What Is a Sales Funnel and How Does It Work

A sales funnel outlines the stages you want to lead your potential customers through, from interest, to engagement, to whatever is your ultimate goal. And you want your customers to come back, too, so even before you have sold someone your product or service, you need to be thinking about how to keep them and convert them again.

Before we get any further into this, here are a few things worth knowing:

87% of consumers buy from businesses that provide valuable content at all stages of the conversion process.
63% of consumers need to hear your value proposition 3-5 times before they decide to trust you.
Nurtured sales leads make 47% larger purchases than non-nurtured leads.

What is a Sales Funnel?

Foundation, Floodgate, Sales Funnel

The first way we’re going to look at it is through a superstructure encompassing these three words, Foundation, Floodgate, Sales Funnel. This is what you are thinking about before you have even started creating your actual marketing funnel, which you may have noted is the third component in our initial superstructure. If you want to maximise efficiency, you have to do research and strategy.

Think about this as all your prep work before you have embarked on your actual marketing funnel. There are many questions to answer. And, yes, you need an agency like Rumblr to help you with this, too. Clearly we are biased, but the smart move is to get a marketing agency involved as early-on in your process as possible while you are defining your business and probing for your audience.

Step 1: Foundation

Start with your foundation. Who are the customers you are looking for – i.e. what are your customer personas? Foundational work is just that: discovering customer personas, and looking at the competition; discovering your unique value proposition – what problem are you solving? What’s your strategy to build your brand? Are you a unicorn or a steady-growth business? How do you monetise? What’s the ROI? Is your business scalable?

Step 2: Floodgate

So if your foundation is discovering your brand and your customers, Floodgates describes how you will drive traffic into your sales funnel. A simpler way of asking this is where do I start? Start with pay-per-click advertising on social media channels, for example, aimed at highly targeted leads to get an idea of the demographic makeup of who is responding to your product. Opening your Floodgates might and often does also include email marketing, content marketing (like this blog) or other free materials, and website SEO.

Step 3: Traffic

Once you have worked out who you are approaching, you can begin directing traffic to your funnel. Typically, this involves:

A lead magnet – catches the attention of your target audience.
An amplifier – states your value proposition and positions your product in relation to the competition.
A conversion event – an action you initiate that your prospects respond to, and turns them into bona fide sales leads.

And of course, the miracle of digital marketing is all of this can be customised and narrowcasted in different ways to different, specific audiences.

AIDA

Okay, so four words: Awareness. Interest. Desire. Action. Also known as AIDA. These are the four components of your conversion funnel. Essentially, there is universal agreement about this.

The AIDA model was developed in the 19th century, and it absolutely translates to 21st-century digital marketing. That said, Neil Patel describes a similar but still distinctly different model that’s worth exploring, and which we’ll get to in a moment.

What is a Digital Marketing Sales funnel?

A digital marketing sales funnel describes the process of discovering people unaware of your product or business and “converting” them to such loyal customers that they become ambassadors, evangelists even, on your behalf.

Here’s a simpler way to describe AIDA:

Get people’s attention
Have a conversation with them
Tell them what they need to know
Convert!

And, look: it’s easy enough to describe this process. What is much harder is to execute it, but what it boils down to: tell people a good story they can get emotionally invested in, because at some point between the desire stage and the action stage you need your potential customers to go from wanting something to deciding they cannot breathe one more breath without having what you are offering.

So let’s look at our stages in a bit more depth.

Awareness

Let people know who you are with highly targeted hero content designed to make a big splash and drive awareness of your brand. Or maybe use some search friendly help content to get the attention of the right people. A person discovers your brand and becomes a lead. But all leads are not created equal. You need to be intentional about who you bring into you funnel, avoiding prospects do not present a good ROI.

Interest

Remember, the key is to get prospects actively engaged at each step of the process. During this stage, you want to build interest in the product. The goal is to establish a deeper, stronger relationship with your prospects, who you already now know are interested. Remember your value proposition – what problem are you solving?

Here is where you become actively involved in learning more about your prospects’ specific problem, and communicating to them how your product or service solves it. By providing some free solutions, you allow your prospects to experience quick wins and develop good feelings about you. This pulls them in, and gets them more engaged with you.

Now you need to have plenty of content to answer questions and loads of help content. If you believe your prospects are the right ones, you need to be prepared to have as long a conversation as possible. “If people know who you are and they’re spending a lot of time on your site but they’re not converting, that’s where we need these pieces of Go Content, which is like just convert, do it, buy now, here’s some money off, that direct response stuff. So you can use different pieces of content across the sales funnel to answer different business problems,” says marketer Jon Mowat.

Desire

Prospects who have passed through the interest stage and into the desire stage are convinced they do have a problem and said problem demands a solution. Whether it’s a new pair of sneakers, an expensive digital camera, or a weekly fresh produce box, they want it.

They have now convinced themselves, or you have convinced them with your genius marketing campaign, or more likely some combination of the two, the applicable tactic now is to nudge them from like to love. You can offer some kind of deal, or flood the zone with beautiful ads until you get to …

Action

Congratulations, you’ve made a conversion! You have convinced your prospect to do what you want them to do, whether it is buying your product, completing a form to sign up for a service, or if your funnel is longer, converting them to the next step, for example giving you an email address and signing up for notifications. The important thing is you have convinced them to do something that requires their initiative to complete.

Construct your funnel to achieve a clear objective, usually that’s selling a product or a service. That’s your strategy. Then once you’ve discovered who you are targeting via customer personas and other means fill your sales funnel with traffic to drive that traffic from the top of the funnel to the bottom of the funnel where they convert into a paying customer and become an advocate for your business. Those are your tactics – how you move people through your funnel.

How Sales Funnels Work

Just remember this order of operations: strangers, visitors, leads, customers, and promoters. And check out our blog post on Inbound Marketing and how it works. Another important element to understand is that a funnel is a process.

It does not happen overnight. You’ve got to follow the process.

Of course sales funnels go hand-in-hand with the concepts of inbound marketing, but the concepts are not the same, and it’s worth looking at the two separately while considering how the two work together.

Get Customers & Grow Customers

As mentioned above, Neil Patel has created what he calls a “more flexible conversion-base d funnel,” employing a tactic he calls a viral loop, which looks something like this:

Instead of a funnel, it looks like an hourglass turned sideways, but possibly a better way to describe it is a conventional funnel stops with a conversion, whereas Patel’s conception is that the point of action or conversion is only the halfway point of the process.

In this conception, the point of conversion also functions as the opportunity to “Keep Customers” by employing a variety of incentives that encourages customers to remain not only reliant on you, for example with product updates, but also interested and engaged via fresh email and/or blog content, contests, loyalty programs, and events.

Then the funnel expands again to the “Grow Customers” phase that incorporates upselling, next-selling, and cross-selling other products. Further, this idea counts on the notion that your customer will be so impressed with your product and – vitally – that your marketing and content efforts will breathe life into the universe of your brand in a continuous feedback loop.

Underpinning all this, to circle back to a concept discussed in our blog about inbound marketing, is the idea that people don’t function in perfect, linear ways, and no two people make decisions based on the same inputs, so you are well-served to make that consideration as you build your sales funnels.

Confused yet? At Rumblr we’re here to help. But know this: digital marketing has absolutely and completely changed the way businesses communicate with customers, and – here’s the really important part – an intelligent, focused digital marketing campaign increases sales while extending your marketing reach and depth.