Conversion Funnel - How to Convert Your Target Audience

1. What is a Conversion funnel and how does it work?
2. The most important phases of the Conversion Funnel
3. What is the difference between a Conversion and a Sales Funnel?
4. Why are Conversion Funnels important for companies? 
5. What results can be achieved with the Conversion Funnel?
6. In which business areas are there Conversion Funnels?
7. 15 Lead Magnets for Your Conversion Funnel
8. How can the Conversion Funnel be analyzed and optimized?
9. Tips for Your Conversion Optimization
10. What tools are suitable for analyzing and optimizing Conversion Funnels?
11. Conclusion: Invest in Your Funnel

Are you still pondering or are you already converting? In this article, we explain the function and value of a Conversion funnel. We will show you how a Conversion funnel can supply your business with new customers on a regular basis and the measures you can use to influence leads.

What is a Conversion funnel and how does it work?

The Conversion funnel is a popular tool in e-commerce, describing the path, strategy, and touchpoints to convert the target group into paying customers. The funnel, an English term for a funnel, refers to the reduction of the number of users along your marketing strategy.

Initially you have many potential customers on your website, only a certain proportion follow your offers or CTAs and finally make a purchase. The purchase completion describes the lower, narrow end of the funnel.

A simple example:

Your website has 1000 organic visitors in the week. Out of these, 300 click on further information about an arbitrary product. 100 add the product to the cart and 50 finally buy it. Your Conversion rate in this case is 5%.

In the context of your marketing strategy, the conversion funnel defines all established contact points with the user. Additionally, you can use Conversion Optimization Software & Tools to determine how successful your strategy is and which parameters may need adjustment. More on this later.

Conversion Funnel

The most important phases of the Conversion Funnel

For visualization of the conversion funnel, it is divided into different phases. Depending on the literature, there are usually three, four or five phases, all with the same objective: to activate and convert the target group.

We have presented two variants for you here to better expound the function of the phases.

TOFU-MOFU-BOFU

This concept divides the funnel into three, flowing into each other in levels:

1. TOFU – Top of the Funnel

A user is interested in a product and begins to research. He or she neither knows your company nor your goods, brands or services. The phase describes the broad mass of your potential customers. Your task is to pick them up according to their interest and build trust. This can be achieved through blog posts, infographics, video tutorials, and a lot of SEO.

2. MOFU – Middle of the Funnel

The information content is becoming increasingly dense. The user is already familiar with things and is now selecting the wheat from the chaff. He might have already set his eyes on a few labels, pressed one or the other follower button, or subscribed to a newsletter. As a seller, you should now play your aces. Evidence of your expertise, quality, and a good price are decisive in this phase, whether an interested party stays in your channel or thins out the funnel. You should also maintain high design and usability.

3. BOFU – Bottom of the Funnel

Your potential customer is almost at the bottom of the funnel, the conclusion of purchase is becoming within your reach. All that remains is the last spark, a quality feature, a significant advantage, a good review or a decisive keyword and the customers are yours. A discount for the first order, a limited offer, or free shipping costs can help you.

AIDA model

The AIDA model as an acronym for Attention, Interest, Desire, and Action, is a very popular concept that not only illustrates the functioning of the Conversion funnel. It serves primarily to represent the effectiveness of advertising or Customer Journey.

Phase 1: Attention 

In the first step, or upper end of the funnel, you make it clear that you are a provider of a particular product. You tell the world: Here I am. To make this work, you use appealing design, rely on influencer marketing, catchy advertising slogans, etc.

Phase 2: Interest

In the next phase, the task is to take advantage of the attention already gained. With the help of detailed information on your website, high-quality content or videos, you can stand out and anchor yourself even better in the minds of your target group. The result: there is still interest in your offers.

Phase 3: Desire

What once was interest now turns into desire. In this phase, it is your job to present your product in such a way that the acquisition promises a clear improvement for your target group. It becomes a status symbol or problem solver. This is best achieved through emotional or rational messages, usually in the form of advertising promises.

Phase 4. Action

All that remains now is a well-placed call to action to purchase. A landing page equipped with a call to action or a buy now button. Add to this a straightforward checkout process and your visitor has converted into a customer.

Models and phases Conversion Funnel

What is the difference between a Conversion and a Sales Funnel?

The definition of Conversion Funnel does not necessarily mean the conversion of potential customers into customers. The conversion could initially pursue a preliminary goal: registrations in your newsletter list or booking a consultation.

On the other hand, the Sales Funnel describes the entry of a customer into the sales channel. These users are already familiar with your products, offers, and services, may have already bought from you, and represent your target group 100%. For users in the Conversion Funnel you are still working to build this connection.

Therefore, the two terms are closely linked but should not be used interchangeably.

Difference Conversion and Sales Funnel

Why are Conversion Funnels important for companies? 

The aim of the Conversion Funnel is to maximize the number and quality of users who come into contact with you at various touchpoints. Because they automatically increase your chances of selling.

It is also important for you to make your advertising efforts efficient. A funnel does exactly that and provides the necessary tool to analyze and consistently reduce funnel dropouts. But there are more advantages:

• Your funnel works for you, and 24/7 at that.
• The funnel works automatically. Once set up, an appropriate tool takes care of all the work.
• You know your target group, accordingly you not only determine the number of contact points, but you can also set up variable Conversion Funnels.

What results can be achieved with the Conversion Funnel?

• primarily you generate traffic that leads to your website
• you generate qualified traffic, because your funnel is adapted to your target group
• your contact points constantly cater to the interest and engagement of your visitors
• you get to know your target group (even) better
• you recognize where your users drop off and can optimize exactly there
• you strengthen the bond with your customers and thus pay directly into the Customer-Lifetime-Value.

In which business areas are there Conversion Funnels?

