INNOVAREModule 7 · AI in Marketing, Sales & Customer Experience

Case 4: The Map From 1898 — Sales

AI in sales runs on a diagram that looks scientific and is actually a 19th-century copywriting heuristic. Here’s where it came from, and where it breaks.

July 2026 · Case 4 of 6
As you read — hold this question

The funnel is taught as fact — but it was falsified 25 years ago. So what should an AI actually optimise for?

1898
the year the “funnel” was really born — as an ad man’s rule of thumb, never peer-reviewed.

The sales funnel and pipeline look precise and scientific. In truth the funnel began as AIDA, sketched around 1898, with the funnel shape added in 1924 — and research falsified its core claim decades ago. Point an AI prediction engine at a tidy funnel and you optimise a journey buyers don’t take.

The standard sales playbook
The textbook versionQuiz: Sales & the funnel

Three AI jobs, and two century-old diagrams

Video 3 splits AI in sales into three jobs: predictive analytics (who is most likely to buy), generative AI (drafting the outreach — emails, messages, even calls), and automation (moving deals along). It runs on two diagrams: the funnel (awareness → interest → intent → consideration → decision) and the pipeline (lead → qualify → contact → demo → negotiate → close). Fine as checklists.

Follow the funnel back
The rest of the story

A copywriting heuristic from 1898 — never peer-reviewed

The funnel didn’t come from a lab. It began as AIDA — attention, interest, desire, action — sketched by advertising man E. St Elmo Lewis around 1898. The funnel shape was added later, in a 1924 sales manual by William Townsend. It was never a peer-reviewed model; it just stuck. The sales pipeline has no academic basis at all — it is CRM-vendor picklist convention.

The other side — it was falsified a quarter-century ago
When researchers tested the idea that buyers move through neat fixed stages, it didn’t hold. Palda questioned it in 1966; Vakratsas & Ambler reviewed ~250 studies in the Journal of Marketing (1999) and found “little support for any hierarchy of effects.” Google’s own research calls the reality the “messy middle” (Think with Google, 2020): people loop between exploring and evaluating until something tips them over. Point a prediction engine at a tidy funnel and you optimise a journey your customers don’t take.
Buyer beware
The other side

The AI-sales hype check

11x
A 2025 TechCrunch investigation reported the AI-SDR startup had listed customers it didn’t actually have. The company disputes the reporting.
Artisan
Ran “Stop Hiring Humans” billboards to sell its AI agent — while, according to reporting, still hiring humans itself.
Take this away

Keep the funnel as a checklist of stages to serve — not a law of how people buy. Predict from real signals in the mess, and audit any AI-sales vendor’s headline number: no method behind it means marketing, not evidence.

Quick recall — without looking back

Test yourself on this case

Question 1 of 3

Where did the sales funnel come from, and what is its academic status?

It began as AIDA (attention, interest, desire, action), sketched by E. St Elmo Lewis c.1898; the funnel shape was added by Townsend in 1924. It was never peer-reviewed, and its stage claims were falsified — Palda (1966) and Vakratsas & Ambler (1999, ~250 studies) found ‘little support for any hierarchy of effects.’ The pipeline has no academic basis at all.
Question 2 of 3

What is the ‘messy middle’, and why does it matter for AI in sales?

Google’s term (Think with Google, 2020) for how buying actually works — a loop between exploring and evaluating, not a linear funnel. It matters because an AI prediction engine aimed at a tidy funnel optimises a journey customers don’t actually take; you should model the mess and predict from real buying signals.
Question 3 of 3

Name the three AI jobs in sales and one cautionary tale from the hype.

Predictive analytics (who will buy), generative AI (drafting outreach), and automation (moving deals along). Cautionary tales: 11x (TechCrunch reported customers it didn’t have; disputed) and Artisan (‘Stop Hiring Humans’ billboards while still hiring humans).

Module 7 Video

Module 7 · Long Form · No Takesies Backsies

Sources

Module content
BUSN9049 Module 7 — Video 3 and the lecture deck’s funnel/pipeline diagrams. Flinders University, 2026.
Funnel provenance
E. St Elmo Lewis (c.1898, AIDA); Townsend, Bond Salesmanship (1924); Palda (1966); Vakratsas & Ambler, Journal of Marketing (1999); Think with Google, “the messy middle” (2020).
Hype check
TechCrunch investigation of 11x (2025, company disputes); reporting on Artisan’s “Stop Hiring Humans” campaign.
Innovare Study
Long-form video: No Takesies Backsies. 2026. youtu.be/yV5R4JThoYQ