Databases Reference
In-Depth Information
94
Understanding Sponsored Search
The buying funnel is the consumer parallel to the organization's sales funnel. The
sales funnel frames the customer buying process from the producer's point of view
with the aim of funneling the potential customers to a successful transaction [
18
].
The buying funnel is historically rooted in the writings of E. St. Elmo Lewis, a
late-1800s American advertising and sales pioneer. In a material for an advertising
course [
19
], Lewis developed the buying funnel (a.k.a., the AIDA model) as a sales
tool based on his personal observations of empirical customer behaviors in the life
insurance sales area.
His idea of the buying funnel was not necessarily an explanation of the consumer buy-
ing process but rather a funnel model to explain the mechanisms of personal selling.
Note the phrase “personal selling.”
In the buying-funnel model, Lewis stated that successful salespeople followed a
hierarchical, layered process using the four cognitive phases that buyers follow when
accepting a new idea or purchasing a new product. Lewis held that sales personnel
should aim for different sales objectives for their prospects and their customers at
each level of the buying funnel.
Since its inception - the model was already in wide use by 1925 [
19
] - the buying
funnel, more widely known in scholarly literature as the AIDA model, has served
as a framework to study how advertising affects consumers. Additionally, it was the
basis for numerous motivation-driven consumer behavior research models. As such,
the buying funnel is used in search engine marketing campaigns for conceptually
understanding customer behavior.
Foundationally, the buying funnel rests on human information-processing theory,
which is at the core of most consumer behavior models [
20
]. Information-processing
theory postulates that consumer decision making involves a five-stage process: (1)
problem recognition, (2) information search, (3) alternative evaluation and selec-
tion, (4) outlet selection and purchase, and (5) postpurchase processes [
21
,
22
].
Specifically, in practice, the buying funnel is a staged process for describing the
way consumers make their buying decisions, from becoming aware of the existence
of a need all the way to the final purchase of a product or service that addresses this
need or desire. Although there are several variations depending on the source, the
buying-funnel model is typically depicted as stages, with each stage relating to the
cognitive phase that the consumer is in.
Although there are various labels for each stage, one common labeling system is
Awareness
,
Research
,
Decision
, and
Purchase
(see
Figure 5.3
), which is the labeling
scheme that we use here.
•
The first stage is
Awareness
, when a customer realizes that there is a product that
can solve his/her problem or need.
After a consumer realizes that a product can address a problem, he or she finds a
•
specific product line and becomes more knowledgeable about this type of product
or service. This stage is called
Research
.
The third stage is
•
Decision
, when a consumer is deciding between different brands
of a specific product by forming choice set.
