Simply put, retail marketing involves how stores showcase and sell their offerings to potential customers.
In this article, we’ll break down the core concepts of retail marketing and explore why it’s indispensable for marketers and business owners aiming to boost their marketing effectiveness.
- With a good retail marketing strategy, stores strategically position products
- Understand demographics and preferences to enhance product placement and promotions
- Location impacts customer reach—choose wisely for visibility and accessibility
- In fact, 69% of consumers are more likely to shop at stores with loyalty programs
- Seamless online and in-store experiences create a cohesive, engaging shopping journey
- Focus on immersive experiences, community engagement, and sensory stimulation for shopper satisfaction
- Brands exploring the metaverse enhance innovation, reaching younger audiences for strategic marketing success
What Is Retail Marketing?
Retail marketing is the strategic promotion of products and services to customers through diverse distribution channels, aiming to boost sales.
This encompasses a mix of direct and indirect approaches, including advertising, promotions, public relations, partnerships, and online marketing. It extends to the layout of your store, your social media engagement, and the role of your employees, forming a comprehensive plan to drive sales and profitability.
Why Retail Marketing Is Important for Retail Stores
A well-crafted retail marketing strategy isn’t just about selling products; it’s key to connecting with your target audience. It goes beyond merely pushing merchandise — it addresses doubts and lessens buyer’s remorse, a concern felt by about 42% of shoppers post-purchase.
Key Benefits of Retail Marketing
- Build Customer Loyalty: Foster lasting relationships by understanding and meeting customer needs.
- Increase Revenue: Strategic marketing drives sales, directly impacting your bottom line.
- Strengthen Branding: Shape a distinct brand identity, standing out in the crowded retail landscape.
- Enhance Customer Experience: Elevate satisfaction through personalized interactions and streamlined processes.
- Competitive Edge: Stay ahead by adapting to market trends and outshining competitors.
- Targeted Communication: Reach the right audience with tailored messages, maximizing impact.
- Adaptability: Respond swiftly to market shifts, ensuring sustained relevance and success.
- Data-Driven Decision Making: Utilize analytics for informed choices, and optimizing marketing efforts.
Types of Retail Marketing
Marketing for retail stores isn’t a one-size-fits-all endeavor; it’s a dynamic blend of various strategies working together to drive traffic. If you’re acquainted with marketing attribution, you understand that these tactics collectively guide consumers through the buyer journey, culminating in a conversion (sale).
Traditional marketing, rooted in the advertising surge of the 1950s, encompasses tactics that are still effective today. Classic channels include newspaper and print ads, billboards, and TV and radio commercials. Despite the digital era, these methods remain crucial.
For instance, direct mail marketing boasts a 31.49% success rate, with 80-90% of mail being opened, a notable contrast to the 20-30% open rate for emails, even on good days.
Digital marketing spans eight key categories: affiliate marketing, content marketing, email marketing, analytics, mobile strategies, pay-per-click, search engine optimization, and social media marketing.
Wondering about the effectiveness? Note that companies with 30+ landing pages generate seven times more leads than those with fewer than 10, while those with over 40 often yield a 12x lead increase. Incorporating videos on landing pages can boost conversions by up to 86%. Remarkably, PPC delivers a 200% ROI, returning $2 for every $1 spent, while email marketing shows an impressive $36 return for every $1 invested.
What Is a Retail Marketing Mix?
In retail marketing, the concept of a retail marketing mix echoes the traditional marketing mix, famously known as the “4 Ps of Marketing” – product, pricing, place, and promotion.
However, recognizing the diverse aspects crucial in retail, three additional “Ps” are introduced: people, process, and physical evidence. Similar to the adage “Don’t put all your eggs in one basket,” effective retail marketing requires a multifaceted approach.
Addressing product quality, competitive pricing, strategic placement, impactful promotion, customer interactions (people), and the overall presentation of your offerings, the retail marketing mix ensures a comprehensive strategy, acknowledging that success stems from a balanced integration of these essential elements.
