A start-up’s guide to your customer marketing funnel

A marketing funnel is a system that collects non-customers and converts them into paying customers over time.


Your marketing funnel works like any other funnel: you fill it at the top and it lets out at the bottom. Unlike most funnels, however, you fill this one with business leads – in other words, human beings.

What does a marketing funnel look like?

Marketing funnels are often conceptualised in graphic form as an inverted triangle shape with multiple layers. You might already be familiar with some models, such as the one where the layers are labelled “Attention, Interest, Desire and Action”.

However, there are some key differences between a physical funnel and a marketing funnel:

  • Marketing funnels have leaks. And some degree of leakage is to be expected, no matter how well-built your marketing funnel might be – not every person who hears about your offer will accept it.
  • Your marketing funnel may also have loops. Like tubes coming out of the sides of the funnel and feeding back in at the top, these loops allow leads to move back to an earlier stage of the business relationship.

Modelling your brand’s marketing funnel isn’t difficult. Using pen and paper or graphics software, you can sketch out the basics in three steps:

  1. Start at the top. How will people get into your funnel? Make a note of the main ways you capture leads, and what those leads are most likely to want from you.
  2. Sketch the main stages of the funnel. What brings your leads closer to buying? Note down the types of content and communications you’ll send them, and the ways you’ll build trust and commitment to set the stage for sales. Try to put these tactics in the most logical order from your leads’ perspective.
  3. Now look at the end of the funnel. What’s the offer you want your customers to accept? When someone accepts that offer, they exit the funnel. (If your start-up is thinking ahead, those new customers go straight into your customer relationship funnel, where you nurture them to increase repeat business.)

How does the marketing funnel work?

If you fill a physical funnel with water, gravity will pull the water through and out at the bottom.

Marketing has no invisible gravity-like force, unless you create it. The role of conversion is to move people through the stages from brand new lead to confirmed desire and finally to paying customer.

5 ways to improve your marketing funnel

  1. Find and fix big leaks – where do most people drop out of your funnel? How can you encourage more of them to stay in at that specific stage? Potential solutions include providing more valuable free content, changing the order of your communications, or using social proof at key moments to build trust and commitment.
  2. Segment and target your audience – can you split the funnel into two or three slightly different funnels, each targeting a different audience persona? For example, your start-up might choose to use a consumer funnel and a business-to-business funnel, or a Millennials funnel and a Baby Boomers funnel.
  3. Measure what matters – and ignore what doesn’t. The obvious metric for your marketing funnel is its sales conversion rate, but to identify leaks or blockages you’ll also need to measure the rates at which your leads move from one stage to the next all the way through the funnel. The high-level key performance indicator to monitor is your funnel’s ROI.
  4. Boost web page conversion rates – test changes to the design and copywriting on key landing pages associated with your funnel, such as email opt-in pages, welcome pages and sales pages. Testing is the only way to gain objective data on what works best to move leads through your funnel.
  5. Bring more people into the funnel – when your marketing funnel is in place and you’ve confirmed that it’s effective, start scaling up. Use your marketing and advertising budget wisely to bring as many targeted leads into your funnel as possible.

Armed with these fundamental principles, your start-up can build and optimise its marketing funnel without too much trouble. Time to put it into action!

ReachLocal are marketing funnel experts who work with small to medium businesses like yours. To learn more about the power of conversion, and discover useful tools that make it work for you, visit the ReachLocal website.