As I’ve said in the past, most people who have been in technology for a day or two usually have tactics like search engine optimization, social media marketing, blogging, twitter, and Facebook rolling from the tip of their tongues. Many times its is only after trying several tactics and realizing that their returns across the board are small do they seek to understand how to create a strong product and online marketing strategy.

Since the success of your product and marketing depends solely on your customers, an effective strategy depends on the stage of customer knowledge and interaction with your product. These stages in aggregate are often called the customer funnel. The four stages of the customer funnel are 1. acquisition 2. activation 3. retention and 4. referral. Much has been written about the customer funnel and its stages. You may have seen lots of different visualizations of the customer funnel. I find it helpful to think of the customer funnel as a ladder you want your customers to climb since it reminds you of the effort you want them to take. To convince them you have to take several product development and marketing actions at every stage. Acquisition As the name suggests customer acquisition is all about bringing customers from different channels to your product. It is helpful to think of the customer’s coming to your product website or app as the final result of this stage. Oftentimes before that can happen you have to:

1. listen to existing conversation
2. join in existing conversation and thus build an awareness of who or what the brand is
3. engage in a conversation, show value, and develop customer trust in the value you offer

If you do this well customers will begin to arrive from various channels.

Activation Activation is when a user visits your product or web presence and engages in some action that you want them to take to deepen their engagement with your product. This action could be anything from registration/signing up, sharing with a friend, reading a few pages or your content or something else depending on your site’s navigational flow and design. At this point you have the customer interested but not convinced. They come to your product curious to see if what your offer fit’s their needs and whether or not your product is the best one to fulfill those needs. Key’s to their satisfaction and thus your success in getting them to take the activation action are that the entry pages provide:

• clear value proposition and feature explanation
• easy navigation aka usability
• appropriate user interface i.e. one based on user-centered design principles

Several pieces of information from your listening in the acquisition phase as well as the information you can get about who the visiting users are and where they are coming from should inform these decisions.

Retention Retention refers to the return of visitors to your product. Few products are designed as everyday apps which become a necessity to the user’s daily existence. See Bokardo’s post on what makes an everday app. The closest everyday apps I use are social networks like Facebook and Twitter but even they took a while to get to this point. They had to determine who their best customers were for this as well as pinpoint the feature set, navigational flow, user interface and reminders in other non-product channels they had to develop that allowed them to maximally retain these customers iteratively. Keys to successful retention are then quick development and iteration with an eye towards improvements in returning visitors. Web/app analytics along with qualitative customer research are helpful in this stage.

Referral Referral by your customers to their social networks is what allows for a higher customer acquisition for each dollar spent. Referrals are what allow your product to be viral. The definition of virality is percent of users referring your product to others X average number of people invited X percent of users who accepted invitation.

To allow referrals a referral product loop must be built in early into the product. See Kissmetrics product planner to get ideas of successful referral loops.

In future posts I will be talking about various ways to use social media in each of these stages to understand, engage, and sell to your customers. Would love to hear your thoughts on my interpretation of the customer funnel. Do let me know what you think by commenting below.

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