The Conversion Funnel is a great concept for visualizing and understanding how your business interacts with your market and converts those interactions into sales. Your business’s goal is to get prospective customers into and through your funnel(s). (The term ‘funnel’ is a bit flawed – in actuality it works more like a spider web [see image] because many points on the consumer journey are interconnected, however for the sake of industry standards, let’s just say funnel.) A conversion funnel may be long, with many customer interaction points before a sale, or short with an immediate point-of-sale transaction. Similarly, a conversion funnel can be complex, recursively looping through itself with additional services, product accessories, or related product offerings, or it can be simple with one-off customers. Nevertheless, each conversion funnel is unique, and it is paramount to pay attention to the details of yours to maximize profit.
Before creating or optimizing your conversion funnel, you must establish your priority conversion goal. Ask yourself first, what end result do I want from interactions with consumers? Do you want to build brand reputation with the public by interacting with followers on social media? Would you like them to sign up for a company informational newsletter to build trust, leading to a purchase of the education you teach? Or maybe the funnel is very direct because you sell hot dogs at a ballgame. Everyone’s funnel is unique. There can be multiple goals within a funnel, or funnels within funnels. You must first decide what your end result (conversion goal) will be in order to build upon and optimize the prospect’s journey.
The goal you want a prospect to follow through with determines how simple or complex your conversion funnel will need to be. No matter what goal is set, it’s important to dissect and evaluate the components of your funnel to ensure it is working effectively. As stated before, the conversion process can be a conglomeration of interactions with various entry points and can go a variety of ways, however there is a basic outline of the concept outlined below. Feel free to look through it and use it as a reference while evaluating your conversion process.
- Awareness: When prospects have begun their search and become aware of a company. They may come from organic search, word of mouth, social media, ad campaigns, etc. In this stage, branding, reputation, and overall trust are critically important to make the business appear legitimate in the consumer’s eyes. They may begin comparing brands or products to determine which provider best suits their current need. Build trust and offer your opening argument: why your business is the one they should utilize. Having a uniform brand experience that looks similar across the board supports the credibility of your business and ensures that each consumer is receiving the same great experience; it also helps set expectations which is significant to the overall prospect experience and conversion funnel as a whole.
- Interest, Desire: Okay, so you’ve piqued their interest. Now what? If prospects had a pleasant experience during the awareness stage, they will begin to seek more information. At this point, the consumer has a better understanding of what they want – interactions at this stage need to be nourished to flow down the funnel. Become an expert in persuasion – provide supporting information to consumers about what to expect when doing business with your company. Correct any misconceptions that they may have about the target result or the enterprise. Show them how the result will optimize their purchasing power. When you pick a charity to donate to, you want to pick one that will make your money go further, right? Perhaps they need help comparing quality or prices – help with that, too! Proving your knowledge and expertise at this stage is crucial to assist prospects with continuing to the action stage of the funnel.
- Action: The prospect has most likely determined what action to take or they may be on the brink of a decision – this is when a final Call-to-Action (CTA) – your closing argument – is needed to give that extra push towards the conversion goal. The CTA is generally where you see pop-ups like “Buy Now”, “Act Today”, “Sale Ends at Midnight!”. It is a flag in the consumer’s face saying, “Hey! You should really get this and here’s why!” A well-thought-out CTA is the tipping point that moves the prospect to the desired action of the conversion goal.
- Re-engagement: Congratulations! Your funnel(s) worked by converting prospects to customers! Is that all? Ha – no. Now your job is to keep them engaged! Ask for feedback about their experience with the process. If they had a good experience, great! They will probably share their experience within their network. Provide the tools to do so (a.k.a. share- button). If it wasn’t a great experience for them, make sure to be sympathetic and ask why it wasn’t, then revise and improve the journey. Perhaps this was just one stage in a bigger picture conversion funnel and now you need to introduce them to a different funnel. Example: Your first goal was to get them following your social media account, but you ultimately want them to buy clothes, so now you need them to subscribe for a newsletter to receive discounts and promo codes to complete the goal of actually buying a product. Again, many end targets have funnels within funnels, requiring dedication and patience during the honing process.
