Why Funnel Marketing Doesn’t Work
It is easy to see why “the marketing funnel” is such a popular concept. Marketing is a process we use to extract a small stream of prospects and clients from a vast sea of strangers. So many writers and speakers use the funnel model to describe the process: that large crowd of potential customers at the wide end, and those select few, our actual customers, at the narrow end.
Visual images can be powerful tools to help us understand complex ideas, or to simplify sequences and processes so they are easier to work with. But they also can mislead, if the chosen image does not accurately reflect the concept in question. That’s what happens with “the marketing funnel.”
Marketing Is Not a Funnel
Marketing and sales are not funneling processes, no matter how visually appealing that image may be. As alluded to above, the process of marketing is one of narrowing the field, of sifting out the undesirable or unpromising candidates, of eliminating the chaff. It is rather like panning for gold, where you wash away a lot of worthless stuff to come up with a few precious nuggets — nuggets you can live off of.
This sifting process starts when you narrow the world at large down to a target market, whether you define that by need, company characteristics, product line, geography, industry, or other factors. It should happen again when you come in contact with interested prospects, so you will devote your attention to qualified prospects: the ones who have the budget, the support, the decision-making power to complete a profitable project with you.
In short, marketing is a series of culling steps, eliminating some players so that we can focus on the best opportunities.
A funnel does not work that way at all. Everything you pour into the top of a funnel comes out the bottom. Everything. There is no selection, no elimination of any kind.
And since every single candidate for your business — the very promising and highly qualified, and the absolutely hopeless and the high-maintenance-low-margin possibilities — would emerge from the narrow end of the funnel, what’s the point?
Truly Narrow the Stream
When you realize that you have to extract a small subset of valuable prospects and clients from a larger mass of widely varying quality, it helps you focus on a couple of key marketing activities.
One is defining your niche and focusing on those “nuggets.” It takes a lot of discipline to focus on your target market. But you generate more revenue from less work when you can develop expertise, reputation, contacts, and reusable techniques and tools, and all that happens when you have a client base that is sufficiently homogeneous to allow you to do that. After all, when you prospect for gold, you don’t just go anywhere. You go where conditions suggest that there might be gold in “them thar hills.” And you don’t search for gold the same way you do for oil, nor do you extract them and turn them into profits the same way. It is hard to be a successful prospector for “any precious stone or mineral.” Specialization leads to better results.
Another important activity that comes out of this understanding is expanding your penetration of your target market. In other words, if you were panning for gold, you would identify a promising region (your target), and then you would try to sift through as much of the material in the most promising areas as possible. The more material you handle, the more likely you are to find nuggets.
In the same vein, once you understand the series of narrowing steps that your marketing and sales process involves, you become more determined to make sure that you are visible to the widest possible audience within your target market. Depending on your business, your preferences, and your market, that could mean anything from blogging to advertising to speaking engagements to other marketing ploys. But you know that the larger the field you start with (still within a clearly defined niche, mind) the more clients, and the more profitable clients, you will eventually acquire.
Toss Your Funnel
Shotgunning your marketing messages to the widest possible audiences wastes resources, compared to the returns it generates. Marketing based on an “everything in, everything out” model – which describes a funnel – is a lot of work, and often incurs a lot of expense, given the results.
Recognize the ways in which you will filter that stream, diverting the low-value portion so that you can greatly increase the “density” of opportunities among your prospects. Define your niche, qualify your prospects, penetrate your target market, and apply your resources where they will do the most good.
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I agree with you, the funnel ideology really doesn’t work well when you compare it to the abstract idea of marketing, especially internet marketing. I would say sifting is a better description, or filtering.
And I just bought a book that explains how “Brilliant” funnel marketing is. That sucks
Ok…., the article makes some sense… However, the “funnel marketing” concept is a “concept” – a visual depiction of the process we use to get people to buy from us… If we took everything literally, then we’d be really dumb – just think about it, squeezing people into a funnel…
Enjoy your book and apply it!
Don’t worry Daniel, the whole post doesn’t tells that “funnel” marketing is not brilliant, it only says that it’s not correctly named!
