The Death Throes of the Purchase Funnel

Just a few years ago, marketers viewed the purchase funnel process as a long term process. Brand building and demand creation could take 2, 10, 20, 30 years or more sometimes relying on the assumption that building the brand would automatically result in sales. But that assumption has taken a beating in recent years. Companies no longer tolerate large investments that do not deliver a proper return within a reasonable time period.

The emphasis on advertising budget accountability has never taken on more importance than it has in today's market.

Cathy Clift wrote a perceptive article entitled "Is The Purchase Funnel Dead? How The Internet’s Rewired Consumer Buying Behavior" which challenges this decades old concept as the Internet changes the marketing environment.

The purchase funnel evolved into various mutations over time. One of the best known purchase funnel theories called "AIDA" simplified the concept by braking it down to "Attention, Interest, Desire and Action".

Ms. Clift states: "The problem is that it doesn’t even come close to mapping the consumer’s approach to a considered purchase decision in the Internet age... The Purchase Funnel takes no account of the way consumers use online research to 1) expand their consideration set and 2) to take advantage of the experience of existing owners and users to help guide their choice. Both points have important implications for the purchase funnel."

She goes on to show detailed, relevant research to support her hypothesis.

Another way to look at it is that a purchase funnel of sorts still persists, but it is much compressed and takes on a greater degree of unpredictability. 

Some marketers see this buying process as compressing the AIDA process, such as it is, into taking a few days or weeks rather than decades. In fact, the final buying decision for some purchases may happen simultaneously during the few minutes it takes for the customer to do the Internet research. The brand building process goes from years to build or tear down to a few minutes based on what consumers say about a given product on the Internet. 

In other words, the AIDA process may take place within a single Internet session.

For direct marketers, understanding this process is critical because it drives the results analysis. For example, how much credit for the sales goes to traditional media versus the Internet? Expense and sales allocations continue to confound marketers as they wrestle with the evolving nature of the purchase funnel theory.

What are your thoughts concerning channel allocation and the purchase funnel as it stands today? 

Posted on June 20, 2009 and filed under Direct Marketing Strategy.