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Breaking down and Building up Your Sales Conversion Funnel
Buzzwords fade in and out of fashion in the business world, but there are some that enter the lexicon and never leave. One such word is “conversion funnel.” If you are involved with marketing or sales, you will no doubt be familiar with this term. What is it? Simply put, a conversion funnel is the journey that customers take from awareness to action — that is to say, the journey from the moment when customers become initially aware of a company’s product, all the way to their final purchase. Ideally this is followed by customers then spreading awareness to other potential leads.
As the name suggests, a conversion funnel takes on the shape of an inverted pyramid. This is because marketing and sales efforts will create awareness for a large number of potential customers, of which only a portion will actually convert. This makes improving the conversion funnel a natural focus for any business. Decreasing the difference in size between the top of the funnel and the bottom is what proves that marketing and sales efforts are working, and creates a more efficient business.
Get the most out of each stage of the Conversion Funnel.
In order to successfully build and monitor a conversion funnel for your business, you must break it down piece by piece, make sure every stage has directives specifically targeted for it, and then focus on fixing the holes in each part of the funnel. Here are the most commonly accepted stages of a typical conversion funnel.
The awareness stage is when the consumer initially becomes conscious of the need for a product or service, and subsequently the desire to address that need. An effective marketing campaign can reach customers at this stage, presenting the right customers with a solution to a problem they did not realise they previously had. This can be done through emailing, targeted ads, and so on.
The consumer engages in a process to gather information on potential solutions to address their need. This is usually where most companies enter the fold. It’s critical to be highly visible at this point in the funnel. A way to accomplish this goal is through website search engine optimisation — after all, the more visible your business is online, the more client interest you’ll be able to generate..
Just before the purchase stage, the customer makes a decision, having narrowed the search down to a more finite list of products, services, or brands. This is where it is important to provide a product or service that has a special edge when held up against competition, so that any comparisons end up weighing in your favour.
This is the action stage. The consumer has made a decision, and will either purchase or not. Companies need to provide means to ensure that they do not lose customers at this stage. Ecommerce and CRM technology can be an important factor here, so that the customers can be effectively and personally guided home..
Beyond purchase, the ideal customers will then take to the internet and real life situations to “advocate” for your product, spreading awareness to other potential customers through word of mouth. This is where good customer service, personalised follow up, and a strong social media presence become invaluable.
Ways to Improve Your Conversion Funnel.
Once you have a plan in place to tackle each section of the conversion funnel, the next challenge becomes narrowing that gap between the large number of consumers at the “awareness” stage, and the much smaller number of people at the “purchase” and “advocacy” stages. Obviously, a good product or service is important here, but there is more that you can be doing from a sales and marketing standpoint.
Here are several effective ways to optimise your conversion funnel for the modern customer:
Send incentives to the right people.
Sites that use targeted onsite coupons can achieve a 19% increase in sales, and an 18% increase in conversions. Whether onsite, over email, or through snail mail, there is a reason that incentives like these are still popular: They work. Coupons can be a major player in the “decision” stage of the funnel.
Despite the popularity of social media, email is still 40 times more effective at acquiring customers than both Facebook and Twitter combined. This makes email an important priority for businesses who want to increase their leads, and thus improve their success rate further down the funnel.
Offer custom pricing.
Industries such as airlines, hotels, movie theaters, and so on are already taking advantage of custom pricing to great effect. This is a good way to make your product or service stand up well against competition, and it is now easy to automate pricing with sales software.
Create compelling calls to action.
That final “purchase” stage of the conversion funnel is where every company should make sure that they are not losing any customers. This is why a compelling call to action is essential — you want to make that click irresistible. Images can be hugely important in this respect.
Avoid Common Mistakes.
As with anything in business, it’s not just about doing the right things, it’s about avoiding certain common pitfalls. You may be directing your focus in the wrong place, or even be suffering from a lack of focus altogether. This can come from not understanding your customers properly, a problem that is thankfully easily rectifiable through using modern sales and marketing solutions.
Another common problem is writing off certain methods of reaching customers too soon. This is another area where technology, particularly predictive analytics, can help. Using this kind of technology, your sales and marketing teams can not only understand where their focus should be, but use smart analytics to figure out exactly the right time and place to send each potential customer the right offer to entice them.