Understanding The Buying Funnel
The buying funnel is a well known marketing concept that illustrates a consumers journey and thought processes through from beginning to end when purchasing a service or product.
This diagram gives you an idea of a buying funnel at its very basics.
It traces a consumer from the moment they are first made aware of the particular service or product you offer to then becoming interested in that service or product and wanting to learn more about it, to finally making a decision to purchase. Most online marketers believe that this concept should also apply to search because it is a well proven model of consumer behaviour when it comes to purchasing habits.
Moments That Matter
The problem with the buying funnel is that there is usually so much focus on the end goal, that the really important mid-journey touchpoints within a consumers buying cycle are often overlooked.
These are the moments that really matter. These are the moments when potential customers are susceptible to the persuasion of a good marketing strategy, when people are looking for something to inspire them and can be easily influenced by positive and negative factors. Building an online presence is crucial to growing a business. Technology has created an audience that are now media intelligent and as the internet opens up a whole new world of research for consumers and they become more savvy with shopping online, the real buying funnel is becoming more and more complex as new ways are developed to influence consumers towards purchasing your product or service.
Another thing to consider is the very bottom of the funnel. What happens once the consumer has purchased your product? Are they happy with their purchase? Will they return to buy your product or service again in the future? Would they recommend your business to a friend? Taking all this into consideration we begin to see exactly how complex the real buying funnel could potentially be.
Why Apply Econometrics?
Econometrics is, at its very basics, best described as the method of combining mathematical statistics with economical data to form theoretical observations.
The customer journey is a very complex problem, with many variables. According to Google’s philosophy on 10 things they know to be true, the number one statement is: “Focus on the user and all else will follow”. This should not stop at the design of your website though. By carrying this simple concept through to your marketing strategy, and focusing on how your users made it through to the last click on your website at the checkout you can build an idea of your own businesses buying funnel.
Within econometrics the occurrence of observed effects allows you to be accurate in quantifying them. So by taking this concept and applying it to all the different factors along a typical consumers purchasing journey you can begin to piece together the bigger picture.
If done properly, by combining econometrics with the buying funnel, you can potentially measure exactly how influential your marketing strategy is, what isn’t working for your business, and where improvements can be made.