Funnel Analysis
Tracking user progression through defined conversion steps to identify where prospects drop off.
Definition
Funnel analysis visualizes and measures user progression through a defined sequence of steps toward conversion. By tracking how many users complete each step—from landing page to product view to cart to checkout to purchase—you identify where the biggest drop-offs occur and prioritize optimization efforts.
Funnels can be configured for any conversion goal: e-commerce purchase, lead form submission, account creation, feature adoption. Segment funnels by traffic source, device, or user attributes to identify specific friction points for different audiences.
Why It Matters
Funnel analysis transforms vague "conversion optimization" into specific, actionable priorities. Instead of guessing where to focus, you see exactly which step loses the most users—that's where improvement will have the biggest impact.
Understanding funnel metrics also helps diagnose whether problems are traffic quality (wrong people entering) or experience quality (right people dropping off).
Examples in Practice
Funnel analysis reveals 60% cart abandonment happens at shipping cost reveal, prompting free shipping threshold testing that recovers 20% of lost orders.
A B2B company's funnel shows demo requests convert well but demos-to-closed drops significantly, focusing attention on sales enablement.
An app's onboarding funnel identifies step 3 as the 50% drop-off point, leading to UX research and redesign that doubles completion.