Sales and Marketing
The Sales and Marketing Funnel Approach
The acronym AIDA, standing for Awareness, Interest, Desire and Action has been around in the world of marketing for a long time. It was first proposed by the US advertising executive Elias St. Elmo Lewis over 100 years ago in the early 1900’s and applied at that point to readers of newspapers, magazines or any other print media. With this acronym, Lewis proposed that every sale (whatever product or service was being advertised) was the result of a customer journey from:
- A) Being aware that the product or service even exists (an increasingly tough job in the highly cluttered modern world of course)
- I) Gaining interest (usually through some kind of engagement with the selling entity
- D) Converting relatively passive interest into active desire to purchase (at least at some future point)
- A) Bringing a customer to action or to a point where they are happy to buy.
This is all illustrated in the graphic below.
As the above shows, the “journey” to a purchase of some kind is often illustrated with what today is simply called the “marketing funnel”. This funnel depicts that prospective customers are always at the widest point (and therefore should be sensibly segmented), should be targeted to win interest, have to then be motivated to increase levels of product or service desire and finally have to be given straight-forward ways to purchase or acquire (including renting, leasing etc) . Through each step of the AIDA acronym, the first three letters are often seen to involve marketing and the last involves sales. In this case sales is the specific activity to convert a qualified prospect to buy.
The marketing funnel analogy suggests that consumers pay attention to only some offers that are made, weigh the alternatives to each offer, make decisions to distinguish what is interesting versus uninteresting to them and finally (perhaps) buy products or services. This model then guides marketers towards specific marketing “push” approaches to guide consumers at each stage of the funnel process to influence their behavior, and maximize the chances of them being “pulled” through the funnel.
Until the Internet came into being the marketing funnel worked well in describing how prospective customer’s attention was captured, nurtured and converted and traditional marketing methods could be used to perform these broad marketing functions, such as TV, Radio, Print ads, Events and even customer calling on the telephone. However, while these methods to reach customers have not gone away, we now clearly live in a digital age and attempts to pull possible customers through the marketing funnel is a little different (and perhaps we therefore need to change the metaphor we are using). New marketing methods such as email, text messaging, web site SEO, Blogs, on-line advertising and the use of web-based social media are increasingly being used as the new channels by which to gain attention. and convert prospects to purchasers. In other words, the funnel analogy still seems to work as a stage by The staged approach (from broad to narrow) are therefore similar but the tools to pull people through this conversion funnel seem to be changing g rapidly (and maybe it’s even changing the shape of the funnel a little).
There are now several alternative metaphors that claim to better describe what is addressed by the funnel diagram but these are often complex and much disputed among marketers. However, one version of these alternatives, which seems to have much more popular appeal has been described in the book Duct Tape Marketing by John Jantsch, written in 2007. The updated model of the marketing funnel from Duct Tape marketing is shown in the diagram below:
Clearly, Jantsch sees the ideal metaphor as not so much of a funnel but as an hourglass, through which customers still have to be pushed (and pulled) but now in seven discrete stages. Gaining awareness or knowledge about a product or services or still very much the same but then each subsequent stage is more about getting increasing levels of engagement before buying occurs. Even at this fifth stage, there are still two others in which customers should be encouraged to engage (which is why this is an hourglass and not a funnel). These are to repeat the purchase and to refer others or advocate to new prospects on how good the product or service experience has been. These may only be word-of-mouth recommendations or reviews on web sites, but they are powerful influencers on potential buyers.
The funnel metaphor is useful in providing a way to understand the strength of a marketing approach at different stages, highlighting the possible difficulties or bottlenecks that may see possible customers lost and even highlighting where more marketing effort or focus is likely to pay dividends. Although modern marketing methods, tools and channels have changed greatly in recent times, especially through use of the internet, the funnel metaphor still works, but perhaps we can now start to think of it as an hour-glass, as we track our customers to and beyond their first purchase.