5 Stages of an eCommerce Conversion Funnel (+Examples)

As an eCommerce store owner, you already have a conversion and marketing funnel in place. 

However, are you optimizing the conversion funnel to get more sales?

The eCommerce marketing funnel has five stages: Awareness, Interest, Desire, Action and Re-engagement.

In this article, we'll uncover optimization strategies for each stage with EXAMPLES:

• Awareness (how to TELL shoppers)
• Interest (how to make shoppers CARE)
• Desire (how to make shoppers WANT what you offer)
• Action (how to make shoppers click on the CTA)
• Sales & Re-engage (how to get REPEAT buyers)

Stage #1: Awareness (how to TELL shoppers)

"In awareness stage, TELL shoppers about your USPs to help them discover products and like your brand." - Luke Perry, CRO expert, Convertcart

1. Grow your audience with the Facebook Lookalike strategy

Facebook's Lookalike is a top of the funnel marketing strategy that allows you to target new people similar to the ideal customer. 

It might sound similar to the Adwords “Similar Audiences”.

But the major difference is that Facebook's feature is not based on certain defined parameters. 

Instead, it finds shoppers having traits, interests, and disinterests similar to the profiles suggested by you. 

This way, you can reach a wide but relevant audience. 

Here’s how you can set up Lookalike Audiences on Facebook to optimize your eCommerce marketing funnel:

• You can either do this during the Ads creation process using Ads manager or go to Audiences
• Create audience > Lookalike audience
• Choose the source. This can be from your pixel data or can be a custom audience
• Pick the desired country/region
• Pick the ideal size. Don’t keep it too wide. Facebook recommends the range of 1000-50,000
• Click on Create Audience
• It takes up to 24 hrs to create the audience and about 3-7 days to update the target for any active ads

2. Find negative unsatisfied customers of your competitors online

When a customer is unhappy with a product or a brand, they are usually quite vocal about it through reviews. 

- Find customer reviews on Amazon or the competitors' websites

Go through their public profiles and study their activity online.

See what products they buy, why they don’t like a product, what their needs are, etc. 

With this information, update Audiences on Facebook or Google to run more effective ads. 

- Get active on Quora

Search for ‘reviews’ with competitor brand names. 

Respond to negative reviews with a convincing pitch and draw their attention to your brand—elaborating on why it could help them solve a problem.

The key to success here is to identify their needs, what was missing in the competitor’s product and tailor your pitch to drive more conversions. 

3. Partner with the right brand for a coalition loyalty campaign

Many eCommerce stores stay away from coalition loyalty campaign either due to poor experiences or lack of justifiable ROI. 

As a top of the funnel marketing strategy, the key is to find the right partner brand to work with and build a long-term relationship with them and improve your eCommerce marketing funnel. 

When choosing your ideal brand partner, consider:  

- Relevance to your brand (Can you pitch an offer together?)

- Is it a highly dependable relationship? (It has to be. Otherwise, you risk losing partners in a short period.)

- What do they have to offer and what can you give in return? (Assess the greatest strengths of the individual brands, and see what exchange would fit the context.)

Once you have the right partner, keep the following tips in mind when creating a loyalty program:

- Run collaborated surveys to gain maximum insights before drafting the program

- Bundle your products smartly (you can use this opportunity to clear some slow-moving stock while getting new customers to your best-selling products)

- Seek social proof from existing customers (social shares, referrals, and a comprehensive review of certain products)

- Have tier-based rewards systems (for instance, if they promote your product, get a valuable referral, and are frequently participating in your sales campaigns, they get a high-value freebie—for just a social share, they could earn a flat 10% off any product)

Hey, you'll love this: 14 eCommerce Loyalty Programs Backed By Science (Examples)

4. Find channels that drive relevant traffic

When targeting, cast a wide net.

To attract leads that can become customers in the eCommerce funnel, figure out where the best traffic is coming from. 

In Google Analytics’ referral source reports. 

Go to your Acquisitions → Overview, and you’ll see a report similar to the one below:

On the top, you can see the channels bringing in the most traffic to your site.

In this example, it’s Direct. 

Next, see the average session duration, pages per session, and bounce rate.

In the last section, see the channels bringing in the most conversions for your store.

To view that traffic sources, open your All Traffic report on GA:

Click on secondary dimension, choose source/medium and that will give you the breakdown of the search engines and other details about where you’re getting the best traffic and what can be done to leverage them more.

