Have you heard of the Pirate Funnel? Businesses are using this growth marketing strategy to cut through process confusion, identify bottlenecks, and grow faster.
It’s a funny name—and certainly doesn’t sound like serious business. But once you see the results of this powerful technique, you’ll be saying “Arrrr, matey” with the best of them. (Sorry… we couldn’t resist…)
Before you break out the eye patches and peg legs, let’s get right to it: the Pirate Funnel helps you find—and solve—the weaknesses in your customer acquisition process.
As a B2B tech company, finding and retaining the right customers remains the key to success. That’s ultimately combining what the Pirate Funnel and B2B growth marketing can do for you.
Let’s dive in.
The Pirate Funnel & How it Works
The Pirate Funnel (named after its hearty AAARRR acronym) has become an industry standard growth marketing strategy. It’s not just a funnel; it’s an analytical framework you can use to break up your business and your sales process into smaller chunks and identify the true bottlenecks in your sales pipeline.
If your business is considering a move toward growth marketing tactics, the Pirate Funnel is a great first step.
Let’s take a look at the six steps or phases in the Pirate Funnel and how each can affect your business.
Before a customer can even consider whether they want to partner with you, they must know that you exist. Customers learn about you through any number of channels: organic search and inbound marketing, paid search (SEM), social media ads, billboards, direct mail, word of mouth, message in a bottle, carrier pigeon… one way or another, businesses have to find you before they can buy from you.
Step one in the Pirate Funnel examines how many people are aware that you exist.
The New North approach:
With our experienced team and strong marketing technology stack, we can quickly evaluate how effective your marketing is at driving awareness with potential customers. We then use this process to identify new strategies for improving effectiveness in existing channels.
Your prospects knowing that you exist and your prospects visiting your website are two different things. In the online space, acquisition often begins with click-throughs. As you advertise online, you should have access to the total number of ad impressions your ads receive. The click-through rate measures how many people actually “click-through” to learn more about you.
The New North approach:
Using the Pirate Funnel framework for growth marketing, our team of designers and copywriters are specialized in developing creative that drives action – not simply creative that looks nice. Success like this is only possible when you’re making the right decisions about where to allocate your resources in both the Awareness and Acquisition stages.
Once your customers know who you are and have learned a bit about you, the next step in acquisition is Activation. They may sign up for your newsletter, download your app, read your eBook, or take some other step toward wanting to get to know you better.
Essentially, activation is gaining additional buy-in from a prospect.
The New North approach:
Growth marketers like our team at New North focus on creating expert-driven content that truly leverages our clients’ unique insights and perspectives. This high-value content stands out among the repetitious droll most marketing companies spit out. We recently worked with one of our clients to create a campaign which resulted in a 150k increase in subscribers.
The next step is a big one, Retention. How many of your activated customers come back to give you a second or third look? The more someone comes back, the more likely you will be to convert them from prospect to customer.
A good growth marketing team will measure this stage for you. Typical factors that can impact retention are whether you’re doing a good job of educating your customers (about industry insights or the features and benefits of your product or service) and effectively demonstrating that you’re worth the cost (how you’ll improve your customer’s bottom line).
Retention is all about whether your audience or customers come back to you in the future.
Customer retention is difficult to place a timeline on, but next comes the point of conversion (tracking potential customers becoming paying customers).
Every business wants more revenue. But experts in a B2B marketing agency like New North know that customers must go through several stages before they’re ready to become your customer, so it is important to understand those stages.
Whatever way you measure revenue (MRR, ARR, gross sales, etc.), the bottom line in this stage is that you are gaining paying customers. The Pirate Funnel framework examines hard data so that you can see how many potential customers become actual customers.
One of the most effective ways to grow your business and increase revenue is through referrals. In fact, a recent study showed that about 65% of new business opportunities come through the referral process. Better yet, referrals are often far easier to close, decreasing overall acquisition costs.
Once upon a time, the referral process was opaque, and the only way to know if your customer referred someone to you was if they told you personally. But today we can measure referrals in a variety of ways, including through UTM parameters, online reviews, social media posts, and shares.
The New North approach:
At New North, we’re passionate about developing your brand so that your customers will passionately endorse you to other potential customers, like what Bryan Voltaggio experienced with his restaurant venture.
How the Pirate Funnel Helps
The primary function of the Pirate Funnel is to identify bottlenecks in your customer acquisition process. By default, as people proceed through your funnel, fewer and fewer will reach each stage.
Here’s an example. Let’s say you launch a social media ad campaign that receives 50,000 impressions.
- 100% of your potential customers who viewed the ad are now Aware that you exist.
- 20% (10,000) of those customers click through to see your page and are now Acquired.
- 30% (3,000) of those sign up for your newsletter and are now Activated.
- 60% (2,000) of those visit your page more than once and so are Retained.
- 10% (200) of those make a purchase, providing Revenue.
- 25% (50) of those Refer their network contacts to you.
By considering the Pirate Funnel, you’ll be able to identify the bottleneck in your growth marketing funnel.
In this scenario, you’re dropping steeply between Retention and Revenue. Maybe that’s normal in your industry or market, maybe not. Either way, this is strategic insight: why pay through the roof to double your impressions when the real need is tightening your conversion language?
Looking at the Pirate Funnel in this way gives you the ability to target the right areas for improvement.
You + New North = Growth Marketing Strategy Success
So, what would it look like if your business worked with our B2B growth marketing agency to develop and refine your Pirate Funnel, among other growth marketing strategies?
We start by helping you build your pirate funnel properly and accurately, identifying your most troublesome bottlenecks. Then we examine your practices and data to determine causes and solutions for those bottlenecks. Next, we’ll build you a customized B2B growth marketing strategy that positions you for explosive growth.
Every business presents a unique challenge, especially in B2B tech. We understand the B2B tech space, and we tailor our strategies so we can deliver a world-class B2B growth marketing funnel that excels in your unique context.
In other words, we know the challenges in your way. And chances are we’ve solved them before.
If you’re interested in seeing how growth marketing strategies, including the Pirate Funnel, can help you gain more best-fit customers, schedule a call with us. We’d love to connect!