The secret to creating marketing success? Create a solid customer acquisition funnel.
A customer acquisition funnel is a model that helps you identify stages in your sales and marketing process, refine existing strategies, and keep track of the effectiveness of your marketing efforts. A targeted customer acquisition strategy requires taking a step back and figuring out what's best for your business, resources, and audience. An added benefit of a customer acquisition strategy? It guides you on exactly what you can do to attract new customers and retain existing ones.
When it comes to acquisition funnels, "one size fits all" doesn’t work. Each stage of the funnel may be labeled the same, but the strategies a brand needs to develop to target their audience at each stage can vary greatly. An in–depth understanding of the funnel is crucial to ensure that your customer acquisition efforts don't go to waste.
The various stages of a customer acquisition funnel are as follows. However, it is important to keep in mind that these stages are named differently in different places, and working within them according to the needs of your brand is the key to success.
● Stage 1 – Lead generation: The prospect is made aware of your brand, products, and/or services
● Stage 2 – Lead acquisition: The prospect starts interacting with your brand, considers your products and services, and thinks of investing in them.
● Stage 3 – Lead conversion: The prospect pays for your products and services, and is now a customer.
Generating brand awareness and driving interest in your offerings is difficult, but the final stage — converting leads into customers — is the hardest. This is because convincing leads to opt for your product/services and not your competitors' involves a lot of grit, smart strategies, and a cracking USP, among other things.
Let’s take a quick look at why you need a customer acquisition funnel before diving into the steps you can take to build an effective one.
Why Do You Need a Customer Acquisition Funnel?
Every business needs a customer acquisition process. The goal is to create a systematic way to acquire your ideal customers and adapt to changes and consumer trends. It also shows you how much it costs to get new customers and how to look for opportunities to maximize your marketing budget.
The cost of acquiring a new customer is referred to as customer acquisition cost (CAC). Creating a funnel is an effective way to identify gaps in your sales and marketing process. If one stage of your funnel shows losses or a substantial drop in the number of prospects entering the next stage, it's time to review and revise your strategy. Note that CAC and CPA (Cost per Acquisition) are different. Filling the gaps in your funnel can translate into huge gains for your company, both in terms of customer engagement and conversions. An acquisition funnel helps you visualize the process a customer would go through. If you can visualize their journey, you can gain extremely valuable insights and ideas on making your strategies and products more inviting, exciting, and catering to the needs of your customers. Now, what happens if you don't (or can't) visualize this journey? You create and promote products that poorly cater to your audience’s needs. You create strategies that aren't customer-friendly because you haven't mapped out their journey in the first place. Your prospects exit the funnel in the initial stages, leaving you with low sales and little-to-no engagement. Creating an effective and successful funnel isn't as hard as it looks like. There are various best practices you can keep in mind while creating a funnel, and this blog post covers seven steps you can use to create a funnel that works for you.
The cost of acquiring a new customer is referred to as customer acquisition cost (CAC). Creating a funnel is an effective way to identify gaps in your sales and marketing process. If one stage of your funnel shows losses or a substantial drop in the number of prospects entering the next stage, it's time to review and revise your strategy. Note that CAC and CPA (Cost per Acquisition) are different. Filling the gaps in your funnel can translate into huge gains for your company, both in terms of customer engagement and conversions. An acquisition funnel helps you visualize the process a customer would go through. If you can visualize their journey, you can gain extremely valuable insights and ideas on making your strategies and products more inviting, exciting, and catering to the needs of your customers. Now, what happens if you don't (or can't) visualize this journey? You create and promote products that poorly cater to your audience’s needs. You create strategies that aren't customer-friendly because you haven't mapped out their journey in the first place. Your prospects exit the funnel in the initial stages, leaving you with low sales and little-to-no engagement. Creating an effective and successful funnel isn't as hard as it looks like. There are various best practices you can keep in mind while creating a funnel, and this blog post covers seven steps you can use to create a funnel that works for you.
Step 1 - Know Your Target Audience
I am sure you have heard the phrase "know your customer" many times before. I bet it has even become a cliché by now. Make no mistake, though – knowing your target audience, and knowing it well is key to your business success. If done right, understanding who makes up your market can be invaluable for helping you define and fulfill customer needs.
The customer discovery process is essential if you want to get your funnel right. Identifying potential users and customers is what will help you create a more effective funnel. This step ties in with all your marketing and sales efforts as well. Most companies design their customer acquisition process around their own view of the world, instead of first taking the time to understand the customer's buying process, and their concerns at each stage. In the business world, we typically visualize the customer journey with a funnel or a similar graphic that highlights the stages in the buying process and the mindset of the prospect. Define your target audience, study their needs, preferences, and the potential they carry for your brand's products or services. If you miss this step, you will likely end up targeting an audience sector that has the least spending potential, has low interest in your brand, or does not need your product. Creating effective marketing campaigns and strategies is only possible when you have your audience defined, with their exact needs in mind.