Wow, I’m glad this was posted. Typical marketing models avoid the “funnel” method now. Language used more often is “niche” or “filtering.” Many see marketing as a two part process: taking care of the people who already respect you and brand presence in a niche (filtered) market. Also, remember the 4 Ps of marketing: product, place, price, promotion.
I am going to have to agree to disagree!
I don’t think anyone can say something is totally wrong if it works for others.
I know some very wealthy consultants, and one of them referred the Wealthy Freelancer to me, and that’s where I’m sure this post is directed at.
It almost sounds more like a stab to discredit than it is to share a different opinion.
A Funnel is just a visual representation attempting to make people understand the process more clearly. Obviously everything comes out the bottom of a funnel, that isn’t rocket science.
I don’t know Will Kenny, and I am sure he is a brilliant man, but there no definite right or wrong answer, so don’t think what you read in another book is wrong.
It’s all knowledge, and the more the better. You take it all in, and use it how you feel will work for you.
Great comment, Kyle!
I love the concept of funnel marketing and it works great!
And perhaps that’s what we can learn from this article – simply to take something that works and write something controversial about it, and we get lots of comments and stir some discussion…
I respectfully disagree with the notion that “everything comes out of the bottom”. The funnel, as we define it, accounts for “failed conversions” at every step in the process. The funnel concept is helpful in defining states that align to the buying process. Definition of stages also represents a progression…I’m sure there are other ways to articulate this progression from one stage to another, but the funnel seems to do just fine. Without understanding that the stages must align to the buying process, this whole concept falls down quickly. But if the alignment is there, one can measure the effectiveness of activities in each step in the process. Again, we expect some “failed conversions” at each step, where prospects fall out of the funnel at each step.
I’ve always disliked the marketing funnel analogy… the funnel analogy works with other things really well, but not so much with marketing. You’ve posted some great advice, thanks.
I agree Funnel Marketing has never enticed me to buy or join. All its caused me to do is look elsewhere for what I was finding. Now I may have “PASSES UP THE OPPORTUNITY OF A LIFETIME” Along the way but. I always see it as cheap and not relevent.
Will – point taken. However, just because one uses the funnel analogy to visually explain that this is a culling process doesn’t automatically mean that the top section of the funnel requires ALL possible prospects to enter your funnel. In fact, when I teach this concept, I make it very clear that the top section of the funnel is all about finding the RIGHT prospects, which is what you talk about here. This is the area where solo professionals need to spend a great deal of time — feeding the funnel with the right people. Why? Because the rest of the funnel depends on what you put into it.
Also, I think the value of using the funnel analogy is to explain that this is a filtering process. Getting into a discussion on semantics and the absolute best visual analogy for this process can be helpful. But spending too much time arguing about the exact visual representation can be counter-productive, IMO. I mean… we could argue the whole “Life is a like a box of chocolates” thing (Is it truffles? Or maybe jellybeans?) all day long… yet risk missing the point of the analogy.
I’ve heard the funnel metaphor used to indicate that one’s marketing “machine” needs to be fed [from the top] but proactively, versus just-in-time. So perhaps a “hopper” is a useful replacement for funnel – just as long as there’s a filter across the opening.
I always laugh when I see a pyramid scheme calling themselves reverse funnel systems.
In regard to the article though, the customers are the ones that withdraw from the sales process most of the time, saying that the marketer is the one sifting them out is just self-serving language. I’m sure the marketer isn’t “sifting” out 90% of their audience because they want to.
I totally agree and I think this article is right on target.
I spend my time teaching creatives how to find a viable niche and reach out to those qualify the prospects.
On our Resource page — http://www.marketing-mentor.com/html/resources.html — we have a list of trade associations that creative freelancers are targeting, as well as a free webcast called, Who Exactly Are Your Prospects. Check it out!
