The upside-down funnel in marketing (aka focusing on customers first)

Remember the last time you visited a new city? Did you go to a restaurant that was recommended by someone you trust or one that was advertised in the airport?

We naturally put more trust in real people than in traditional ads and marketing. It’s why we check reviews before we book a hotel or choose a restaurant, and why influencer marketing has been so successful.

It’s also why the inverted marketing funnel works so well—it focuses on building relationships and ensuring customer satisfaction above all else. Because when a customer loves your product or service, they’ll be more likely to recommend you to their friends, colleagues, and even strangers on the internet. 

In this article, we’ll dive into the key concepts of the upside-down marketing funnel, why it works, and how to build your own.

The upside-down marketing funnel flips the traditional funnel on its head and puts the spotlight on your existing customer base. Placing them at the forefront of your marketing strategy builds brand loyalty and encourages customers to become brand advocates and promote your business throughout their network.

So, instead of spending all your resources trying to attract new customers, the inverted funnel focuses on investing in the customers you already have.

Traditional vs. upside-down funnel

A traditional sales funnel is where you cast a wide net to build awareness and then guide people through the steps of becoming a customer. It looks something like this:

Here’s a quick look at how the two compare:

Although the upside-down marketing funnel can take more time, the long-term results are worth it. Plus, it’s often more cost-effective because, as well as providing compounding returns, it generally has less upfront cost than a traditional funnel approach.

You can have the most incredible product in the world but the real value lies with your customers. Instead of starting out broad and narrowing down to convert a small percentage, the inverted funnel hones in on your happiest customers to widen your reach and drive growth from within. Let’s break it down. 

1. It uses a customer-centric approach

In putting your customers at the beginning of your growth strategy, you’ll gain a deeper understanding of their needs and pain points, which will allow you to serve them better, build stronger relationships, and solve their problems. 

By prioritizing customer satisfaction and retention, the inverted funnel results in more loyal customers, plus they become brand advocates, increasing brand awareness and promoting your products or services naturally. 

It’s actually easier to think of it as more of a cycle rather than a funnel. A happy customer continues to buy from you, recommends you to their friends, who go on to buy from you, who become happy customers, who go on to recommend you to their friends, and so on.

2. It improves conversion rates and ROI

Loyal customers are more likely to purchase from you again and spend more (37% more, in fact!). And as well as leveraging your existing customer base, you can also benefit from reviews, user-generated content (UGC), case studies, referrals and more. 

This will allow you to reach a more targeted audience that’s a better fit for your product or service because they’ve entered into your funnel through social proof and real experiences rather than an ad or search result. 

3. It allows for deeper customer insights

Customer feedback is priceless, and another awesome thing about the upside-down funnel is that it encourages ongoing communication with users through communities, relationship management, feedback loops, focus groups, and more. 

In doing so, you’ll learn about how your customers use your product, where it shines, where it falls short, and what your ideal customer actually wants and needs. You can then use these insights to make informed decisions about the direction of your product and optimize your messaging for maximum impact.

4. It increases customer retention and loyalty

Loyal customers are 5 times more likely to buy from you than new customers, but they’ll only stick around if there’s something worth sticking around for! 

A solid customer-centric approach that focuses on retention through support, onboarding, education, loyalty programs and feedback is guaranteed to improve your customer experience and offering. Naturally, customers will be less likely to move to a competitor, churn will decrease, and customer lifetime value will go up.

5. It increases profitability

The traditional funnel often depends on advertising. While ads are very important and effective, they can also be costly. By maximizing the value of existing relationships, you can spend less and get higher returns. 

Repeat sales, upsells, and cross-sells are lower-effort but higher-impact, making them more cost-effective than attracting new customers and nurturing them to a sale. Plus, it leads to more sales via your customers’ recommendations.

6. It gives you built-in word-of-mouth marketing and advocacy

The inverted funnel kind of kills two (or three, or four) birds with one stone: you’re making your customers happy, improving your service, growing your brand awareness, and bringing in new leads in one self-sustaining cycle. 

You focus on your existing customers, and their reviews, recommendations, social media mentions and more will roll in by themselves, bringing attention to your brand organically. It’s like you have your own army of marketers made up of your happiest customers—is there a better kind?

Learn how to turn your customers into lifelong fans with our guide on relationship marketing.

When you’re creating your upside-down funnel, the main thing to remember is customer experience. Happy customers = happy business = more sales!

