Paving the Path to Sales: The Conversion Funnel Explored

Anyone responsible for getting more customers starts thinking about things like:

How do I get people in our target market to discover our brand?
How do I build trust and generate real buying interest? (not just vanity metrics)
How do I convert these people into loyal, paying customers?

This post is about taking the conversion funnel you have in your mind and turning it into a clear visualization you can share and improve. With funnel stages defined, you can tie them out to real user actions that track the customer journey across any digital marketing channel.

What Is a Conversion Funnel?

A conversion funnel is a model businesses use to describe and track how potential customers turn into paying ones. There are many different types, but they all share the same essential “funnel” shape: a wide top that n arrows down to the bottom, like a pyramid flipped upside-down.

Here is a diagram of a widely used conversion funnel structure:

As you can see, the funnel is broken into stages (Top, Middle, Bottom) that segment the customer capture where a customer is in the buying process at any given moment.

You can also see how the percentage of people who move through the funnel drops off at each stage. Not everyone who visits the site is going to make a purchase, or take steps to move through the funnel, such as visit a product page or download a case study.

It’s not a perfect visualization, by any means.

The point of a conversion funnel is to be able to talk about this process in a coherent, objective way. You define what the stages of your funnel are based on the most important events of a typical customer journey, and then you do what you can to help more people complete that process.

Once you tie those events out to trackable metrics (like clicks and page views), you will be able to monitor activity in your funnel. You can spot issues quickly and find opportunities to improve your conversion rate, which will make any funnel much more profitable.

What conversion funnel framework should I use?

I would use something simple, that has worked before, and that fits with the realities of your business. Your funnel framework is not set in stone, but it’s not something most businesses want to fiddle with all the time.

Some of the popular frameworks are:

Top-Middle-Bottom
Awareness-Interest-Desire-Action
Awareness-Engagement-Consideration-Conversion-Retention

There’s clear overlap and many more similar frameworks out there. Dig into your options, but don’t stress too hard. One of them will probably make sense, and you should go with it.

If you just started building a funnel, you might want to try the simplest, 3-stage funnel. It’s easy to explain and it captures both digital and traditional marketing channels well enough.

You will see it referred to as “ToFu, MoFu, and BoFu” on account of the three stages:

ToFu: Top of funnel. At the top are people that are just discovering the brand or not yet engaging with it meaningfully.
MoFu: Middle of funnel. In the middle of the funnel, people are learning about the brand, interacting to some degree, and potentially building trust.
BoFu Bottom of the funnel. At the bottom, people are actively interested in the brand, comparing other options, and have a real need for the brand’s product/service.

An example of a customer journey through this funnel might be:

A customer engages with an ad on social media and clicks through
They arrive at a landing page and give their email in exchange for a discount
They leave the site without purchasing, but a week later receive a reminder to spend the discount.
They return to the site, find a great deal with 5-star reviews, and make a purchase.

This is a completely believable real-world example. The ToFu content (social media ad) successfully attracts the right kind of buyer to the company’s site.

Then the MoFu content on the site stokes their interest and gets them to signup for a discount. Additional MoFu email content later reignites their interest and gets them to return to the site.

BoFu content, like the specific product page and social proof (5-star reviews) ultimately convinces the buyer to make the purchase.

What is the purpose of conversion funnel stages?

Stages are crucial for delivering the right content to the right customer at the right time. People who are just finding out about your brand may not even know you can help them. People who are actively comparing products want the nitty-gritty details.

How you define the boundaries of your conversion funnel stages is up to you, but most people build them around:

Trackable actions, like clicks, signups, downloads, purchases, and form fills.
Engagement depth, like repeat site visits and returning to pricing pages.
Purchase intent signals, like becoming a subscriber or registering for a demo.

The boundaries between stages can be a little fuzzy. Two people might attend the same webinar despite being at very different stages of their buying journey. But in aggregate, conversion funnel stages are accurate enough to show you where customers are and what they need.

What To Track in a Conversion Funnel

A $5M ecommerce brand might have 30 funnels. A $200M brand can have hundreds, or even thousands.

The scale differs dramatically, but when I hear marketers from those larger companies on podcasts, they’re wrestling with the same challenge as smaller brands:

How do I track the customer journey in a way that actually helps my team improve it?

Every conversion funnel boils down to a simple sequence of steps that a customer takes. Or doesn’t.

Defining which steps matter most is the critical judgment call. Sales and signups are obvious, but what about the signals along the way that show interest, trust, or hesitation?

To make your funnel useful, you have to know which metrics tell the full story and completely map your customer journey.

Key conversion funnel metrics

Not all of these will matter in every situation, but when you are trying to get a feel for what is happening in a conversion funnel, these metrics are almost always helpful.

New, unique visitors
Page views
Time on page
Session duration

Bounce rate
Signups
Unsubscribes
Microconversions
Content downloads
Video completion rate
Conversion rate
Average order value
Abandoned cart rate
Customer acquisition cost

Most of these metrics are tracked automatically, but you will have to flag them as important within your analytics tools, and potentially supplement these metrics by tracking custom conversion events.

Let’s take a close look at how these metrics help you form and visualize the three major stages of a conversion funnel

Top of funnel metrics | Awareness & Engagement

At the top, you’re looking at signals of engagement. Metrics like new visitors, page views, time on page, session duration, and bounce rate tell you if people are discovering you and sticking around long enough to care.

