15/03/2017 08:00 - Nguyễn Đặng Tuấn Minh
This article helps business owners gain an overview of the customer purchasing experience, allowing them to develop strategies to convince customers and expand their customer base.
The article “Decisions Based on Numbers” in Tia Sáng Magazine on December 5, 2016, introduced the "Pirate Metrics" – AARRR scale to measure user interest in products and services, helping business owners, especially startups, make better decisions in product development and marketing. However, for these metrics to reflect the efforts and effectiveness of marketing and sales activities, business owners need to place them within a customer experience journey. The Sales Funnel—commonly known as the "sales funnel"—has been used for decades to measure the effectiveness of transforming the customer experience step by step.
Although in the digital age, with the rapid development of technology, many argue that the age of the sales funnel is over because buyer decision-making has changed and is influenced by social factors, and not every buyer has to go through all the steps of the funnel to become your customer, when applied correctly, the sales funnel still helps standardize the sales process and creates ways to shorten the time it takes to convert a potential customer into a real customer or turn a regular customer into a loyal one.
A simple sales funnel looks like this: A customer will go through five basic stages:
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Awareness: When customers have a need, they will start looking for information across various channels.
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Interest: These channels will lead them to you (your website or store).
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Consideration: On the engagement channels, they will learn more about your product or service, and request more information if needed.
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Intent: When your product/service meets their needs (partially or fully), they will consider making a purchase.
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Purchase: When they decide to buy, they become your customers.
These steps are just a suggestion. For each business or even each sales channel, you will have different content to fill in the funnel. A sales funnel can have more or fewer than five steps.
By understanding the customer experience from when they are uncertain about choosing a product until they select your product/service, you begin to realize two main issues:
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Measure conversion rates through each step:
For example, consider the conversion rate from someone requesting information to someone who is considering (they will ask for more information or negotiate price, discount, quantity, delivery time, etc.). You will understand the number of people interested in your product and those who could become potential customers.
Similarly, by analyzing the conversion rate from those considering the product/service to those who actually make a purchase and become customers, you will see the effectiveness of your sales team. Additionally, through feedback, you can identify why some people did not purchase your product. -
What should you do to add value to each step of the customer experience?
It would be a mistake not to build a customer database from the very first steps in the business process, and even more of a mistake not to treat the information and feedback from your existing customers as a valuable asset.
To address this issue, you should use an advanced tool based on the basic funnel mentioned above: The Two-way Funnel.
The Two-way Funnel, as shown in the diagram, is a complete process for Attracting – Retaining – Expanding customers.
After officially gaining a customer, you must retain them and encourage them to refer your product or service to others. The process goes as follows:
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Customer Retention: It is important to check customer satisfaction and feedback through calls or surveys.
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Customer Segmentation: Segment customers into different groups and have specific strategies for each group.
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Encouraging Repurchase: For customers who consume the same product, encourage them to buy additional items they have previously purchased.
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Cross-Selling: Encourage customers to buy complementary and/or related products.
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Referral Incentives: Use incentives to encourage customers to refer your product or service to others.
Pay attention to the curved arrows in the diagram. After becoming a satisfied customer, they may refer your product/service to others through different channels, starting a new cycle. Or, by building an incentive system for customers to refer new customers, you will have more potential customers entering the "engagement" step or even the "consideration" and "purchase" stages.
Using a Two-way Funnel not only helps you understand the overall picture of customer care and service but also allows you to develop strategies for each stage.
Sales Process
How to connect the sales funnel with the business process to improve sales performance? In other words, how to align company resources with the sales strategy into a clear and understandable picture? Because from that picture, you will be able to see where your resources are lacking and identify which steps need improvement to refine the business strategy.
With the information from the simple sales funnel and the Two-way funnel, let’s turn it into a table as follows. However, for the first column, adjust it based on your business reality in your field.
For example, if your company provides consulting services for choosing schools for children, once you’ve built a sales roadmap, you should start filling in the details, like the example below for your business. It’s best not to create a future roadmap, but rather a current map to see existing gaps and risks in the business, from which you can develop a new strategy to improve the sales process.
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Buyer’s Process: Put yourself in the buyer’s position or observe and ask customers what they usually do in the first stage when they become aware of their need. List all their common actions.
Example: For those needing consulting services for choosing schools, their actions might include:
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Searching for information online
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Asking friends on Facebook
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Searching for lists of schools
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Calling to inquire about schools
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Business Tasks (Your Tasks): For each action taken by the buyer, list the tasks you have done to help them complete their actions most effectively. Example:
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Post information on the Facebook Fanpage
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Expected Response: You need to answer what customers expect at this stage. Example:
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Your information is helpful
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Metrics: Provide measurable criteria to evaluate the effectiveness of the business tasks you perform.
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Number of people visiting the Fanpage
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Number of people liking the page
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Number of people commenting
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Problem Identification: After putting yourself in the customer’s shoes and experiencing it, you will find issues that have not been resolved or annoyances related to your product or service. Example:
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Unable to find information in the first three results on Google
Continue with the next steps in the buyer’s process and be as detailed as possible.
Then, color the cells where there are serious problems using different colors. For example:
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White: Normal
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Yellow: Issues
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Red: Serious issues
With these three tools, you can work with your sales and marketing team to analyze conversion rates through each step and identify weaknesses in the sales process, thus refining your business strategy.
Source: TiaSang
