What is the Marketing Funnel?

marketing funnel
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In a perfect world, you purchase some advertisements, they run, and you immediately have a much bigger customer base knocking down the doors of your business. If only it were that simple. 

No, marketing is more complex than that, both an art and a science. To track the customer journey, professional marketers tend to think in terms of the marketing funnel, also known as a sales funnel.

The marketing funnel was invented by E. St. Elmo Lewis, a pioneer in the advertising space who lived from 1872 through 1948. It’s widely regarded as the first real marketing theory of the modern age. It’s also sometimes known as the “hierarchy of effect.” There are a few different variations, with varying numbers of steps in the funnel and names for those steps. At the most basic level, the sales funnel tracks the customer journey from zero awareness of a business to purchasing from that business.

When you’re thinking about acquiring new customers for your business, it’s worth briefly researching a few different funnel models to see which one makes the most sense for your business. For simplicity’s sake, this blog will focus on a very basic three-tier B2C funnel model.

Top of Funnel (TOFU)

At the top of the funnel, it’s all about building awareness around your business and the problems your business solves or the services your business sells. If your business is the sort that has salespeople, this is where your marketing team is generating leads for those salespeople to chase. So while you certainly want to focus your efforts, remember that this is the top of the funnel — it’s the widest part, the mouth.

Top-of-funnel marketing efforts have a broad focus. Printing out 1,000 flyers for your restaurant and paying someone to pass them out all over town is top of funnel marketing. Billboard advertising on the side of a major highway with a message like “Your car deserves care. Come to John’s Auto-Body for a check-up” is the top of the funnel.

Another example would be running a grocery store advertising effort, purchasing a Cartvertising campaign for your hair salon that says, “Why live with loose ends? Come to Lucy’s, put an end to loose ends.” The common thread between these examples is a broad audience, building awareness of your business, and building awareness of the problems your business solves.

Middle of Funnel (MOFU)

In the middle of the funnel, your audience comprises potential customers who are already somewhat aware of your business and the problems your business solves. You have their attention, and you need to convince them to stick around. You want to educate them more specifically.

Let’s say you’ve been running some TOFU-oriented advertisements in your local grocery store for a couple of months. Anyone who shops at that grocery store has probably seen your Cartvertising campaign. They know about your business. It’s time to update your advertisements.

In a situation like the above, you might not want to update every one of your advertisements. New people might be coming to the grocery store who haven’t seen your campaign and can benefit from your TOFU-oriented ads. Instead, create new ads featuring customer testimonials, and replace half of your existing ads with these.

It’s important to note that these more MOFU-oriented ads will certainly still be appealing to folks in the TOFU zone, but they should be especially effective to folks who saw your earlier ads. They know what your business is, and now they’re seeing that other people have already spent money with you and are satisfied. That should be enough to convince them to visit your shop.

Bottom of Funnel (BOFU)

The bottom of the funnel is the most targeted part of the marketing process. This is the last mile when the customers are (metaphorically or literally) at your door, and you need to tempt them to pull out their wallets. For the most part, this takes place after advertising.

You could even think of having someone stand outside your business (let’s say you run a restaurant) and talking to passersby, trying to get them to come in, as a BOFU effort. But that person is running a whole funnel process. First, they’re talking to everyone who comes by (TOFU), they’re explaining what your menu is and why it’s so delicious (MOFU). Then they’re navigating the resulting conversation to bring customers into your door (BOFU). 

A BOFU advertisement in any of your existing campaigns might include discounts or deals. Consider giving repeat customers a discount card as a BOFU effort. Basically, it’s all about the follow-through.

The marketing funnel is handy if your business is running digital ads because you can usually track particular aspects of the customer journey on digital advertising platforms. The purpose of this article is to give you a framework for any marketing efforts, even just a man-on-the-street effort, as described in the BOFU section.

It’s always easier to think about your marketing efforts when you break them into segments like this. If you understand your customers and the journey they’re taking to spend money at your business, you’re probably going to see higher revenue.

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