3.1 Marketing funnels vs customer journeys
In the last chapter, we talked about how Sales teams use a funnel model to visualise how opportunities are progressing. The funnel is a practical way to show the flow of a large number of early stage opportunities at the top, some leakage as deals are lost, down to a smaller number of closed business opportunities at the bottom. The leakiness of the funnel is a measure of the efficiency of converting early opportunities to revenue; a high percentage reduction through the funnel could be a product of an ineffective sales methodology, an uncompetitive solution or a poor quality of initial opportunities. Sales teams will measure the progress of opportunities through the funnel to ensure there is both a sufficient pipeline of opportunities to achieve sales quota and to identify areas of optimisation. Historical sales data is modelled against industry best practices to troubleshoot and optimise sales activity against with conversion rates at different maturity stages. These stages will have clear customer definitions to remove subjectivity and predictive models can be developed to model future revenue goal attainment. As covered before, capital markets value predictability so accurate forecasts and clear actions to drive attainment of results are essential.
For Marketers, marketing funnels fulfil a similar purpose of tracking progress of activity towards objectives, but may become confused when the funnel model is aligned to a customer journey framework. Funnels present a generally linear experience, which is at odds with the organic, apparently chaotic journey a customer will go through. Funnels are also typically driven by measured data, whereas the customer journey framework is a definition of language. Much the same as Sales funnels, marketing funnels are not the same as customer journeys. It is a mistake to conflate the two but there does need to be alignment. Ultimately, the further through the funnel a customer or prospect is, the more mature they are in their purchase process. The fundamental misalignment comes from the relative objectives of each model: Sales and Marketing funnels are designed to be internal frameworks for understanding the volumes of customers at different stages of purchase; customer journeys frameworks are definitions of the steps that each customer will go through on a path to purchase. Leading organisations understand this and act accordingly:
The Customer Journey Framework grounds the organisation on how to understand the customer
Sales and Marketing teams share adoption, understanding and application of the journey framework
The Journey Framework informs the Sales and Marketing measurement funnels
A Marketing funnel typically looks at a more rounded view of the volume of different types of engagement at each funnel stage, while a sales funnel may just look at pipeline at different stages of maturity. The customer journey framework likely does not have measures against it, but maps of customer journeys can consider conversion rates and cost per activity at different stages Organisations may apply different funnel goals depending upon their sales alignment and measurement frameworks but the objectives are broadly the same: to understand if top-of-funnel activity is on-track to deliver bottom-of-funnel objectives.
A Dutch colleague introduced me to the word ‘olifantenpad’. Translated into English, this mean’s ‘elephant paths’. In the context of urban planning, elephant paths are the paths that develop when people pick their own routes over unpaved ground. City planners may lay out concrete or brick paths that connect what they think are the logical destinations for citizens, perhaps with tidy perpendicular intersections, but people walking diagonally across open spaces every day on the most direct routes to their destination will wear new paths into grass. These foot-worn paths are the elephant path – people deciding the best route from A to B to meet their goal. Customer Journeys can be very similar. Customers do not go through linear purchase processes. They will be distracted, deterred and delayed; or, equally, determined, direct and deliberate in the interactions they need to purchase from you. Despite your best efforts, you will not define a perfect journey that every customer goes through, but you can understand the experiences that you need to craft and enable your customers with these.