7 P’s of Retail Marketing to Incorporate in a Marketing Mix
In retail marketing, surpassing the basics of the traditional “4 Ps” is crucial. Enter the “7 P’s of Retail Marketing,” an expanded playbook encompassing product, pricing, place, promotion, people, process, and physical evidence (or environment). Each element plays a critical role in crafting a dynamic marketing mix.
In the upcoming section, we’ll explore the significance of these seven components, explaining how their strategic interplay elevates a retail marketing strategy to new heights.
At the core of the marketing mix lies the product, the linchpin influencing every facet of your strategy. It’s not just about what you’re selling, but the solutions it offers to customers’ problems.
Pricing strategies play a substantial role in shaping consumer behavior. The four primary pricing strategies are:
Everyday Low Pricing (EDLP)
Retailers maintain consistently low prices rather than relying on occasional discounts or promotional events. This builds a perception of value and reliability for consumers.
In this common strategy, a product is initially introduced at a higher price and then gradually discounted as demand wanes. Also known as “hi-lo” or “skimming” pricing, its effective use demands a keen understanding of timing and market dynamics.
Businesses set prices based on competitors’ pricing in an effort to attract more customers and expand market share. This strategy, known as competitor-based pricing, applies to online and offline markets.
This strategy of psychological pricing leverages pricing to influence consumer behavior by appealing to psychological needs. Whether it’s saving money, investing in quality, or securing a perceived “good deal,” psychological pricing aims to align with the customer’s mindset, ultimately driving sales and satisfaction.
Each of these pricing strategies carries its own set of advantages and challenges, and selecting the right approach depends on factors such as market dynamics, consumer behavior, and the unique value proposition of the product or service.
The goal is to strike a balance that not only meets the financial objectives of the business but also resonates with the psychological triggers of the target audience.
The placement of your product and how it’s sold should be driven by customer insights. Knowing their purchasing patterns and strategically targeting them at the right buying stage informs where and how you should promote and sell your products. This alignment is crucial for seamlessly integrating your online and real-world marketing mix.
Effective marketing strategies encompass a spectrum of promotional activities, spanning advertising, direct marketing, and in-store promotions. In the digital realm, the avenues are boundless, including online events, chats, social media groups, and livestreams.
Examples of impactful tactics include influencer collaborations, engaging content creation, targeted email campaigns, and leveraging social media platforms for interactive promotions. The key is creatively harnessing these diverse tools to connect with your audience and propel your brand forward.
Exceptional customer service drives immediate sales and is a powerful catalyst for expanding your customer base through referrals. These endorsements, stemming from genuine brand love, exemplify how marketing efforts seamlessly support the sales process.
Every brand representative, including AI chatbots, should be a well-trained sales professional who understands the product’s value to customers.
As a note, 89% of consumers are inclined to make repeat purchases after a positive service encounter, and 93% exhibit brand loyalty to companies delivering excellent customer service.
Crafting an efficient and reliable process for delivering your product to consumers is paramount. It ensures smooth transactions and aligns with your brand values, such as environmental sustainability.
In the era of online shopping, integrating digital partnerships and robust logistics has become integral to a well-rounded marketing mix, optimizing the overall customer experience and reinforcing your brand’s commitment to excellence.
7. Physical Evidence
Physical evidence serves as tangible proof of your brand’s existence and transactions. Whether through a physical store, a website, or printed business cards, these elements affirm your brand’s presence. Proof of purchases, such as receipts or follow-up emails, further solidifies customer interactions.
The broader spectrum of physical evidence extends to what customers see, hear, and smell about your product or service. This encompasses packaging, in-store displays, and digital placement on your website and social media, all crucial aspects influencing the overall customer experience.
What Is a Retail Marketing Strategy?
A retail marketing strategy is a systematic plan utilizing marketing tools, whether digital or traditional, to attract customers to a store and drive product sales. This approach proves especially beneficial for small retail businesses lacking the extensive resources of corporate giants.
Diverse retail marketing strategies exist, tailored to various business sizes and goals. In the upcoming sections, we will explore these strategies, offering insights and guidance for effectively implementing them to enhance your retail business.
15 Types of Retail Marketing Strategies
Taking your retail game to the next level involves deploying a mix of savvy strategies. Each tactic is a key player in ensuring your brand stands out and thrives in the competitive retail landscape.
