Marketing Funnel Stages: How to Get More Leads and Sales at Each One

August 12, 2022

Posts
by Kieran Duffey

The marketing funnel is still a foreign word to a handful of marketers. And even for those who’ve glanced over the term, very few have stopped to consider what it means and what it can change for your business.

According to data from Salesforce, 68% of companies are yet to discover their marketing funnel. These businesses are missing out on a lot of sales and leads based on another study by Semrush that shows that 72% of marketers who create how-to guides as a top-of-the-funnel marketing strategy enjoy tremendous success.

Wait, you have to discover your marketing funnel?

Yes. You must also understand what your customer wants or needs at each stage to maximise leads and sales. Let’s dive further into this topic.

What is the Marketing Funnel?

The marketing funnel is a series of stages that guide a business’ prospects through the customer journey. The funnel assists the marketing teams in planning and measuring their efforts to engage, attract, and convert prospects. These efforts may be through content and other marketing materials such as ads and landing pages.

E. St. Elmo Lewis first developed the marketing funnel concept in 1898. The original concept has barely changed since. It’s versatile and adaptable to the needs of different businesses.

What changes are the tools and strategies used to achieve the goals of the sales funnel.

The AIDA Funnel

The AIDA funnel is the most commonly used marketing funnel concept developed almost 50 years after the original by St. Elmo Lewis.

The earliest marketing funnel concept had four stages. These were Attention, Interest, Desire, and Conviction. Instead of these four, the AIDA funnel consists of Attention, Interest, Desire, and Action.

These four stages describe the steps a customer needs to go through before buying a product or service. It’s based on the principle that people don’t spontaneously decide to buy something and don’t always wait until they actually need something.

A powerful marketing funnel can convince prospects to buy something they don’t need. That’s because, through the marketing funnel, the brand understands its customer’s journey and can instigate it and guide the consumer through it.

The four stages of the AIDA funnel can be broken down as follows:

1. Awareness – The customer gets to know about the existence of your brand and its products or services

2. Interest – Once the prospect is aware of what you have to offer, you turn their awareness into interest

3. Desire – After building enough interest, you create an emotional connection between the consumer and the product or service that builds their desire to purchase it

4. Action – You show the consumer how to turn their desire into reality by taking some action, such as purchasing the product or service, clicking on a button, or signing up.

This model is a template for marketing teams to build their consumer journey around. You can also use the AIDA model to generate leads at every stage, which can convert and generate sales for the business.

The Three-Stage Model

The AIDA model is often simplified into a three-stage model which consists of:

1. Top of the Funnel (TOFU) – Awareness

2. Middle of the Funnel (MOFU) – Consideration (Interest and Desire)

3. Bottom of the Funnel (BOFU) – Conversion (Action).

This model aligns more with marketing in the real world, where customers don’t typically transition linearly through the four stages.

Some prospects will bounce in and out of different stages until they convert. Others may transition to the bottom and jump out at the last stage without converting.

That makes understanding the consumer journey essential so that you may know your prospect’s non-linear buying behavior from the moment of awareness to conversion.

The Four Marketing Funnel Metrics You Should be Measuring

To understand your consumer’s journey, you need to observe and communicate with them instead of relying solely on assumptions and numbers on a chart. Therefore, you need quantitative and qualitative data to measure the success of your marketing funnel.

The following are four key metrics you should closely observe.

Cost Per Acquisition (CPA)

Cost per acquisition measures your spending on marketing efforts to acquire a new customer. Teams use CPA to analyse the effectiveness of their marketing efforts, such as paid advertising, social media, and email marketing.

Cost per acquisition is calculated by dividing the total cost of your marketing campaign by the number of conversions. If the cost outweighs the gain, the drive might not be effective, and you might want to consider ending it or testing alternatives.

Conversion Rates

Conversion rate measures the frequency of conversions. Typically, marketers measure the final conversion, which translates to sales for the business. However, you can measure the success of each stage of the marketing funnel through goal conversions or micro-conversions.

For instance:

Top of the funnel conversion can measure how many visitors convert to marketing qualified leads (MQLs)
Middle of the funnel conversion can measure how many marketing qualified leads convert to subscribers or sign-ups
Bottom of the funnel conversion can measure how many subscribers or sign-ups convert to customers.

The goal conversion rate or micro-conversions can help your team make more informed decisions about its efforts at every stage in the marketing funnel instead of viewing the consumer journey in one single outcome.

Customer Lifetime Value (LTV)

Customer lifetime value measures the continuous value a customer brings to your business. This metric gives insight into customer retention, a handy metric in Software as a Service (Saas) and other subscription-based companies.

Lifetime value also gives insight to traditional sales and eCommerce businesses that helps the marketing and sales team predict the likelihood of a customer making another purchase.

CPA and LTV are affected by other factors such as company and marketing costs and the pricing of your products and services.

Pricing can be hard to determine, especially if you’re a startup. Market research alone won’t inform you how much to charge for your services or products. You have to test the prices and actively listen to consumer feedback.

Conversion Rate Per Channel

Each channel has unique goals. Therefore, you need to devise ways to analyse the success of the marketing efforts in each channel.