If your ad campaigns are bringing in traffic that converts, invest more in ad campaigns that can help to maximize visitors on your site who are looking for your product and are genuinely interested in buying it.

Here's an interesting read: eCommerce Customer Segmentation: 10 critical mistakes businesses make

Stage #2: Interest (how to make shoppers CARE)

In the interest stage, you need those website visitors to turn into leads, so come up with compelling copies and visuals that set you apart from other stores. - Mike Hale, UX specialist, Convertcart

1. Promote UGC on social media and website

To pique the interest of potential customers:

- Send user-generated content like social posts, promote photo collabs

- Promote positive reviews on Amazon or your website

- Allow customers to add images & videos to their reviews on your product pages

2. Have video-based product descriptions (include social proof)

Over a third of the audience (esp Gen Z) prefer to learn about the product through a video. 

While it is important to have a creative and compelling written description, having a product video will help convert the younger audience. 

Check out how video-based product descriptions are uploaded on Amazon.

More inspiration right here: eCommerce product videos: 30 brand examples to learn from

3. Proactively address queries through FAQs

Having an FAQ section on the website can leverage the interest stage of the eCommerce funnel.

It helps attract new visitors to the online store through improved SEO. 

What to avoid: “How is this product better than what’s out there?”. Include that in the product description. 

What to address: “What are the materials used to make the product?” or “If the product fails to work, can I get a replacement?”. Cover topics regarding customer support, privacy policy, and shipping information. 

To create a list of such queries, browse through Quora and look at what potential customers ask about the product and a competitor's brand. 

4. Introduce Live Chatbots 

Over 85% of visitors have had a good experience with a chatbot. 

Consumers feel that they are prompt, help address queries immediately and keep them engaged. 

If you have a store on Shopify, here’s how you can set this up:

• Customize Theme > Customize Button
• Footer Option on the Left Side Panel
• Click Theme Actions > Edit Code
• From, you would need to copy and paste the code snippet of your preferred chatbot app

5. Run tests & collect data (always a good idea)

It's crucial to understand how shopper's behave.

Heatmaps are a visual representation of where shoppers focus their attention on the site and where they don’t. 

You can also conduct A/B tests. Create two variations (Variation A and Variation B) and test them out against each other. After running the test, see which variation generated more conversion against another. 

For example, you want to test which CTA will generate more conversions between orange and green. The test might look something like this:

Explore more with: 153 A/B Testing Ideas for eCommerce (Homepage, PDP, Cart, Checkout)

6. Find where shoppers (generally) drop off

Each level of your eCommerce funnel filters out users who aren’t interested and qualifies the others to the next level.

This process creates drop offs—essentially shoppers who aren’t interested to move forward in the journey towards a macro conversion. 

So, how can you identify these leaks in the sales funnel?

Open Google Analytics → Go to Funnel Visualization Report → View a detailed visual representation of how users move through your website 

Select “conversions” from the Analytics menu and then click on funnel visualization.

The above screenshot is a breakdown of the journey a customer has taken on an online eCommerce store. 

You can see here at what stage you are losing the visitors and what steps they’re exactly taking rather than staying on the website.

From here, you’ll have to weed out what leaks are causing a significant dropout and which ones don’t make any difference.

Another way to do this is with the Reverse Goal Path report.

This report shows you how a visitor arrived at the conversion rather than how they moved through the eCommerce funnel. 

You can also refer to the Goal Flow report for similar insights.

This report provides an analysis of the common paths taken by users from the beginning. 

This can help you monitor visitors’ behavior and if their actions are in line with your conversion funnel. You'll also understand if you should make any changes to the conversion funnel.

We think you'll love: Does infinite scrolling kill conversions? Here's what we found

Stage #3: Desire (how to make shoppers WANT what you offer)

In the desire stage, solve solutions to create conviction. - Luke Perry, CRO expert, Convertcart    

1. Highlight security certificates and payment modes

About 15% of the visitors abandon their cart owing to concerns about security. 

SSL certificates, multiple payment options, and trust badges help get rid of these worries. 

The key here is to place them in the right place on your website. 

On the product page, place them right under the CTA button or the product title to grab their attention. 

If you run your store on Shopify, this is taken care of for you.

Here’s a quick eCommerce funnel example:

2. Make your exit-intent pop-ups compelling

You can save at least 10-15% of your visitors with a well-crafted exit intent popup. 

However, you need to first understand what a good exit intent popup looks like in today’s eCommerce funnel dynamic.