1. Brand Partnerships
Brand partnerships are powerful tools for expanding your customer base. By collaborating with other brands or influencers, you reach a broader audience, instilling trust through association with reputable names.
This mutual promotion enhances brand credibility and product recommendations. Targeting local partners further allows precise demographic alignment, fortifying your retail sales performance and fostering mutually beneficial relationships.
2. Competitive Analysis
Competitive analysis is a strategic tool to evaluate your market position and differentiation. Studying comparable companies and product categories reveals opportunities for improvement.
Insights from tools like BuzzSumo, Ahrefs, WooRank, and SEMrush to identify market gaps, allowing targeted consumer outreach. Leveraging these differences fortifies your brand image, ensuring a distinctive and reputable standing in the competitive landscape.
3. Customer Communication
Open communication fosters trust and loyalty. Providing accessible channels such as emails, texts, and social media, helps to facilitate customer inquiries and suggestions, and builds a responsive brand.
Engaging in social listening and online reputation management ensures timely responses to customer concerns, enhancing your company’s visibility and showcasing your brand’s commitment to customer satisfaction.
4. Customer Surveys
Incorporating customer satisfaction surveys, whether through website prompts, purchase emails, or in-store receipts, is key for predicting sales trends and understanding consumer behavior.
Tools like SurveyMonkey (great for smaller companies), Qualtrics (ideal for seasoned marketers), and Zoho Survey (suited for larger organizations) offer robust platforms to craft surveys tailored to your retail marketing needs. These insights aid in strategic planning, refining approaches based on customer preferences.
5. Customizable Features
Integrating customizable features into products elevates the shopping experience, enhancing the likelihood of a sale. Options for personalized names, colors, images, scents, and additional accessories create a unique connection between customers and products.
This tailored approach allows for a standard base product while offering a personalized touch through customizable elements.
6. In-Store Interaction
In-store interaction goes beyond personnel engagement. Interactive displays like photo booths and wall murals encourage shoppers to become advocates for your brand.
Captivating imagery prompts them to share pictures, tagging or mentioning your brand. This user-generated content is a powerful introduction for new customers, enticing them to visit, shop, and join the visual conversation.
7. Local Searches
Maximize local searches to enhance product visibility and accessibility within your area. Optimizing for specific products and locations increases the likelihood of appearing on the first page of search results.
Claiming your company page on search platforms and maintaining an accurate profile and location through listing management boosts your web reputation, elevating your position in search rankings for improved visibility.
8. Launch Events
Whether in-store or online, hosting product launch events captivates both new and returning customers. Introduce promotional launch offers for early visitors or purchasers, enhancing the allure. These events provide a platform for product demonstrations and trials, creating a buzz that amplifies traffic and visibility for your brand.
9. MultiChannel Integration
Expanding beyond company websites, retail marketers leverage various channels like social media to enhance brand visibility. Tailored content engages distinct demographics on each platform, generating targeted web traffic.
By seamlessly integrating multiple channels through cross-platform links, marketers redirect consumers, amplifying the impact of marketing campaigns across diverse touchpoints.
10. Optimized Point of Sale
Strategically placing small items, samples, and marketing materials along the path to the point of sale in retail stores capitalizes on impulse shopping behaviors. Reminiscent of the concept of placing essential items like milk at the back and cereal near the floor, this method taps into the psychology of spontaneous purchases.
The carefully crafted layout encourages customers waiting to check out to grab additional items. In 2021, shoppers spent $6 billion in the checkout area, highlighting the success of this approach in boosting sales.
11. Remarketed Products
Remarketing tailors marketing efforts to customers’ past purchases, offering targeted emails, discounts, and promotions. This personalized approach demonstrates an understanding of customer interests and provides a direct, accessible method for them to make additional purchases or upgrades to products in line with their preferences
12. Loyalty Promotions
Loyalty promotions are a potent tool, with 70% of Americans citing loyalty programs as a key factor in brand allegiance, according to a late 2022 survey. Over 50% of U.S. shoppers expressed a likelihood to increase participation in such programs.
