Creating an effective sales funnel is one of the key responsibilities of the modern digital marketer. Without a sales funnel that’s appropriate for your organization and your product, potential customers will have a difficult time making it through the buyer’s journey to generate revenues.
However, if you’re just getting started with digital marketing activities in your company, you’re probably wondering how to create a sales funnel that will give your product a competitive edge. You’ll want to build a funnel tailored to your company, growing your customer base in the most efficient way possible.
To do that, you have to understand how the sales funnel breaks down, what kinds of strategies are necessary for building one, and—most importantly—how to get started today based on your organization’s capabilities and needs.
What is a sales funnel?
The sales funnel has four segments or phases that you’ll need to understand if you want to create one yourself. These four segments are:
- Interest and Deliberation
- Conversion (or Action)
Each of these phases is defined by a distinct set of consumer behaviors and marketing strategies. For the consumer, this progression is relatively simple—they just need to decide at each stage whether they’ll continue down the funnel toward making a sale, or step away from the transaction altogether.
In contrast, the marketers who create these sales funnels have a ton of complex tactics at their disposal, some of which may be better fitted to their product or their target market than others.
Now, let’s take a closer look at each phase of the sales funnel, and explore some tactics that marketers can employ to help move the consumer through them.
The awareness phase of the sales funnel is where potential customers learn about your product, service, brand, or website.
Businesses can establish awareness via social media, advertisements, shout-outs in third-party content, or word of mouth. Building a broad base of brand awareness is a vital first step for all mass-market businesses.
However, if your company’s target market is relatively narrow, building awareness may not be a major focus of the funnel—customers will become aware of your product and evaluate it for their needs at roughly the same time.
Interest and Deliberation
During the deliberation phase, customers evaluate the newly discovered product or service that caught their interest during the awareness phase. The purpose of the deliberation phase is for the customer to assess whether their needs align with the capabilities of the product or service on offer.
From a marketer’s perspective, guiding the customer through the deliberation phase of the funnel means understanding the customer’s needs as deeply as possible.
As long as your company can prove that it truly has a handle on the customer’s specific needs, all that’s left is to convey how and why your company’s offering is the only one on the market that will fully meet those needs.
As the deliberation phase winds down, and the customer starts comparing your company’s product with those of your competitors, it’s finally time for them to make that crucial decision: to buy, or not to buy.
But unless your company’s product is so unique that there exists no alternative, this isn’t the end of the decision-making process. Your competitors will be vying for that sale just as fervently as you are, so you’ll need to offer customers additional services to sweeten the deal if you want to convince them to buy with your company.
However, it’s important to understand that a broad range of factors can influence their decision, and not all of them will be within your company’s ability to control. Even something as simple as hearing a good word from a friend about a competing product could be enough to pull them out of your sales funnel and into your competitor’s.
Conversion is the final phase of the sales funnel, and it’s the one in which potential customers are converted into actual customers. This is also the first time the customer needs to actively participate, establishing the buyer-seller relationship.
The traditional approach to supporting conversion is to prompt the customer to convert as rapidly as possible once they’ve become acquainted with the details of your product. In tactical terms, this often means prompting customers to convert at the end of each piece of marketing content.
Building a Sales Funnel: A Step-By-Step Guide
Now that you understand all the moving parts that make up a sales funnel, it’s time to walk you through the necessary steps toward creating one that’s compelling, robust, and primed for success.
1. Pick a Strategy Tailored to Your Product and Customers
The first step in creating a sales funnel is to make sure you understand your product and understand your customers, and pick a strategy accordingly. Broadly speaking, there are two main funnel strategies: wide reach, and narrow scope.
Wide reach strategies require a massive amount of expenditure on building awareness, as the assumption is that each customer will not bring much revenue relative to the cost of acquiring them. Wide reach strategies are therefore better suited to mass-market products and business-to-consumer (B2C) products where many different demographics might fall within the target market.
Similarly, a wide reach strategy requires a lot of investment into conversion, as consumers may be prone to defecting to a competitor if they encounter any hiccups in the funnel.
In contrast, narrow scope funnels spend less on awareness and more on interest, deliberation, and decision. When your company has a narrow scope funnel, your customer base may be small, but your product perfectly matches their needs, so their conversion rate will be high.
2. Position Resources for Building Awareness
Once you understand which type of strategy your sales funnel will use, you’ll need to start building awareness. This can be done in various ways, such as:
- Buying pay per click (PPC) advertisements
- Reaching out to email lists of potential customers
- Presenting at industry events to advertise your product
- Initiating social media campaigns to inform consumers about your brand
Knowing which awareness-building tactics are most appropriate will depend largely on your target market. It’s generally easier to build awareness for B2C products, as consumers are more likely to respond to direct outreach methods.
3. Create Content for Each Funnel Segment
Each phase of the funnel requires compellingly crafted content that informs your customers and implores them to move on to the next step of the transaction. To get the most out of the content that you create for your company, each piece of content needs to have specific goals in mind.
Awareness-building content should introduce your company and your product in a compelling way for your target market. In other words, this content should tell your customers that you understand their woes and that you have created a solution they’ll want to consider.
Lower in the funnel, you should also have pieces of content which help customers to understand how your product differs from those of your competitors—and why your product is more effective at addressing the needs of customers in your target market
And don’t forget: calls to action (CTAs) are among the most important pieces of content when it comes to converting your customers, so be sure to include them wherever you can.
4. Initiate the Campaign
Once all the pieces are in place, it’s time to initiate your marketing campaign and start drawing customers into the funnel. As soon as your campaign is off the ground, it’s important to:
- Track consumer behavior at each part of the funnel
- Always push the customer toward the next segment of the funnel
- Make it easy for the customer to get the information they need in order to decide whether your product is for them
The individual moving pieces of your marketing campaign should probably be initiated at roughly the same time so that customers can easily flow down the funnel without defecting.
5. Optimize for Conversion
Once the funnel is buzzing with activity as a result of consumers showing interest in your company’s products, you’ll need to optimize for conversion on the basis of incoming data. This might mean changing the way your website is organized, tweaking your content, or shifting your resources to bolster an underperforming segment of the funnel.
To optimize websites for conversion, many companies run A/B tests to see which website designs or social media content templates are working the best for their respective brands. Optimizing for content quality is a bit more difficult, however. Some companies have found success in optimizing their marketing content with extensive keyword research for each new piece of content, so that may be something to consider.
Maintaining the Sales Funnel
Once you’ve optimized your sales funnel for the first time, the hardest part of the process—initializing the funnel—is over. However, a good sales funnel requires ongoing maintenance and observation to further optimize the process.
To maintain high performance with your sales funnel, it’s best to learn and track key marketing metrics for each phase of the funnel, then optimize accordingly. Most importantly, always keep an eye on key high-level metrics like your lead-to-conversion rate to watch how efficiently your funnel is operating.
Remember: Your sales funnel is the path that all of your customers must take in order to access your product. You should always be working to improve it however you can.
This article was written by Compose.ly writer Alex Carchidi.