The Effect of Market Saturation & Market Sophistication on Funnels

By James Vannelli | Uncategorized

Dec 04

You’ve been optimizing, tweaking, analyzing and adjusting away at your funnel, but even though you’re having a reasonable degree of success, its really just not hitting the levels of profitability that you anticipated, or used to experience!

If your automated funnel isn’t converting like wildfire, or isn’t converting like it used to, here are 2 things to consider:

1) Market Saturation

The novelty of funnels is done. Everyone and their grandmother has one.
Market saturation impacts both your Cost Per Lead and your Sales Conversion % (the two most critical variables in determining your Cost Per Acquisition AKA profitability).
This is important to understand because once upon a time, when you or someone else was the only game in town, being invited to a webinar for instance, was actually exciting and new for the consumer.

Fewer people were doing it, the consumer had less choice, it was more likely to make a sale simply for the fact that there were fewer offers competing for the same dollar.
With market saturation, especially if we don’t differentiate ourselves enough from our competitors, our sales conversion % is naturally going to decrease because as the market is flooded with new offers.

Why? Because we still have relatively the same base of consumers and the same amount of dollars to grab up, it just has to be spread more thinly, every advertiser who’s using the same or similar funnel strategies is on average going to receive a smaller % of the consumer spending pie.
The double whammy effect here is that, since there are more advertisers bidding on the same ad inventory on Facebook (or elsewhere), that inventory is getting more expensive, which means your lead cost is going to continue to rise.

And a higher lead cost per lead + a lower sales conversion % are not a great combination for your profit margins.
Sorry but, having an “abundant mindset” won’t quite help you sidestep this issue, not alone at least.

2) Market Sophistication

This is the other side of the same coin. As more and more advertisers push ads and funnels in front of the same consumers, consumers level of awareness continues to rise.
That “live” webinar that isn’t actually live? Yeah, that used to work, but not anymore.

Using scarcity tactics trying to pressure people into making impulse decisions? Yeah, again, been there and done that, your consumer isn’t falling for it at the same rate they used to.
Trying to push someone through the exact same:

Ad > Lead Magnet > Email Series > Sales

No, its quite simply going to have consistently diminishing returns, one of the factors at play being general “ad burnout” from seeing the same type of stuff over and over again.
This is actually why using someone else’s “ultra-secret proven process” could be killing you as it robs you of any point of differentiation.

And if you’re in an industry where consumers have been consistently burned on big promises and little results (marketing, coaching, health, and wellness) then you’re going to have to find a way to overcome those objections too.


The solution is to INNOVATE.

When everyone else had newspaper ads, and yellow pages listings, the innovators had websites.

When everyone else had a website, the innovators had funnels.

Now, when everyone else has funnels, the innovators must forge ahead and create a new path, to truly differentiate.

I believe that path is combining modern-day marketing tools and tactics with timeless relationship building principles.

It’s about playing the short and the long game. Instead of relying on just a funnel to convert everyone in 7–14 days.

It’s about understanding that a huge % of your sales are going to come through the consistent follow-up; 30, 60, 90, 120, 180 even 1 year from coming into your ecosystem! And if you ignore that, you’ll be ignoring 80% of your potential profits.

And its about actually understanding and living up to what certain words mean.

“Give value”, “engage with your audience”, “be genuine”, “ethical”, are terms we hear so often yet so few are truly applying them in the way they do things.

Giving value doesn’t mean providing a single lead magnet for download and then calling it a day, no, that’s par for the course these days, you have to go MUCH deeper.
Engaging with your audience doesn’t mean popping into your group once a week, asking everyone how their week was, and not responding to 1 single reply yourself. That sounds more like attempting to heard sheep than actually connecting with people.

Being genuine and ethical means that what you do in your business is 100% honest, 100% of the time. It means no tricks, no exaggerations, no performances. A good reference test when determining what sales and marketing tactics are acceptable or not, think of applying it to a loved one. If you wouldn’t use it on them, don’t use it on anyone else.


About the Author

Over the past 6 years I’ve built dozens of websites, managed close to $1M in online ads, and helped shape the online marketing strategies of hundreds of small businesses.