What is an Ecommerce Conversion Funnel and How to Create One?

In 2022 it’s essential to monitor customer behaviour and to guide it in the right direction. Of course, there is only one goal: becoming a customer.

Monitoring all the available channels, analysing data and behaviours, guiding the visitors – it all goes down to creating an Ecommerce conversion funnel.

What is an Ecommerce conversion funnel?

The Ecommerce conversion funnel is the name given to the journey taken by customers that starts from when they first encounter your online business and ends when they become loyal paying customers.

Every Ecom manager should have an idea of how to create an Ecommerce conversion funnel but there are parts of it that are largely out of your control.

There are multiple channels and multiple conversion funnels when it comes to Ecommerce

However, there are a few things that Ecommerce managers can do to encourage the process and this guide will show you some of them.

What are the stages of the conversion funnel?

In an ideal scenario, a converted visitor goes through the following stages of the conversion funnel:

  • awareness
  • consideration
  • intent
  • decision
  • loyalty (after purchase stage)
Ecommerce conversion funnel stages

The awareness stage

This is the very point that a potential new customer becomes aware of a brand’s existence. It could be through some tactfully placed social media advertising, having your products on a large online marketplace or simply through word of mouth.

No matter how they hear about your business, this action marks the starting point of the Ecommerce conversion funnel and it’s important that you make a good first impression if potential customers are going to move beyond this point.

The consideration stage

This is where your work really begins. Now that the customer knows about your business, it’s up to you to nudge them towards conversion.

You can do this through on-page features like strong reviews, detailed product descriptions and intuitive product suggestions but off-site techniques such as email reminders, targeted adverts and high-quality social media content can also help build trust in your brand and move new customers further along the conversion funnel.

The important thing to remember is that you need to plant a seed in their minds that will make sure you are remembered more than your competition as the customer shops around.

The intent stage

This is where the funnel properly begins to narrow. The intent stage marks the point where the customer is actively interested in buying your products. However, before they do this there are still questions that might need answering before they part with their hard-earned cash.

Make sure that your product descriptions, imagery, video demonstrations, FAQs and everything else are in order, informative, and, most importantly, accessible.

Customers demand convenience and any interruptions to their purchasing journey could put them off converting. You should also always make sure your customers know that your business is easy to contact and that you are always willing to answer any questions that they might have. This gives them both peace of mind and breaks down some of the barriers between your business and them.

The decision stage

Here we are, it’s crunch time. All your optimisation, SEO and marketing work has paid off and your customer is ready to place their order.

Typically, only 3% of customer journeys reach this stage, so it’s important that you don’t fall at the final hurdle.
Ensuring that you have a smooth checkout process that’s simple and offers all the right delivery and payment options is a great way of ensuring that you meet the needs of as many customers as possible. Now, you would be forgiven for thinking that this stage marks the end of the Ecommerce conversion funnel, but this is not the case. Now, you need to turn these new customers into returning ones.

Loyalty stage

This is the final stage and arguably the most important. Loyal customers provide businesses with a higher lifetime and order value. They are also more likely to recommend your business to their friends and family.

The post-conversion phase: staying in touch with the converted customer

Word of mouth is the most powerful marketing tool out there, so putting the work in now could pay off massively in the future. Staying in touch with customers through mailing lists that give them access to special offers and benefits is also a great way of building the type of lasting relationship that will help your business reach its goals.

How to create an Ecommerce conversion funnel?

The nature of Ecommerce means that your conversion funnel will most likely have to consist of multiple channels and platforms. Because of this, you may have to create multiple sub-funnels in order to create one super effective one. Let’s illustrate this with some examples.

Ecommerce sales funnel: Example #1

Sarah has recently taken up running and now she is in the market for a good sturdy pair of trainers. She’s new to the hobby and wants to do some research to find out what works best for her before she parts with her cash.

She starts, where most people would, by Googling “beginners running shoes for women”.

Little does Sarah know it, but she’s just entered the awareness stage of the Ecommerce conversion funnel.

Let’s say that you’ve been investing in well-written SEO content which means that when Sarah ends up on one of your blog posts when she searches for this term.

The article gives her all the information she needs and now she feels like she’s ready to start shopping around but before she leaves a pop-up appears on the screen that offers a 15% discount to those who sign up to your mailing list. This sparks her interest and moves her along into the consideration stage of the Ecommerce conversion funnel.

