Latest / The Marketing Funnel Podcast with Fexingo: Awareness, Interest, Decision, and Action Stages / How a Tiny Bookshop Beats Amazon at the Marketing Funnel
Transcript
- Lucas: There's this small bookstore in Nashville called Parnassus Books. It has maybe 1,500 square feet of retail space, fewer than twenty employees, and it competes every single day with Amazon. Luna: And it's thriving. I've read that their year-over-year revenue growth has actually outpaced the overall bookstore category for the past three years. Lucas: Exactly. And if you look at it through the lens of the marketing funnel — awareness, interest, decision, action — the interesting thing is that Parnassus doesn't spend a dime on paid advertising. Luna: Zero? No Google Ads, no Facebook campaigns? Lucas: None. Their entire awareness stage is driven by word of mouth and earned media. And what's wild is that according to a 2025 survey they did with customers, forty percent of new visitors said they came because a friend told them about the store. Luna: That's an incredible conversion rate from word of mouth. Most brands would kill for that. Lucas: Right. So let's walk through how they do it, stage by stage. At the awareness level, Parnassus relies heavily on their location — they're in a mixed-use neighborhood in Nashville, not a high-traffic mall. Foot traffic is decent but not huge. Luna: So how do people find out about them if they're not running ads? Lucas: Two main channels. First, they have a very active author event program. They host about four events per month, and those events draw people who then tell others. Second, they leaned into being a 'destination' for book lovers. They got featured in a few national publications — Travel + Leisure, Southern Living — and that brought in tourists. Luna: But tourists alone don't build a sustainable business. You need locals who come back. Lucas: Exactly. That's where the interest stage comes in. Parnassus doesn't just sell books — they curate. The staff writes handwritten recommendation cards that sit next to featured titles. They have a 'Staff Picks' wall that's organized not by genre but by mood — like 'If you liked this, try this' chains. Luna: That's a classic interest-stage tactic. You're giving the browser a reason to stop and engage. Lucas: Yeah. And it works because it's personal. The cards are signed with the staff member's first name. So if you pick up a book recommended by, say, Mary, and you like it, you start to trust Mary's taste. That trust pulls you into the decision stage. Luna: So the decision stage — the moment where the customer decides to buy — is that just the checkout counter? Lucas: Partly. But they've designed the physical space to reduce friction. There are no long queues because they have a small but efficient point of sale system. They also offer a loyalty program called 'Bookmarks' — spend $100, get a $10 reward. Simple. Luna: And that brings us to the action stage — the actual purchase. But does Parnassus have any post-purchase follow-up? Lucas: They do, and this is where I think they really differentiate. Every customer who signs up for the loyalty program gets a monthly email — not a generic newsletter, but a personalized recommendation based on their past purchases. The email open rate is around sixty-five percent, which is almost double the retail average. Luna: That's impressive. But what about advocacy? That's the top of the funnel for new customers. Lucas: Right. Advocacy is word of mouth. Parnassus doesn't ask for referrals, but they've built a community that naturally generates them. They have a book club that meets in-store, an Instagram account that posts staff picks daily, and they run a 'Book of the Month' club where subscribers get a curated pick delivered. Luna: So the advocacy stage is really just the awareness stage for someone else. It's a loop. Lucas: Exactly. And the key metric is that forty percent of new customers come through word of mouth. That means the funnel is self-sustaining to a large degree. Amazon can't replicate that because Amazon doesn't have a physical space where community happens. Luna: But can this scale? If Parnassus opened a second location, would the same model work? Lucas: That's the million-dollar question. They haven't done it yet. Co-owner Karen Hayes has said in interviews that they're cautious about growth because the model depends on the specific staff and the specific neighborhood. But there are other indies doing similar things — like Powell's in Portland or The Strand in New York — so the model can scale, but it requires intentional curation. Luna: So what's the one takeaway for a small business owner listening? Lucas: I'd say the handwritten recommendation card. It's low-tech, costs almost nothing, and it creates a personal connection that no algorithm can replicate. If you can get your customers to trust a specific person's taste, you've built a bridge through the entire funnel. Luna: It's funny — we spend so much time talking about AI and automation in marketing, and here's a tactic that's literally pen on paper. Lucas: And it works because it's human. Which brings me to something I've been thinking about. Luna: What's that? Lucas: This show itself — we talk about marketing funnels every week, and we try to keep it ad-free and focused on real examples. A handful of listeners have been supporting us through buy me a coffee dot com slash fexingo, and honestly, that support is what lets us keep doing deep dives like this one without chasing sponsors. Luna: Yeah, it's a small group but it makes a real difference. Keeps the podcast independent. Lucas: Right. So if these conversations have ever given you a useful idea or a new way to think about your own marketing, that's where you can help keep it going. Buy me a coffee dot com slash fexingo. Luna: And I think that ties back to the Parnassus model — small acts of support from people who believe in what you're doing. Lucas: Exactly. Anyway — back to the funnel. The final stage I want to highlight is retention. Parnassus has a customer repeat rate of about fifty-five percent, which is outstanding for a small retailer. Luna: And that repeat rate is probably driven by the personalized emails and the sense of community. Lucas: For sure. And the lesson for any marketer is that the funnel doesn't end at purchase. If you can turn a buyer into an advocate, you've effectively created a new top of funnel driver at zero cost. Luna: So Parnassus isn't just selling books — they're building a marketing machine where the customers do the heavy lifting. Lucas: Exactly. And that's something any business can learn from, whether you sell books or software.