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Why You Should Invest in Mid-Funnel Marketing

October 13, 2021
Lina Hagström

Mid funnel marketing is a trending topic among advertisers right now. As a result, we have seen many leading brands exploring opportunities beyond the lower funnel. We're here to understand why investing in mid-funnel marketing is more important than ever.

First things first, let's begin by defining the different stages of the funnel. There are several ways of dividing a conversion funnel, but at the end of the day, these stages represent your customer's mindset.

Let's take a closer look at each step of the funnel and what they mean for us at Smartly.io. First, the upper funnel is your cold audience - it's all the potential customers who are still unaware of your brand/product/service.

The mid-funnel is your warm and cozy audience. It consists of people who've heard about your brand and have shown some interest or consideration but haven't converted yet.

The Lower funnel is your hot audience. This group of people has already shown intent. They are highly interested users that have shared some information with you already.

When planning your campaign mix, keep in mind that although sales may be the end goal, most consumers aren't ready to buy on the first ad/touchpoint when looking at consumer behavior. High-value conversions usually happen after multiple touchpoints.

The key to success is to adopt a mindset/strategy of constantly driving consumers down to the next funnel stage.


Looking above the lower funnel

One of the main reasons brands invest in mid-funnel is to increase the reach of their marketing efforts.

By increasing your reach, you can turn more people into potential customers, which, in turn, will most likely bring you additional incremental conversions and sales.

The ad delivery auction aims to find the cheapest conversions first (lowest cost). Depending on the objective, we will eventually reach a saturation point, after which we'll see diminishing returns.

By increasing the reach, we can have a more efficient spend by delaying the audience saturation point.

Mid-funnel is also becoming a popular strategy for those advertisers that need to diversify their audience reach to mitigate signal loss. With reduced user-level tracking across apps, "performance branding" is becoming the new sweet spot for digital marketers and advertisers to master. If you are interested in some other tips to mitigate the impact of signal loss, make sure to read this blog post.


How to build your funnel strategy

To increase your target audience and warm it up by pushing it down the funnel, remember to customize your ads to each step of their journey.

The first step towards a full-funnel approach is to start working on your mid-funnel strategy and build your way up.


Each step of the funnel has an ideal structure; you can adapt this to your marketing needs, depending on your target audience size, budget, and KPIs.

Focus on DABA and Lookalike (LAL) audiences for your mid-funnel campaigns to reach potential consumers similar to your already existing customers. Group people based on where they are in the customer lifecycle and combine that audience targeting with a relevant optimization goal so the algorithm can look for people most likely to convert and show them relevant creative messages that move them down the funnel.

Measuring the impact of your mid-funnel campaigns

Once we have planned the campaign with our desired structure and message and it's ready to go live, it's paramount to analyze its performance correctly.

It is critical to measure each step of the funnel with various operational KPIs and the overall funnel approach with a strategic KPI.


Conversion Lift studies are ideal for measuring the impact of adding extra budget to a mid-funnel strategy. If you can't run a lift study (e.g. IOS 14), you may run a Split test. However, keep in mind that Split tests cannot measure incrementality. Thus, comparing the attributed CPAs and volumes is crucial, e.g., the number of conversions and additional reach between cells.

Expanding your reached audience should also have a positive effect on brand awareness and consideration. Therefore Brand Lift studies could be a good measurement route as well.

Here is what we call "All in one Lift test" structure:

unnamed (1)

This is a Multi-Cell lift test is designed to answer the following question: Does a mid-funnel strategy improve overall performance and conversion volumes? How should I allocate the total budget across the Mid and Lower funnel?

Test Structure:

  • Cell 1: Most budget allocated to Mid-Funnel
  • Cell 2: Equal budget for both funnel steps
  • Cell 3: Emphasis on Lower-Funnel
  • Cell 4: BAU.
  • Duration: min 1 month

It's important to emphasize that budget splits, and funnel steps may vary on a case-by-case basis. Also, the overall audience size and the BAU campaign structure may suggest a different testing setup.


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