You've worked hard to build an eCommerce store. Now you need to figure out how to make it profitable. It's not easy, but there are some simple steps that can help you increase your conversion rates and profits.
One of them is by using a conversion funnel template. What is that and how does it work? We'll walk you through those below.
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There are numerous ways to boost sales, including optimizing your website based on customer feedback, providing clients with more attractive deals so that they will make a purchase, and offering additional incentives like free shipping.
However, before you can move to these methods, it’s essential to make sure that your customers can use your website in a way that is convenient to them and which takes their needs into consideration. There are many ways in which you can do this, but one of the easiest (and most effective!) options for store owners is to build a conversion funnel.
What is a Conversion Funnel?
Also known as a marketing funnel or a sales funnel, it is a method of visualizing the way in which your customers move from one stage to another with the end of the funnel leading to a purchase.
A conversion funnel essentially maps out the journey your customer takes from catching sight of your ad or post to arriving at your website and navigating it, to finally making a purchase.
This pathway is visualized using a funnel because customers are guided through the process in such a way that they are provided with lesser and lesser navigation options at each step, slowly directing them so that there is only one clear option at the end (to sign-up or make a purchase).
Customers start off at the widest part of the funnel (imagine the mouth of a funnel), where they have a wide number of choices they can make, and are guided to narrower steps, where their options are eventually limited.
What does the marketing funnel have to do with e-commerce? This is a proven marketing strategy that promotes the conversion of potential customers to buyers.
This strategy also helps you understand how marketing messages are impacting your website. It's difficult for an e-commerce business owner to know what marketing messages are most effective, but this type of analysis can help identify which ones lead to more conversions and higher profits.
How do you begin with creating a conversion funnel for e-commerce? First off, you need to understand the AIDA funnel.
What is the AIDA Funnel?
The AIDA Funnel is easily the best type of funnel that can relate to the e-commerce business.
AIDA stands for Awareness, Interest, Decision, Action.
The idea behind AIDA is that people move through various stages on their way to becoming potential customers, and marketing messages can help them move across the stages.
Let’s look at these in further detail and how they relate to the e-commerce business system.
This stage is when potential customers are first made aware of your brand.
The Awareness Stage is your customer’s first encounter with your product or even just a hint of what your product can do for them.
The marketing message you send is intended to make them realize that they have a problem or a need, and that there’s something in it for them if they choose to purchase from you.
More often than not, though, you won't push for a sale at this stage. It's enough that you catch their attention enough to encourage them to learn more about what the product is all about or how their problem can be solved.
When it comes to e-commerce, the best way to establish awareness of your products are as follows:
Social Media Presence
You should start by creating your own Business Pages on social networking platforms that your potential customers belong to. This could include Facebook, Twitter, Instagram, Tiktok, LinkedIn, or even Youtube. To find out which social media sites you should use, you should check on the demographics of each one.
After creating your business page, you should proceed by introducing your products and sharing them with people you know. This can help grow the presence of your business page to help you find organic viewers.
You can also boost your social media posts by using ads available for each platform.
Take this post by Toms Clothing as an example. While this clothing brand is already well-known, they use social media posts to introduce or increase awareness of a specific product (in this case, Ezra’s convertible heel flips).
Paid Display Ads
While social media posts can help capture the attention of organic audiences for free, paid display ads help build awareness of your products by showing banners across a multitude of online properties for a fee.
Paid marketing ads are marketing messages that are presented on various online platforms to help increase the awareness of your products. These ads are typically shown as banners and can be effective in marketing your products, especially if you go for a marketing strategy that accurately targets your audiences.
One example of a banner ad campaign by an e-commerce business is this marketing campaign by a solar power generator brand named Jackery. Since banner ads have limited space, they use the image to tell the story and a short text to tell potential customers exactly what the products are and what you can do with them.
This banner ad will likely be displayed on content websites and blogs.
To make your paid advertisement more effective, make sure they are displayed on websites whose content is relevant to your products or niche.
Generally, you can mark the Awareness stage as successful when the customer engages with your post or ad. For instance, if your audience has liked or shared your social media post, it confirms their awareness of the product.
If the audience clicked on the link to learn more about the product, then that's a good sign that the audience is more than just aware; he is ready to move to the next stage of the AIDA funnel.
Involves generating interest in your products. You will need to generate enough interest that customers want to independently research your products (or the services you’re offering) further in-depth.