Encourage brand loyalty by offering incentives for recurring purchases through subscriptions or cumulative discounts. Loyalty points, redeemable for discounts, free samples, or other perks, enhance customer engagement. By rewarding returning customers and referrals, you foster loyalty and expand your customer base.
13. Retail Store Categorization
Within a store, strategic retail categorization aligns with buying trends and seasons, simplifying customer navigation. Placing displays or entire product categories at the back prompts shoppers to explore other areas, boosting additional purchases.
Tailoring categories for back-to-school, spring cleaning, or holiday themes like Valentine’s Day enhances customer experience and encourages targeted purchases.
14. Curb Appeal
Curb appeal isn’t just for homes; it’s a game-changer for retail stores, too. Just as a well-kept exterior enhances property value, an inviting storefront attracts shoppers. A warm and welcoming exterior significantly increases customers’ likelihood of stepping inside, fostering a positive first impression and encouraging foot traffic.
15. Word-of-Mouth Marketing
Word-of-mouth marketing thrives on consumers naturally sharing their positive experiences with a company’s product or service in their daily conversations. It’s organic advertising, often exceeding customer expectations.
Companies foster this through intentional publicity efforts and platforms encouraging consumer-to-consumer and consumer-to-marketer interactions. Also known as “word-of-mouth advertising,” it encompasses various forms like buzz, viral, blog, emotional, and social media marketing.
5 C’s of Retail Marketing to Analyze When Building a Marketing Strategy
Explore the core components essential for a strong retail marketing strategy. In the upcoming section, we’ll uncover the significance of the 5 C’s—company, customers, competitors, collaborators, and climate. These aspects provide a foundational analysis, guiding businesses to craft precise and impactful marketing strategies.
Kickstart your analysis of the Company aspect by posing critical questions about your business:
- Product Lines: What are our major product lines or types?
- Distinguishing Factors: In what ways do our products stand out from competitors’ offerings?
- Competitive Edge: What sets us apart? What’s our competitive advantage?
- Brand Identity: What makes our brand memorable and unique?
- Strengths and Weaknesses: What does our business excel at, and where do we fall short compared to others?
- Customer Perception: How do customers perceive our business?
- Investment and Budgeting: If we had an extra $10,000, where would we invest it? Conversely, if we had to cut our budget by 10%, where would the cuts be made?
- Future Goals: What are our 1, 3, and 5-year goals for the company?
For a more straightforward start, consider a SWOT analysis tailored to eCommerce. While not as comprehensive as the 5C model, it serves as a practical initial step, providing valuable insights into your company’s strengths, weaknesses, opportunities, and threats.
Honesty is key throughout this process, especially when identifying weaknesses and acknowledging where competitors outperform. Use this candid assessment to set your company’s realistic short- and long-term goals.
Understanding who they are, their desires, and how well your product aligns with their needs is pivotal for effective marketing. This insight guides targeted promotions and informs the language and imagery that resonate with potential customers. Customer analysis proves invaluable in comprehending your products and business—unveiling likes, dislikes, and critical insights.
Key questions for customer analysis include identifying the ideal customer, understanding target audiences, recognizing current purchasers, and gauging product popularity. Delving into customer behavior on your website, repeat purchase patterns, and compelling promotions aids in crafting a comprehensive understanding.
The ultimate aim is to unravel customer motivations, preferences, and sources of information, providing a competitive advantage in your retail marketing strategy. Utilize all available customer feedback sources and regularly revise your analysis to adapt to evolving customer dynamics. Understanding this complex puzzle grants a formidable edge that’s hard for competitors to match.
Comprehending your competitors is as vital as understanding your own business. Start by identifying direct competitors and distinguishing established from emerging players. Scrutinize what they offer that you don’t and pinpoint their strengths and weaknesses through product and company reviews.
Analyze competitors’ customer acquisition strategies, targeting audiences, content production, and social media presence. This knowledge positions you strategically, providing a competitive edge.
Even if competitors are larger, smaller companies boast agility and inventiveness in marketing, compensating for a giant advertising budget. Rather than head-on competition, exploit weaknesses, gaps, and opportunities for incremental victories that accumulate over time.
