Why today’s marketing funnel needs a makeover
Marketing has long been segmented into functions defined by their area of responsibility across the purchase funnel – cue all sorts of mnemonics that brands have created to put their own ‘twist’ on exactly how to segment the funnel.
Traditionally and simplistically though, the funnel goes something like this: brand marketing uses mass media to work the top of the funnel, and shopper plays the role of closing the sale at the bottom. The middle has always been messier, but brand traditionally used to win.
This type of segmentation made sense 10-15 years ago, where the path to purchase was more linear; consumers learned about a brand through mass media, and then later visited a store to buy where they then ‘became a shopper’.
But things have become a lot more complicated lately, with the rise of eCommerce, social commerce and voice blurring the lines of the role of brand and shopper marketing. This has only been accelerated by the pandemic, as brands shift large portions of their budget towards digital channels. In today’s landscape, the marketing funnel remains both important and relevant in a) understanding the stages through which a consumer makes decisions about brands and b) devising a strategy to nudge a consumer from one stage to the next.
However, the way in which media channels are traditionally assigned to each stage of the funnel is fast becoming outdated. Why? Because a rapidly evolving media landscape, coupled with changing shopper behaviours, means that ‘awareness’ channels are increasingly becoming ‘shoppable’ and ‘conversion’ channels are increasingly able to deliver a brand message.
To bring this to life, consider TV – a classic brand-building ‘top of the funnel’ activity – for which we’re now seeing more brands directly linking their advertising back to purchase, like Coca Cola’s ‘Send me a Coca Cola’ campaign, that encouraged people to order a sample by simply asking ‘Alexa’ for one. By doing this, brands have the opportunity ‘to close the loop’ and connect the dots across the funnel. Conversely, think about the sheer volume of customers that interact with a grocery store every single week (on or offline) – globally, Amazon is one of the top ten most visited websites – in this sense, media that has traditionally been labelled ‘shopper’ has immense power in the ‘mid’ and ‘upper’ funnel too.
Assigning a media channel a singular or fixed position in the funnel no longer makes sense. On the contrary, recognising that a single media channel can perform across multiple aspects of the funnel enables brands to spend their marketing budgets far more effectively and delivers a better experience to customers too. But how can brands adapt to this way of thinking in a world where shopper and brand are typically treated as separate disciplines, managed by different teams with different budgets and objectives?
This is where commerce marketing as a discipline comes in. Commerce marketing promotes the creation of integrated, physical and digital media campaigns that, at the core, work from ‘the store back’ and focus on driving retail footfall and conversion. This approach removes the divide between ‘shopper’ and ‘brand’ and instead, champions the view that shopper can do a great job of building brands as well as driving sales. It tackles the messy middle of the funnel by activating joined-up campaigns to consumers at the point of consideration. Commerce marketing should encourage brands to take a much more holistic and connected approach to building their marketing campaigns. It has the potential to be very liberating.
So why aren’t more brands adopting this approach? The truth of the matter lies in the engrained delineations between ‘shopper’ and ‘brand’ that exist in larger FMCG brands. It is these legacy structures – combined with longstanding conceptions and lack of agility due to size – which is holding them back.
Step forward challenger brands – it’s your time to shine! Challenger brands are growing more rapidly than ever before. IRI finds that smaller companies are gaining share vs. larger companies, and that this trend has accelerated during the pandemic. Challenger brands have the luxury of being able to pivot quicker and have limited department divides; marketing tends to be done by one team. This puts them in a great position to adapt to a rapidly evolving landscape and reap the benefits in doing so.
Brands that continue to view ‘brand’ and ‘shopper’ as separate disciplines achieving different jobs across the funnel will fall behind. Their budgets won’t be maximised, their marketing won’t be connected, and they won’t be able to take advantage of the best opportunities available to connect with their customers. The quicker brands can adapt and adopt to this new commerce marketing approach, the better the results will be for everyone involved.