Here’s an example - rather than saying “hey, how about a flat 50 off?”, you can allow visitors to save the product to come back to it later. 

The image below is a clear eCommerce funnel examples of this:

As you can see, it’s not pushy with its messaging. 

It allows visitors to save their items of interest to later come back and purchase them. 

This way, you get some action from them without completely driving them away. 

Read for more ideas: Exit-Intent Pop-Ups: overcoming common mistakes + 20 brilliant examples

3. Make it easy to compare options

At this stage when you have a shopper's attention, don’t risk losing them to a competitor. 

Here's how to create a stcutured comparision chart:

- Create a comprehensive product comparison chart for your products and also include your competitors’

- Add in details that make your brand stand apart fromthe rest (if your price is higher, wow them with the features—articulate precisely so that they know what they’re paying for)

- Add in reviews, ratings, and product specs (you can also add best-seller tags and a “Who generally buys this product?” section)

By the way, if you can’t name your competitors, just compile the information under “Other products/brands” and save yourself from a potential lawsuit without missing out on a sales opportunity.

4. Set goals for soft and hard conversions

Once a flow for customers is established, measure how shoppers are navigating through the store.

To measure how your eCommerce conversion funnel is performing, set up goals in Google Analytics at every step.

Log into Google Analytics and go to Admin Settings → Select the view or the concerned page → Click on ‘goals’ from the drop-down menu.

Next, click on New Goal on the upper left side. It should appear like this on your GA:

From here, you will have different options to set up your goals. 

On the top, there are different templates to choose from. 

These include online registration, submitting content, referring friends,  reading reviews, etc.

If any of these options match with conversions you want to measure, set up those templates and assign yourself a goal. 

For metrics that don't show up here, create custom goals.

Google Analytics allows four ways to do it:

• Destination: When users visit a particular URL
• Duration: The amount of time spent by the user on the site
• Pages per session: Number of pre-set pages viewed by a user
• Event: Action taken by the user on the element tracked by JavaScript

With each new goal, you can also add a funnel. 

This means you can add a list of pages that users visit before completing the action, which can later help to measure conversions more effectively.

Dive deeper with: The only 10 metrics eCommerce founders should track

5. Identify where micro-conversions happen

When developing an eCommerce funnel, look into micro-conversions that lead to macro conversion—of the visitor turning into a customer.

Some common micro-conversions can look like:

• Newsletter sign-up
• Browsing specific pages such as product pages, category pages, homepage, etc.
• Adding products to the cart
• Product launch sign-ups, etc.

Micro-conversions can include as many actions as you like, depending on the business type and site.

Segment what content the customers will see at different stages that will prompt them to move ahead.

Hey, have you seen this? 11 brilliant ways to get More micro-conversions (Updated 2022)

Stage #4: Action (how to make shoppers click on the CTA)

The action stage is focused on making shoppers click on that shiny CTA button. This is also the stage where most dropouts happen. So start with small tweaks to achieve a significant improvement in your conversion rates. - Mike Hale, UX specialist, Convertcart

1. Offer guest checkout option on the checkout page

Nearly 40% of visitors who abandon an online store do so because of having to create an account. 

Instead of having them sign up, offer a guest checkout option to make things faster.

Here’s how you can enable it if you own a store on Shopify:

Shopify admin > Settings > Checkouts > Under the customer accounts section choose “Accounts are optional” > Save to confirm.

Here’s how it’ll look on your site:

An alternative to this is to enable Social Login. This allows you to gather all the information you need and connect with them post-purchase without having a long process. 

For more insights, read: Guest checkout: Still a good choice? (+16 way BETTER alternatives)

2. Reduce the number of form fields 

‍An experiment found that 5 form fields convert the best.

The details can include the email address, delivery location, and full name.

Following the 5-field rule, split the location into 2 fields and also add in a field for their contact information. 

Here's a study comparing usability performance and number of form fields:

3. Customers expect full disclosure (pricing and policies)

When customers are ready to checkout and purchase a product, they are convinced that it is worth a certain amount of money. 

But during payment, if they are met with a new, hiked-up price with little to no explanation, it's difficult to expect a completed transaction.

Provide a clear explanation of the total cost including tax information and packaging fee. 

Apart from this, on the same page, mention the terms and conditions of the refund and return policy. Keep it crisp and straightforward to avoid any misinterpretation. 