Essentially, the goal at this stage is to get customers to think of your offerings and think, “I like it.”
This is the stage where your audience starts looking into what you offer further than just a passing glance or scanning through it quickly. They could be interested in learning more about how your product can help them solve their problem or improve their lives somehow.
When it comes to e-commerce, the Interest Stage starts when your audience lands on your product page to learn more.
At this stage, they are starting to become curious about what makes your products different from other alternatives out there in the market today. They may also be comparing prices across brands and even looking for discounts on specific properties first before deciding whether or not to make a purchase from your store.
In order to get customers to like your products, the content you produce around them needs to be both engaging and persuasive.
In the awareness stage, you’ve captured the attention of your potential customers – in this stage, you need to hold on to that attention.
When it comes to e-commerce, some ways to hold on to that attention are the following:
Improve your product page
This means addressing the problem your product can solve in a succinct, interesting way. The best way to approach this is by highlighting the benefits instead of the features.
A benefit answers the question "how can this help improve my life"?
For example, if you sell products for women who are always on the go, your product page should mention how it makes their lives easier.
If they can easily carry all of their things in one bag or just type in a couple of numbers to create an alarm that will sound before they leave so they won’t forget something important at home, then they will be more likely to take a closer look at your product. (This bag sounds amazing!)
You can mention the features as supporting details.
Show Product Reviews and Customer Testimonials
Use testimonials and reviews from other customers who have already bought the item, as well as photos of people using it in real life if possible.
These are marketing campaigns that show real customers using your product -- making it more relatable for other potential buyers who may have similar problems or goals as these happy customers did.
Customer reviews can help convince your audience that the product is worth buying since other people have already tried and liked it.
Create a Product Video or Demo
Showing people how to use and/or apply your product will help potential customers see its value and relevance in their lives, which can turn them into prospects who are ready for the next step of the marketing funnel: the decision-making stage.
At this stage, your audience is weighing their options and deciding which product to buy.
If they see that there's a chance for them to get into the Interest Stage by visiting your store or website, then chances are they will do that instead of buying from another source -- even if you're selling at higher prices than competitors in the market.
This is the phase in which you should aim to move the customer from knowing and liking your product to wanting it and deciding to go for it. It is at this stage that customers are convinced that your product or service is something that they should spend their money on.
In order to be successful in this stage, you need to be aware of your product’s USP, its unique selling proposition – the reason why customers should choose your brand over a competitor.
It’s essential for business owners in this stage of the conversion funnel to remember that customers make purchases from companies that they:
As you’ve already covered the knowing and the liking parts of this equation, the Decision stage should convince potential customers to trust you, your brand, and your products.
When it comes to e-commerce, the end goal of the decision stage is for the customer to start the purchase process. The most concrete action would be by adding the product to their cart.
How then do you convince your customer to add the product to the cart? By intensifying the need to purchase the product now. You can do this by:
Increasing Urgency and Add Scarcity
Countdown timers and limited quantity notifications help convince the customer that they need to purchase now if they don’t want to miss out on a discount or the product itself.
People are more likely to buy when there's scarcity involved, so why not use this marketing tactic?
You can also show real-time products that have been added into carts and wishlists by other customers which will give your potential prospects an idea of how popular you really are as a brand.
Furthermore, seeing the countdown timer almost run gives a giddy feeling that is supported by the next strategy.
Enhance FOMO (Fear Of Missing Out) and Herd Mentality
Nobody wants to be left behind. Case in point: the emergence and continuous proliferation of social media platforms.
People want to be continually feel seen, heard, and be a part of something. It is a part of our survival instincts. When it comes to products being sold online, people almost automatically rush to purchase something they think everyone else is getting but them.
Discount marketing is one of the most commonly used methods to convince customers that they need to buy now.
In this case, you’re not just convincing them that your product will benefit their lives because it's a good deal, but also because other people have already purchased from you and loved what they got in return -- which can lessen the fear of purchasing something without being able to test out first.
This increases brand trustworthiness if handled properly along with customer retention rates through incentivizing purchases for repeat customers.
Using Free Shipping as an Incentive
The most common incentive strategy would be offering free shipping when someone makes a purchase above a certain amount or within a specific time frame.
This marketing tactic is very popular because it's a win-win for both the customer and the business owner.
