1. FUNNELS in
MARKETING
What Are They
and
How Do They Work?

2. What Are Funnels?

3. In marketing, a funnel is
a sales technique that
is used to “capture”
prospective buyers and
customers. The
“funnel” will attract
people to the store
(website, etc.). A low-
priced product will be
offered to attract the
buyer’s attention.
When the buyer makes
the purchase, the will
be led to the next level
of the funnel.
First Layer of Funnel

4. Next Layer of Funnel
Once the customer makes the first purchase, they are immediately taken to the next
layer of the funnel. There, the buyer is offered another good deal. This next offer will
enhance the first purchase in terms of add-ons that will make the first product so
much better or easy to use. This product is generally slightly more expensive than
the first product but not so much so that it scares the customer away.

5. Funnels Upsell the Product
The third layer of the funnel will, again, be more costly but will offer the purchaser a
product that enhances the use of the first two.
The first product does what it says it will do without purchasing the next products
but the “upsell” products just make so much sense and the price doesn’t usually add
a whole lot more to the cost.
The upsell product(s) may be one-time-purchase products or they may be a
subscription or membership type of product where there is an ongoing regular
payment, perhaps monthly or annually.

6. There can be many levels in the
seller’s funnel. If there is a
membership or subscription
funnel, it may be that the seller
will add more layers (or more
products) to the funnel as time
goes on.

7. Parallel Levels
Once inside the funnel, customers may be enticed to go to parallel products. These
products may not necessarily be add-ons to the existing product but may be
accessories to the product.

8. Example in Marketing
Purchasing a Motorcycle
A buyer purchases a basic model of a motorcycle. Once the buyer has decided to
purchase the bike, the salesman may work to upsell the product – leading the
purchaser further into the funnel. The purchaser may decide to add a windscreen to
the bike. The next add-on may be an upgrade on the seat to allow for a companion to
ride behind on the bike. Perhaps then, the salesman will show the purchaser a
comfortable backrest for the bike or dressier mirrors.

9. Not All Buyers Move Down
The Funnel
Not all buyers will opt to purchase beyond the first layer of the funnel. That’s okay,
because they may eventually come back and add to the bike at a later date.
They may not add to the bike later but they may come back to purchase the parallel
products or accessories. These might be riding boots, a helmet, riding gloves or
leathers.
Once the seller determines how far the purchaser will travel down the funnel, they
will remember this and further advertise to the buyer in future, announcing product
sales, new products or whatever. By that time, the buyer may be ready to make other
purchases.

10. End of the Funnel
The funnel in marketing often never really has an end. There is likely to be a new
product, an improvement to the original product, an upgrade, a new style or model
and so on.
It is wise for the seller to continue to advertise to their customers on a regular basis.
They do not want their customers to forget about them and they do want to keep
their customers informed about the latest and greatest in their product line.
In online marketing, sometimes the buyer will be referred to another seller’s
product whether or not the seller is still advertising their own product to the
customer. An example of this would be affiliate marketing, where the referring seller
will receive a percentage of the sale for the referral.

11. Watch for the Funnels
Next time you are purchasing, whether it be online or in a regular store, watch for
the “funnel”. Sometimes it is more obvious than others.
In a grocery store, watch for the “funnel” as you go through the checkout. What
about the magazines and candy for sale. They were not placed there just because
there wasn’t anywhere else to display them!!

12. ENJOY YOUR SHOPPING