The problem with a funnel is that it has a hole in the bottom. Customers can flow right through it if you don’t catch them.
The basic idea behind the sales funnel is that if you focus on speaking to more people (filling the top part of the funnel with prospects) then more people will end up purchasing from your business (the bottom part of the funnel where conversion occurs) .
Not familiar with the sales funnel? Learn more about the sales funnel
The bath tub theory
The bath tub theory is more focused on keeping customers in your business. Here’s how you can implement the bath tub theory.
Step One: Secure the plug
Before trying to acquire new customers, make sure that the retention rate for your existing customers is a high as possible. If you think of your customers as the water, you want to make sure that there are no (or very few) leaks in your bath (your business).
There are many ways you can look to improve your customer retention rate. Here are a couple of ideas:
- Find out why people stop purchasing from you (and address the cause of this issue)
- Identify where customers are looking elsewhere for solutions
- Use email marketing or social media to keep in touch with your existing customers (building stronger relationships)
Step Two: Turn on the tap
Only after securing the plug does in make sense to turn on the tap or attempt to acquire new customers through advertising or promotion. Then you can be sure that your hard work in gaining new business will be worthwhile!
Another option: Put the funnel above your bath
That’s right. Focus on securing the plug first and then filling up your funnel with prospects. Then you’ll need to put the emphasis on your conversion rates – although that’s the subject of another blog post!