For example, a high bounce rate means people are leaving without taking a second action. It’s not perfect, but it does indicate whether your awareness efforts are drawing in the right audience.

Middle of funnel metrics | Interest and & Consideration

In the middle you are looking for metrics that show movement towards a buying decision. Metrics like email signups, content downloads, video completion rate, and other microconversions can help you capture how seriously people are considering your brand. A microconversion is any small step toward purchase, such as adding an item to a wishlist or watching a product demo.

Bottom of the funnel | Conversion

At the bottom, metrics like conversion rate, average order value, abandoned cart rate, and customer acquisition cost measure how well you’re turning prospects into paying customers.

For example, a high shopping cart abandonment rate means people are interested but something is blocking the purchase. Your customer acquisition cost (CAC) shows whether your funnel is profitable at scale.

How To Set Up Conversion Funnel Tracking

The goal is to be able to monitor activity in your funnel quickly, and have the ability to dig into the data if needed.

A lot of the tracking is built-in to the tools you use already, but it’s not going to be configured for your conversion funnel. With a bit of setup, you can help the platform do a much better job capturing the data, which makes funnel analysis and optimization much easier.

There is also the issue of integrating data from multiple tools, which is the only way to capture the flow of traffic through a multi-channel funnel.

Let’s go through these tasks one by one.

Tracking funnel activity within tools

Most of the metrics I just listed are tracked automatically in their respective tools. Your email marketing service automatically records open rates, clicks, and so on. Google Analytics 4 (GA4) will capture many of the engagement metrics you care about on a website.

The brands who make these tools (think: Google, Klavayo, Hootsuite, Meta) want to keep you engaged and demonstrate how effective they are. They really do make it as easy as possible for non-specialists to set up conversion funnel tracking and visualize performance.

Once you understand what each platform tracks automatically, you can start to optimize those settings to fit your specific conversion funnel.

Web analytics platforms capture website traffic, user sessions, page views, and basic conversion tracking. In GA4, for example you can define “key events”, which are specific actions that matter to your business, like button clicks or form completions. You can also create audiences based on specific criteria and track how different segments move through your site.

Email marketing services automatically show subscriber growth, open rates, click-through rates, and unsubscribe rates. Advanced platforms like Klaviyo also track revenue attribution from email campaigns, showing which messages directly lead to purchases.

Ad Platforms like Google Ads, Meta Ads, and LinkedIn Ads automatically record impressions, clicks, and basic conversions tied to campaigns. They use tracking pixels to follow users from ad click through purchase, allowing for sophisticated attribution modeling. Advanced features include lookalike audiences based on your best customers, and automated bidding toward specific conversion goals.

There are many more tools you can use to get in front of your audience and capture behavioral data, but if you are just starting out, the mix of web, email, and paid ads is a reliable and manageable option.

Integrating funnel data

The goal here is to get all of the data that is important for your conversion funnel into a single platform for analysis.

So long as you are using well-known tools that have been around for awhile, there will be pre-built integrations, which will speed the process, along with tons of documentation online to help you unify conversion funnel data.

Most smaller brands start with Google Analytics 4 connected to their email marketing service, and maybe one or two ad platforms.

This is the approach I would take to get started. It gives you basic funnel tracking without overwhelming complexity.

Some additional integrations to think about would be your CRM software or ecommerce platform. Connecting GA4 with something like Shopify or HubSpot is usually straightforward.

Down the line, if you grow your site, you can think about adding analytics platforms like Adobe Analytics, customer experience platforms like Nextiva, and business intelligence software like Tableau. These tools aggregate data from dozens of sources into unified customer profiles and executive dashboards.

Tips for optimizing a conversion funnel

With everything accurately tracked across your funnel, you can make data-driven decisions about how to improve it.

Here are a few strategies to help you get started:

Double-down on profitable attribution paths. You can view these directly in GA4 (they used to be called conversion paths) to find which series of touchpoints leads to your most profitable conversions. Then, steer the content on your site to promote these paths instead of less profitable ones.
Investigate drop-off points. When you spot significant drop-offs between funnel stages, dig deeper by segmenting the data by traffic source, device type, etc. to identify patterns. For example, if mobile users drop off at checkout but desktop users don’t, you’ve probably found a technical issue rather than a general conversion problem.
Look for patterns by traffic source. Different traffic sources bring visitors with different intent levels. Organic search traffic, for example, often converts better than social media traffic because people are actively looking for solutions. Look for trends that can help you better match the mindset of users from different traffic sources, or better prioritize your ad spend.
Use Ad performance to shape strategy. Which headline formulas or ad creatives are performing the best? Click through rates can tell you a lot about which messaging strategies are really resonating, and with which demographics.
Identify key microconversions. Rather than tracking every possible action, find the microconversions that strongly predict eventual sales, such as adding items to wishlists or downloading buying guides. Then, optimize the paths leading to them nearly as aggressively as you would optimize for direct sales.

Boost AOV with built-in tools. Most ecommerce platforms give you a range of options for cross-selling, upselling, and bundling. Take advantage of these to increase average order value by digging into purchase data to and making recommendations that align with real buying habits.

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