If you take the idea of the funnel literally, there is a chance you’ll misinterpret its use; the funnel is meant to represent the number of contacts that convert from one stage to the next in your marketing process. It’s one of many visual devices to indicate that not all people you come into contact with will convert to a lead. Is it perfect? No, but it is simple. Say 100 people visit your website, 10 sign up for the newsletter. 10 % conversion from visit to signup. So the number of visitors in the next step of your marketing is only ten. You build relationships with these 10 contacts, and over time 2 become customers. That would be a 20% conversion from newsletter subscriber to customer. It would also indicate that for all visitors to your site in a month, you will likely get a 2% conversion from visitor to customer (you would need to measure this over time). The reality is that most conversions look more like a 50′s era champagne glass than a funnel, but the idea is understandable. You could use bar graphs if that makes life easier, but the end game is to understand the effectiveness of your marketing efforts.
As Justin mentioned, sometimes people will choose not to engage with you, and in other instances you will disqualify a person as a potential prospect for your services, so sifting too has both merits and flaws, but in either case – filter or funnel – you can envision losing contacts a key stages of your marketing.
Thanks for the excellent article. You are spot-on with the sift vs. sales funnel analogy. I always wondered why the funnel didn’t work for me, and now it makes sense.
I advise my clients to find their niche and target their market. Now I will add the words ‘sift’ and ‘filter’ as well.
A Funnel is called “embodo” in our place. I got the point here but honestly, this is the first time I heard it the marketing field, no wonder its no longer modish. I’ll take note of the 4Ps that Zac mentioned.
Yes, yes, yes… and I’ll stop eating funnel cake as well, as the name is far from appropriate for it (let’s face it, it doesn’t even look like a funnel… and it makes me fat too)….
With all due respect, Jesus spoke in parables, yet no one complained – and most of the parables were less than perfect (just think of the guys who worked the fields – one from morning till evening; the other one from noon till evening; and yet the third one worked for about an hour before they got paid – and each got paid the same amount…
Ok, I might have given the wrong comparrison, but the Funnel Marketing is just a visual depiction of how we attract a ton of clients to the “large mouth of the funnel,” to our landing page, for example….. of the 5000 visitors in a month, only about 500 sign up for our freebie (the funnel got skinnier); then of those 500, only 50 bought our first offer of a low priced product…. and only 8 purchased our higher priced product… It’s that simple. We had an entry point with thousands of people… and we ended up with fewer and fewer people by the time of the main sale.
I think it’s a great visual depiction? Is it perfect? No – no one comparison really is…. If we called it the Marketing Sifter Funnel, that’d be a better comparison, as yes, we are losing lots of people on the sides before a few select ones make it to the bottom of the funnel…
Funnel marketing turns me off as a consumer. So I agree that I do not want to use it as a business marketer. Great advice.
We are about to pay someone to do some Funnel Marketing for my new start up.
Can you suggest another type of marketing other than the Funnel Technique?
@joshua: In fact this post isn’t really against funnel marketing. All advertising initiatives will be subject to the funnel effect, which is that some people will leave at each step of the process. The point is that the objective is to get BETTER people in the process instead of MORE people…
@joshua: echoing the point made by @JFR, the focus is on optimizing and measuring your touch points and interactions with your potential customer base. The funnel is a simplified view of a customer conversion process; as some have already pointed out, you don’t have to enter at the top of the funnel, the process isn’t linear, and that the funnel relies to heavily on an acquisition model. Ultimately, you want to make sure you have the metrics to understand how each of your efforts contributes to growing and retaining customers.
A funnel visual provides you with a high-level dashboard view of how many people you have in any one stage of your customer pipeline. Visually it is important to have a view of:
People who have inquired about your service(s)
People you have spoken with and qualified as a potential fit for your service(s)
People who are planning projects in the next 6-12 months
People who you have provided a quote for service(s)
People who you have ‘won’
It’s really about your ability to win business; if I know that my win rate is 10% from quotes, I know I need to post 100 quotes out to get 10 projects (we’ll ignore size of project for this example). If I know that 20% of the people planning projects ask for quotes, I know I need to know of 500 people planning projects. Hopefully you get the idea. It really is about the sales side of any business and making sure that you have enough activity going on to sustain yourself and grow.
It’s not a replacement for measuring and optimizing any individual tactics you use to attract, engage, and convert existing customers. For these measures, you will define a goal and then define the key metrics that help you determine how well you’re meeting that goal. Based on the results, you will adjust and optimize your efforts as needed.