Understanding the sales funnel in a digital world

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The digital world works a little differently from other “traditional” spheres. This is no different when it comes to sales and marketing. Here the sales funnel turns digital and converts customers in a dissimilar way. It’s therefore vital to understand the sales funnel in a digital world.

If you are not familiar with the traditional sales funnel, this model describes the four stages of the customer journey. The four stages are Awareness, Interest, Desire and Action. In short, it explains that a customer first becomes aware of your product or service, whereafter they show interest in learning more about it. Next, the desire to purchase a product or service becomes evident. Lastly, the customer takes action by finally purchasing the product.

The point of the sales funnel is to lead customers through the entire journey, hoping to improve sales and create more return customers.

In the traditional sense, it looks like this: Your customer sees advertisements about your product. They are now aware that your product exits. Seeing it on the shelves in the supermarket makes them curious about what it does. They pick up the product, read the information and perhaps put it back down. Next time they visit the shop, they remember how it could have been useful in a particular situation, thus considering the purchase. Finally, they decide it is a must and buy it.

The Digital Sales Funnel

E-commerce turns the traditional funnel upside down. There are no shelves, and customers cannot pick up a product and interact with it before they buy it. Furthermore, consumers now have the opportunity to research products before buying. This means reading reviews and articles, watching videos and comparing prices between websites for similar products.

Unlike the traditional funnel, the digital funnel needs to focus on a non-linear process that always considers the behaviour that drives the user to turn into a buyer. The digital marketing funnel can divided into three funnels.

1. Hourglass digital funnel

The hourglass funnel emphasises the importance of working towards one sale and crafting strong client relationships. The top half of the hourglass focuses on attaining business, and the bottom half focuses on client retention. These are respectively known as the pre-purchase and post-purchase stages.

The pre-purchase stage consists of the following:

Engagement: Building brand awareness
Education: Identifying a problem
Research: Discovering a solution
Evaluation: Determining how a product or service resolves a problem
Justification: Validating the purchase of a product or service
Purchase: Buying the product or service

The post-purchase stage consists of:

Adoption: Using a product or service
Retention: Ensuring a user’s satisfaction
Expansion: Upselling a user
Advocacy: Becoming a brand advocate

2. Looping digital funnel

There are six steps contained in the looping digital funnel. It highlights that each user’s journey is unique, and during their journey they will loop through the various stages. Furthermore, it emphasises the importance of post-sales service.

It can be summed up as follows:

Awareness: Becoming aware of a problem or need
Consideration: Finding a solution
Research and Discovery Loop: Uncovering potential solutions and brands due to finding solutions in the consideration stage.
Purchase: Buying the product or service
Post-Purchase Experience: Improving the experience of the buyer
Loyalty Loop: Building shopper loyalty after the post-purchase experience was positive for the shopper.

3. Micro-moments digital funnel

A micro-moment is a moment of inspiration that triggers a user to immediately search for a specific product or service online. Google developed this term as an attempt to define the drive that users experience to enter this specific sales funnel. An example of this would be any person becoming hungry and searching for “restaurants near me” or more specifically, “pizza near me”. It also works for services such as car washes, plumbers, etc.

The business needs to define what it will be that motivates the ideal customer to search for the business. Is it to buy something or go somewhere? Google categorised these micro-moments into four categories.

Want-to-Know Moment: Answering a question
Want-to-Do Moment: Doing something
Want-to-Go Moment: Going somewhere
Want-to-Buy Moment: Buying something

A business owner needs to understand these funnels in order to effectively convert leads into buying customers. Identifying their behaviour and which decisions they will make at what stage. The onus is on the entrepreneur to ensure the right messages are received by the user at the correct stage to guide them towards the next step.