Funnel Analysis: The Key to Understanding Your Conversion Paths
Funnel analysis is an essential way to observe and describe a customer journey as a process with different stages that users go through. It usually involves several steps, from entering an app or web page to performing a particular action. It is called a funnel because of its shape that becomes narrower and narrower. By observing your funnel, and analyzing and adjusting its parameters, you will be able to improve conversions and customer satisfaction.
The funnel is an excellent tool for marketers, product managers, sales, and data scientists to understand user behavior better. Whether you wish to convert visitors into customers or you want your customers to buy more of your products, or even make them stay more in your app, funnel analysis is essential. Having a good understanding of your funnel is like using a GPS to guide you to a place you want to visit. It will show you the speed, the direction, and whether you’re on time or going to be late.
Conversion rates can help you understand the number of visitors who came to your website and bought a product or performed an action, such as watching a movie, downloading a document or submitting a lead form
There are steps you would expect your visitor to take, from entering your website or mobile app to taking an action, such as making a purchase. With a simple funnel analysis, you can visualize your visitors' steps to convert. Creating a funnel allows you to observe where exactly visitors or users are dropping.
First, you collect data through user tracking, SEO, email campaigns and other methods. Note that you need to have your data available and ready for funnel analysis. Then you define the steps which will be evaluated.
A simple funnel tracks how users convert from entering a landing page to checking out, or watching a movie, or other goal conversion. The funnel itself is usually presented as a bar graph. You will know where to look next when you see a decline or drop in your funnel. Usually, this is the time when an imaginary light bulb shines above your head. Understanding each step of the funnel and making necessary adjustments to see what works and what doesn’t will eventually lead to more conversions.
When creating a Funnel there are a few things you need to consider.
Please refer to Kubit's Documentation to learn more about how to to create a funnel
Sometimes your customers don’t follow the path you have created for them. Users can enter your funnel in a variety of different ways. That’s why it is important to define your funnel. There are a few types of funnels:
Funnel analysis shows you whether people are dropping off, but it doesn’t tell you why they do it. Brainstorm the potential issues. Is the registration process too long and hard to fill, do you have clear messages and good product descriptions, are there too many steps and blanks to fill in before ordering a product, etc.
Quality over quantity - it is vital to not just attract visitors but also to make them stay. If you want to increase the quantity, then observe from where your audience is coming - social media, Google ads, Internet search, etc. Increasing the number of visitors doesn’t guarantee higher conversion. But, proper maintenance of the funnel will help get the most out of your new users.
Fine-tune your filtering! Some customers might be looking for a particular product while others are just browsing. Filter out those who are not your target.
Conversion windows. If you are selling shoes, from first opening a product page to placing an order, it might take a couple of minutes, but if you are comparing streaming services, it will take a little longer to complete the task. Keep that in mind.
A visitor is coming to your website, and he’s seeking products, then if the products are interesting enough, he will add them to the basket and then end up buying them. Let’s explore three stages of a user journey:
That’s the ideal route, but sometimes visitors can go back and forth on the steps. Let’s dig a little deeper. Here’s where the true funnel analysis happens: If visitors are dropping off between 1st and 2nd steps, you should check whether there is enough information about the product. Are you providing helpful information like a help menu or a chat box, or anything visitors can use as guidance? If a visitor is dropping between the 2nd and 3rd steps, you should focus on prices, check competitors, and make sure you have a unique product or service. By observing where your visitors are dropping off, you can define your weak points and discover places where improvements should be made.
There is one final step - coming back or re-engaging. After seeing a customer making a purchase, you will want to invite them on another journey of being your repeat client. You can offer a discount on their next purchase, and sign for your newsletter, and like your social media page to support your cause.
High drop-off usually means UI problems. But before scratching everything and returning to the drawing board, examine the audience who are dropping. Are they teenagers or elderly? Are they your targeted audience? If not, it’s a better idea to remove them from your funnel analysis.
Funnel analysis is a useful process that will support you on your way to building an exceptional product. However, it’s not the final phase. If you want to know the middle steps that your user or a visitor takes, consider doing a Path analysis and examining where your users are getting confused. Path analysis is an integral part of conversion rate optimization. We’ll cover this in a future post.
Want to see how Kubit can help you understand your user's behavior? Get in touch with an expert to learn more.