What is a conversion funnel?
A conversion funnel also referred to as a “sales funnel”, is used to describe the route taken by a visitor to become a customer. It explains the different stages of the journey that the customer takes from becoming aware of a brand to making a final purchase.
A conversion funnel is designed based on the customer’s buying behaviour with the primary goal of providing a great user experience within the customer journey so that they are forced to get converted. Hence, understanding the customer flow through the funnel is essential as it assists in engaging prospective leads, building trust, and encouraging them to become loyal customers.
Through the funnel, qualified prospects are moved from one stage to the next, eliminating those who are unsuitable for your business or don’t need your products or services at this point.
A simple example of a conversion funnel and its flow is shown below:
Stages of a conversion funnel
There are 3 basic stages to any conversion funnel. Let’s take a look at them:
- Top of the Funnel (TOFU) – The awareness stage: The focus of this phase is on attracting the customers’ attention by getting your product or solution onto their radar at the right time. An organic search is the best way to do just that. This is the start of building a healthy pipeline for the rest of the funnel.
- Middle of the Funnel (MOFU) – The middle phase represents a smaller and more qualified section of the visitors. This phase can be broken into two sub-stages:
- The interest stage: This is the stage where the customer is aware of your product as an available solution to their problems. The interest is piqued concerning their requirements. Make sure to provide unique selling points and relevant information to secure their trust in your brand’s quality and expertise. A well-laid-out website and content will make the desired first impression.
- The consideration stage: This is where the customer is in the comparison mode and exploring your competitors also to make up their mind. Provide beautiful product pages along with rich visuals, supporting knowledge base, FAQs, and testimonials from happy customers. This is the stage to target and sell more aggressively.
- Bottom of the funnel (BOFU) – The decision stage: This is the stage to push hard the customer to take the final step. Showcase offers, promotions, and incentives such as discounts, coupons, and free shipping. Include compelling CTAs to create a sense of urgency and keep the checkout process frictionless.
- At the end – The retention stage: Once you have successfully converted a customer, it’s time to keep them engaged and loyal to the brand. Provide personalized service and keep them informed and educated. Providing sneak peeks, webinars, tutorials, trend guides, etc through email and on social media is a good way to maintain the engagement level.
Importance of an optimized conversion funnel in the marketing strategy
Having a conversion funnel can influence the purchase decision of prospects and improve the conversion rate. A few of the clear benefits of an optimized funnel include:
- A higher proportion of prospects entering and moving through the whole funnel will lead to higher sales.
- An opportunity to plan an effective marketing strategy to target the right audience at a certain given point in their purchase journey.
- Identifying reasons why your product or service may not appeal to every prospect, making you equipped to better meet their needs.
- Having an edge over competitors who don’t invest time and resources in improving their funnels.
Steps to building an effective conversion funnel
- Research your audience
The foremost step is it research your target audience. Your marketing efforts will be more effective and more likely to convert prospects into paying customers if you know and understand more about them. Find out answers to questions such as:
- Who do you want to target?
- What are their likes, and dislikes?
- What social media platforms users are more active on?
- Customer pain points
- How your product or service can help?
- Create user personas
A detailed buyer persona can help you create marketing content that is tailored to your target audience and optimize your sales pipeline. Create user personas based on demographics such as gender, age, income, education, interests, and so on.
- Lead generation
Once the research work is done, it is time to bring the right customers to your website. Running lead generation campaigns at different levels and platforms can be the right move. Various strategies can be implemented to generate leads, such as:
- Social media advertising
- Landing page optimization
- PPC campaigns
- Influencer marketing
- Guest postings
- Engage leads
The leads generated in the previous step now need to be turned into engaged prospects. The best way to do so is to educate the customers about the features and benefits of your product or service. This can be done by:
- Compelling content in form of blogs, informative videos
- Email newsletters
- Social media posts
- Influencer generated content
- Testimonials and reviews
- Appropriate supporting content
- Strong CTAs
- Help leads to convert
An engaged customer is a game almost won. This is the time to provide an easy transition for the customer to finish the action. Some things to keep in mind:
- Simple sign-in and sign-up process
- Frictionless checkout and payment process
- Optimized site speed
- Easy site navigation
- Implement exit-intent pop-ups providing incentives to leaving customers
How to optimize the conversion funnel
For the funnel to function at its best, it is essential to keep it optimized at all times. This can be done by following the below simple tips:
- Understand page performance with user behaviour reports
VWO Insights helps you generate various tracking reports to understand the user behaviour on your website. Some of the tools available are:
- Heatmaps – helps understand visitor movement on the website
- Scroll maps – show the scrolling activity of users
- Session recordings – analyze recordings of dropped-off visitors
- A/B test your pages
All the above-collected data can be put to use by running A/B tests of the elements that contribute to conversions. With VWO testing you can run dozens of tests at a time and track the test impact across the entire funnel. Take a free trial to find out how.
Important metrics to track
For an ongoing improvement of your conversion funnel, it is important to track the performance at regular intervals. Few metrics that help in measuring a conversion funnel’s effectiveness are below:
- Traffic: Find out from where the maximum of your traffic is being generated- search, social media, etc. Use your budget on those relevant sources.
- Conversion rate: You can get to know your audience more if you track conversion rates across all offers. Test different offers to determine which one gets the most engagement, then apply what you’ve learned.
- Bounce rate: Knowing your bounce rate will tell you why visitors leave your website and allow you to introduce more incentives.
- Sales: Fluctuations in sales will help you focus on the funnel stage that needs more attention.
- Cart abandonment: This will give you insights into why people add products to carts and leave. You can look into any improvements required to the checkout process or flow.
It can be challenging to create a conversion funnel, but if you collect the right data, you can make your conversion funnel more efficient by implementing improvements. That’s why it is recommended to run tests continuously and gather data.