In competitive industries, digital marketing costs are often substantial - leading to high customer acquisition costs. Keywords are bid up to exorbitant prices, and only the companies that can efficiently convert and monetize leads are able to stay in the game. This leads to a relentless focus on "the funnel."
When I hear discussions around the funnel, they usually center around converting a target group of people from an initial impression to their first purchase. However, I think the funnel question is actually more than this and encompasses these additional elements:
1. Who is the target group being brought in to the top of the funnel? Is it the right group? If you advertise to people who are inherently less likely to convert, it will affect everything conversion metrics throughout the entire funnel.
2. Are you sourcing and converting the right leads that will become long-time, happy, referring customers? Not all customers are equal. Just because you can show someone your product and get them to buy once doesn't make them a great customer. The real key is to identify, convert, and invest in customers who will be with you for the long haul and refer their friends to your business.
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