Learn about ecommerce conversion funnels to grow your business

Without a working knowledge of ecommerce conversion funnels, businesses risk attracting the wrong leads and experiencing a decrease in sales. On the other hand, businesses that understand and leverage ecommerce funnels can attract potential high-quality customers and guide them through the complete buyer’s journey successfully, increasing sales as a result.

Whether you lead a well-established ecommerce business or an emerging venture, you need to recognize the impact of a good ecommerce conversion funnel on revenue — and feel confident both in how your funnel process is working and how it can be perfected.

In this article, you’ll learn the strategic process behind ecommerce funnels so your company can optimize its lead generation capabilities and improve conversion rates to drive business growth. Specifically, we’ll cover:

• What an ecommerce funnel is
• Importance of ecommerce funnels
• Five stages of the ecommerce funnel
• How to track progress down the funnel
• Best practices for ecommerce funnel optimization
• How to attract the right leads with ecommerce conversion funnels

What is an ecommerce funnel?

An ecommerce funnel is a visual representation or understanding of the customer journey as it relates to an online business. A customer enters the ecommerce funnel at the top and moves down through various stages until they hopefully make a purchase — and ideally become a regular customer.

Every customer’s experience going through the ecommerce funnel is unique. Some prospects sprint through the process and become paying customers in a flash, while others might remain in the top or middle of the funnel for months before finally making a purchase — if they even do so at all.

Since a funnel can apply to any business, the ecommerce funnel simply refers to what the various stages of the customer journey typically look like for an ecommerce site. This means that an ecommerce funnel differs from the funnel for an enterprise software company, for example. Each industry’s customers navigate a unique path and set of processes on their way to making a purchase.

Importance of ecommerce funnels

Ecommerce funnels are critical tools that can help your business better understand the customer buying journey. Conceptualizing your online customers through a funnel model is valuable because it allows you to target your marketing toward customers at different stages of their respective journeys.

A well-designed sales funnel can help increase brand awareness to tap into new markets and drive traffic to your site, leading to better conversion rates that enable you to grow your customer base.

Put simply, ecommerce conversion funnels help create a strategy to attract the right customer and guide them through the buyer’s journey to increase revenue for ecommerce businesses.

The five stages of an ecommerce conversion funnel

The ecommerce funnel is cone-shaped to illustrate that not every site visitor is going to convert. Just as some prospects are drawn deeper into the funnel, some of them are inevitably lost along the way.

Generally speaking, the ecommerce funnel consists of five core stages, which fall within the top, middle, and bottom of the funnel. Read on as we explore in detail each of the five stages and how you should connect with these individuals.

1. Awareness

At the top of the funnel, site visitors are figuring out what they want. Your brand may be on their radar, but they aren’t sure if your products align with their goals or needs just yet.

During the awareness stage, prospects are being introduced to your brand, so it’s vital that you leave a great first impression. Target these individuals with high-quality marketing content that aligns with your brand’s voice and values.

Unfortunately, the awareness stage is where you will lose touch with the largest number of audience members. Some individuals will see what you have to offer and simply determine that it’s not for them. You can reduce your attrition rate at this stage by ensuring that you’re targeting the right audiences and ranking for the appropriate keywords with SEO.

2. Interest

As prospects move into the middle of the funnel, they transition from awareness to interest, also called the consideration stage. These individuals have defined wants or needs and probably have done some research on the products that intrigue them.

While these individuals may still be a long way from making a purchase, they are at least contemplating the benefits of your offerings.

Prospective customers that reach the interest stage are ripe for retargeting. You can use ad retargeting measures to nurture these prospects and draw them deeper into the sales funnel. Offering this group of individuals deals or specials can be the perfect way to push them into the next phase of the funnel, desire.

3. Desire

In the desire stage — also known as the intention stage — prospects have a strong interest in buying your product, but they may be hung up on concerns around price, features, or something else. Alternatively, they may conduct additional research before deciding whether to commit to your brand. Either way, customers at this stage are very close to buying.

You can incentivize individuals to take the next step by using one of several strategies. You could target these leads with tailored email messaging, offer discount opportunities, or highlight the benefits of your products.

Ensure that it’s easy for customers with purchase intent to find product reviews and feedback from past buyers. Positive reviews can nudge prospective buyers that are on the fence.

