In Part 1, Brendan J. Hughes offers a structured approach to your digital marketing strategy that helps drive prospects to and through your funnel–inspiring cold audiences, educating warm audiences and convincing hot audiences to purchase from you.

In marketing, the funnel has been one of the fundamentals since its inception in the late 1800s. From market traders to Mad Men and onward to innovators in digital advertising, the theoretical and practical funnel remained stable. This is a luxury every brand should embrace and an opportunity for stability and structure that those operating in e-commerce should especially appreciate.

However, over the years, many have attacked the funnel, battered it, and even declared it dead. While the ways in which we connect with potential buyers and how we measure success have changed in leaps and bounds, the psychology behind the purchase journey itself has remained constant.

So yes, the marketing funnel is still very much relevant in 2021 and can certainly help you develop a structured approach to growing your e-commerce business.

Funnel psychology

While the funnel is not dead, it does need a bit of revamping. The original funnel below is what ad agency exec Elias St. Elmo Lewis in Philadelphia came up with back in 1898:

marketingIt might seem a bit simplistic in the context of today’s complex maze of a buyer’s journey. Google published a study that showed that no two customer journeys were the same. The number of touchpoints they found were also massive–$375 for one user to buy a single pair of headphones!

On the other end of the spectrum, 44% of American shoppers said they made at least one unintended impulse buy in the past 3 months.

So the buyer’s journey can be minutes, days, or months–depending on the person, the circumstances, and the product. However, the mental process the buyer goes through is largely the same.

This purchase decision flow can be summarized into these three stages:

Regardless of the number of touchpoints they engage with or the length of time it takes, your advertising needs to support customers at each of these stages.

Supporting the customer journey

No matter how a customer reaches a touchpoint, you need to be ready to engage them with appropriate messaging.

Building off of the psychology of the buyer, the marketer’s three-stage funnel looks like this:

marketingInspire cold audiences

The top of the funnel is all about brand awareness. Here, you’re trying to identify potential customers who might be in-market for your product, but simply don’t know you exist.

In this step, you want to inspire so-called “cold audiences” and warm them up to your offering. You’re trying to get them to change their behavior and become receptive to your particular solution to their problem. Essentially, you need to create a vision for how their lives improve  should they take you up on your offer.

Educate warm audiences

The next stage addresses audiences who have heard of your brand, have previously interacted with you somehow, but haven’t yet made a purchase. These “warm audiences” typically need more information.

Your goal here is to support their decision-making process by providing resources that answer the question, “Why you?”  At this stage, they’re aware of their problem and that you provide a potential solution, but they need to understand why your solution is more compelling, and a better match, than your competitors’ solutions, which they’re also likely looking into.

Messages for this audience should highlight benefits and features that help you stand out.

A Feature Benefit matrix like the example one below can help with this messaging.

marketingConvince hot audiences

This group is actively considering purchasing your products; you just need to help them overcome any purchase objections. The messaging here isn’t to inspire or educate–you’ve already accomplished that.

Here you need to address the questions of “Why now?”

You should use cognitive biases, such as authority, urgency, scarcity and social proof to your advantage to get them over the finish line.

Mastering the funnel

These are the fundamentals you need to follow and craft your ad structure around for success. Of course, you’ll need to base all of these campaigns on your customer persona research and then test and test until you’ve nailed your copy and creative for each stage.

You’ll also need to take care with how you split your budget. While your gut instinct might be to put a huge portion of your ad spend into the lower end of the funnel where you get your conversions, starving the top of the funnel too much means you’ll be spending a lot more per conversion than you need to.

It’s a delicate balance that needs to be struck so you’re continuing to feed the top enough, while not neglecting to nurture your audiences further downstream.

Want more?

I go into much more detail on the three stages of the funnel, measurement and analytics, along with optimization best practices designed to help you scale in my new book.

Accelerate E-commerce Growth: A Proven Framework to Scaling Your E-commerce Business with Digital Advertising is available in paperback and for Kindle on Amazon, but we’re offering Small Biz Daily readers a free download for a limited time.

Brendan J. Hughes has been “doing” e-commerce and digital marketing since 1997. For much of his career, he has been responsible for devising e-commerce and digital marketing strategies to help businesses accelerate their growth. In each of those roles, Brendan was confronted with the perennial challenge of buying media across multiple platforms and how to get the best returns from across the big walled gardens of Facebook and Google. Over time, Brendan got to know the co-founders of an ad-tech start-up called Optily whose mission is to level the playing field for small and medium-sized businesses advertising on the big ad platforms, such as Facebook and Google. Brendan joined Optily as CEO, realizing that the self-service solution developed by the team was a game-changer for E-commerce marketers. Twitter: @BrendanHughes


Marketing funnel stock photo by Red Deer/Shutterstock