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What it is.

In online marketing, the term “funnel” refers to a flow. A flow that, initially has a rather large number of elements that gradually decrease. Imagine a marathon, in which 1,000 people start; at each intermediate stage the participants decrease, until 20 arrive at the finish line. 

So many start, few arrive, so we have a funnel structure, a funnel. 

Now replace the image of the marathon with that of a workflow, of a purchasing process on an ecommerce, of a series of steps within which one must pass to finalize a conversion, and lo and behold, in marketing terms, everything becomes clearer and we can already begin to glimpse the usefulness of this type of analysis.

What are the applications in our marketing?

Analyze the stages that constitute an advertising campaign……and thus avoid throwing money away
Analyze users’ behavior in filling out forms……and thus prevent it from quitting before it has given us the information we need
Analyze the steps leading to a shopping cart checkout……and then abandon before I can have completed the purchase process
Analyze the steps leading up to a reservation checkout……and then quit before I can have completed the registration process
Analyze the navigation path between the pages of a site to a landing page……and then abandon before it can have reached the page we want it to read
Analyze the customer journey of a potential customer……and thus avoid losing him before he is ready to become our customer

And much more. 

So clearly there are many reasons to work on this funnel, this funnel. We want to analyze and improve our funnel:

  1. Because we want to lose, at each stage, as few users as possible!
  2. Bringing users to the entrance of a funnel has a cost. Always. And we don’t want to waste time, money or resources.
  3. Because we want to improve conversions
  4. Because we want to identify (and solve) problems
  5. Because we want to understand your users

Funnel Marketing: where is the drop? 

In the first of our articles dedicated to Funnel Marketing, we made an introduction. We explained what a funnel is and what it is used for. Now let’s try to look at a few examples and get a little bit more into it.

An example of Funnel: From campaign to registration

The following is a typical example of a funnel that anyone running a business might come across. Let’s talk about that case where we want to start a “keyword advertising” campaign using Google Ads within a campaign with a really simple and basic structure.

  1. the user searches for something on Google
  2. Google generates a search results page (SERP) containing our Ad
  3. the user clicks on our sponsored result which takes him to a Landing Page
  4. on that Landing Page we ask the user to fill out a form and then submit it

Four simple steps describe our funnel.

We must now analyze and understand whether, from one step to the next, we have left behind interesting customers.

N.B. remember that we those users we are now losing between steps, we paid them! We paid them to Google with every click they made. And after we have invested time and economic resources in this campaign, do we want to waste that investment?

So how do we show what happens to our Funnel?

Let’s first get clear on what the steps are in it:

and then ask ourselves: what can I measure, in the transition between steps, to see if I am working well?

  • In the transition between step 1 and step 2: I can check Impressions (Views), clicks, the cost of each click, and CTR (click through rate, i.e., percentage ratio of people viewing the ad to people clicking on it)
  •  In the transition between point 2 and point 3: I brought the user to my site. I have my analytics system installed (hopefully… and always making sure everything is in place with cookies, privacy, etc.). Thanks to my analytics system and appropriate tracking, I can know how many Page Views there were in a given time interval and linked to a specific Traffic Source (my campaign), I can count Interactions, check the Dwell Time on the Page, and analyze the Bounce Rate to see if that page is interesting or not.
  • In the transition between step 3 and step 4: I want my user to open and fill out the form. Then I can set up systems to track how many times the form is opened by clicking on the CTA (Call to Action) button, how many are Abandonments, and how many times the form is filled out and submitted instead.

So where is the problem in our Funnel? Let’s put some easy numbers in a table and figure out what a very simple approach to analysis can be:

Google SearchesClick on sponsored contentClick on the CTA buttonPeople submitting the form

as you can see, there are 3 rows in this table, presenting 3 possible scenarios. Let’s try to read these very simple numbers to at least understand how to reason:

  • Row 1. the funnel does not show dramatic collapses in users until the last column, the one related to form submission. How is this supposed to make us think?

So, 90% of the people who view my ad then click on it. This means that I have chosen good keywords, profiled the audience well, and presented them with an ad that has good copy, works well! When they get to the page, the vast majority of them do what I want: they open the form. But then I see that this form is not filled out and nobody submits it! Is it not that maybe the problem is in the form? am I asking for too much information? is it not working well on mobile? is there some technical problem? am I asking questions that are too personal? Let’s try changing the form and see if this issue changes….

  • Row 2. in this second scenario we see that our funnel narrows dangerously when we get to the third column. So the same things that we said for the first scenario apply to the initial phase, but here things change: the problem must be on the Landing! Why don’t people click the darn CTA? Why don’t they open the form? Have I placed it in the wrong place on the page? Am I not making it clear what benefit the user would have in filling it out? Are there technical issues? You might want to go and analyze the page statistics, do some A/B testing and see if the situation improves.
  • Row 3. Only 20% of the people who see my ad click on it. From then on, both the page and the form seem to work fine. So the problem must be in the first step, the one related to the campaign. For now I can think that the Landing and the Form are innocent, if there is an error, it must be in the campaign setup: did I misidentify my target audience? did I choose the keywords wrongly? did I write ad texts that don’t convince or at least don’t make the user understand that I have the solution for his problem ready? You definitely need to improve that campaign.

Different types of Funnels

The one proposed is obviously a very limited and very simple example. But it is important to understand what the logic is in the process of optimizing a funnel, whatever it is:

  • define and be clear about the steps that make up the user journey
  • understand what we can measure and what KPIs we can use as indicators of success
  • be sure we can measure what is happening, step by step
  • analyze the data for each step to understand where the “leakage” is

Once this is clear, you can apply the same principle to many other situations:

From the ecommerce home page to payment:

From the Home Page to one of our Goal Pages.

A lengthy registration process

We will stop here for now, but we will continue on this topic in the next article!