Something that might interest you: 14 Brilliant Examples of eCommerce Return Policy (+ Proven Tips)

4. Measure the right metrics

To keep your eCommerce funnel going in the right direction, you need to measure ALL the right metrics and accordingly find & fix gaps.

Here are 8 metrics that'll help you measure the effectiveness of your funnel at each stage:

i. Conversion rate: Measures what percentage of your total visitors actually convert into paying customers.

You can calculate this metric by using this formula:- Number of customers/ Total or average website visitors.

ii. Click Conversion Rate: Similar to the previous metric, this measures the click-through rate to conversion ratio. For instance, if you ran an Ad campaign and it had 1000 clicks and 100 customers, it means that you have a 10% click conversion rate.

You can calculate this metric by using this formula:- Number of conversion clicks / Total clicks.

iii. Cart Abandonment Rate: The rate at which your visitors leave your site without buying anything. In specific, how many visitors add something to the cart and then leave without completing the checkout?

You can calculate this metric by using this formula:- 1 - Number of completed checkouts / checkouts initiated x 100%

iv. Add to Cart Rate: Measures what percentage of your visitors add an item to your cart.

You can calculate this metric by using this formula:- Number of add-to-carts / total visitors.

v. Customer Lifetime Value: Measures the value of each customer or the amount each customer has spent on your store to date.

You can calculate this metric by using this formula:- Average customer lifetime x average monthly spend x % gross margins.

vi. Average Order Value: Measures the amount of money a customer spends on your store each time.

You can calculate this metric by using this formula:- Total revenue / Number of checkouts.

vii. Repurchase Rate: Measures how many customers are coming back to buy more from your store. It could apply to your site or a single product.

You can calculate this metric by using this formula:- Number of customers who bought more than once in a particular period / Total customers in that period.

viii. Returns: Measures what percentage of your orders are returned for whatever reason.

You can calculate this metric by using this formula:- Number of return requests / Total number of orders fulfilled.

Curious? Check out 7 unconventional product page Metrics for eCommerce (& insights)

5. Make your site really easy to navigate

Each step of the conversion funnel should be designed to provoke action to the next step.

Visitors arrive at the homepage or product page, add items to the cart, make the payment, and then checkout. 

Seems easy, right?

No. Because not every visitor takes the same path. 

When you’re mapping a conversion funnel, keep in mind:

There’s an ideal path you want a customer to take, and then there is a path that customer takes, which needs to be mapped and accounted for.

Create different funnels for different user behaviors to help convert shoppers into customers.

If you attempt to push everyone through the same funnel, there'll be no significant improvement in conversions because shoppers might take different paths to reach your online store.

Understand what’s the most important goal of your website. 

It could be sales, lead generation, or getting customers to sign up. (Here's something in-depth on sign up forms)

Then look into what actions a customer should take to complete the step.

Stage #5: Sales & Re-engage (how to get REPEAT buyers)

Your goal is not only to get one-time traffic but make these people come back to shop repeatedly.

1. Order confirmation emails - it's ONLY about the order

Order confirmation emails are the first communication post purchase and see 6X more open rates than other emails. 

Avoid pitching other products in these emails.

Instead, focus more on providing every detail your customers need to know:

• The order summary
• When they ordered it
• When they receive/expect to receive the order
• The mode of payment used and the payment status
• The break-down of the cost, including taxes and shopping breakdowns
• Refund and return policy (just the important details)
• Contact information of the customer support team

Here’s a good example of the format of transactional emails by Fitbit.

Also read: Order Confirmation Page: 25 Best Practices (+ Great examples)

2. Welcome them to the community

Since the goal is to drive them back to your online store to buy more, welcome emails need to do more than just saying “welcome to the clan”.

Research shows welcome emails perform better than your typical transactional emails by 300%.

There are 4 important aspects to focus on here:

• Strong subject line and headline
• Crisp and sticky copy
• Smart placement of the CTA
• Compelling incentive

Let’s look at a few examples of good welcome emails and break them down.

Here's more to chew on: Welcome Emails Inspiration: 7 Best ECommerce Examples

3. Exclusive early access to products

During this stage of the eCommerce funnel, it is easy to drive that sense of exclusivity within your customers. 

However, you need to segment your customers to pitch to—based on browsing & shopping behavior and their interaction with your brand. 

This includes purchases from your store, searches on your site, page visits, etc. 

The more focused the group, the easier it is to create that feeling of exclusivity. 

Based on this, your campaigns need to be subtle and give out very less. 

