A Crash Course in Marketing Funnels
What is a marketing funnel?
The funnel terminology is used pretty widely across industries and across segments inside of those industries. Sometimes it’s called a marketing funnel, sometimes it’s called a sales funnel, it really depends on the type of business you’re running.
For our purposes, we are going to refer to it as a marketing funnel and to break it down to the absolute basics this essentially just means the journey it takes a customer to purchase something from your website.
The Three Tiers
There’s a lot to be said about how many stages there are in a marketing funnel, and you can find a lot of information about them all over the internet. But when it comes to running Facebook and Instagram ads, it’s best to always go back to basics. A simple three-tiered approach is the way we look at our paid media strategy.
We have the Top of the Funnel also called Prospecting or Cold Leads. Top of the the Funnel is generally thought of as people who most likely are brand new to your brand. You’re utilizing ads to get in front of new customers, whether that is through our Lookalike audiences (which we discussed briefly above) or through Interest or Affinity Audiences, these are new, prospective, customers. This stage of the funnel generally has a lower return and results in less conversions or purchases overall. But that being said, it’s an important and extremely necessary part of your ads strategy and any marketing funnel so don’t be discouraged by seeing lower returns specifically here.
The next layer down in our three-tiered marketing funnel is known as the Middle of the Funnel. This stage is sometimes referred to as remarketing or retargeting and is all about people who have already interacted with your brand. This Middle of the Funnel is why we will spend so much time getting your ads account properly connected to your website and instagram account and making sure your pixel is all set-up. Within our Facebook ads strategy, we will use the Middle of the Funnel to target people such as individuals who have visited our website in the last 30 days, or people who have liked a photo on our Instagram in the last 60 days. The Middle of the Funnel is where the conversions and the return really start rolling in. That being said, it’s important to note that even though the return on Middle of the Funnel will usually outweigh the returns at the Top of the Funnel substantially, Middle of the Funnel cannot and should not exist without the Top of the Funnel. Without serving our ads to new and prospective customers we wouldn’t be filling our funnel, and eventually, the middle of the funnel would either start being over-served or simply not serving at all. We will get further into these scenarios later.
The last and final step in our three-tiered marketing funnel approach is, you guessed it, the Bottom of the Funnel. These are individuals who have not only interacted with your business but have made it basically to the last steps of making a purchase but not completed that purchase (Abandoned Cart people). There a multitude of ways to get your brand back in front of these people, we are a big fan of utilizing Facebook’s Dynamic Retargeting ads. The goal of the Bottom of the Funnel is basically to remind those people who made it to the a couple of inches before the finish line that it’s super easy to grab those items again and bring them home. Bottom of the Funnel ads typically have a very low cost per acquisition and a very high return, but once again, should never exist without the Top of the Funnel to help fill everything.
Budgeting With Your Funnels
We will break this down a bit further when we get into actually building our campaigns and constructing our ads but to give a debrief and breakdown. Whenever you’ve landed on your monthly advertising budget, you then must break this up between the various levels of your funnel. With our description of each level of the funnel above, and discussing where the returns are highest, it may sound tempting to feed the majority of your budget to the Middle and Bottom of your funnel but we promise this isn’t going to work out quite like you would like.
As you begin to learn more about your audience, you will navigate your budget breakdown but the recommendation to begin with would be to dedicate about 60% of your budget to the Top of the Funnel and the remaining 40% divided between the Middle of the Funnel and the Bottom of the Funnel (with a heavier emphasis on the Middle of the Funnel)
Dividing your spend budget up this way will ensure that you are getting plenty of new customers to see your business and fill the larger part of your funnel and then as they get more familiar and more comfortable with your brand, continuing to serve them ads to keep your brand top of mind.
In the next Module we will go step by step through creating your ad account and confirming it’s connected properly to your website and ready to start running ads.