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Have you ever heard of a "funnel product"? Don't worry, I hadn't either until I started selling on Amazon and Shopee. But let me tell you, funnel products are an absolute game-changer when it comes to getting more customers and making more sales.
In this post, I'll explain what exactly a funnel product is, why it works so incredibly well, and how you can use it to attract way more customers to your online store. We'll keep it simple and focus on actionable tips you can implement right away. Let's dive in!
What is a Funnel Product?
A funnel product is a special type of product that is designed to "funnel" customers into buying more from your store. It's usually a lower priced item that has high demand. The goal is to get customers drawn in by the funnels product, then get them to purchase your higher ticket (and higher profit) items once they visit your store.
Funnel products are also called:
- Lead magnets
- Doorbuster deals
- Loss leaders
- Traffic drivers
But it all refers to the same idea...using strategic products to drive new customers to your e-commerce store.
Why Funnel Products Attract So Many New Customers
Funnel products leverage two key psychological triggers:
1. The Desire for a Great Deal
All of us love getting a bargain. When customers see your funnel product at an ultra-low price point, it pushes that "great deal" button in their brain. Even if they weren't in the market for that specific item, they'll buy it since the deal is too good to pass up. This gets new customers in the door to your online store. From there, you have the chance to show them your other products and turn them into repeat buyers.
2. The Fear of Missing Out (FOMO)
When you promote your funnel product as high demand, low quantity, or for a limited time only, it triggers a FOMO reaction. Customers hurry to buy so they don't miss out on the deal. You drive urgency around the funnel product, you get urgency in response. It's human psychology - we hate the thought of missing a good deal that others are getting.
Real Life Examples of Funnel Products in Action
Let's look at some real life examples of brands using funnel products to skyrocket their customer acquisition:
Dollar Shave Club
You may have seen Dollar Shave Club's viral video campaign. They gained 12,000 new customers overnight! Their funnel product? A $1 razor with free shipping. Once folks purchased this discounted razor, many stuck around as loyal subscribers to get replacement razor blades shipped regularly. Dollar Shave Club's funnel product brought in customers, then their subscription model kept them around long term.
Groupon
Daily deal sites like Groupon base their entire business model around funnel products. They offer insane discounts on local services, activities, restaurants, etc. to bring in new website visitors. Once people get used to checking Groupon for sweet deals, they gain life-long customers. Even without a deal, folks will check their site first before booking services at full price.
Amazon Prime Day
Amazon's Prime Day is a massive annual sale event where they offer Black Friday-like prices in the middle of summer. Huge discounts on popular items bring tons of new customers to Amazon on Prime Day. Many of these deal-seeking folks stick around as Prime Members after the sale is over. Prime Day acts as the funnel that adds new long-term customers for Amazon.
How to Create Your Own Funnel Products
Now that you've seen funnel products in action, let's talk about how you can create your own!
Here are 5 steps to set up an effective funnel product for your ecommerce store:
Step 1: Find a High Demand Niche
Choose a product in a niche with proven customer demand. You want something people are actively searching for and interested in buying. For example, fidget toys, phone chargers, or makeup tools are hot product niches right now with high buyer interest. Start your product research here.
Step 2: Offer a Deep Discount
Price your funnel product at an extremely low price - at least 50% off normal retail pricing. Remember, you’re not trying to maximize profit here. The goal is to attract attention and get new visitors.
Step 3: Limit Quantity
Create urgency around the funnel product by limiting how many you have in stock. You can say something like “Only 1000 available at this price!” This triggers the fear of missing out that we discussed earlier.
Step 4: Promote the Deal
Let your audience know about the amazing discount you’re offering! Share it on social media, send emails, run ads, etc. The more buzz you generate around your funnel deal, the more new eyes you’ll drive to your store.
Step 5: Retarget Traffic
Use tools like Facebook pixel or Google Analytics to retarget people who engaged with your funnel product. Remarket to them with your best-selling items and promotions to turn them into buyers.
Funnel Product Examples
To make these funnel product concepts more concrete, let's look at a few examples for different ecommerce niches:
Makeup Store Funnel Product
A set of 3 makeup brushes for 80% off original price. Priced at $5 with free shipping and only 500 available. Promoted on beauty Instagram accounts. This attracts makeup buyers who want quality brushes at a steal. Once on your store, you can display higher-end brush sets, palettes, beauty tools, etc.
Pet Store Funnel Product
An adjustable dog collar for 60% off, priced at $3.99 with free shipping. Promoted on pet-themed Facebook groups. Dog owners jump at the practical item under $5. Once they purchase, retarget them with your bestselling toys, treats, accessories, and more for their pup!
Home Goods Store Funnel Product
A set of 8 kitchen utensils for 65% off, priced at $9.99. Limited to the first 750 orders. The too-good-to-pass-up deal brings in homeowners. Retarget them with furniture, decor, appliances, and other home products they’re likely interested in. See how you can tailor a funnel product to your specific niche!
Funnel Products Case Study: 461% Increase in New Customers
To show just how powerful funnel products can be, check out this case study from PrimeTech Deals, an electronics ecommerce store.
They created a funnel product by bundling in-demand accessories like phone chargers and cables at a deep discount. The bundle was priced at 79% off its $50+ value, available for only $9.99. By promoting this on deal sites and retargeting traffic, the funnel product generated a 461% increase in new customers over a 6 month period! The low priced bundle acted as the hook to get new people to PrimeTech's online store. From there, many bought higher profit tech products like laptops, tablets, and headphones.
Tips to Optimize Your Funnel Products
To maximize the customer-attracting power of your funnel product, keep these tips in mind:
Offer the lowest price possible - go as low as you can while still making a small profit
Use power words like “Last chance” “Almost sold out” or “Today only” to spark urgency
Make the discount only available for first-time customers to bring in new visitors
Promote the deal through multiple channels like social media, PPC ads, influencers
Retarget aggressively to turn funnel product buyers into repeat customers
Go Capture New Customers with Funnel Products!
There you have it - a complete guide to funnel products and how they attract 461% more customers!
The key takeaways:
Funnel products use huge discounts on high demand items to bring new visitors in
Creating urgency and buzz around the deal taps into shopper psychology
Retarget funnel product buyers to turn them into long term customers
I challenge you to create your own funnel product and use it to skyrocket your customer acquisition starting today. Just one hot deal can ignite exponential growth for your ecommerce business when you do it right!