and Ask for Input
Merely ranting and raving about the value of a particular product or service is a sure-fire way to lose a viewer’s interest. Instead of coming off as a pushy salesperson, describe the benefits of your brand as it relates to a problem heavy category users may be experiencing. Show them how your product or services will solve an on-going issue or fix their problem.
Another way of connecting with consumers and giving them exactly what they’re seeking is to come right out and ask them for this information. Whether this inquiry is posted somewhere in the funnel, on social media or the website, customers will realize you care and aren’t just trying to sell them something.
For example, using a waitlist can be an effective lead magnet. This exploits the psychology of scarcity but it also gives you an opportunity to ask consumers questions about their needs. This builds the relationship by creating value that goes beyond the transactional benefits of your product or service. It also creates value because you can use survey resp[onses to determine whether or not a consumer is, potentially, a ‘best customer.’ This will affect the next step in the marketing funnel.
The Valuable Role of a Website
A website is a powerful tool that can be used to connect with online consumers. If your online marketing is a wheel with a rim, spokes and a hub, then the website is the hub of the wheel. The Marketing Funnel and the tactics used are the spokes and the brand message is the rim. Separately they don’t do much for a business and have little value but when combined, they perform like one of the most valuable and important inventions of all time. We call this the Hub and Spoke Marketing strategy and it’s key to creating value using online marketing.
What are the Steps in the Marketing Funnel?
Marketing funnels are very successful when implemented on the website of a business and follow a certain strategy. Most often appearing on landing pages, these funnels start with awareness, continue with an interest, create a desire resulting in an action. Let’s follow these steps and take a closer look at each one:
Awareness – Begins with content marketing and targeted advertising. As mentioned above this is the T in TRV. You want to choose the media that bring high-quality traffic to your website.
Interest – Once awareness has been obtained, interest needs to be piqued to further the customer’s journey through the funnel. This is the offer. Attention-getting content encourages viewers to learn more, delve deeper and get to know your business and brand.
If users are leaving during this vital this step, it could be due to several issues from the website being too difficult to navigate, contains too many options or otherwise poorly designed. Consider the Five Second Rule when designing any page on your website. The five-second rule says that you have five seconds to do three things: assure them that they are in the right place, give them a benefit-oriented reason to stay, and make it crystal clear what they should do next.
Desire – Now that we have the visitor’s interest, it’s time to convince them to take the next step through the funnel. This part of the strategy uses content that demonstrates why your brand, product or services delivers the biggest bang for their buck.
Social proof like customer reviews, testimonials, case studies, webinars showcasing your expertise in the industry or product demonstrations are all valuable tools and work well during this step of the process.
Action – Everything is in place and working as it should when we’ve arrived at the CTA location for the next step to success. But a single conversion isn’t the goal of a marketing funnel as this is an ongoing, repeatable process that continues to provide opportunities to your audience.
When a user or visitor is converted to a qualified sale, this turns a lead into an existing customer or returning client. Even service businesses can up-sell customers to other types of products or services in turning a one-time purchase into repeat business opportunities. At the purchase their interest is high. Don’t miss this opportunity.
Should Your Business Institute a Marketing Funnel?
Absolutely! Even if it means redesigning your existing website or launching a new one, it’s worth this affordable investment. Web design is an important, valuable and integral part of this process and shouldn’t be overlooked.
Conclusion – Marketing Funnels and TRV
A marketing funnel is a series of communication tactics designed to guide and encourage prospects toward a purchase or call-to-action.
An effective marketing funnel makes it easy for customers to purchase your product or engage with your brand.
A marketing funnel is a series of steps that attract prime prospects, communicates benefits, overcomes obstacles and encourages action.
A marketing funnel is generally a combination of advertising that attracts prospects, a landing page that engages prospects, email marketing and/or retargeted advertising to remind prospects and a call-to-action device, usually a button.
TRV is an acronym for the three pillars you will find in an effective marketing funnel: high-quality Traffic, content that builds Relationship and trust, and the mutual exchange of Value.
Please contact us today to see how our team will deliver exactly what you’re looking for in a powerful and successful website. We’ll deliver everything from fantastic funnel results to increased awareness through better SEO practices. And we’re fun to work with.