Are you paying attention to your site’s sales funnel?

 When someone visits your Web site, how do you take them from just barely being aware of your brand all the way to becoming a customer?

Do you blast them with messages like “ORDER NOW!!!”?

Do you leave them to their own devices and hope that they find some reason to buy from you?

Or, do you take their hand and thoughtfully guide them along the path to becoming a customer?

Put in those terms, it seems obvious what you should be doing—but it’s not always clear how you should go about it. Even if you’ve conquered the Wall of Text with your Unique Value Proposition, your Web site probably isn’t doing all it can to bring a visitor into the fold.

This transition from first-encounter to customer is not instantaneous. As you can imagine, those in-your-face buying messages will alienate 99.5% of your audience—everyone who is not ready to buy. At the same time, if you’re too hands-off, you leave the fate of your leads up to chance—maybe they’ll convert into customers, maybe not.

The alternative here is to carefully consider those in-between stages of customer development and put those into practice on your Web site. 

We often think about this in terms of a funnel: a large number of people enter the first (top) stage of the funnel—these are people who have just come into contact with your company for the first time—and a progressively smaller number of people move through each further stage, until the final stage of the funnel, which are your customers.

Your business’s sales funnel (a.k.a. your conversion funnel) might look something like this:

A visualization of the conversion funnel for a generic product

Finding the stages of your funnel

When creating a model of your own funnel, try to break each stage down into the smallest steps you can. The move from one step to another is a micro-conversion, and you need an idea of how you’re going to make that conversion happen. What can you offer to nudge or incentivize a visitor to take that step?

Your biggest goal here is to keep the user moving forward. You should never have calls-to-action or other prominent offers to let a person move backward in the funnel. For instance, if you have an ecommerce site, your checkout pages probably shouldn’t have your full site’s navigation—if a visitor has made the micro-commitment to buy, you don’t want to guide them away from that!

Case study: Moving users through the funnel for a software-as-a-service (SaaS) Web app

As you may know, I recently announced a tool for monitoring & improving your marketing efforts, called GoldPanning. The audience for this tool will be primarily consultants, freelancers, and design agencies (people who don’t eat if their marketing efforts aren’t working!), and those are the people whose feedback will be most valuable; this is a market that I understand very well, since I’m in the same boat! At the same time, though, I’m in touch with a lot of local small business owners who have expressed interest in the tool, so some of my in-person marketing efforts will be targeted at them.

At the top of the funnel are all the ways that someone might hear about the app. These channels include:

• Content marketing—This starts with reading a post on the GoldPanning blog. The blog will be focused on topics of interest to my target market, such as improving your return-on-time from your marketing efforts, getting more clients with less work, and so on. This might also include posting on other business blogs or forums, where my comments might direct someone to the GoldPanning site.
• Social media & email relationships—I know, I know… In general, relationships built this way are a terrible way to bring in customers. What I have in mind, though, is much more targeted: I’ll reach out to a relatively small number of ideal customers and work to win their business over the course of a few months.
• Cold calling—Inspired by Robert Graham’s Cold Calling Early Customers, I plan to use cold calling effectively by offering free value to the (highly targeted) prospects on the other end of the phone. (If you rolled your eyes at the idea of using social media for customer development, they might be permanently stuck at this point!)
• Public relations—By getting GoldPanning on the radar for a select group of bloggers, journalists, and other (non-competitive) companies that market to small businesses & consultants, I plan to bootstrap my own audiences from existing ones.
• In-person networking—Don’t discount the possibility of getting people into your funnel (introducing them to your product) in person. It doesn’t scale, but in the early stages of a startup—especially a bootstrapped startup—things don’t have to. At this point, I want to get to 100 users as quickly as possible, and in-person marketing will be a big component of doing so.
• Business coaches—Because GoldPanning helps business owners iterate and improve on their own processes for marketing, business coaches could be ideal “distribution hubs” for the app. (What business coach doesn’t want their clients leveraging their time to greater effect?) This is really a sub-category of the PR strategy, but it’s a major one.

Following first contact, we want to get people into our ecosystem. That means either signing up for the free trial of the Web app or joining our email list (with the latter sending content designed to drive trial signups). To move the highest portion of people from the first step of the funnel into the second, we need to make this both a valuable and frictionless offer—our offer needs to be a no-brainer in terms of value and easy to get.

Once someone has signed up for the demo, we need to get them onboard with the tool. This is where the person enters their initial data into the app, and it probably means spending 10 to 15 minutes entering your last few months’ worth of appointments. That’s a big time requirement when the person isn’t very committed, so I suspect that iterating on this stage of the funnel will be one of the most important aspects of the conversion optimization process for the first few months.

Then, after we’ve onboarded a new user, we need to demonstrate the value they’re going to receive from the app. This will come in the form of tips & advice sent by email (based on the person’s usage patterns). The worst thing we could do is simply hope that people understand the value available in the tool, so we need to make it very clear.

Of course, if we’re successful, we should be able to move a high portion of those onboarded, value-added demo users into the final stage of the funnel—becoming a paying customer. A couple emails near the end of the trial asking for the sale should be all it takes.

Armchair market research can only take you so far—you need kaizen, too.

The funnel above was created with what I call “armchair market research”—I sat in an armchair and pondered how best to reach my target market and convert them into customers. This is great as a first approximation, but it needs improvement based on actual customer interactions.

That’s where kaizen (改善) comes in. Kaizen—the idea of continually improving your processes—was pioneered by Japanese corporations like Toyota, famous for measuring every aspect of their business processes and innovating on them. When applied to your conversion funnels, that looks something like this:

1. Begin with your current best idea for a funnel.
2. Monitor key metrics, searching for “leaks” in the funnel where a disproportionate number of users are dropping off.
3. Brainstorm ideas for improving leaky stages of the funnel.
4. Test those new ideas.
5. If the new ideas outperform the old ones, standardize them.
6. Return to 1.

The most obvious way to do this is to make your analytics tool aware of your conversion funnel. KISSmetrics offers a guide to setting up a Google Analytics funnel.