If you have a website, you have a conversion funnel – whether you know about it or not. If this was news to you, then we’ve got some serious work to do…
Only 22% of businesses are satisfied with their conversion rates, which means millions of companies are missing out on both critical opportunities and profit. If you’re one of them, then this guide to understanding and optimizing conversion funnels is going to get you on the right path to meaningful results.
But, in order to start optimizing your conversion funnel, you first have to understand how it works.
What is a Conversion Funnel?
A conversion funnel is a way of visualising the path and conversions a potential customer takes before committing to a product and/or service (or in many cases, not committing!).
These can be customers generated through any means, from SEO and Content Marketing to Social Media and Paid Ads – even cold outreach. They all fall into your conversion funnel, but how far they get is really down to you.
A basic Conversion Funnel is made up of four main stages:
- Awareness
- Interest
- Desire
- Action
In reality, they’re actually a little more complicated which we’ll cover later in the article, but for now, let’s just focus on the main four stages.

1. Awareness
The first stage of any conversion funnel is making people aware of your business and the product/service you are offering.
Although you might think that this stage is all about quantity, focusing on attracting qualified leads (i.e. people who are likely to become customers) is a better use of time and advertising budget. You can always scale out your reach later if you find you’re not getting results.
Content in this stage is often the most creative, it’s educational and not too ‘salesy’. The main strategies utilised during this stage are:
- PPC Campaigns: good for generating qualified leads as you’re targeting users actively searching for what you’re offering.
- Organic Search: often the lower-cost option, you’re reaching users as they search. Good SEO is important for this strategy to ensure you’re visible near the top of the search results.
- Social Media: although advertising to users who aren’t necessarily actively looking, it can be an effective way of getting seen by your target audience.
2. Interest
Now you’ve made people aware, you need to keep them interested.
An engaging, user-friendly website and relevant content are key for helping your audience get to know, like and trust you.
This stage is where potential customers evaluate to see if you meet their needs. Therefore it’s important to illustrate the value your product/service provides and what sets you apart from competitors.
Testimonials/reviews, case studies, demo videos, and FAQs can all be useful at this stage. Not only do they demonstrate trust, but it also shows you understand the customer by providing additional information they might be looking for.
3. Desire
Your potential customer is hooked, so now it’s time to reel them in. A good copywriter is invaluable for this stage.
Even though qualified leads have made it this far in the funnel, it doesn’t mean they’re ready to buy yet. In fact, more than half of them aren’t on the first visit.
Email drip campaigns are a perfect way to continually build the customer-company relationship. Rather than sending a sales pitch immediately, establish trust slowly whilst demonstrating why they can’t live without what you’re offering.
This stage can take time or could be an instant conversion depending on the customer. Play the waiting game, it’ll be worth it!
4. Action
The last stage and the one you’ve been working towards.
This stage is all about completing on your ultimate goal, whether that is a sale, a sign-up or a download. Only a small % of leads reach this stage but an optimised funnel maximises the number of leads that move forward, increasing the number of potential customers who become physical ones.
Now that we’ve covered what a Conversion Funnel is, let’s take a look at how to optimize it…
How can I optimize my Conversion Funnel to maximise profit?
The following advice applies whether you’re selling something, looking for email signups, resource downloads, enquires etc. If your goal is to get visitors to take an action then you have a conversion funnel – and it probably needs optimizing.
As mentioned earlier, a conversion funnel is not necessarily as straight forward as A->I->D->A. To optimize yours, you need to know what exactly it looks like first.
Map out your ideal buying process
Depending on the steps you want to analyse, your conversion funnel could be a lot more complicated than the main four stages we looked at previously. There could also be multiple goals within the funnel too.
To find out what your conversion funnel should look like, ask yourself what are my most important goals?
Often these are sales or lead form submissions but it could be something completely different depending on your business.
The next question is, what other actions need to be taken in order to achieve this main goal?
Perhaps you want the lead to read information on the product, download a resource or sign up for a mailing list first. These are considered micro-conversions and are helpful for visitors to learn more about your business/product. They build trust which ultimately pulls them further down the funnel towards your end goal (or macro-conversion).
Now you know what your funnel should look like, you’re going to want to track how it’s performing…
Set up conversion goals in Google Analytics
You can’t just guess your conversion funnel and call it a day. You need to measure how users are actually moving through your site, which is where conversion goals in Google Analytics can help.
Setting up at least one goal for every stage of your funnel will give you an accurate idea of how it is performing, highlighting if and where you need to make changes.
Make sure to add goals for the four main conversions:
- purchases
- form submissions
- email list signups
- resource downloads

You have two options for goals: template and custom.
Templated options include common goals like account creation and social engagement. For conversions that don’t match these categories, you can also create custom goals using one of the four options below.

