This is the most important slide in the world. We use it in nearly every presentation we do. The reason why this is so important is because this research by McKinsey from 2010 killed the concept of the conversion funnel. The concept of the conversion funnel is the leading principle behind classical advertising: the more eyeballs your campaign throws in on top of the funnel, the more sales will eventually fall out of the bottom of the funnel.
The McKinsey research clearly shows that this funnel is an idea from the past. Since digital has become the operating system of the world, and since nearly everyone is tapped into digital, we now walk a different path. At the initial consideration stage we have a few brands in mind. And yes, advertising still plays a role. But after considering a few options, people start on an active evaluation hunt. They talk to peers (online and offline), they google for alternatives, they check review and rating sites, they learn what influencers tell. In short: active evaluation sometimes confirms the initial consideration set, it sometimes add a few more options to the set, or it simply reshuffels the whole set. In a digital world, the sales funnel doesn’t get smaller, it actually broadens up.
On the moment of closing the deal, the interaction with the brand or the product – and what other people tell about it, determines for 74% whether or not someone is going to buy.
What does this research learn us:
- We should get obsessive with crafting the user experience with the brand. It’s the most important impact factor on the moment of closing the deal AND it’s the most important reason why existing customers talk about it, give it good reviews, blog about it, etc…
- We ought to get obsessive with understanding the tactics of stimulating the spread of consumer excitement. How can we get them to give great reviews and ratings at the most important websites? If you are a hotel owner, you should only worry about giving your guests such an amazing experience, that they actually will do you the favor of writing a good review on Tripadvisor.com. That’s the only marketing effort that is relevant to you. The consumer decision journey will do the rest.
- Advertising should shift from promoting the product, towards putting the spotlight on the remarkable stuff you do, that gets people talking.
- Negative word-of-mouth isn’t something you can’t ignore anymore. Whenever a prospect client stumbles upon negative word-of-mouth during his active evaluation stage, you lose. Negative WOM is a disaster these days. the effects of negative WOM stretch much further than the little inner circle of the so-called detractor.