What Is a Good Funnel Conversion Rate, How to Calculate It + 8 Guaranteed Ways to Improve It

What is a good funnel conversion rate and how to calculate it

You have built a sales funnel, you’re attracting traffic and leads, and helping them convert and become customers. However, you don’t know if your funnel conversion rate is good enough. Not enough customers going down your funnel? Maybe there’s something wrong, and you need to optimize your funnel! 

It goes without saying that you should set a goal regarding your funnel conversion rate and aim for that to see if your marketing efforts are paying off, but what should it be? How can you measure it? That’s when CRO tools come to help you!

Indeed, One of the best ways to understand if your sales funnel is doing well enough is by using session replay software. WatchThemLive offers you  many great features such as session recordings, heatmaps, visual live chat, and many more to help skyrocket your conversion rate in sales! So sign up and start today!

In this article, we’re going to learn what a conversion funnel is, its important metrics, how to calculate it, and what a good conversion funnel should be.

What Is a Conversion Funnel

So, have you encountered a strange word and are looking for its meaning? I mean, who would’ve thought funnels and marketing are connected?! Or perhaps you already know what a conversion funnel is and want to know whether your rate is considered a good one or not. Either way, you’ve come to the right place! All your answers are here.

The conversion funnel or sales funnel defines the stages potential customers go through on their journey to convert and purchase. A good conversion funnel leads buyers through all the steps. Many people might enter your funnel, but not all of them will make it to the end and purchase. However, well-defined funnel turns most of these potential customers into actual shoppers. 

Usually, conversion funnels contain three steps: the top, middle, and bottom of the funnel. However, it depends on the company’s sales model; some of them can be more complex. 

An excellent way to track your funnel functionality is using session replay software such as WatchThemLive. With this software, you can follow leads as they go through each stage of your sales funnel. It records visitors’ moves from the moment they enter your funnel until they leave. Watch this video for a better understanding: 

Interested? Sign up for FREE and see WatchThemive’s other amazing features. 

What Are the 3 Stages of a Marketing Funnel

There are 3 stages to every marketing funnel, and it’s important to know all those steps and optimize each one to lead the customers from the first step to the last smoothly and efficiently.

Here are 3 stages of a marketing funnel:


This stage is at the top of the funnel and is where people will see and know you. At this stage, you need to learn more about your potential buyers and target them. If you don’t, you’ll waste a lot of your time targeting the wrong customers. Of course, we don’t want that!

You should give all the necessary information to viewers at this stage and guide them to other steps of your sales conversion funnel.


This is one of the most important parts of every customer journey. This stage is where your potential customer will compare you to other options, and that’s when you have to convince them to always choose you! Wondering how? 

First, have confidence and explain all about your business, services, and plans! Try to make a personal relationship with your customers and show them that you care about them and their needs. This relationship is formed through your website’s content and its relevancy. 

Follow all these steps carefully, and you’ll reach the final stage!


Now, we arrive at the final destination! Your customers have made up their minds and, hopefully, have decided to choose you! This stage is where your viewers do what you want them to. It can be signing up on your website, purchasing one of your products, or any goal you might have.

Congratulations! You have led your customer through the marketing funnel successfully! But be cautious, as your job isn’t done yet. Even though you have succeeded in convincing your viewers to convert, you need to turn them into loyal customers.

Encourage them to buy from you again by updating your business, sending promotional emails, and, most importantly, keeping them happy and satisfied. Increase your retention rate and flourish your business more than ever.

What Are Sales Funnel Metrics

If you want to improve your marketing efforts and increase your sales funnel conversion rate, you need to track some metrics. These metrics show in which stage of the funnel customers are dropping and help you calculate your ROI to build more effective sales strategies. Here are four important sales funnel metrics you need to measure. 

1. Leads

You need to know how many leads enter your sales funnel in a specific period of time. For this mean, first, you should determine the source of these leads. They could have entered your funnel from email, marketing, or SEM campaigns. Also, they might have entered from sales department efforts, events, etc. 

However, this can be tricky because calculating the number of people who entered your funnel is not easy. To know the real number, you have to collect the numbers from all of your business efforts and add them together. 

2. The Duration

This metric shows the amount of time a potential customer takes to become a buyer. Usually, the shorter the duration, the better the quality of your sales funnel.

You can easily calculate the sales funnel duration by subtracting the prospects’ entry time from the time they made a purchase. Also, it is a good practice to calculate the duration of each funnel stage. This way, you can understand how efficient each stage is.

3. Sales Velocity

Sales velocity shows how long it takes to make revenue. Calculating sales velocity is especially important for forecasting revenue over a specific period of time. 

