E-commerce is a huge opportunity in the global market. It is expected that global e-commerce sales will rise from $1.3 trillion in 2014 to $4.5 trillion by the end of 2021. If you are a business owner trying to sell your products by capitalizing on this opportunity, you need to understand the conversion funnel.
What is a conversion funnel?
A funnel is simply a representation of the journey of the potential customers as they make a move to becoming paying customers. This includes the entire process of visiting the store, viewing products to completing the purchase. If you want to maximize the profits of the store, you need to optimize every stage of the process by encouraging the passage from one stage to another and then plugging the funnel exit holes which might cost you sales.
What do you need to do?
For conversion funnel optimization, you need a few things:
First and foremost, an understanding of the e-commerce funnel.
A tool that will help measure the performance of the funnel.
A method you can use to test the performance of your site.
The funnel is divided into three levels, top, middle, and bottom. The top of the funnel is the area where consumers become aware of the brand and the products you sell. The engagement level here is light. The middle of the funnel is where the engagement of the consumers with your company increases. The prospects will become leads as they explore the offerings at a deep level and might make a purchase. Lastly, the bottom of the funnel is the final engagement when the leads will become consumers and will buy from the brand.
Why is it important?
The funnel is important since every consumer that visits your website will not buy from you. Hence, it is a cone-shaped funnel. Visitors will leak out of the funnel at each stage and when you optimize the funnel, you will be able to keep more people inside it until a purchase is made. Until and unless you are clear about how the funnel works for your business, you cannot make any changes in the same. You can start working backwards, that is, asking yourself how you can generate e-commerce sales. When you work from your goal, you get insights into the funnel and you understand how it is working.
How to use tools for funnel measurement?
You do not need to be an analytics wizard to understand how the tools work for you. You can use the Google Analytics to track your goals and understand how the funnel is performing. If you do not see any progress, you need to make changes to your marketing campaigns. There are advanced reporting systems which help you analyze the performance of the software. The tools can be used to track how far the consumers reach on your website. You might not be getting enough sales because you are not getting enough traffic in the first place. If you are getting good traffic, you might be getting a drop off in the check out process. Whatever the reason, you need to design a funnel which would help you improve the results.
Which stage should you optimize first?
There have been a lot of discussions on the funnel stage you should optimize. Many believe that you should start at the top so that you get more prospects and the sales can improve while there are many others who say that you need to optimize the conversion process so that the visitors are more likely to buy from you. There is no specific rule you need to follow here. You can choose one hypothesis and put a tool in place. If you notice that the optimization at the top of the funnel is not working for you, you can make changes to the same and move towards the optimization of the conversion process. If you can identify what is going wrong, you can simply work on it and increase your sales.
Understand your business and what drives the consumers to the same. If you have your goals well laid out, you will be able to work on the funnel with ease. Every business owner strives to increase sales and revenue, this can only be done by optimizing the conversion funnel and building campaigns that can work wonders for your business. Do not underestimate the power of digital marketing, you can achieve the potential with simple tools and strategies.