For high-level conversions, the easiest way to track them is to select ‘destination’ and add your ‘thank you’ page as the URL. (If you don’t already have a thank you page you need to add one immediately!)
Important: Don’t make the mistake of having your contact page as the destination URL. While it shows interest, it won’t track if any action, such as calling, was taken, so the data is largely meaningless.
By adding the pages users typically visit before completing a goal, you can track how effective they are at generating conversions and see which might benefit from a redesign.
For this step, you also need to decide where you’ll be tracking entries from. Do you want to track entries only if they come through the ‘first page’, or are you tracking every entry point? Decide and then toggle the “required” option on the first landing page appropriately.
Create the right content for each stage
“Lead Magnets” or content designed to get users into your funnel can be particularly useful. These include content that requires an access key, such as downloadable resources you have to submit your email to access.
Although your content should vary by stage, there are four important questions to ask every time:
- How do we make customer more aware of the brand? (Relevant even after the initial awareness stage to keep it at the front of their mind)
- How do we entice them with an irresistible offer?
- How can we anticipate and acknowledge their needs?
- Why would they not act and what can we do to fix it?
Identify (and plug) leaks in your conversion funnel
The very nature of a conversion funnel means there aren’t the same number of leads at the top as at the bottom. Otherwise, it would be more of a conversion shaft and every business would be making $$$ in profits!
Some leaks will occur simply because they are unqualified leads; the ad/search appeared in front of them but they are not an audience for your product/service. There’s nothing you can do to stop those leaks.
Potential customers who aren’t being moved to the next stage in the funnel though are leaks that need plugging A.S.A.P.
There is a multitude of reasons a leak might occur. Your content isn’t persuasive or relevant enough, your price is not accessible, your website isn’t user-friendly, the list goes on…

The Funnel Visualisation report is the best way to identify any issues. It shows you what steps a user isn’t taking and where they’re doing instead. It may highlight certain steps that instead of pushing users to the next stage, are actually distracting from the goal. Take a closer look at these pages and redesign them in a way that moves users in the right direction.
Poor funnel performance could also mean that it wasn’t designed to accurately reflect how users move through your site. In this case, it’s not leaking, it’s just the wrong funnel!
The Reverse Goal Path Report shows how users are actually arriving at the conversion. This data can then be used to create more accurate funnels or edit existing ones.
The Users Flow report under the Audience tab also shows similar insights. The key difference being it starts at the beginning of a journey, rather than focussing on the actions right before conversion.
Optimize for conversions
Anyone familiar with Conversion Rate Optimization will know that there are literally hundreds of tweaks you make to your website to improve CRO. Changing button colours and placements, updating forms, new call-to-actions, you name it, someone’s tried it.
This changes should be done based on insights from your target audience, and not just copied from another business model, as they won’t necessarily make sense for you. Run A/B tests on any changes to see what’s working, starting with pages identified as sources of leaks.
Create alternative offers
As we mentioned before, people drop out of your funnel for a number of reasons. One of which may be that the core product isn’t quite right for them.
If you offer similar products at different price points consider directing a user who completed micro-conversions before abdoning the page towards one at a lower price point rather than letting them leave altogether. A small sale is better than no sale at all.
Exit intent pop-ups can also be a useful way of reengaging qualified but not converting leads. Triggered by the cursor moving towards the top of the page (ie. towards the back arrow or exit), these pop-ups usually include a discount code, free download or even an entry into a prize draw (all in exchange for an email address – get their details!).
Final Takeaways
Getting your conversion funnel right and optimizing it effectively is not a matter of guesswork. As we’ve seen there are multiple optimizing options available to you and not all of them are going to be appropriate for your funnel. Test, monitor and analyse using the Google Analytics reports available to you to really understand your funnel and get the results you want for your business.
And finally remember, it costs 6-7 times as much to get new customers than it does to retain existing ones. If you managed to get a qualified lead through every stage of your conversion funnel, don’t let them slip away. Consider ways to reengage and upsell existing customers: additional offers, products to complement previous purchases or plan upgrades are all affective options.
Bonus Tips for Optimizing
- When adding steps to a funnel remember that the middle pages don’t necessarily have to be visited in order to track the conversion. Feel free to add any small or less common steps that may be relevant if you want data on them (the order isn’t crucial either).
- Send surveys to qualified leads who took no action to learn what kinds of problems they have and what’s preventing them from using you as a solution.
- Know what the best source of qualified leads is for you and focus more attention there. Under the Aquisitions tab, the overview shows channels bringing traffic (left column), user behaviour data (middle column) and channels driving conversions (right column). The All Traffic Report shows similar data broken down by Source and Medium (where they saw content and how they arrived).
- Alter email campaigns based on users last response. For example, if they didn’t engage with content in the first email, send it in a different format the next time.
- Existing customers can be one of the most effective ways of bringing in new leads. A referral programme that offers the referrer and referee something for signing up is a great way to continually refill the funnel.