The customer discovery process is essential if you want to get your funnel right. Identifying potential users and customers is what will help you create a more effective funnel. This step ties in with all your marketing and sales efforts as well. Most companies design their customer acquisition process around their own view of the world, instead of first taking the time to understand the customer's buying process, and their concerns at each stage. In the business world, we typically visualize the customer journey with a funnel or a similar graphic that highlights the stages in the buying process and the mindset of the prospect. Define your target audience, study their needs, preferences, and the potential they carry for your brand's products or services. If you miss this step, you will likely end up targeting an audience sector that has the least spending potential, has low interest in your brand, or does not need your product. Creating effective marketing campaigns and strategies is only possible when you have your audience defined, with their exact needs in mind.
Step 2 - Create Valuable Content
Whether you want to create a B2B sales funnel or a B2C one, you will need to have a content marketing strategy in place. Content marketing works, and it brings ROI. We live in the world where there's no need to reinvent the wheel because we already have many resources available on the topic that we're about to cover. And if you think that creating something of your own will do it better and faster, just remember: people want things that are helpful and easy to digest.
If you've spent enough time on various social media platforms, you'll know that valuable content sells. Many brands leverage social media platforms like Linkedin, Instagram, and Twitter to share resources, wisecracks, tips and tricks, and insights on niche matters. This strategy works wonders for your funnel as it leads to a tremendous number of people entering Stage 1 of your funnel: awareness. The goal of sharing lots of valuable content isn't baseless promotion but a genuine way of helping your audience and thereby making people aware of your brand. The more relevant your content is, the more people will talk about it. And the more they talk about it, the more you get noticed. Once you've added a boost to the first stage of your funnel, you have lots of opportunities and potential to convert these leads into customers through other creative branding strategies that are stage-specific. Here are a few content ideas you can work on - 1. Helpful resources (such as websites and books) in your niche 2. Infographics 3. Tips and tricks, or How-to posts 4. Contests and giveaways 5. Customer testimonials 6. Collaboration posts with other brands
If you've spent enough time on various social media platforms, you'll know that valuable content sells. Many brands leverage social media platforms like Linkedin, Instagram, and Twitter to share resources, wisecracks, tips and tricks, and insights on niche matters. This strategy works wonders for your funnel as it leads to a tremendous number of people entering Stage 1 of your funnel: awareness. The goal of sharing lots of valuable content isn't baseless promotion but a genuine way of helping your audience and thereby making people aware of your brand. The more relevant your content is, the more people will talk about it. And the more they talk about it, the more you get noticed. Once you've added a boost to the first stage of your funnel, you have lots of opportunities and potential to convert these leads into customers through other creative branding strategies that are stage-specific. Here are a few content ideas you can work on - 1. Helpful resources (such as websites and books) in your niche 2. Infographics 3. Tips and tricks, or How-to posts 4. Contests and giveaways 5. Customer testimonials 6. Collaboration posts with other brands
Step 3 - Work on Content Optimization
Now that you've captured your audience's attention, you need someplace they can visit to know more about your brand's products and services. These landing pages can make or break the first few stages of your funnel, so it is important to constantly optimize the content on your landing page and your website as a whole.
By analyzing your CVR (Conversion Value Ratio) metrics and understanding where your visitors, users or leads dropped out, you will find what to optimize. Content optimization helps create a speedier and smoother user experience and improves organic search rankings.
Here are a few ways you can optimize your website and landing pages:
1. Create a content calendar, and stick to it
2. Optimize headings and meta descriptions
3. Focus on both high-volume and long-tail, low-competition keywords
4. Regularly update your content (blog posts, social media, etc.)
5. Conduct SEO Audits
6. Make sure the media on your site isn't size-heavy and loads fast
Step 4 - Leverage Email Marketing
In today's competitive market, companies have to work hard for customer acquisition as well as customer retention. In fact, they need to reach out the prospects in a way that resonates with them and makes an impact on them. The growing number of channels available today is making this task all the more complex and challenging. This is where having a solid email marketing strategy comes into play.
Email may be labeled as "ancient", but the truth is, it’s still a highly effective marketing channel. Leveraging email marketing at every stage of the acquisition funnel can bring you an impressive ROI, as high as 4400%! Sending out relevant emails with the latest offers, product updates, or content newsletters tailored to your audience’s funnel stage is what it’s all about. So, create personalized emails according to the stage of the funnel a potential customer is at. The first two stages can include useful information and other relevant content about your brand they'll find engaging. At the third stage, they already know what they're looking for, and providing more details about the product they might opt for, loyalty programs, discounts, and free trials would be highly effective. Study the ins and outs of email marketing to work out what’s best for your brand’s sales funnel.
