The Purchase Funnel Is Now A Loop: What Story Is Being Told About Your Product or Service?
Originally published on Sailthru on April 16, 2014.
If you’re a marketer, you’ve probably studied or referred to the Purchase Funnel, many times in your career. It’s a classic model that illustrates a customer’s intent to purchase as they move through a decision making process from Awareness, Interest, Desire and to Action (AIDI). I did a little digging and it turns out the basis of the funnel was created in 1898 – yes, that long ago – by E St. Elmo Lewis. In 1924, it was further defined and proposed by William Townsend in a book called Bond Salesmanship. Well, 116 or even 90 years is a long, long, long time ago when you’re talking about the world of marketing and how consumers make decisions.
I’m not the first to say it, but it’s important to recognize that the classic decision funnel is now a loop fueled by digital conversations. In 2013, Latitude Research and About.com fielded a study called “The Purchase Loop” and found that 83% of people say their path to purchase includes a greater numbers of “stops” but it takes less time than it used to make decisions overall. And, 79% of consumers said their relationships with brands are more personal than ever before.
What’s fueling the shift from funnel to loop?
The growing penetration of mobile and tablet devices and access to real-time information and digital conversations has changed everything. In the New Digital Age by Eric Schmidt and Jared Cohen the authors state that 97% of mobile users have a smart devices within three feet of them at all times. Consider that today’s shopper can use Apps to compare retail prices and reviews, post on social media prior to making purchases or even consider the power of the shared social graph (e.g. AirBNB) before making a purchase decision. The funnel as decision making process as we knew them will never be the same.
What do Marketers and Brands need to know?
Now more than ever, it’s important for companies to recognize that real-time conversations about your products or services are impacting the conversations being discussed in real-time decision making loops. In today’s world, your product and service is marketing and your customers can be your sales force. If your sales are down, ask yourself, “is my product and service that best that it can be?” Are you fighting mediocrity at every touch point and raising the bar within your organization? Are your product and marketing organizations operating in silos or as a team? To survive and thrive in the new world of digitally fueled, always-on decision making, brands and marketers need to recognize the power of the product and service story. In the documentary, The Naked Brand the filmmakers argue that “the social media revolution has left little room misbehavior.” They continue and add, “the transparent and honest brands will succeed.” And I couldn’t agree more.
So ask yourself, what story is being told about your brand, service or product? Is the dialog fueling or putting out the conversation in your customer’s decision making loop?