A sales funnel is a model that shows the path of a potential customer from the first contact with a company to the conclusion of a sale. The term "funnel" describes the process by which paying customers are ultimately acquired from a large number of prospects.
The sales funnel consists of various phases that represent the customer decision-making process. In online marketing, the following phases are frequently used:
- Awareness: In this phase, the potential customer becomes aware of the company, the product or the service. This can be done through various marketing measures such as paid online ads, social media or also search engine optimization (SEO).
- Interest: After the prospect has become aware of the offer, he begins to find out about it and shows interest in it. In this phase, it is important to provide the potential customer with information and make him aware of the advantages of the offer.
- Evaluation: In this phase, the potential customer compares the offered service or product with other alternatives on the market and makes his decision.
- Commitment: After the customer has reviewed all the options and decided on the best offer, he is ready to buy the product or use the service. At this stage, it is important to create incentives to buy and remove possible barriers to purchase.
- Purchase (conversion): The final phase of the sales funnel is the actual conclusion of the purchase. The customer has decided on the offer and makes the payment.
Optimizing a sales funnel is a central component of online marketing strategies. Here, targeted measures are taken to facilitate the transitions between the individual phases and to increase the conversion rate.
Some of the most important ways to optimize a sales funnel are: Split testing to improve user experience, email marketing to retain customers, and targeted remarketing campaigns to pick up prospects again and move them further along the funnel.