About Funnels

What is a Funnel?

A funnel is simply a series of actions you want an end-user to take or a series of locations (URLs) in your digital property you want end-users to visit.

Below is an example of a basic checkout funnel visualization built in FullStory:

What Type of Funnels Should I Build?

To “build” a funnel means to define the necessary steps involved in reaching the desired goal. To do this, simply ask yourself: What do I want people in my product (or on my site) to accomplish?

• If you work in SaaS or have a subscription-based business model, then maybe an answer to this question is something like “sign up for a free trial.”
• If you are in eCommerce, maybe the answer is as simple as “buy something.”

Funnels should be specific to your business and reflect meaningful moments between your end users and your business. When building out a funnel for the first time, it is helpful to work backward and limit the funnel to key events only. So, let’s begin at the end!

Beginning with the End

The funnel example below tracks the user's events once a purchase is confirmed. A purchase is confirmed when a user is sent to a confirmation page (URL path /confirm), so the last step in the funnel is the Visited URL is path /confirm. 

Now that you have a solid funnel endpoint, work backward to fill in key navigation steps, such as before visiting path /confirm, the user clicks "purchase," and prior to that, the clicks the “checkout” button, and so forth until you reach the first step. 

End at the Beginning

As you work your way backward, how do you know where to stop? Well, it depends.

You may prefer to begin the funnel at the home page (or where users initially land on your website), or you may prefer the first action or URL that more strongly indicates an intent to convert (like adding a product to a cart).

In the example below, users who buy a product must add it to their cart starting from the /market page, so visiting the /market page is the first step. 

URL Funnels vs Event Funnels

In our example funnel above you may have noticed that we included both URL visit information and end-user click event information. When learning to think about funnels for the first time, it is common for people to think in terms of either URL information or in terms of end-user event information like “clicks.” Rarely do people intuit that these two different types of information can be used together in a single funnel. In this section, we will explore what it looks like to use each of these types of information alone and will then explore some of the benefits of using them together.

URL Funnels

For many people this is the default way to think about constructing funnels. You can think of a “URL funnel” as a funnel where each step is defined simply as having visited a given URL or URL path.

Event Funnels

While URL funnels can be interesting and useful in certain situations, they are not the only way to go about analyzing how end-users are navigating your product. Once you have digital experience analytics (like those available from FullStory) it becomes easy to start thinking about funnels in terms of end-user actions. You can think of these “event funnels” as a series of actions taken by the end-user (often clicking something).

Telling Different Stories

How you decide to build the funnels can have downstream consequences for how you understand your product. To help us explore this concept, let’s compare our two example funnels from above side by side. 

Visited URL Funnel

Clicked Text Funnel

What you might notice about these two different funnels is that they are both built to look at the same end-user journey through our eCommerce site The Fruit Shoppe. This journey begins on the home page of the site and ends with a product being purchased. Both of these examples are completely valid approaches for building a funnel and looking for points of friction in the end-users’ journey. However, they will not show you exactly the same information. Let’s add to our funnel examples the number of end-users who completed each step and look at them side by side again:

When we start comparing the numbers of end-users at each step of these funnels, it immediately becomes clear that these funnels, while largely “the same,” are telling us very different stories about the same group of people. Let’s dig into one specific way these two funnels differ.

Checkout -> Purchase Conversion

The difference between our two funnels at the last step is both startling and important.

Our URL funnel is telling us that only 35% of end-users that make it to the checkout page end up actually purchasing something. For most businesses it would be highly problematic to see a drop off at the last step in a purchasing funnel. This kind of loss at a single step is a red flag and would make the /checkout page a prime candidate for immediate improvement.

What is interesting is that when we look at our event based funnel, things look quite different. Our event based funnel is telling us that 62% of people who make it to the checkout page actually follow through with purchasing something. This is a much more acceptable conversion rate than the 35% shown in the URL funnel, and while there is still room for improvement, a finding like this is much less likely to cause a red alert.

This comparison is a great example of exactly how the funnel you choose to build can affect everything from the high level understanding you have of your product, to how and where you decide to spend time and resources optimizing your product.

"Hybrid" Funnels - Using URLs and Events Together

As illustrated above, how you decided to build your funnels can have serious implications for your business. From understanding how your products are performing to where you spend your time. As a result it is important to get as much clarity as possible. Enter “hybrid” funnels.

In our previous examples we looked at both a URL funnel and an Event funnel of a single journey through our site. Both types of funnels tell a different story about what is happening on our eCommerce site Fruit Shoppe and one story is much more worrisome than the other. A “hybrid” funnel actually takes both types of information and combines them into a single, more granular funnel. Using this approach allows you to get a more accurate understanding of what is occurring in your product than using either URLs or events alone. And, you have the ability to uncover issues you would have never found using one of those other funnels. Our “hybrid” funnel, built using the information from above, looks like this:

How awesome is this?! A single funnel with double the information. Not only is it more accurate, but we can learn things about our product we would have totally missed before. Let’s explore a couple examples.

Both Ends of Navigations

In products (like our Fruit Shoppe site) end-user navigations have a start and a destination. By this we mean clicking the “Market” button takes you to the URL path /market. When we were using our shorter separate funnels previously we were only looking at the start or the end but not both. In our hybrid funnel we get to see both ends of each navigation. We have highlighted two instances of this here in red:

Ideally, when end-users click a button in your product or site it should always take them to the desired destination. However, in the example about, when people click “Market," something goes wrong. 5.2k people click “Market” but only 4.7k actually land where they should on the /market URL path. This is a sign that something is going wrong and needs to be investigated. This is the kind of issue that would go completely unnoticed in our URL only or event only funnels from before.

This kind of issue is also what is responsible for our very different stories around end-users completing purchases. For some reason, users that clicked “Purchase” were not all landing on our confirmation page. This lead to very different looking conversion rates at the last step of our earlier, shorter funnels.

Additional Non-critical "Micro" Steps

Another great thing about “hybrid” funnels is they allow you to easily layer in lots of details that are not critical to funnel completion.

An example of this in our funnel are the clicks on the “Add to cart” button:

In our hybrid funnel, this step is not necessary for understanding how people navigate the purchase funnel as a whole. We could exclude this step and still be able to get a decent understanding of how the overall funnel is performing, but the additional insight you get from including this step can be helpful. In this case, 17% of end-users who make it to the /market page do not add something to their cart. It might be interesting to explore different ways to improve this metric.

After seeing this example you can start to think about what other optional steps it might make sense to include in your funnel. For eCommerce, these might be watching a product description video or interacting with the product review widget. Both of these behaviors could potentially impact conversion positively or negatively but are not required navigation events in the purchase funnel.

Final Thoughts

Hopefully this exploration of the concept of funnels has left you feeling empowered and ready to tackle your product’s user journeys with a fresh perspective. If you are new to thinking about funnels, remember to start simple and build. Begin at the end!