Collaborators form the backbone of your business. Create a comprehensive directory of those contributing to your operations, ensuring you can quickly address challenges. Key questions and examples to consider:
- Who oversees daily operations?
- Are there partners or co-runners?
- Do investors or stakeholders play a role?
- Who supplies your products?
- What shipping provider do you use?
- Who handles credit card payments?
- Which eCommerce platform is in use?
- Who manages inventory or warehousing?
- Who registered your domain?
- Are there contributors to website creation?
- Any support in content creation or copywriting?
- Marketing or advertising collaborators?
- Ongoing relationships with photographers?
- Distributors or sales partners?
- Social media management?
- Engagement with freelancers or contractors?
- Any other regular collaborators?
This directory clarifies responsibilities and serves as a foundation for enhancing business productivity and efficiency.
Consider the external factors shaping your business landscape when examining the climate. Explore industry, societal, legal, and technological trends. Key questions for analysis:
- How might new laws or regulations impact your business, and what’s your strategy to address them?
- What societal trends could influence consumer preferences and buying behaviors?
- Are economic trends altering customer shopping behaviors?
- What emerging technologies might reshape customer actions or business operations?
- What ideas or sentiments are gaining or losing popularity?
Rather than predicting the future, aim to grasp the market’s general direction. For societal trends, understand evolving values, concerns, and priorities. Being attuned to your target audience’s increasing focus on eco-friendliness, fair trade, or manufacturing origin is crucial for success and risk avoidance.
The cautionary tale of Blockbuster, failing to foresee technological shifts, emphasizes the vital role of industry awareness—a lesson worth heeding for sustained business relevance and profitability.
5 R’s of Retail Marketing: The Key to Success
Unlocking the success of any retail marketing strategy hinges on mastering the 5 Rs: right merchandise, right quantities, right time, right price, and right place. These fundamental principles are the cornerstone of an effective retail marketing approach, ensuring alignment with customer needs and market dynamics.
|5 R’s of Retail Marketing
|The Right Merchandise
|The Right Quantities
|The Right Time
|The Right Price
|The Right Place
Successful Retail Marketing Examples
Discover the strategies that set successful retailers apart as we delve into compelling examples from IKEA, UNTUCKit, and McDonald’s. These stories showcase the diverse and effective ways brands can connect with their audience, redefine in-store experiences, and turn simplicity into substantial revenue.
1. IKEA: Real-Life Roomsets for a Real Impact
In a poignant departure from its signature showrooms, IKEA launched the “Real Life Roomsets” campaign in March 2023. Partnering with the national charity Shelter, the campaign featured installations in IKEA stores across the UK, depicting the harsh reality of those living in temporary accommodations.
This immersive campaign, born from real stories of local individuals, serves a dual purpose—raising awareness about homelessness and advocating for 90,000 social homes by 2030. By addressing a critical social issue and engaging with the local community, IKEA demonstrates a powerful fusion of marketing and social responsibility.
2. UNTUCKit: Unconventional Routes to Capture Audiences
Clothing brand UNTUCKit took an unconventional path to acquire customers. Instead of relying on a traditional PR agency, the brand opted for sports radio ads and print airline magazine placements.
This less-traveled approach gave UNTUCKit a more captive audience than the fast-paced social media landscape. The decision to go against the norm paid off, enabling the brand to reach potential customers at a lower cost. UNTUCKit’s CEO emphasized the importance of curiosity and exploring non-conventional avenues to deliver messages effectively, highlighting the value of creativity in customer acquisition.
3. McDonald’s: Turning Celebrity Favorites into Revenue
McDonald’s found success by turning to celebrity endorsements through its “Famous Orders” promotion. Launched in 2020 and featuring meals enjoyed by celebrities like Travis Scott and BTS, the campaign aimed to capitalize on the fascination with celebrity culture. McDonald’s created a unique connection with its audience by associating specific meals with famous figures.
Travis Scott’s favorite meal, a Quarter Pounder with cheese, became a sensation, emphasizing the influence of celebrity endorsements in driving customer engagement. The campaign boosted sales and showcased the impact of simplicity and cultural resonance in marketing strategies.