You can calculate sales velocity by this formula:

Sales velocity = (number of opportunities * average deal value * win rate) / average length of the sales cycle 

sales velocity formula
Sales Velocity

4. Average Sale

Average sale is the value generated at the end of your sales funnel. This is the average amount of money customers spend. If it’s low, then maybe you need to start improving it by conducting market research or targeting people who would spend at the end of your funnel.

You can calculate average sale by this formula:

Average sale = overall income (for a specific period of time) / Sales funnel customers

average sale formula
Average Sale

How to Calculate Funnel Conversion Rate

The most important metric you have to measure is the funnel conversion rate, which shows the number of leads who convert into customers. Depending on your goal, conversion can mean a sale, subscribing to a weekly newsletter, signing up on your site, downloading an ebook, etc. Measuring funnel conversion rate helps you come up with ideas on how to improve it and increase revenue

You also have to measure micro-conversions to better understand how to improve this metric. For example, customers entering their email addresses on their way to purchase also counts as a conversion. So you need to track the funnel conversion rate of each stage. It all depends on your business and the kind of goal you want to achieve. So, make sure to pay attention to micro-conversions

Here is the funnel conversion rate formula: 

Funnel conversion rate = (number of conversions / number of leads) * 100

Take a look at this conversion funnel for a better understanding: 

funnel conversion rate calculation
Funnel Conversion Rate Calculation

There are also many conversion funnel calculators online, such as SAP BW Consulting, Omni Calculator, and ClickFunnels which allow you to calculate your funnel conversion rate more easily.

What Is a Good Funnel Conversion Rate

Now that you know how to analyze your funnels, it’s time to delve into it more! After calculating your funnel conversion rate, you need to examine it and see whether it’s above average. It’s important to be mindful of it and take immediate action if it’s not what you want it to be.

The average funnel conversion rate of most businesses is %3. If your sales conversion rate is under %2, then maybe you should start conducting funnel analysis to see where it needs improvement. A funnel conversion rate above %2 is considered good, and a rate between 3.1% to %5 is great. 

How To Improve your Funnel Conversion Rate

As the saying goes : ‘knowledge is power’ and you have become much more powerful now that you know all about funnels! After that, it’s time to learn how to increase your conversion rate funnel more than ever!

With just a few steps, you can ensure a smooth customer journey through your sales conversion funnel. So keep reading to learn what these ways are and use them right away to reach that business owner’s dream!

1. Improve your website’s credibility to be more trustworthy and reliable to new customers. There are many ways to do so. Designing a professional website with accurate and authentic content, using testimonials, and strong customer service can all help you gain more credibility.

2. Clarify who your target audience is and focus on them. This is very crucial because if you target all viewers, not considering their potential, you’ll waste precious time and resources.

3. Use CRO tools such as WatchThemLive to track your website’s visitors and understand their behavior more to enhance your funnel steps accordingly. By doing so, you’ll be able to establish a close connection with them and fulfill their needs and answer all their questions.

4. Try to publish blogs relevant to your products to answer any questions visitors might have and improve your conversion rate in sales as it encourages them to purchase from you. When your customers find all they need through your blogs, they won’t feel the need to go after other options and will be loyal to you!

5. Personalize your website in a way to be relatable to your target audience and increase your sales conversion rate.

6. Try to make every step of your funnel as simple as possible to ensure a good bounce rate and keep viewers from dropping due to confusion or being overwhelmed.

7. Have a landing page checklist and optimize it, as it’s one of the first parts of your online business a viewer sees. That’s why you should always make sure to leave a good first expression!

8. Work on your website’s SEO and attract organic traffic. Never underestimate the power of SEO and its impact on viewers! 

FAQs on Funnel Conversion Rate

By now, you’ve probably found the answer to all your questions. If you haven’t, take a look at these questions. Maybe one of them is yours!

Q1. What Is Conversion Funnel Analysis?

It shows you how your customers are acting on each step of your funnel and how they’re interacting with your business. Understanding user’s behavior on each stage is cruical to enhance your revenue and conversion funnel analysis is the key. 

Q2. Why Is Funnel Conversion Important?

It allows you to monitor your customer’s journey and enhance your business to send a more personalized message to your target audience and increase your sales conversion rate. By going over your funnels throughly, you can see where in their journey customers are dropping off or changing their mind. Smart marketers never underestimate the importance of funnel conversion and always think of ways to enhance it even more!


The funnel conversion is a very important part of your business. If its stages are not optimized, you will experience a decrease in your revenue. If you want to take a step forward in becoming successful, then start tracking your funnel conversion rate now to find the areas of friction. 

To make your sales funnel perfect, you need a tool to do this for you. WatchThemLive is a solution that helps you monitor leads’ interactions with your sales funnel. You can capture their interactions as they go through each stage of your funnel. This way, you will understand at what stage they drop off and why. Sign up here and snag their free plan!

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