These marketing channels include:

Paid ads (SEM, display, podcasts, social)
Organic search
Email
Referrals and influencers.

The conversion rate per channel works like goal conversions. It gives marketing teams an easier time deciding which marketing efforts on what channels are performing well, need to be axed, or require some improvements.

Examples of questions you might ask yourself to determine what you want from each channel include:

Is responding to an email a conversion?
Is clicking on a paid ad a conversion?
Is signing up for a newsletter a conversion?

How to Optimise Each Stage of the Marketing Funnel and Get More Leads and Sales

You can employ different strategies at each stage of the marketing funnel to generate more leads and garner more sales.

Top of the Funnel (TOFU)

The top marketing funnel allows you to raise awareness and generate interest in your product or service. It is the most popular stage among marketers, with 95% reporting that most of their efforts are focused on this stage.

You can optimise your efforts in this stage by doing the following:

Use Social Media to Share Your Brand Story

Your brand story should form the foundation of your marketing funnel. It creates the narrative that customers associate with your services, products, and marketing.

Your brand story also drives ROI. Studies show that 55% of consumers are more likely to buy a brand’s products or services if they like its story. 44% will share it with others in the future.

You can share your brand story through various formats such as social media posts, blogs, podcasts, and videos. Your story should be authentic, relatable, interesting, and highlight the company’s values, culture, and mission.

Advocate for Causes Your Customers and Brand Care About

Value-based communication is as effective as product-based communication in convincing prospects to make a purchase. This means that if you’re advocating for causes your customer cares about, they’re more likely to do business with your brand.

For instance, by simply giving back some of your profits to community causes, you can attract sales from consumers interested in driving global change. These causes can be anything from social justice to environmentalism.

Build SEO-Rich Blogs

Blog posts are a powerful tool for driving sales and leads in the marketing funnel. Studies show that 60% of consumers value relevant content from blog posts in the early stages of the marketing funnel.

Blog posts help you generate leads by showing off your industry expertise and attracting readers who may be interested in your brand and offerings.

SEO-rich blogs featuring relevant keywords make more impact. They improve your brand’s search engine ranking making it easier for prospects to find your brand and the content they’re looking for.

Including CTAs in your blog posts helps transition your prospects to the next stage in their consumer journey.

Middle of the Funnel (MOFU)

The middle of the funnel stage focuses on nurturing leads and drawing them closer to making a purchase decision. This stage also filters out unfit leads. These are some ways you can optimise your efforts at this stage.

Add Case Studies to Your Website

Case studies are the fifth most popular type of content after visual content, eBooks, and blogs. Case studies give customers in the middle of the funnel real-world examples of how your service or product helps people or businesses achieve their goals.

These examples establish trust and credibility, which are essential in converting leads into customers.

You can share these case studies through paid ad campaigns to increase the conversion rate.

Create FAQ Content

Frequently asked questions are crucial for effective content marketing in the middle of the funnel. FAQ pages address customer concerns and allow the brand to target specific keywords prospects may be searching for.

Tools such as Ubersuggest and social media provide great insight into the questions your prospects may need to be answered.

Tell Stories from Your Customers

Stories from your customers are influential in driving leads and sales through your marketing funnel. Research shows that 40% of consumers will follow a brand based on recommendations from family and friends. On the other hand, 93% say that online reviews influenced their purchase decision.

These statistics show the power of social proof, which can be generated by telling stories from your consumers. These stories can be in the form of reviews on product pages or testimonials on your website.

Bottom of the Funnel (BOFU)

Bottom of the funnel marketing strategies focus on conversion. At this stage, you want your prospects to take the desired action, whether it’s subscribing to your email list, signing up for a free trial, or making a purchase.

The following is what you can do to optimise your efforts at this stage.

Create Demos of People Using Your Products

When customers are at the bottom of the funnel, they should clearly understand the value your brand offers. Therefore, they’re more likely to be interested in trying the product but may be hesitant to commit to a purchase.

Creating demos of people using your products help ease their concerns and increase their likelihood of conversion.

Publish Blogs that are Highly-Targeted

Value drives conversion at the bottom of the marketing funnel. Publishing highly-targeted blog posts ensures that you’re providing the best value to your prospects, tapping into their needs and interests.

For instance, if you’re a software company selling tracking software for marketing teams, you could write a blog post about the importance of data and tracking in marketing. Prospects get to see the value of what you’re selling and are more convinced to make the purchase.

Use Clear and Customisable Pricing

Customers at the bottom of the marketing funnel are always interested in pricing information. This is where things can get a bit murky.

Bad pricing can spit out a lead from the marketing funnel. If the customer feels the price is too high, they’ll move to a competitor. On the other hand, if the price is too low, they’ll start questioning the quality of your product or service.

To combat these issues, be very transparent with your pricing. If possible, allow customers to customise their orders and get their needed pricing.

Get the Help of a Professional

You can nail conversions, lead generation, and sales in every marketing funnel stage. Get in touch with a professional today to transform how your business sells itself.

Over to You…

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Marketing Funnel Stages: How to Get More Leads and Sales at Each One