Draw them to the website or landing page to reveal the product. 

Here’s an example of an exclusive product launch email:  

Thinking of incorporating exclusivity? Read: 6 Ways to Make Your Products Look Exclusive (& Real-world Examples)

BONUS: Frequently Asked Questions About eCommerce Conversion Funnel

1. What is an eCommerce conversion funnel?

An eCommerce funnel represents the journey customers take from getting to first know about your brand (awareness) through to buying from you (conversion). 

It's an organized map that allows you to set goals and track how well you are performing to guide them through this journey—educating them, driving desire, making them pay up and then inspiring them to buy again.

So, what is a conversion funnel?

In simple terms, a conversion funnel is a journey each customer takes through different stages on the website that ultimately lead to conversion.

The different stages include the homepage, product pages, cart pages, and checkout pages. 

There is a significant drop-off of the visitors at each stage and the number becomes smaller as you get closer to conversion. 

As an eCommerce business owner, your job is to discover weak areas and optimize them so there’s a lesser drop in customers at every stage. 

The eCommerce conversion funnel is divided into three parts: upper funnel, mid-funnel, and lower funnel.

Upper Funnel: The upper funnel or top of the funnel is when the users get to know about your brand. They might come to your website to check the products, pricing, and for overall experience, and then could go to a competitor's website to compare. 

Mid-funnel: When they're here, customers actively know about your brand and explore the offerings at a deeper level with a greater likelihood to purchase.

Bottom funnel: This is where the magic happens. Leads become customers, which increases your conversion rates.

2. What is a good eCommerce funnel conversion rate?

The Adobe Digital Index 2020 report found that most funnels convert at a rate of around 3.1% to 5%.

This, of course, can then be seen by the industry with gifting bagging the highest (4.9%) and consumer electronics bringing only a mere 1.4%.

This means anything over 2% can be considered to be doing okay and anything over 4% leaning over the “good” side. 

You will love reading 23 Scientific Strategies to Increase your eCommerce Conversion Rate

3. What is another name for a eCommerce conversion funnel?

Generally known as the conversion funnel, it can also be referred to as the sales funnel or the AIDA funnel.

AIDA here stands for “Awareness,”Interest,” “Desire” and “Action.”

4. What are the stages of an eCommerce conversion funnel?

The first stage of “Awareness” relates to shoppers coming across your brand or products when they first begin to see that they need to solve a problem. 

At the second stage, “Interest,” shoppers feel like they’re getting to know your brand and what it has to offer to them. 

At the third stage of “Desire,” they’re looking for more reasons to put their faith in your brand—which means it’s your responsibility to tell them about features, benefits and what sets your products apart. 

At the fourth stage, “Action,” shoppers are ready to go ahead with a purchase. 

eCommerce funnels also present a fifth stage “Re-engagement” where the business attempts to wheel back customers in for repeat purchases. 

5. How do I build an eCommerce sales funnel?

An eCommerce funnel is a sequence of steps designed to help an online store convert visitors into customers. 

The goal of a sales funnel is for your customers to complete the conversion or purchase process, which generally generates a monetary result for you.

The steps can be created manually or automatically depending on the eCommerce platform you use and what tools are available. 

You can follow the steps outlined above to create an effective eCommerce sales funnel.

6. Do eCommerce sales funnels really work?

The short answer is — yes. 

Sales funnels were created for eCommerce businesses to increase conversion rates so that you can make more money from every customer. 

eCommerce is a business that relies on every conversion to turn a profit and, again, sales funnels increase the chances of your customers converting into paying customers.

7. How do eCommerce sales funnels work?

The eCommerce sales funnel is an exciting and inspiring concept in online marketing. 

The concept of an eCommerce sales funnel revolves around moving an average customer through a series of stages as they progress through their purchase cycle — thereby increasing the likelihood that they will complete their purchase.

If you design a funnel well (based on customer segmentation, behavior etc.), it is bound to work, because you’re essentially sending the shopper down a path where they will see value in engaging with your brand and products. 

A customer’s journey is not linear — but the more you know about their behavior and history, becomes more predictable and recurring.

How can we help you 👇

98% of visitors who visit an eCommerce site—drop off without buying anything. 

Why: user experience issues that cause friction for visitors. 

And this is the problem ConvertCart solves. 

We've helped 500+ eCommerce stores (in the US) improve user experience—and 2X their conversions. 

Our conversion experts can audit your site—identify UX issues, and suggest changes to improve conversions.