It cannot be stressed enough how important the prospect experience is to the conversion funnel(s). Each prospect’s experience can determine whether you have a repeat customer who tells all their friends and family, or no customer who writes a bad review and leaves for the competition. Continuous optimization of the funnel is necessary to fix any ‘holes’ where current prospects might be leaving. Holes can be many things: a sales rep who has a bad attitude, too long of a delay to reply to an email from a prospect, prices that are too high for that buyer persona – the list goes on and on. Remember, anything that causes a prospective customer to stop considering your business is a conversion funnel hole.
It is best to understand your desired target market before establishing your conversion goal or revamping the user experience. User Experience (UX) is an industry term very similar to “customer experience” and is used to refer to design, content, and the overall experience a user may have interacting with your website, store, or media. To start understanding your audience, create a few buyer personas. Determine who your ideal customer is and what their journey will be. If you know what your ideal customer’s attributes are, you will have an easier time serving users and designing the process.
Conversion rate optimization (CRO) is best achieved by understanding your buyers and their personas. Put yourself in their shoes, listen to their feedback and study where things go astray (or well!). Once you understand your prospects’ experiences, then you will begin to understand how to ‘patch the holes’ and lead more prospects towards the conversion.
A conversion funnel is only as good as its most incongruent experience. An imperative part of providing a positive customer experience is to remember that it’s more important to avoid bad experiences (poorly executed logo, bad content, etc.), then to try to win the conversion in any one exact moment. You must meet the expectations you originally set. While a fantastic experience is ideal, it’s okay if it isn’t superb, as long as it is not terrible! Due to time investment and switching costs, the effort of finding a similar product and going through the whole process again with a different company, a consumer may still go through with the conversion – even if it is mediocre. But if something goes wrong, they will presumably fall out of that ‘hole’, share their encounter, and not return because that bad experience is worse than the process of starting over somewhere else. A bad experience can cause a ripple effect that leads to chaos.
This may sound monotonous but – be proactive, not reactive. A buyer’s behavior is like water flowing downhill: you can’t reverse its direction, but you can channel where it flows. Consumers will go through this journey, so help direct where they finish and provide a good, memorable experience.
[Scroll down to see examples of the conversion funnel in action.]
What does this all mean?
You just read a lot of information and terms, but you’re probably wondering how it all ties together. Your goal is to lead prospects to a desired action. Providing prospects an optimal experience throughout their interactions with your business will improve the conversion rate and return on investment (ROI). You can further improve ROI by continuing to refine the conversion funnel to match the prospects’ behaviors and expectations. Create a unique, easy, enjoyable experience for the prospects to guide them through your funnel, and it should make for converted customers who re-engage and share their experiences with their network, helping to create new customers who will also return to your business.
Real Estate Agent
Steve is a new real estate agent, and is developing his network. Steve’s first interactions with potential customers includes direct sales/contact, word of mouth from friends and clients, and hosting open houses. Steve needs to have an average of three conversations with a prospective client before they convert. It takes an additional six months on average with that client to sell or buy their home and complete a transaction generating revenue for Steve. Steve knows his business model rewards personal relationships and requires a positive customer experience to produce more word-of-mouth referrals and repeat customers, so Steve dedicates his small marketing budget to materials that enhance his in-person interactions.
Andrew operates a legal firm that provides cost-effective consultation services to small and mid-sized businesses. Potential customers are introduced to the firm through search engine results, digital ads, direct mail, conventions, and word of mouth. Andrew’s conversion funnel requires driving prospective clients to his firm’s website, where credibility and additional lanes of communication can be established. The website features effective landing pages, industry relevant articles (a blog), newsletter signup, and persuasive displays and content. Andrew’s firm also invests significant resources in content strategy and creation, which benefits not only the website and the brand’s credibility, but also creates new points of entry to the funnel via organic search traffic.
Pencil Pushers Co. produces and sells pencils to the public. They want to specifically target students and teachers who will be starting school soon. Their marketers know that people generally need to see an ad three times to buy the product and that many of their sales are from students who see their friends using Pencil Pushers’ pencils. To get prospects into this funnel, they invest in signs to be hung up at retail stores during the summer where their pencils are sold. They also run a TV ad campaign and interact with students on social media. Lastly, Pencil Pushers Co. runs a national contest accepting essays from students explaining why their school should receive the Pencil Pushers’ bi-annual pencil donation. The contest is advertised on the website and social media, and the winners, upon the acceptance of their donation, are posted to Pencil Pushers’ social media accounts, as well as an article in the local newspaper.
Want to learn more about Conversion Funnels? Check out these references!