1. Understand what your customers need

The main reason people continue purchasing your product or service is simple—you do a great job meeting their needs. But before you can do that, you need to listen. To collect those all-important insights about your customers’ goals, challenges and behaviors, you can:

• Run surveys about your product, service, and resources

• Run an NPS (Net Promoter Score) survey

• Hold interviews and focus groups

• Create a community and monitor conversations and ask questions to spark discussions

• Log significant feedback and comments made to your customer service team

• Spark conversations on social media

• Hold Q&A events and webinars

2. Build relationships with your customers

Email marketing is the best tool to stay connected with your audience, knowing that 100% of them will receive your message. And with segmentation, it's possible to be very personal, even when talking to thousands of people!

If someone gives you their email address, it’s a sign that they want to start a relationship with you, so make sure you capture the moment with a welcome email sequence. 

Welcome emails typically have an average open rate of 50-60%. Send a message immediately after a customer gives you permission to do it. At MailerLite, we send an entire welcome email series to keep the conversation going. Then keep people engaged with useful content and exclusive offers with regular newsletters that are personalized based on their behavior.

Use social media to connect, not only to promote

The essence of social media was all about connecting people, but along the way, the power of social media marketing crept in and overtook everything. A lot of brands are great at promoting their products, but they’re missing the opportunity to let their personality shine, connect with customers, and build stronger relationships. 

Here are some ways to make your customers your social media besties:

• Speak like a human, not like a business. Before you hit post, ask yourself if this sounds like something you would say

• Reply to comments and others’ posts with real, custom responses and engage in conversations

• Join in on relevant trends, even if they don’t directly involve your brand or product

• Be real. Running a business isn’t easy. Share some of the lows as well as the highs

• Celebrate and support your community. Give them shout-outs, share their content and celebrate their successes

• Have fun! A humorous approach can not only make your posts go viral, à la Ryanair, but it will also encourage your customers to interact with you more

Here are some of our favorite fun tweets from the MailerLite community. We love that MailerLiters feel free to have fun with us.

3. Share knowledge and insights

You want people to understand how to use your product or get the most out of it. At Mailerlite, we send emails about features along with video tutorials explaining how to use them. We also remind everyone that our customer support team is always here for them. The newsletter below is an example of the content we send out to subscribers, with resources to help them get the best out of MailerLite and optimize their email marketing strategy.

It’s always a good idea to educate people about your product or service to help them achieve great results. It's even better if you share interesting and valuable content that’s still relevant, but not directly related to your business.

For example, if you sell honey, share some of your favorite recipes using honey. If you sell mattresses, talk about the importance of rest and sleep. If you sell perfume, explain the process of creating signature scents.

4. Tell your brand story

People don’t connect with logos, they connect with people. So show the humans behind your brand! Some ways you can do this are:

• Share your origin story

• Share your values and mission and how they make an impact

• Fun facts about your company

• Behind-the-scenes sneak peeks

• New milestones and hiccups in your journey

• Share your team and who they are

Opening up your brand on a personal level will allow customers to connect and relate to you more easily. Encourage people to not only open and click on your emails or like your social media posts, but also reply to them with their own personal stories. 

5. Empower customers to spread the word

Your customers are your best marketers, so make it easy (and, if possible, rewarding) to share the love for your brand. You can:

• Add social sharing buttons to your website and newsletters

• Encourage user-generated content and interact and share those that create it

• Make reviewing your product or service easy with links on your website and in review request emails

• Ask for customer success stories and share them with your audience

• Launch a referral program with rewards

Just Another PM is a newsletter (run through MailerLite!) that provides content, resources and strategies to help product managers to thrive. In this newsletter example, they requested subscribers to leave a review, letting them know how much their contributions mean. We also love the human and relatable language and messaging of this newsletter. It’s never a bad idea to let your customers know how much you appreciate them!

They also share the feedback they receive on their website!

6. Monitor customer satisfaction metrics

Keep a close eye on metrics like NPS, CSAT (Customer Satisfaction), churn rates, and retention rates to understand sentiment and monitor for fluctuations. These kinds of metrics can let you know whether you’re on the right track, what might be affecting customer satisfaction, and what improvements can be made. To keep track, you should:

• Send regular NPS surveys (at least once a year)

• Use CSAT surveys to get customer feedback on their purchase, website experience, or customer service interaction

• Track support metrics such as first response time, resolution time, and customer satisfaction

• Use social listening tools like Brand24 and Mention to track brand mentions and keywords

• Track repeat purchase rates, customer lifetime value, and churn rate in your e-commerce platform or subscription service

Our transactional email partner, MailerSend, runs regular NPS surveys through its app via a simple pop-up that asks the user to rate how likely they are to recommend the service to a friend or colleague.