Email may be labeled as "ancient", but the truth is, it’s still a highly effective marketing channel. Leveraging email marketing at every stage of the acquisition funnel can bring you an impressive ROI, as high as 4400%! Sending out relevant emails with the latest offers, product updates, or content newsletters tailored to your audience’s funnel stage is what it’s all about. So, create personalized emails according to the stage of the funnel a potential customer is at. The first two stages can include useful information and other relevant content about your brand they'll find engaging. At the third stage, they already know what they're looking for, and providing more details about the product they might opt for, loyalty programs, discounts, and free trials would be highly effective. Study the ins and outs of email marketing to work out what’s best for your brand’s sales funnel.
Step 5 - Focus on Social Media Outreach
Social media holds a huge chunk of how you reach out to potential customers. Social media platforms have a tremendous amount of reach, and if one studies and targets a specific audience segment well, social media is a goldmine of leads.
This step ties in closely with the second, as regularly creating and sharing valuable content on social media channels boosts the number of people in the first stage of the customer acquisition funnel: awareness. Interacting with customers, responding to comments and reviews, sharing new product launches, behind-the-scenes experiences, and resources on social media is key to building a robust and effective funnel.
Step 5 comes with an added benefit. One can easily spread brand presence across different apps that cater to different audience segments, both local and international. A boost to your social media presence means more social proof which, in turn, leads to an even larger boost for the last stage of your funnel: lead conversion.
Step 6 - Paid Ads Are Your Best Friend
Who said only organic reach works for your brand? Building an organic following and turning it into a customer acquisition channel takes time, especially in contrast to paid advertising. Paid ads, thanks to the enormous number of people who use the internet, hold more potential than you can think. Paid ads can be displayed on search engines, social media platforms, and on other relevant high-authority websites in your niche.
Paid acquisition should be an integral part of your growth campaigns. You can use paid ads to create awareness, or boost sales during a marketing campaign. One can create and post ads that are keyword-specific, location-specific, and profile-specific. Various advertising options such as pay-per-click (PPC) ads on Google and location-specific ads (targeting potential customers within a specific geographical location) enable you to aim for a higher conversion rate quickly.
Various analytics tools also help monitor and study how your ads are doing: information that is especially handy while looking to plug holes in your acquisition funnel.
Every revenue-generating business must answer a single question: how do we acquire new customers and then how to retain customers? If you're focusing on organic traffic or Search Engine Optimization, you could be leaving money on the table. Here are 5 reasons why paid search is essential to your success:
1) Paid ads allow you to launch right away without waiting for SEO and organic rankings. In fact, many businesses start with paid ads before they even create their site because it takes time to build up that organic traffic over several months which can affect your bottom line in the meantime.
2) You control where people land when they click on your ad. Unlike someone sharing a link online through social media or other means, Google Ads allows you to specify where visitors go when they click your ad. This landing page can include a brief introduction to your product or service, design elements that build trust and credibility for your brand, and even an opportunity for the visitor to take action by signing up for a free trial or purchasing immediately. No matter what you choose, paid ads are an effective way to get people from clicks to conversions.
3) Paid ads are customizable at scale. Google Adwords has tools that allow advertisers to create thousands of ads quickly while still maintaining control over important variables like copywriting, branding, bidding strategy, etc.
4) Paid ads drive higher quality leads than organic traffic. Just because someone found their way to your site through organic search doesn't mean they're qualified or ready to buy. With paid ads you can target customers who are beyond the research phase of the buying funnel so they're more likely to see your ad, click on it, and ultimately buy.
5) You get access to Google Analytics data for free through Adwords so you have full visibility into your advertising performance. This is an invaluable tool for understanding engagement and traffic patterns coming from your ads as well as those coming from organic search. Paid traffic isn't the only kind of marketing you should be doing, but it's a key part of any successful campaign to acquire new customers online.
1) Paid ads allow you to launch right away without waiting for SEO and organic rankings. In fact, many businesses start with paid ads before they even create their site because it takes time to build up that organic traffic over several months which can affect your bottom line in the meantime.
2) You control where people land when they click on your ad. Unlike someone sharing a link online through social media or other means, Google Ads allows you to specify where visitors go when they click your ad. This landing page can include a brief introduction to your product or service, design elements that build trust and credibility for your brand, and even an opportunity for the visitor to take action by signing up for a free trial or purchasing immediately. No matter what you choose, paid ads are an effective way to get people from clicks to conversions.