It builds trust on your end as a brand while giving customers an incentive to purchase from you now without going anywhere else -- which means they're also more likely to make a return visit later down the road if or when they need something new.
These are just some of the ways that you can sweeten the deal for your potential buyers. For a more intensive guide on how to use numerous psychological techniques in marketing, read our article on the 13 Marketing Strategies to Grow Your eCommerce Business.
There’s a good chance that your marketing funnel can turn them into paying customers if you make it easy for them to go from one stage to the next until they get all the way down to Action Stage.
Also known as the Conversion stage, this is where you convince customers to take the action you desire. This can be anything from making a purchase to signing up for a newsletter or following you on social media. It is at this stage that customers should move from a mindset of “I want it” to “I’m getting it.”
In e-commerce, the end-goal is for the consumer to complete the checkout process, meaning the payment should be processed and confirmed.
The CTA at this step should be crystal clear on the benefits that taking the action will bring to them. It should be uncomplicated and prominent and convince them that taking the action is the right choice for them.
In order to successfully move a customer through the action stage of the conversion funnel, the process for them to take that action should be clear and easy to navigate.
Optimize Checkout Process
You will therefore need to ensure that the checkout process is optimized. Make certain that customers are not presented with unexpected surprises at the last moment that may lead them to change their minds (such as unexpected shipping or service costs), and confirm that the process is as short as possible.
You will also need to analyze your checkout form to ensure that there are no unnecessary fields and that you have numerous payment options so that no one turns away due to an inability to pay.
For example, if you only sell digital products such as e-books, your checkout form will likely not need a “shipping address” section. Removing this from your form will make it easier for customers to complete.
Test the Flow
At this stage, you should also thoroughly test a variety of checkout pages to see which performs the best before taking it live. This process should be completed every time you make a change to the checkout process – you should ask yourself whether the change benefits the customer.
If it does not, you will need to seriously consider whether the change is one that is worth making.
You can also increase the sense of urgency in this stage to make sure that your customer does not back out right when they’re about to complete the purchase.
You can add a checkout timer that indicates how long the cart will hold the product on temporary reserve while the customer completes the order. This technique will be effective if you indicate that there is limited availability of the product or service.
An Extra Step: Retention
Though the AIDA conversion funnel only sets out four stages, most businesses add another other at the end of the funnel – retention.
This stage is focused on ensuring that customers return to your website and repurchase from your brand. It’s a crucial part of any conversion funnel because retention is more valuable to a business than customer acquisition.
Retention costs less than acquisition does, and it’s easier to successfully guide returning customers down the conversion funnel than it is with newer customers. This means, essentially, that returning customers convert better and are more likely to make a purchase.
Some ways to improve retention rates include:
- Ask customers to sign up to marketing channels so that they will remain aware of your brand. This includes asking them to follow you on social media, sign up for SMS marketing messages or an email newsletter, and so on.
- Provide incentives for future purchases, such as a small discount or additional services such as free shipping. You can place a time limit on these incentives so that customers will have to return to your website sooner.
- Ensure customer service is prompt and effective so that customers feel like they are valued. As mentioned above, customers need to like and trust a business to buy from them, and caring customer service helps people trust brands.
- Stay true to your company’s values. Customers are more likely to buy from companies whose values they feel align with their own.
The most effective retention strategy right now is SMS Marketing, especially since text messages are sent directly to your customers’ phone numbers with minimal barriers. To encourage customers to subscribe to SMS messaging from your business, turn the option on during checkout. Just make sure to indicate opt-in for compliance’s sake.
Advantages of Optimizing a Conversion Funnel
Now that you know how a conversion funnel works and how it relates to e-commerce businesses, let’s talk about how optimizing this funnel can help you (that is, if you’re still not convinced that optimizing your funnel is necessary).
There are a number of ways in which a conversion funnel can benefit your business. These include:
1. Helps you understand a buyer’s journey.
By mapping out the journey that a customer takes when making a purchase, you can easily identify the pain points in the process. You’ll also be able to determine where you need to refine your funnel and how you can make the journey more convenient for customers.
2. Allows you to understand customer motivations.
A marketing funnel allows you to track sales by helping you understand what motivates a customer to research and purchase your products.
You can use the information gathered from the conversion funnel to determine what actions you should take to boost conversion rates. These can include calls, increased social media activity, marketing emails, and so on.