Ecommerce conversion funnel example

A few days later, Sarah receives a promotional email with a selection of beginner running shoes. Analytical data shows that this has further sparked her interest as she has revisited your site several more times since receiving the email and she seems particularly interested in the products you showed her. She is now in the intent stage.

Naturally, she checks out the competition to see what else is on offer, but the discount you offer seems like a deal that’s too good to miss and she ultimately decides to purchase one of the products you advertised to her in the second email. She has now moved beyond the decision stage.

When her package arrives it also contains a leaflet with tips for beginners as well as an invitation to join a loyalty club that offers special promotions. This rounds off the loyalty stage and keeps her coming back to your business for all her health and fitness needs.

This conversion funnel combined the use of SEO content targeted for organic search terms, blog content, targeted popups, subscriptions, email content, promotional offers, targeted product suggestions and a loyalty program. Each tool complements the other and furthers the conversion process.

Ecommerce sales funnel: Example #2

Social advertising is also a great way to bring new visitors to your Ecommerce store.

Imagine you run a business that sells top quality toys for babies. Now, parents love to post photos of their babies on social media and targeted ads on sites like Facebook and Instagram are a great way to get their attention.

Let’s say you’ve done this and one of your ads catches a potential customer’s eye, lets’s call him Marcus. Your ad has brought Marcus into the awareness stage of the Ecommerce conversion funnel. Marcus has a one-year-old son whose birthday is coming up and he wants to get him an active toy that will promote learning. This desire has brought Marcus into the consideration stage.

Continued targeted advertising via social media, email or third-party channels can continue to establish the presence of your business in Marcus’s thought process and move him further along the funnel.

This pays off and eventually, Marcus adds a couple of your products to his cart, but the life of a young parent is a busy one and he unintentionally abandons the cart without completing the order. Marcus is now in the intent stage but clearly needs some more encouragement before he moves on to the decision stage.

Ecommerce conversion funnel

After a couple of days, you send him an email reminder about the abandoned cart.

This could even offer a small discount as he’s a new customer and interested in multiple items. This email works and Marcus returns to complete the order and take advantage of the offer you’ve provided. He has now moved beyond the decision stage.

Marcus and his baby are very happy with the products and he becomes a loyal customer who continues to buy your products for years to come. Through this sale, word starts to travel amongst Marcus’s social circle of fellow young parents and some of them come to your business as a result.

This example shows how different channels can cross and collide and that the conversion funnel can take an indeterminate amount of time to complete but still pay dividends in the long run.

So, how do you identify and create a multi-channel Ecommerce conversion funnel?

Identifying the Ecommerce conversion funnel

Just like in the examples, creating and identifying points in a multi-channel Ecommerce conversion funnel requires the combination of several tactics working in unison. However, there are a few things you should always do before you start creating.

Visualise the funnel

The best place to start is to visualise your conversion funnel as, well, an actual funnel. By doing this you can identify how and when you want new customers to enter each different stage. This helps in the idea forming process and helps with organisation and planning.

Create goals and monitor them

In order to achieve your ultimate goal, you first need to set yourself smaller oness for each stage of the Ecommerce conversion funnel. These goals could be things like the number of people signing up for a newsletter or arriving at your site through targeted ads. These targets can be tracked through Google Analytics and tweaked where necessary to ensure maximum benefit.

Reverse the goal path report

Reversing the goal path report basically retraces the steps of a customer’s journey, normally through the final three steps of the process. This is a great way of getting to understand how your customers are interacting with your conversion funnel and can highlight areas for conversion optimisation. The report doesn’t have to be from conversions and can stem from pretty much any interaction between customers and your website.

Optimising the Ecommerce conversion funnel

Pretty much every aspect of the conversion funnel can be optimised for a sleeker performance. Setting specific goals is the best way of tracking progress and isolating the performance of individual sections. When this is done you can then make adjustments accordingly and in a way that doesn’t require huge overhauls of your Ecommerce store.

For example, if you find that customers are regularly dropping off at your checkout page, this is an indication that you specifically need to make optimisations around the intent stage. Knowing this allows you to be much more efficient and can save you a load of time and money.

Remember, compartmentalising the Ecommerce funnel and creating a customer journey is your key to success.

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