Much like a bottleneck, a funnel begins with a wide end and then narrows in a triangular shape to a small opening. Funnels are needed when filtering uncooperative materials, in order to make them cooperate accordingly. Building a Funnel
In terms of funnelling customers, the goal is often to sort out the unpredictable individuals in order to find those who are searching for your product or type of information.
Essentially, you will want to guide visitors through the site in order for them to end at a signup or checkout point, inviting them into your community.
Imagine the large end of the funnel as the initial goal of “Inviting Visitors.” These may be fans or they may be those who have literally stumbled upon the website by accident for the first time. Either way, the goal is to build a relationship with those who should belong to your group.
With this in mind, the next step would be to “Activate Members,” which consists of building a relationship with a customer or potential customer. The third step would be to “Retain the Customer.”
Imagine the three steps as the beginnings of a relationship. The first step (Inviting Visitors) results from a type of activation upon their part. Imagine this is an attractive individual flirting from across the table. Much like a wink, new users must join an email list, create an account, or purchase goods on the site.
The next step (Activate Members) will then require that person to continue to use the product, much like being in a romantic relationship where dates are the standard. This could include individuals who read and share emails or continue to purchase products on a regular basis. These users (Retain the Customer) most resemble getting married.
It can be discouraging to have a scenario where thousands of individuals are visiting the website while only a handful of customers are actually making purchases.
In this scenario, it’s important to understand which conversation rates signify normal success. Honestly, the deeper into the funnel, the less traffic exists. Mathematically, imagine 100,000 visitors resulting in 1,000 members, which would be a 1 per cent conversion.
Of those 1,000, let’s only 600 stick around, which would be a 60 per cent conversion. While the numbers are helpful to determining individual growth, they are almost impossible to compare to one another.
Also Read: Finding a Niche
The first thing to consider would be whether or not your overall traffic specifically identifies with a product. If the product in question is an ebook about woodworking but the articles are about welding, many visitors will quickly move on to something else.
Much of this depends on the relationship of products available as well as the headlines of feature articles. With that in mind, there are specifics types of traffic sources that can convert members at higher rates than others.
Sometimes, these will be current trending topics or any of other countless examples.
In another scenario, consider your specific activation goal. Trying to get an email is much easier than trying to make a sale. Asking for smaller favours results in larger results. This is also true of high membership fees.
When considering retention rates, it’s also important to consider others within the same market. Certain products will feature more repeat users than others.
For example, high-end hand-crafted pieces of furniture may not have repeat customers while a fruit-of-the-month club will invite shoppers to purchase goods each month.
Once a growth hacker understands the variables, there are additional facts to keep in mind when tracking and expanding growth. The first rule is that numbers should always be improving.
Much like an athlete, there is never a reason to slow down or lose a step in a monthly training regime. In terms of analytics, visitors should grow each month on a steady incline. This has nothing to do with unknowns because growth should happen like clockwork despite any adventures in trial and error.
After setting up steady growth, consider tracking growth with a fellow hacker. Find somewhere with a product in a similar field that doesn’t specifically compete with your product and work together to find the most successful rates of growth.
Check one another’s numbers in order for both of your organizations to succeed. These examples may work better for area-based businesses such as a coffee shop in New York and another in Los Angeles. Another example may be two online companies that sell winter gear, where one sells hats and the other scarves. These methods truly help determine realistic conversion rates.
Finally, make sure that you are reading the data correctly. For example, if the number of visitors increases but retention drops, take this into account correctly, rather than only looking at the drop in retention.
The main goal of tracking this data is to create conversion rates in various key points within the funnel. These various stages will work together over time to create a greater impact on the business as a whole.
Funnels actually help determine where to place the most emphasis to build growth. While methods still aren’t soundproof, the results are usually within the analytics.
Imagine a 60 per cent conversation rate from visitors to members and a 50 per cent conversion rate of those members to users, with only 100 new daily visitors.
In this scenario, the conversation rates would be high but the new visitors are relatively low and should therefore be the focus of the growth hacker in this scenario.
Moving aside from growth, it’s time to think back on the product. The term “product-market fit” applies to the priority of the product on the market.
Essentially, if the product completely disappears from the market and 40 per cent of that product’s users were not extremely disappointed, then it may be time to reevaluate the product.
The team behind the product needs to focus more on the actual product, helping to create something that will demand outrage if it were to ever leave the stands (online or otherwise). Make sure the energy going into the growth of a product is for a product that deserves to grow. Building a Funnel