There will be marketing gurus who will try to tell you that the funnel is dead. Don’t believe them.

Because of the PLG movement, the still strong sales-driven model, outbound, and the time-tested sales engagement movement, there is more than one way to create your customer acquisition funnel.

So in this post, I’m walking you through the three different types of customer acquisition funnels, how to break them down, and how you can use them to accelerate the growth of your SaaS business.

  • Lead Magnet Driven
  • Free-Trial Driven
  • PLG Driven

It’s a complicated time in B2B SaaS, especially when it comes to customer acquisition. There are so many schools of thought: ABM, PLG, Sales Driven, and Sales Engagement.

So what do you do?

Through my 10 year journey of operating ToutApp and Marketo, I learned that underneath all the noise are these time-tested principles that always work… and the funnel is still very much alive.

When you leverage one of these you will be unstoppable. I want to dig into the core customer acquisition funnel and walk through the three key principles you need to know to drive growth.

But first, why is the funnel still alive and well today?

The funnel is a simple concept of when you get an ideal customer, they go through three main stages: awareness, consideration, and conversion.

Customer Acquisition Funnel

The reason it’s still alive is that humans operate the same way. They first need to know you, trust you, then they buy from you.

(By the way, if you already have a funnel, but don’t have enough awareness) Here are specific ways to generate awareness for your SaaS business.

Given the funnel is still true, how do you create a purposeful customer acquisition funnel? And which of the 3 golden types of customer acquisition funnels is the right one for you? Let’s go through each of them.

Lead Magnet Driven

The Lead Magnet is still strong. As long as it’s useful and relevant for your ideal customer. This is why inside my SaaS GTM Program, I teach Founders to create a Manifesto as their lead magnet. Your Manifesto serves as a lead magnet that digs into the core of why you exist and why people need to pay attention to you.

It’s also known as your strategic narrative that encompasses your core values. If you want to learn more about how to think about a Manifesto, check out this video.

With your Manifesto in place, you’ll then run ADs, Social Posts, and SEO to bring people into your sales funnel so that you can start to have a real conversation (i.e. demo) and convert them. In this model, in the most traditional sense, you’ll have salespeople take the leads that your Manifesto generates and engage them in real sales conversations. Simple.

In order to have salespeople, your ACV needs to be at least 20k ARR. If you don’t then the unit economics of your business will never hit. So if you’re using this model, it’s important that you are solving an important enough problem that attracts a big enough price tag to pay for your salespeople.

This is the most traditional model. Let’s go to number two.

Manifesto to Free Trial

Say you don’t have a high ACV. You would first put out your Manifesto then put the lead into a free trial and convert them.

Because you have a low ACV, the power in this is that you don’t use salespeople because you put leads into a free trial. You don’t have to pay expensive salespeople but maybe more on marketing to acquire leads.

Lead with a Free Trial First

This is branded as a new thing but it’s existed forever. If customers don’t want free content (aka your lead magnet) then give them a free trial and get them into the product right away.

The free trial gets them into the funnel first, then your manifesto educates and converts them. It leads them to their ah-ha moment and they purchase from the free trial. This method educates customers while they are on the free trial and in the consideration phase.

This is why PLG is so exciting right now. It’s because you can go after larger deal sizes without spending tons of money on a sales team.

In Conclusion

These are the three core types of customer acquisition funnels. People overcomplicate this and they shouldn’t. Ultimately if you focus on these three types you can actually get to the promised land of driving growth for your SaaS business.

There are nuances such as does the market believe there is an important and urgent problem, is your pricing and positioning are right and is your manifesto resonating?

I’m not saying this will be easy. Simple does not mean easy. There are critical components you need to figure out to make all this work. What are those?

You have to figure out your messaging, positioning, pricing, channel, and build out your manifesto. This is all fleshed out as part of your Go-To-market strategy. When you do these, running your funnel becomes easier. If you want to work with me to flesh out your GTM strategy, then check out my SaaS GTM Program.