Your Conversion Funnel is relevant wherever you want to measure the success of your conversion measures or deal with customer analytics. Depending on the size of your company, these divisions are: Marketing, E-Business, Sales, Customer Service & Support, Product Management and Development.

Conversion Funnel - Examples for your Business

Funnel Example 1:

You sell accounting software for medium-sized companies in the DACH region. In the past, you have already had good experience in customer acquisition with LinkedIn.

Now you generate a lead magnet. In this case, an ad that promotes a free webinar, where you introduce the software. You also use the webinar to answer your participants' questions. You also have a special campaign for your exclusive group: 25% discount.

Looking at the phases of this example funnel according to the AIDA principle, you divide it as follows:

1. Attention: Advertising ad on LinkedIn
2. Interest: Registration for the free webinar
3. Desire: Tailor-made software and exclusive offer at the webinar
4. Action: Your interested parties buy your accounting software

The part of the target group that booked the webinar but then did not participate, while technically falls out of this funnel, remains an existing contact. Therefore, you should not delete these people from your contact list. You just continue to support them (e.g. through a newsletter) and maybe they will convert with the next action. Thus, you already have the basis for another Conversion Funnel.

The same applies to the participants in the webinar who did not consume the offer. Perhaps they still need individual advice or have special requirements that you did not address. Another contact and a personal consultation would be good opportunities to better align their needs with your offer. Therefore, these people form another funnel for your sales team.

Funnel Example 2: 

You are a facade cleaner and want to acquire your target group through an ad in the search engine. Your goal is to demonstrate your expertise at an on-site consultation and convince with a trial cleaning. You know, once your target group compares the cleaned sample surface with the rest of the facade, you have already won. You also offer to clean the windows - for free - along with the facade.

Describing this example using the TOFU-MOFU-BOFU model, it might look like this:

1. TOFU: Search engine ads

2. MOFU:

• Your target group explores your website
• Contact
• Advice + trial cleaning on site
• Time-limited offer: facade cleaning + free window cleaning

3: BOFU: Your interested parties book an appointment for facade and window cleaning

Again, here applies: Not every consultation appointment will lead to business. But the contact remains part of your target group and can be considered for follow-up measures.

15 Lead Magnets for Your Conversion Funnel

A lead magnet is an irresistible offer that gives a great taste of your actual services. In the previous examples, it was a webinar as well as a consultation appointment or a trial cleaning. The lead magnet arouses interest and addresses a customer's very specific problem. The easy access to the lead magnet is important. They are usually offered free of charge, or in exchange for contact data.

Leadmagnet-NeilPatel

• Free Shipping
• Product samples
• Webinars
• Personal counseling
• VSL (Videos)
• Templates, templates, and stencils
• Checklists
• Audio Content
• Surveys
• Quizzes
• Free trial periods
• Whitepapers
• Case studies
• Discounts
• Free books

Leadmagnet-Sandra Holze

You can find more tips for lead generation, structure, and methods in our article: Leads generieren.

How can the Conversion Funnel be analyzed and optimized?

To analyze your conversion funnel, you should first divide it into individual sections. These can be the respective phases (AIDA or TOFU-MOFU-BOFU)or better yet the individual touch points. Here, you check how much traffic runs through the positions and how high the Bounce Rate is. You should definitely monitor the results as a KPI on a constant basis.

For targeted Optimization measures you need to test and evaluate the individual passages. Poor usability, complicated registration or purchase processes poor content, or missing translations are common reasons why potential customers lose interest.

A good way to optimize the funnel is to use A/B-Testing-Tools. Here, you try out two or more versions of landing pages, designs, ads, or even offers, and track the results. If variant A leads to higher traffic, you can drop variant B.

Tips for Your Conversion Optimization

ToFu Optimization

• Keyword Optimization or SEO
• Reorientation of the Ads campaigns (new or other platforms or social media channels)
• Content Marketing (Blogs, Newsletter, Social Media)

MoFu Optimization

• A/B-Testing at landing pages with A/B-Testing-Tools like ABlyft
• Reduce the number of steps (the fewer clicks a user makes, the better)
• Logical path to the offer
• Further build trust (Incorporate case studies, certificates, reviews, and awards)
• Check whether target group and offer really fit

BoFu Optimization

• Design order forms and payment processes as simply as possible and clearly mark compulsory fields
• Place Call to Action buttons clearly and prominently
• Targeted offers in case of shopping cart abandonment:
• Remarketing campaigns by highlighting products that were already in the shopping cart
• Push notifications when better prices can be offered

What tools are suitable for analyzing and optimizing Conversion Funnels?

There are separate controlling tools to regularly analyze the successes of your Conversion Funnel. They show you where your traffic is going well or where there are high dropout rates. You can also evaluate targeted campaigns with AB-Testing-Tools, with software support.

Common Tracking parameters are:

• Conversion Rate
• Traffic
• Cost Per Acquisition
• Average Order Value
• Revenue Per Visitor

Funnel Analytics

Software & Tools for Your Conversion Optimization

Kameleoon

Google Optimize

AB Tasty

trbo

Perspective Funnels

Leadz

Unbounce

Heyflow

Zoovu

FullStory

Click through the listed tools and find the optimal program for your Funnel Management. You can find more Conversion Optimization Tools and Web Analytics Tools on OMR Reviews. There, you can not only read about what the individual systems have under the hood, but also find comprehensive reviews and information about the manufacturer. Have fun browsing!

Conclusion: Invest in Your Funnel

Your Conversion Funnel is not a one-time project, but a continuous process and important asset in the context of your sales measures. The design of the Conversion Funnel is primarily oriented towards your target group, their questions, and problems, and should be highly user-friendly. Do you want more sales, more traffic and customers? Then it's best to invest in funnel optimization.