3. Helps you optimize your marketing strategy.
As mentioned above, the conversion funnel will help you analyze what motivates a customer to make a purchase. Additionally, it can also help you understand the reasons behind customer behavior at each stage of the funnel.
All of this information can then be used to adapt your marketing strategy, making it more likely that customers will follow you down the funnel as you want them to.
Help you determine when and how you should nurture your relationship with customers through strategies like additional communication, personalized offers, and so on.
Allows you to determine why certain strategies only work at certain stages of the funnel and help you analyze whether and how those strategies can be expanded to cover the rest of the funnel.
How to Create Conversion Funnels for eCommerce Stores
When creating an AIDA funnel for your eCommerce store, you will need to make sure it is tailored to the unique demands of your website, your products, and your customers.
To create an optimized funnel, you will need to follow three steps:
Identify your customer journey
This involves figuring out what people do when they arrive on your website. You will likely have to create a customer journey for each of your website pages and consider whether people react differently when they enter your website via one page rather than the other (for example, via a product page rather than the main homepage).
Additionally, you’ll also need to consider which platforms bring in the most traffic to your website and which of your website pages those platforms lead to.
Finally, you’ll need to consider how many pages an average customer browses before making a purchase.
Shopify by default monitors the channels that deliver the traffic and the rate at which these viewers make a purchase.
However, these reports are very limited. For example, if you create multiple Facebook posts for a specific product, how will you know which among them sent the best converting traffic?
In such cases, you would need third-party analytics apps such Google Analytics. You would have to use link variations by adding UTM tags to your links for better monitoring.
Map your funnel stages
Use the AIDA funnel explained above to create a plan for how you will guide your customers through each stage of the funnel.
This will help you determine what content you will need to display on each web page and help you decide what pages on your website will need to be tested before they are taken live.
Define when a visitor turns into a lead
For most eCommerce businesses, this point is when a visitor hands over some form of contact information to the website, such as an email address.
However, as many eCommerce businesses see the most benefit through SMS marketing, you may decide that the point when a visitor turns into a lead is when they agree to SMS marketing messages from your brand.
No matter what point you choose, once you have settled on a point, you can then use it to nurture your customers through the funnel, even if they choose to leave your website without a purchase.
In order to do so, you’ll also need to have an effective lead nurturing strategy, as well as a plan on how to create SMS content (or email content, should you prefer email marketing) that guides them through the marketing funnel even when they are not actively visiting your website.
Learn the Conversion Analytics that’s Important to You
You will also need to know what conversion analytics you’ll be focusing on. These will help you determine whether or not your conversion funnel is a success.
Conversion analytics and KPIs that are most commonly tracked include:
- Overall conversion rate
This is the most basic measure, this determines the conversions you have against the total number of visitors. It is usually depicted as a percentage. This number is usually low; for eCommerce websites, it averages 2.63%.
- Marketing channel conversion rate
This is the rate of conversions you get based on each of your marketing channels. Your conversion rate for Facebook, for example, will likely differ from that for Twitter, which will both differ from your conversion rate for AdWords or Instagram.
- Page conversion rate
This tracks conversion rates for the different pages on your website
- Campaign conversion rate
This is the conversion rate for each individual ad campaign that you run.
- Individual ad conversion rate
It’s precisely what it sounds like – how effective each individual ad you run is in affecting conversions.
- Keyword conversion rate
This allows you to find which targeted keywords have the best conversion rates if you are running paid display or search ad campaigns.
- Click conversion rate
This refers to the number of unique visitors who convert (in comparison to the standard conversion rate, which only looks at conversions as a total number). Keeping track of CCR is a key factor in reducing churn.
- Cart abandonment rate
This is the percentage of shoppers who add products to their online shopping cart but leave before making a purchase.
You can later target people who abandon their carts with SMS and email marketing to bring them back to your website and guide them through the conversion funnel once again.
- Add to cart rate
This one is the percentage of visitors who add at least one product to their cart when visiting your website.
- Customer lifetime value (CLV)
This means the total sales you can expect from a single customer the entire time that he remains a customer. There are various ways to compute the Customer Lifetime Value, which is why we created a separate article focusing on this topic alone.
- Average order value (AOV)
This one is the average value of the products a customer will order when making a purchase on your website. Brands aim to increase both CLV and AOV in order to increase profits.
- Retention rate
This calculates how many customers return to your website and make repeat purchases.