3) Paid ads are customizable at scale. Google Adwords has tools that allow advertisers to create thousands of ads quickly while still maintaining control over important variables like copywriting, branding, bidding strategy, etc.
4) Paid ads drive higher quality leads than organic traffic. Just because someone found their way to your site through organic search doesn't mean they're qualified or ready to buy. With paid ads you can target customers who are beyond the research phase of the buying funnel so they're more likely to see your ad, click on it, and ultimately buy.
5) You get access to Google Analytics data for free through Adwords so you have full visibility into your advertising performance. This is an invaluable tool for understanding engagement and traffic patterns coming from your ads as well as those coming from organic search. Paid traffic isn't the only kind of marketing you should be doing, but it's a key part of any successful campaign to acquire new customers online.
Step 7 - Embrace New Trends
In any industry, staying ahead of the curve is a true blessing. That's particularly the case when you're in business. However, most people make this harder for themselves than it has to be. In fact, there is a very simple reason why not everyone is successful at keeping up with new trends and they often fail without knowing exactly what their mistake was.
Embracing niche trends and making them a part of your content strategy is always a good idea. Your acquisition funnel mainly depends on how well you can capture your audience's interest, and keep them hooked till the end of the funnel, and keep them coming back as loyal customers. Trends help you achieve all of these things and make the customer experience unique, knowledgeable, and honest. To help understand this, here's an example: The sudden popularity of video-based content has been noticed across social media platforms and the web. Various brands are integrating video content on their website, with formats specific to their niche. Research shows that audiences respond and retain better with video content and that videos will be a prominent eye-catcher in the coming years. Hopping on these new trends and modifying your funnel (or creating a new one) is key to an effective acquisition process.
Embracing niche trends and making them a part of your content strategy is always a good idea. Your acquisition funnel mainly depends on how well you can capture your audience's interest, and keep them hooked till the end of the funnel, and keep them coming back as loyal customers. Trends help you achieve all of these things and make the customer experience unique, knowledgeable, and honest. To help understand this, here's an example: The sudden popularity of video-based content has been noticed across social media platforms and the web. Various brands are integrating video content on their website, with formats specific to their niche. Research shows that audiences respond and retain better with video content and that videos will be a prominent eye-catcher in the coming years. Hopping on these new trends and modifying your funnel (or creating a new one) is key to an effective acquisition process.
Upcoming Trends For this Year
In order for any customer acquisition strategy to be effective, it must evolve with ever-changing consumer behavior and preferences. Looking for marketing and lead-generation trends for the coming year? We've got you covered. Below is a brief list of potential marketing trends for this year:
1. Influencer marketing will continue to gain further traction
2. AI and VR-based solutions meant to improve the shopping experience
3. SEO would become synonymous with on-site user experience
4. Inbound marketing will be the go-to solution for up-and-coming brands
5. Corporate social responsibility will become a bigger priority
These trends may evolve, but working on your customer acquisition strategy keeping these in mind can lead to huge results!
Final Thoughts about Building an Effective Customer Acquisition Funnel
By now, you should know how to create a powerful customer acquisition funnel. This is not it though. You should not limit yourself to a unique funnel. I suggest you follow the multi-funnel marketing approach by creating several funnels and linking them.Almost every new customer comes with a cost that can be calculated based on the marketing effort put forth to acquire them. In order to know whether your customer acquisition efforts are working, you will need to understand how to calculate your customer acquisition cost (CAC). The lower the CAC for a customer acquisition channel/method, the higher its value for the business. It's important to note that a larger CAC can be justified and may be necessary, for customers who spend more over time. This is why calculating the LTV (Customer Lifetime Value) is essential. So, don't invest all in acquisition but also think about a customer retention strategy.
When it comes to mapping out a successful customer acquisition strategy, businesses have an almost overwhelming array of choices. Setting up an effective acquisition funnel involves various factors from various sectors in your strategy. The key to a smooth funnel is a proper synergy between stage-specific strategies and the overarching brand strategy. Setting long-term goals and modifying your funnel as you go is the best way to build a sustainable growth strategy for your brand. Growth Hackers is a digital marketing agency that helps businesses gain sure success through various growth marketing strategies including social media marketing, building customer acquisition funnels, video editing, content marketing, SEO, email marketing, fundraising, customer retention and more. Contact Growth Hackers now and let us help you create and implement and improve your online business' marketing strategies.
Lucy Manole
I am a creative content writer and strategist at Marketing Digest. I specialize in writing about digital marketing, technology, entrepreneurship, and education. When I am not writing or editing, I spend time reading books, cooking and traveling.