4. Action

The action phase of the ecommerce conversion funnel is where all of your hard work pays off. This is when prospects finally complete their transaction, which is why it’s also known as the purchase stage.

While taking positive action is a major win for your company, you should not view it as the end of the funnel.

After a customer makes a purchase, you have to provide them with a great post-purchase experience. Send a thank-you note, recommend related items, or offer a coupon for another purchase. Doing so can help you turn a one-time buyer into a long-term customer.

5. Retention

Far too many businesses fail to include retention as part of their conversion funnel, but it’s on our list because it’s critical to business growth and longevity.

If you can retain customers, you can increase your overall sales, generate more profits, and decrease marketing costs. Including this stage in the ecommerce funnel is an absolute must.

Several factors influence whether buyers become repeat customers. While product quality is paramount, customer service is important as well. It’s vital that you and your team provide customers with a seamless service experience, especially if they encounter any product issues and need post-purchase support.

How to track progress down the funnel

You can track customer progress down the funnel in several ways. Three of the most common approaches to measurement are:

• KPI-based. As the name implies, this approach involves selecting key performance indicators for each stage of the ecommerce funnel. You could measure your reach in the awareness stage, the number of site visitors in the consideration stage, and how many “add to carts” have occurred in the conversion stage. These metrics help you track leads as they progress through each stage.
• Campaign-based. With this approach, you target specific funnel stages with individual campaigns. For example, you could use an email campaign at the desire stage. When using this approach, you would track the effectiveness of the campaign by measuring selected KPIs, such as open rates or click-throughs.
• Journey-based. This measurement, also called an attribution approach, functions much like a campaign-based method. With this strategy, you set up each campaign based on the stage you want to target, but instead of measuring multiple KPIs, you only track contributions to revenue. You then analyze how much each channel or campaign contributes to your revenue. The journey-based approach allows you to precisely track customers’ progress through the funnel, but it’s more complicated to implement — so many businesses opt for one of the other two methods.

Best practices for ecommerce funnel optimization

Here are some helpful tips based on the various stages of the funnel, which you can implement to develop an ecommerce funnel that actually works.

Top of the funnel

When addressing audience members in this stage, your focus is on increasing brand awareness and generating interest in your products.

You should use social media to generate buzz about your brand and create intriguing blog content to drive traffic to your site. Make sure your content is fun, informative, and engaging.

If you really want to maximize your reach, consider partnering with an established influencer. Influencers have strong social media followings, and they can get your products in front of large, loyal audiences.

Middle of the funnel

Once you get users to the middle of the funnel, you must find a way to keep them on your site and incentivize them to make a purchase. You can accomplish this in a few ways.

First, ensure that your website is optimized. To maximize your ability to connect with audience members, your site needs to work well on both desktop and mobile devices. Make it easy for users to browse content and interact with your product pages. Make sure to include high-quality images throughout your site.

Consider adding a live chat feature to each product page as well, to allow customers to ask questions easily or learn more about your products.

Bottom of the funnel

At the bottom of the funnel, you should work to encourage prospects to take that final leap.

Offering deals, discounts, or free shipping is an excellent way to accomplish this — and while you’re at it, try upselling or cross-selling your audience. If they’re already in “buying mode,” there’s a good chance they’ll throw a couple of extra items in their cart.

Another way to optimize the bottom of the funnel is to send out abandoned cart emails. These will prompt prospective customers to revisit their abandoned shopping carts and finalize their purchases. When sending out these emails, give recipients a little extra incentive to buy.

Attract the right quality leads with ecommerce conversion funnels

An ecommerce conversion funnel is a tool that can help you better visualize, understand, and act on the different phases of the customer purchasing journey. You can use the insights gleaned from the ecommerce funnel to effectively connect with your target audience.

In order to take full advantage of the ecommerce funnel, you need a way to track key performance indicators and monitor the customer journey. Adobe Commerce provides you with a means of doing just that, giving ecommerce businesses the tools for digital success.

Adobe Commerce is the leader in digital commerce and can help businesses build engaging shopping experiences for every type of customer — and especially the right customer. Companies of all sizes can use it to reach customers wherever they are, across devices and marketplaces.

To learn more, take the Adobe Commerce product tour or watch a product overview.