Your sales and marketing funnel can be like a pair of pants with a hole in the pocket. You don’t notice the hole at first. You notice it, however, when you start losing things out the hole, like small coins. While you hate to lose any money, it gets really frustrating (and more costly) when the hole grows large enough that you lose your keys or something else really valuable.
Putting your budget dollars into a leaky sales and marketing funnel is very much like putting money in a pocket with a hole in it. You will inevitably lose some of your money, but you may not know how much.
Finding Those Sales and Marketing Funnel Leaks
The problem is all sales and marketing funnels leak. Whether you are marketing for B2B sales leads, selling consumer products in store or online, driving diners to a restaurant, or recruiting new students to your university, your marketing and sales funnel is leaking. The leaks in your marketing funnel cost you money—and potential customers. The good news is that if you know where it’s leaking, you can take appropriate steps to help stop the leaks or at least minimize their impact.
A thorough analysis of your marketing and sales analytics can reveal where your funnel is leaking. The first challenge is to find and understand the leaks. The next challenge is to identify how to stop or reduce the leaks. How many people who see your ads and read your emails actually visit your store or website? How many of those who reach your website ask for information or make a purchase? How many people leave a store without buying what they came in to buy? It’s critically important to know what is and is not working within each step of your marketing and selling funnel. More importantly, you need to understand how your customers are making decisions at each step in their purchase decision journey.
It is critical to understand your sales and marketing funnel and your customers’ purchase decision process in order to optimize your market effectiveness and marketing ROI.
- You need to identify your Points of Loss (POL)—where you are losing people at each step in your funnel.
- You also need to understand your Points of Influence (POI)—the key points in the decision process where you can win or lose the engagement of your potential customers as they move towards making a purchase decision. These are the points in the decision process where your potential customers seek information on what they want to buy. You need to understand what these POI’s are and who/what is influencing them at each one.
POL’s and POI’s are your key leverage points in making your marketing and sales process much more productive.
Adding More Sales Productivity to Your Marketing Funnel
There are three key ways to build sales productivity in your current marketing and selling funnel:
- Put more total people in the funnel. Your funnel still leaks, but more people in should mean more people out. If only 1-5% of the people at the top of your funnel actually buy from you or sign up for your services, you need to first focus on improving your funnel rather than putting more people into it.
- Put more of the right people in the funnel. You hope to attract and sell more of your target audience. But, if you don’t clearly understand why they are choosing you, this approach will not be fully effective.
- Retain more of the right people in the funnel. By slowing or stopping the leaks in your funnel, you will optimize your efforts to attract and retain more target customers. This is usually a much more productive near-term effort versus just spending more on ads or offering promotions.
Our work with clients shows that the leaks in a funnel can happen for very different reasons. Some can be as simple as the wrong web link was attached to an ad or email, sending the right person to the wrong place on your website. They don’t find what they want, get frustrated, and leave your website.
Other leaks come from only communicating the features of a product or service but not the most relevant benefits. Often, a leak comes from not providing the key information a target customer wants to learn prior to deciding where to shop and what to buy. While these leaks sound like marketing fundamentals, they happen frequently in different stages of marketing funnels.
Shoppers stay in the funnels that best fit their shopping process and POI’s. Companies who best understand how their customers shop and make purchase decisions and can align their marketing funnel with customer information needs will boost their funnel productivity, sales, and marketing ROI. If your competition understands your customers’ shopping and decision process better than you do, your marketing funnel will become less effective and you will lose share to your competitors.
Unfortunately, today’s lean marketing and very busy staffs often don’t have enough time to invest in understanding their Points of Loss and Points of Influence. Whether your internal team does this work or you get outside help, your marketing will be much more productive if you take time to understand why each of your key marketing initiatives may or may not be working effectively in your marketing funnel process.
Are programs ineffective because your funnel process is leaking or are you just not effectively engaging your target customers? Once you better understand your Points of Loss (POL) and your Points of Influence (POI), you can more effectively focus your efforts and marketing investments in the right place. Once your sales and marketing funnel works well and you know how to best engage and sell your target customer, you will accelerate your market success!
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