7. Improve… and never stop improving

With its customer-centric approach, the upside-down funnel is the gift that keeps on giving. Use the feedback and insights to continuously improve your offering and refine your messaging to ensure your loyal customers remain happy and… well, loyal!

Here’s a snapshot of our Wall of Love, where we share feedback from users detailing how MailerLite helped grow their business.

1. Focus on long-term value

Keep the focus on building strong relationships, loyalty and value from the bottom up, and the new customers or leads will flow in naturally. When you prioritize existing customers, you’ll find that they’re much more valuable than any short-term win. Don’t forget about customers as soon as you make a sale: Continue the experience, provide resources and support, and encourage community building

2. Personalize the experience

It might not be possible to know every single customer, but people still like to be treated as individuals and appreciate when their brand experience feels personal to them.

Use behavior, preferences, purchase history and even demographics to tailor your offers and communication. You can use segmentation in your email campaigns to make them ultra relevant, make support interactions more personal, or personalize their on-site experience.

3. Be human and empathetic

For a customer-first business to work, you need to care about and empathize with them. Asking for feedback is great, but it doesn’t mean much if you don’t understand your customers or take steps to address their frustrations. 

Listen to your customers, let them know you understand them, and tell them how you’re working towards making your product or service better for them. 

4. Build a knowledgeable, friendly customer service team (with real humans!)

One unhelpful or negative customer service experience is all it takes to lose a customer’s loyalty. Your customer support team is crucial for the upside-down funnel to work, which means you need highly-trained agents who are happy to help customers when they need it most. 

Run training programs and regular refreshers for team members, hold product update and knowledge sharing sessions, and ask for feedback about the customer service experience after each interaction. And make your support channels accessible! There’s nothing worse than hiding live chat buttons and contact form links, or putting customers through endless AI bot loops. 

One of the cornerstones of MailerLite’s success is investing in and developing an award-winning customer support team, and year after year, it’s one of the things our customers rave about the most. Here are just a few of the thousands of lovely comments we’ve received.

5. Use data to drive retention and advocacy

Make the collection and analysis of customer behavior and satisfaction a key element of your strategy. Put initiatives in place to identify and re-engage at-risk customers, maintain customer loyalty, and identify your biggest fans and turn them into brand advocates.

6. Hang out with your customers

I don’t mean go for dinner or a coffee—unless you really want to, like these MailerLite team members did!

But learn which online communities and social media platforms your customers are active on and go join in on the fun. Reddit, Instagram, Discord, Slack, and Bluesky are just a few of the places you might be able to connect and interact with your audience.

To successfully build an inverted tunnel strategy, there are some tools you’ll need to help you interact with customers, collect feedback, monitor customer retention and loyalty, and create brand advocates.

• Survey/feedback tools: 

  • Typeform - Popular survey tool with customizable templates and a free plan

  • Google Forms - Free, simple forms

  • MailerLite Surveys - Surveys you can add right into your emails with simple drag and drop

• Analytics and behavior tracking:

  • Google Analytics - Track a wide range of metrics including bounce rate, conversions, engagement and more

  • Kissmetrics - Track behaviour, increase revenue and reduce churn with customer-focused tracking

• Communication and relationship building:

  • MailerLite - Email marketing, automations, landing pages and websites with built-in personalization, segmentation and surveys

  • HubSpot CRM - All-in-one platform for managing customer relationships

  • Intercom - Communication platform that helps businesses interact with their customers throughout the entire customer journey via live chat, email, and in-app messaging

• Loyalty, advocacy and community:

  • Circle - Community platform for creators, brands and businesses

  • Partnero - All-in-one affiliate and referral marketing platform

  • Facebook groups, Reddit, Discord - Community-driven and discussion based social media platforms

• Customer experience and support:

  • Zendesk, HelpScout - Popular customer support platforms with ticketing, self-service support and analytics

The word funnel comes from the Latin word “infundere,” meaning "pour into". And if you're pouring your best ideas and resources into your current customers, you’ll see brand growth and increased revenue without putting all of your marketing efforts into traditional “top of the funnel” methods. Plus, you’ll be giving your customers the love they deserve! It’s a win-win!

Have a good product, take care of your customers, and make it easy for them to share the love. It’s time to flip the funnel! 

Do you think it's better to focus more on current or new customers? Let us know in the comments!