Funnel Analysis: The Complete Guide

funnel analysis: the complete guide

Funnel analysis helps businesses find overlooked opportunities to increase conversions. It enables them to identify the drop-off points on their websites and find out how to make the most out of their traffic. 

Analyzing and optimizing the marketing funnel will help you understand the effectiveness of your marketing campaigns and customer acquisition and retention strategies.   

In this complete guide to funnel analysis, we’ll discuss how to analyze funnels to boost conversions on your website.  

Note: You need to track visitors’ behavior and interactions to analyze your funnel’s functionality WatchthemLive is a behavior analytics tool that will help you do that. Keep reading to find out more.

What Is a Conversion Funnel?

Conversion funnel or sales funnel includes the stages potential customers go through from the moment they enter your website until they take a desired action. A good conversion funnel helps potential customers research before purchasing and leads them through the funnel. If you’re successful in driving traffic to your website, but only a few of them convert, that means there might be something wrong with your conversion funnel.

What Is Funnel Analysis?

Funnel analysis is the practice of mapping users’ interactions on a website that leads to the conversion goal—for example, signing up, completing purchases, filling out a contact form, etc. With website funnel analysis, you can understand what percentage of users go through each stage of the funnel, so you can optimize any of the stages to increase conversion rate. 

Conversion funnel analysis can help you optimize the user journey on your website. By following visitors’ paths on your website, you can find out how many users reach each step of the funnel and how many come out of the bottom, becoming  new customers .

Funnels are a powerful marketing tool as they allow businesses to discover what prevents visitors from reaching their website’s goal. In addition, you will be able to track visitors’ interactions throughout your website and see how many drop out of each funnel stage to identify problems and figure out how to improve the customer journey.   

Imagine you have an eCommerce website. Here’s the path your visitors should follow to reach the conversion goal, completing a purchase:

steps to reach the conversion goal on an eCommerce website: homepage, category page, product page, shopping cart page, checkout page, thank you page

If you find out that the checkout page has a high drop-off rate through funnel analysis, it might mean there’s a problem you must fix. For example, your checkout page design is too distracting, or you haven’t enabled guest checkout

Benefits of Funnel Analysis

As more and more businesses are focusing on CRO strategies, funnel analysis is crucial to show how you can improve conversion rates. Let’s take a look at some of the advantages of analyzing conversion funnels:

1- Identifying High-Exit Pages

By analyzing your marketing funnel, you will discover which web pages visitors leave your website. In addition, sales funnel tools can show you the drop-off rate and conversion rate of each web page. 

Website funnel analysis allows you to identify the pages with the highest exit rates so you can put your main focus on optimizing these areas. By improving these pages, you will plug the leaks in your conversion funnel, increasing the chances of getting more users to reach the bottom of it.

2- Identifying the Users That Are More Likely to Convert

Customer funnel analysis enables you to track individual users and find out if they are likely to convert or not. Then, you can focus on these leads and encourage them to move further into the funnel.  

By analyzing the sales funnel, you know what customers want at each step. So, you can help them get to the next level. Maybe some customers are not sure if your products or services are worth the price, so you can encourage them to purchase by offering a discount. 

You can use WatchThemLive, a website visitor tracking tool to track specific users using their email addresses. This way, you can easily reach out to them and send them tailored messages based on how they interact with your website and convince them to convert.

Sign up here and snag WatchThemLive now!


3- Determining the Most Effective Marketing Channels

Funnels also help you identify where your high-quality traffic comes from so you can concentrate your effort on these channels to leverage them fully. 

You can see your website’s goal completions by traffic source using funnel software. This way, you can figure out which channels bring in high-converting traffic.

4- Maximizing Sales

When you analyze your website funnel and know the number of users in each stage, you will design strategies to keep sales coming. In addition, sales funnel analysis will tell you how many leads, prospects, and sales opportunities you have.

sales funnel

Remember, the goal is to have a steady flow of leads to move them through the sales funnel. If you currently have more sales opportunities than leads and prospects, you might not be in a good situation. After closing all the sales, you have to start again to generate enough leads to convert them into paying customers. 

How to Do Funnel Analysis?

To conduct funnel analysis, you need to use website analytics tools such as Google Analytics or behavior analysis tools that provide qualitative data about visitors’ interactions on your website. Behavior analytics tools make analyzing the conversion funnel much easier as you don’t need to analyze numerical data to understand user behavior. 

Below, we’ll explain how to use these two types of tools to analyze your sales funnel.

How Does Google Analytics Use Funnel Analysis?

Google Analytics enables you to define the actions you want visitors to take as goals. Then, you can set up a funnel that includes the steps that lead to that goal for each one.

After defining a goal, you can create the funnel in the “Goal details” section. Here you have to add the URL for each funnel stage, then turn on the funnel option. After saving the funnel steps, GA will start tracking the website visitors that enter the funnel. 

You can find your funnel visualization in the “Conversions” section under “Goals.” You can see the percentage of visitors who proceed to each stage, the funnel conversion rate, and the percentage of people who have completed the goal. In addition, the funnel visualization allows you to see at what stage most people drop out, so you know where you should make improvements. 

Google analytics funnel visualization

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Conducting Funnel Analysis with Behavior Analytics Tools

A behavior analytics tool such as WatchThemLive can help you easily understand your website’s visitor behavior, which is key to marketing funnel analysis. This tool will help you get insights into users’ interactions at funnel drop-off points and high-exit pages to understand what’s going wrong. 

Let’s see how the features of this tool  help you analyze your website funnel:


The Heatmapping feature shows an aggregate of users’ clicks on your web pages. You can see which elements users click on the most and which ones they ignore. Set up heat maps on your high-exit pages to discover what elements are probably making visitors leave your website.  For example, if the heatmap shows you the CTA is getting few clicks, maybe you should make it more visible.


Session Replays

The session replay feature enables you to watch video records of user sessions on your website. Unlike heatmaps, you can track individual user interactions and get more detailed insights into why visitors might be leaving your website. 

You can see what visitors do and what happens right before they abandon your website with session recordings. Especially keep an eye on high-exit pages and see how people interact with them. How are they engaging with the content? Is there too much information overwhelming visitors? Is there anything making them frustrated? 

This powerful tool helps you detect problems and clearly understand visitors’ experiences on your website. Therefore, you can create a better experience to encourage visitors to move further down the conversion funnel.

WatchThemLive session replay

Setting Goals

Just like Google Analytics, WatchThemLive lets you set conversion goals for your website and see how many people complete them. You can add as many goals as you want and keep track of visitors’ actions on your website. Watch this video to find out more:

Try out WatchThemLive now and boost conversions! Sign up here and get started!


Funnel analysis is a powerful way to discover why you are losing conversions. It helps you understand exactly where your website visitors drop off so you will know where to direct your focus to get the best results. If you have a low conversion rate, or visitors are unusually dropping, this means there’s something wrong with your funnel and you need to start optimizing it. For this purpose, you should measure different funnel metrics to understand how well it’s working. 

In this article, we explained what funnel analysis is, its benefits, how to use Google Analytics to analyze your funnel and in the end, we introduced a good GA alternative.   

WatchThemLive is a behavioral analytics tool that offers session replay software. This tool allows you to see what visitors are doing as they go down through the funnel. For example, you can see at what stage and why users leave your funnel, so you can build a better customer journey and increase revenue. 


Good luck:)

Cyrus Nambakhsh
Cyrus Nambakhsh
Cyrus is a serial entrepreneur, product-led-growth expert, a product visionary who launched 7 startups. He has built scalable platforms to help businesses and entrepreneurs. Visit my profile here: ==> Contact: [email protected]
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