At the end of the funnel
Use a funnel to quickly acquire many new customers, track them along the intended customer journey, and profit from the profitable ones at the end. This still diligently advertised mechanic seems to have outlived its usefulness. Digital marketing and brand management, when combined, can accomplish much more today.
“Let us help you boost your new business. With our help, attracting new customers is easy.” I’m sure you receive countless requests like this on LinkedIn. Or recently I received an invitation to a webinar on the topic of “Effortless Marketing”. The organizing company has also protected the term for itself. A lot of “leads” for the marketing funnel are promised. Contacts that are to become highly profitable customers in the funnel and make it possible to achieve or exceed sales targets.
The funnel has long been considered a recipe for marketing success. The online marketing dictionary describes the funnel as follows: “The goal is to turn a prospective customer into a valuable customer by passing him through several touch points in order to carry out a specific action at the end, e.g. to place an order. Figuratively speaking, many interested parties enter the funnel through advertisements, etc. Companies also use the funnel approach to develop new innovations; if a lot of ideas come together, there is bound to be an idea among them that becomes an innovation.”
At last year’s Perikom/Heads event, Prof. em. Dr. Theo Wehner, work and organizational psychologist at ETH Zurich, cast doubt on the “innovation funnel”: “Hearts come in at the front, and at the end of the funnel there are margarine blocks – the innovation process is far from being that linear.”
In marketing, too, the idea of the funnel, in the sense of tracking potential customers along a customer journey envisioned by the company, has arguably endured.
Creating solutions and value for consumers
“The customer journey doesn’t exist … so stop trying to manage it.” As digital marketing specialist Judd Marcello argued in the December 2019 Forbes Magazine, “customers today have more power, more access to information and more media than ever before. It’s nearly impossible for marketers to understand every single step for tausends or millions of customers. There are essentially an infinite number of steps and paths that customers can go through. This makes the idea of a single customer journey obsolete.”
Instead, Marcello said, there needs to be a focus on creating personalized brand experiences that provide unique value to the customer. Instead of creating or managing a journey, he said, it’s about continuously delivering value to build a lasting relationship. This is a paradigm shift from communicating every step of the way to creating solutions and value for consumers – regardless of when or where they are in their buying process, he said. Customers shouldn’t be pigeonholed, he said, but rather given insights based on the data they provide and offered what they want, when they need it – and in a way that only the relevant brand can.
Even Google, not disinterestedly, addressed the topic back in 2017 and wrote an extensive study on the subject. From Google’s conclusion:
“Stop pandering to the average: Be useful. People respond to brands that understand their needs. That’s why it’s important to optimize media for both relevance to the consumer and lifetime value to the brand. Some customers spend more – a lot more – and many customers spend less. Understanding that can make the difference between paying to acquire profitable customers and paying to acquire customers your competition didn’t want.”
Use a realistic self-image to win customers and gain their trust
The digital marketing specialist and Google point to the importance of understanding individual customers in their situational needs. But this is only one side of the coin. It is just as important to develop a realistic picture of the relevant benefits that the company can provide in each situation. And to design the customer approach efficiently, it is necessary to know which benefits can positively differentiate the company from the competition. If these insights are considered in the management of the corporate brand, it is possible for the company to achieve a significantly higher level of relevance: It can always be present when the available service is particularly useful to the customer. But it spares him from information and offers that would not seem relevant or attractive enough in the situation.
A media relations professional recently explained to me how he successfully applies this principle on a small scale. “I have to know exactly which journalists are particularly interested in which topics and – even more importantly – who wants to make their mark through which coverage. For example, I only contact a journalist if a topic really suits her and benefits not only her medium but also her personally. On the one hand, the journalist appreciates that I don’t constantly text her. But she also knows that when I get in touch, there’s a really good story in it. This creates a relationship of trust from which we both benefit. So, I have to know the needs and interests of journalists so well that I know when a story is relevant for whom. And of course, I always must be aware of the topics in which I am credible, where I must work hard to gain credibility, and which topics I’d better avoid in the future because they don’t fit my profile.”
What this PR man uses to address perhaps 100 media professionals also works today with several 100,000 customers thanks to the available data. And with systematic analysis of the company’s performance areas in terms of relevance and differentiation, as well as the appropriate management of the corporate brand, it is possible to get the company noticed where it makes an impact.
The shortcut via a simple funnel mechanism was too good to be true. Unfortunately, building and expanding profitable customer relationships doesn’t loosely slip through a funnel. As is so often the case, the shortcut does not lead to sustainable success. Just like Thomas Edison taught us: 1% inspiration, 99% perspiration. What is needed is continuous analysis and coordination of needs and performance:
Always knowing who particularly values what and when.
Always knowing how one is particularly useful and when.