Retail Marketing Trends
The retail industry is undergoing a profound transformation, and these trends are at the forefront of this exciting shift shaping new connections between businesses and consumers. Stay ahead of the curve by embracing these innovative strategies that resonate with the modern consumer.
Omnichannel Buyer Journeys
Modern customer interactions revolve around omnichannel buyer journeys, reflecting users’ fluid navigation across various touchpoints.
A staggering 76% of consumers now expect consistent interactions across all facets of a business. Surprisingly, just 4% of customers use more than one channel to initiate and complete a purchase. The journey commences with brand discovery through avenues like paid ads, blog articles, or social media, focusing on creating awareness by offering valuable information.
As customers research potential solutions, the role shifts to guiding them toward viewing your brand favorably through informative content. This stage transition leads into paying customers and leveraging live chat marketing and email campaigns for personalized interactions.
Post-purchase, the focus shifts to customer retention through strategies like in-app and on-page support messaging and knowledge base utilization. This comprehensive omnichannel approach fosters brand loyalty and ensures sustained long-term growth.
Cause marketing unites for-profit businesses with nonprofit organizations in mutually beneficial partnerships. This collaboration extends to social or charitable campaigns initiated by for-profit brands. The synergy amplifies a brand’s corporate social responsibility, exemplified by American Express’s pioneering cause marketing effort.
For example, many years ago, American Express contributed a penny for every dollar spent on their cards over three months to aid in restoring the Statue of Liberty. Such endeavors drive social impact and enhance brand reputation and customer loyalty by aligning commerce with a shared commitment to positive change. Cause marketing is a strategic bridge connecting business objectives with societal betterment.
Token-gating in Web3 communities is a dynamic strategy offering exclusive content, events, and perks to token holders, enriching the community experience. An illustrative instance is ‘holders only’ Discord channels, fostering private dialogues within public servers. Each community member possesses a token conferring access to project privileges within this approach.
The advantages of token gating span enhanced security, cost-effectiveness, and the cultivation of excitement around the project. By leveraging token-gated experiences, Web3 communities not only fortify the sense of belonging but also infuse value and excitement into their ecosystems, reinforcing the symbiotic relationship between holders and the community.
Experiential retail goes beyond mere transactions, striving to craft immersive and shareable moments that captivate shoppers. Rather than emphasizing sales, its primary focus lies in establishing meaningful connections with customers, cultivating vibrant communities where engagement takes precedence.
This retail approach serves as a wellspring of inspiration, encouraging novel and creative perspectives in the realm of shopping. Additionally, it places a strong emphasis on sensory stimulation, enhancing the overall shopping experience by actively engaging customers’ senses.
Moreover, experiential retail seamlessly integrates online and in-store elements, ensuring a unified and cohesive shopping journey that spans various channels.
Top Examples of Experiential Retail
- Augmented Reality (AR) Shopping
- Virtual Try-Ons
- Shoppable Video
- Live Stream Shopping
- Personalized Product Recommendations
- AI-Powered Shopping Assistants
- Gamified Shopping
In Metaverse marketing, virtual platforms like Roblox, Fortnite, and Decentraland offer unique opportunities for retail brands to engage audiences. Define metaverse goals: Focus on awareness, sentiment, loyalty, and innovation, as direct sales in virtual realms are smaller. Identify fitting platforms: Experiment across Roblox, Fortnite, Decentraland, Minecraft, and Meta’s Horizon Worlds.
Gucci, for instance, drew 19.9 million visitors with a Roblox metaverse launch. Craft audience-appealing experiences: Balance native advertising, immersive events, and real-world activations. Vans, the skateboarding retailer, launched the interactive skatepark “Vans World” on Roblox, engaging over 48 million visitors by offering virtual exploration, gameplay rewards, and customized products.
Consider the metaverse as a space for innovation and connecting with diverse demographics.
Understanding retail marketing is crucial for success. Explore strategies like omnichannel journeys, cause marketing, token-gated experiences, experiential retail, and metaverse marketing to boost your business. Use these insights to engage customers, build loyalty, and grow.
Now that you know “what is retail marketing,” make smart choices to enhance your brand and achieve success.
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