How should we interpret the AIDA method in 2021?
We analyzed the shortcomings of the method today, the main proposals that have been put forward and what changes organizations need to make in order to adapt correctly.
A few weeks ago, during the course of a meeting, a client explained to us how they are finalizing the phases of the AIDA method in their sales process. He commented that they had already identified how to optimize the first phases, but that, due to lack of traction, they still did not have enough information to project how many sales they would achieve in the future.
This comment got us thinking about how, even today, many companies still use the sales funnel. In fact, in large part due to the rise of digital marketing, we believe that funnels are more popular than ever. We have often commented that the digital discipline has not invented the wheel, but has largely applied well-established methodologies in traditional marketing with the intention of making them work just as successfully.
We know for certain that society has changed in countless elements since some of these methods began to be proposed, and today we want to talk about the AIDA method, analyzing the relevant weight it had at the time, and what alternatives are being proposed today.
The AIDA method
The acronym of this method comes from the initials of the words Attention, Interest, Desire and Action. These are the four steps that this methodology describes and through which consumers must pass in order to become customers. In addition, it is important to note that in order to achieve each of the above concepts, the customer must necessarily have gone through the previous one; and often, for each leap that is made, there are consumers who move away from the purchase objective. This is why this method has always been identified with a funnel.
How has it come to the present day?
Due to the behavior of users in the digital world, this method has become popular and has been taught in many training courses. The problem, however, is that precisely because of the emergence of the digital world; the AIDA method loses its value, as we will explain in later sections of this article.
The truth, however, is that even in 2021 there are many publications explaining this method and why it is necessary to use it. As we have mentioned, the users of a website, in order to complete a purchase, move through different well-defined steps, which makes this method useful to be able to draw some conclusions, such as the following.
The AIDA method is currently useful in very specific situations, but in no case for analyzing the general marketing of a company as it is still being used in many companies.
For contextualization, this method was designed by Elias St. Elmo Lewis in 1898 in the United States (initially with only the first three steps, eventually adding “Action”). At that time, the North American country was in a post-war period, when demand exceeded supply. Therefore, the quality of a product was put on the back burner and the priority was to close sales and win customers at any price. Sales departments were fueled by high variables and little fixed remuneration. Any strategy to understand the consumer and their acquisition was welcome.
Today’s society and its behavior have nothing to do with that of American society at the end of the 19th century; therefore, the methodology of the past must obviously be questioned. It is important to ask what points of improvement could be applied to work on a new framework that responds to current needs.
Problems with the method
Although there are different issues for using the AIDA method with today’s marketing, we have summarized the most important ones in the following three points:
- User behavior no longer follows the expected behavior: Today’s users search online before making a purchase. With this fact, they are exposed to new brands they didn’t know about before, bringing the funnel back to its starting point.
- Loyalty and word-of-mouth are not represented: It only raises to think about loyalty at the end of the process (some professionals already speak of the AIDAR method where the R refers to “Retention”). Loyalty must be worked on at every stage and interaction with the customer. The method encourages marketers to push customers towards the sale and not necessarily towards a good experience. This misses the opportunity to get many referrals. Branding professionals know the importance of this point.
- The funnel does not take into account LTV (Life Time Value) and profits: The goal of a business is to make a profit and good marketers try to work this via the LTV. In contrast, the traditional funnel is based solely on quantity and treats the customer as a customer and a sale as a sale. The real value of marketing goes beyond getting a volume of customers.
To give a clear example of the problem, we can think of the telecommunications companies in our country. We are tired of seeing how, through promotions and offers, new consumers are treated better than existing ones. Attraction is valued much more than retention and LTV. This fact causes that many customers are already looking for a change of company from time to time and that loyalty with the supplier is low. These companies are thinking about the classic sales funnel and not about how to boost their sales thanks to their branding and good customer service.
What are the alternatives?
It would be presumptuous to pretend that ST Strategy is the first to bring this issue to the table. In fact, the world’s major consulting firms have been looking at how to find the solution for years. Although the result ends up having some variations, the truth is that they agree on several key elements. The following are the most relevant alternatives:
- McKinsey: The Consumer Decision Journey. Here we also provide the link to their own assessment 10 years later.
- Joseph Jaffe: Flip The Funnel. In this book, the author explains how the AIDA method is outdated and how to focus efforts on current customers.
- John Jantsch: Duct Tape Marketing. This book also talks about applying a cyclical process.
- Forrester: It’s Time To Bury The Marketing Funnel. In this case, the author makes a deep reflection on the problems of the classic system and the improvements that the new system can bring.
Although all the models differ from each other, in this case we would like to focus on the common points that all the proposals have in common:
- They place the customer at the center of marketing.
- They involve the brand experience in the whole process.
- They talk about a cyclical process relationship, where it is necessary to work on retention and interaction with the post-sale customer.
As an example, we show below how Forrester’s proposal approaches the process, where they propose to visualize the typical sales funnel from three different perspectives, but all of which come from marketing: customer psychology, mixed marketing and value proposition.
Needs to apply the new models
Once we have established that we need to change the basis on which we base our company’s marketing, it is also important to recognize that change is not easy. It is not a matter of starting to apply a different model tomorrow and trusting that everything will work correctly. There are some structural changes that have cross-cutting implications for the entire company. Therefore, we are not just talking about a change in the acquisition model, but we are talking about embracing a modernization of the company to be able to face modern challenges in an appropriate way. We are talking about applying modern solutions to current problems, not continuing to apply solutions from more than 100 years ago to contemporary problems.
Among the most important changes to be addressed by the company, we highlight the following:
- Communication between specialists. No marketing specialist will have the capacity to know in depth all the areas of knowledge that are necessary today. Therefore, we must always think in terms of team and team coordination.
- Marketing teams, with customers at the center. Here we can also include the importance of using User Personas, company positioning, as well as good customer segmentation.
- The priority of marketing has changed. The role of marketing today is to generate a great customer experience in order to maximize customer value in the end.
To conclude the analysis, it will be up to each of us to start working on new methodologies and modernize the company, or to continue focusing efforts on tools that have been of great value, but that have the wrong focus for the current needs of the market.