The Sales Funnel
First, let’s do a high-level overview of what the sales funnel is.
You probably already know this, but if you don’t have a solid idea of how your business’ sales funnel works, you’ll have to go through this before you can create your growth strategy.
In general, funnels look a little bit different based on the business and people size them up in different ways.
However, most people look at the sales funnel in the same general way:
The top is called the “Awareness” part of the funnel, the middle part is called “Consideration”, the lower part is called “Conversion”, and the very bottom consists of the converted users and is called “Retention”.
Next, let’s think a little bit about each phase of the funnel and the metrics that you’ll be monitoring and optimizing for as users move down the funnel.
Top of the funnel: Awareness
This is the very high-level stuff you do to attract traffic, so your goals for the top of the funnel are going to be things like:
- Increasing traffic;
- Moving users down the funnel to the next step;
- Decreasing bounce rate.
The metrics that you would monitor to hit those goals would be:
- Sessions or first-time visitors;
- Bounce rate;
- Time on Site;
- Pages per session.
Middle of the funnel: Consideration
This is where you typically try to capture the user’s contact information and nurture the relationship. The middle of the Funnel goals might be things like:
- Lead generation;
- Email list growth;
- Tripwire sales;
- Low-dollar product sales.
The metrics for this part of the funnel would be things like:
- The opt-in percentage;
- Tripwire conversion;
- Total number of leads.
Bottom of the funnel: Conversion
At the bottom of the funnel, you want to generate as many sales of your main offer as possible. Your goals at the bottom of the funnel are going to be things like:
- Lowering cart abandonment rate;
The metrics you’d use to measure your bottom of the funnel performance might be:
- Average order value;
- Revenue per visit;
- Number of SKUs sold,
- Abandoned cart percentage rate.
Monetization, Retention, and Love
What do you do with users after you’ve converted them? Ideally, you want to increase the value of each user, or get them to advocate for you—so your goals here are going to be:
- Repeat buyers;
- Growing the lifetime value of said users;
- Reducing churn;
- Total number of user invites (referrals.)
The metrics you might monitor for include indicators that show how happy each user is:
- Retention reports;
- Customer lifetime value;
- Net promoter score;
How to create a growth strategy from scratch
Once you have gone through your funnel and established your goals and metrics, it’s time to move on to coming up for a plan to drive growth.
We have created a growth strategy template—which you can get through the form at the top of this post:
The basic idea to keep in mind here is to list out the ideas you have for growth, the area of impact they’re in, and then give them an impact and an ease rating—all while keeping in mind everything we talked about before, each stage of the funnel, as well as the goals and the metrics of that funnel.
Let’s go ahead and dive into some of these.
I’ve listed a couple of examples for you—different things you can do to grow your businesses. Let’s see how I analyzed some of these growth ideas:
Idea #1: Launching dynamic product ads on Facebook
Let’s say I have an eCommerce company and I haven’t done any dynamic product ads on Facebook.
What would that be worth to my business? What is the impact it will have on my business?
This is how I would score this tactic:
- Area of Impact will be the bottom of the funnel (given that this is an eCommerce company and the bottom of the funnel probably makes more sense).
- Let’s say this would have an Impact Rating of about 4—a very impactful type of thing.
- And let’s say I have just hired and paid a lot of money for a Facebook ads specialist—so I added an Ease Rating of about 4 as well.
When I look at the total score, we have an 8 for this tactic—so this would be the total impact score this particular action would have on the bottom of the funnel.
Idea #2: Creating a content upgrade on the blog and give people my marketing guide in exchange for an email
Maybe I have a blog that’s not generating any leads for my business, but is getting a ton of traffic.
I could consider creating a content upgrade for my most popular post”
- The Area of Impact here would be the middle funnel.
- The Impact Rating might be a 3—because this is how much I think getting a few more email addresses would impact my business in this example.
- If I already have a good plan and a content marketing team in place to do this, the Ease Rating might be a 4.
So the total impact score would be a 7 for this tactic.
This means I would put creating a content upgrade on the blog as a lower priority than launching dynamic product ads on Facebook.
Idea #3: Advertising on an industry podcast to build awareness
Maybe the CEO or the CMO has asked us to consider creating a podcast because it’s a very trendy tactic right now.
- This would be the kind of action that would impact the top of the funnel.
- Let’s say I’m not very excited about this one because my industry isn’t that good of a fit for podcasts—so the Impact Rating I’m giving it is a 2.
- In terms of Ease Rating, it’s actually pretty hard to find podcast subjects to interview, so I’ll put it at 1 here.
This gives us a total score of 3—so I might want to drop this a little bit further down in the list of priorities.
Idea #4: Launching a giveaway in partnership with another brand
A competitor seems to be doing a lot of partnerships during the last quarter, so it’s probably because it’s working well for them—which means that we might need to consider this tactic as well.
- This is likely a top of the funnel growth strategy as well.
- The Impact Rating would be 5 because there are massive potential partners with a huge audience that could be interested in what we offer.
- And the Ease Rating would be a 2—because framing and rolling out a partnership typically involves several stakeholders and can take a long time.
This tactic earned a score of 7—so it would be kind of equally important as creating the content upgrade mentioned above, but for a different part of the funnel.
The final result is that I have a clear pipeline of growth experiments and tactics to run during the next few weeks, and I know exactly what kind of impact I expect each of these to have in the business:
Obviously, the way you fill in this template is incredibly specific based on your industry and business.
However, using this template will help you list out every possible growth experiment that you could think of and give you a pretty decent growth roadmap.
Of course, there are other, more complicated ways to do this (some people like to use very sophisticated tools)—but my hunch is that you’re probably going to be just as well-off doing it this way as you would be with a fancier and more complex approach.
You can think of this as the “80/20” in getting started with your growth strategy.
I hope this was helpful!