- Repurchase rate
How many people return to your website to buy the same product? That is the question that the repurchase rate answers.
It is usually measured within a specified timeframe, usually 30, 60, or 90 days since the first purchase. Once the time frame is over, the clock is reset.
This refers to the number of people who return items they have purchased from your website.
All of these factors will help you refine your conversion funnel. For example, if you find that your conversion rate from SMS marketing campaigns is higher than that from email marketing campaigns, you’ll know to focus on them in your conversion funnel.
Alternatively, if you find that CLV is lower than you would like, you can return to your conversion funnel and look for ways to adjust it so that it motivates customers to return to your website.
Shopify Apps for Marketing Funnels
If you use Shopify for your eCommerce website, it’s possible to create personalized conversion funnels easily and quickly with the help of one of the many apps available on the Shopify app store.
However, the large number of options can make it challenging to distinguish which app is truly effective and which isn’t. To make things easier for you, here are some of our favorite apps:
Quiz Funnels is an interactive quiz that is shown to your customers.
Based on their answers, they are provided with personalized product recommendations, offered personalized messages, and more. It’s a great way to guide your customer down a conversion funnel while keeping things light and fun for them as well.
This app can help businesses grow their audience, convert more leads, and grow their revenue. It can integrate with a number of tools, including:
Pricing starts at free for the basic, no-frills plan. However, this plan only allows 10 engagements per month, which is far too little for most websites. Paid plans start at $35 per month and go up to $195 a month. The app also offers a free trial for people looking to try it out before paying to subscribe.
Helixo: Upsell Funnel Engine is an app aimed at upselling and increasing website revenues. It does so by allowing you to create a sales funnel that can provide customers with everything from personalized recommendations and upsell bundles to discounts, tiered pricing, and everything in between.
You can create an unlimited number of sales funnels on this app and test them out through – the app also offers unlimited A/B testing. The ultra-lightweight script will take up barely any space on your website, and the simple design of the funnel means that it will launch within 30 seconds.
The app also works with a wide range of payment processors (including the native Shopify checkout), so you don’t have to worry about you or your customers being limited to choice.
It’s available in a range of prices, starting at free and going up to $249.99 per month, depending on how much you use it. If you have more than 100,000 per month, you’ll need to contact the developers for custom pricing.
Zipify Pages is a landing page builder that allows you to completely customize your landing page and help guide customers through the conversion funnel. It boasts a library of hundreds of landing page templates and sales funnels that you can use for your own or as inspiration when creating a custom option.
The app lets you both build and A/B test your pages, so you can be confident you’re only taking the best options live. Templates in the library are chosen because of their track record for high conversion rates and combined with testing, you’ll be able to refine your conversion funnel to provide customers with the best experience possible.
Pricing starts at $67 per month for the basic plan, which covers up to 250,000 page views a month. The plus plan covers 500,000 page views monthly and costs $97 per month.
If you want more page views, you’ll need to contact the developers about the Enterprise plan and ask for a quote regarding the same. The app also comes with a 14-day free trial, so you can try it out before making a purchase.
Final Thoughts on Conversion Funnels for e-Commerce
When marketing for eCommerce, you should always aim to get the customer from start (Awareness) all the way down to Action.
The main goal is not just about convincing people of how amazing your product is but also understanding their state of mind and what it takes for them to buy something online -- which means being able to create a marketing funnel that guides customers through each stage seamlessly.
These strategies work best when used together rather than separately because then you’re using psychology tactics instead of merely throwing money into marketing ads without much consideration on where these ad dollars are going.
A marketing funnel is all about creating a consumer flow that leads people to the end goal, which in this case is for them to make an actual purchase.
The use of psychological marketing strategies can help you optimize your conversion rates while also lowering user drop-off rates in between each stage or when they leave without taking any action at all. A marketing funnel will give you more control over how customers interact with your brand and what actions they take after exploring it -- making it easier for potential buyers to become paying customers eventually.
One last tip: don’t be afraid to test out different options until something clicks because there are ways around most hurdles if you know where these roadblocks are coming from. With enough trial and error, you should be able to figure out the marketing funnel that works best for your e-commerce business.
You don’t have time for slow conversions anymore – we know that better than anyone else because we work with other companies like yours every day who are looking for ways to grow their businesses faster than ever before. Sign up for a free trial of our SMS Marketing service and see your conversion rates improve within days!