graphic representation of funnel analysis

Funnel analysis: using funnel analytics to increase conversions on your website

February 21, 2019 by Fio Dossetto

Visitors flow through your website every day, but somehow all of that traffic funnels down to just a trickle of conversions, sales, and signups. Funnel analysis can help you spot where users are leaving your website, so you can optimize it and increase conversions.

In this post, we’ll explain how you can analyze funnels to identify key traffic sources and spot high-exit pages. You’ll also learn how to combine funnel reports with more analytics insight, so you can send more traffic down the marketing funnel to the pages that matter.

✋ Hotjar is retiring its funnel analysis tool and it is no longer available to new users. You can find why here, and learn what to use instead here.

Table of contents

What is funnel analysis?

Funnel analysis is a method used to visualize and map the flow of visitors across a set of website pages or events. A website funnel gets its name because, much like a physical funnel, it narrows toward the end—so the volume of visitors at the top is larger than the volume of visitors at the bottom.

graphic representation of funnel analysis
FUNNEL ANALYSIS SHOWING USER DROP-OFF AND CONVERSION RATE

Funnels (also called conversion funnel or sales funnel) are widely used across various marketing functions because they help identify barriers that cause users to leave before reaching a conversion point.

For example: a lot of people might visit the homepage of an e-commerce website, but only a few will eventually go on to see a thank you page after a purchase. A basic e-commerce funnel will look like this:

homepage > category page > product page > cart > checkout > thank you page

Funnel analysis tracks how many visitors make it through each step, highlighting problems or areas for improvement in the customer journey with the goal of increasing conversion rates and revenue.

3 benefits of using funnel analysis on your website

It's often easy (and tempting) to work on too many parts of your site in one go, but funnel analysis helps you understand what needs tackling and prioritize work on those steps first instead. Here is how:

1. Find the high-traffic, high-exit pages where people are leaving

A funnel visualization tool shows the drop-off rate and conversion rate of your main pages, helping you understand when and where visitors and potential customers are leaving your website.

an example conversion funnel showing pages with high user drop-off
ANALYSIS FROM HOTJAR’S ONBOARDING FUNNEL, SHOWING PERCENTAGE DROP-OFF AND CONVERSION RATE

Knowing where in the journey users drop off will help you focus your optimization efforts on the biggest opportunities. To lean on the funnel metaphor: finding where users leave will help you plug holes in your funnel and send more traffic down it.

2. Determine where high-quality visitors come from

Funnels are not only useful for finding issues that need fixing: they can also help you spot successes you can double down on—for example, by revealing where your high-converting traffic comes from.

An advanced funnel visualization tool like Google Analytics will help you do this: you’ll need to set up the goals you are interested in (e.g., cart completion, newsletter signups), and use the Goal Flow feature to filter by source to see where converting traffic came from.

screenshot of goal flow funnel analysis in google analytics showing traffic source
GOAL FLOW FUNNEL ANALYSIS IN GOOGLE ANALYTICS SHOWING TRAFFIC SOURCE

If you understand how visitors who convert reach your website, you can focus more efforts on those acquisition channels and increase the number of likely conversions.

3. Help team members and stakeholders make decisions

jeremy foucray from zetoolbox presenting funnel analysis using Hotjar

JEREMY FOUCRAY FROM ZETOOLBOX PRESENTING FUNNEL ANALYSIS USING HOTJAR (CREDITS: CHRISTOPHE SOLIER)

Conversion funnels are a straightforward way to share where your business is doing well and where there are opportunities for improvement.

Funnel reports are an easy visual aid to use in presentations to stakeholders and team members, helping you get buy-in for future optimization work and showcase your successful projects. There’s nothing quite like seeing a big red ‘drop-off’ alert to inspire people to take action.

Two ways to run advanced funnel analytics

Conversion funnels help you get a clearer understanding of the user behavior across your website, but you can supercharge the analysis by using funnels in combination with other user experience tools.

1. See what’s happening between events and pages

After you’ve identified problematic high-exit pages and roadblocks in your conversion funnel, you can take a more in-depth look at what users are interacting with right before they drop off by using heat maps and session recordings.

Heat maps

Heat maps will record and aggregate user clicks, mouse movement, and scrolls, allowing you to see which elements were clicked (or ignored) and how far down the page users scrolled.

Visualization of 3 types of Hotjar heatmaps

Placing a heat map on your high-exit pages might help you spot problematic elements on it, such as broken links and unseen CTAs.

Session recordings

Session recordings are renderings of individual user sessions on your website, and will help give more detail to the insights you get from heat maps.

Hotjar recordings video
A SESSION RECORDING OF A USER BROWSING HOTJAR.COM

Focus on your high-exit pages and watch how people browse to get there, scroll through content, and interact with buttons before they leave your website. Spotting any issues they encounter helps you empathize with their journey, and get some of the visual data needed to design for better UX and funnel visitors further down your site.

2. Find out what’s going on by surveying visitors on the page

The additional analytics data from heat maps and recordings will have given you a few hypotheses for UX improvements and design changes. You can experiment with design changes through A/B testing at this stage, but there’s one key insight that’s still missing: feedback from your users.

Qualitative data from on-page surveys and feedback is an invaluable part of funnel analysis. Instead of making assumptions and guesses about why visitors bounce and don’t convert, you can simply talk to your users and let them tell you why.

Use survey questions to improve landing page conversions

Again, starting with your high-exit pages, set up a website survey with a couple of key questions to learn more:

  • What’s missing from this page?
  • What’s stopping you from continuing?
  • What were you looking for?
  • How can we help?

Asking the right open-ended questions allows your visitors to tell you how they feel, in their own words, so you can empathize with their needs and provide a better website experience.

Funnel analysis example: a case study from CMS Connected

example of a CMS CONNECTED funnel analysis
FUNNEL ANALYSIS EXAMPLE FROM CMS CONNECTED

✋ Hotjar is retiring its funnel analysis tool and it is no longer available to new users. You can find why here, and learn what to use instead here.

CMS Connected, an IT news and marketing company, used Hotjar Funnels to analyze how a piece of gated content was performing.

The funnel was set up on a simple 3-step journey from a landing page (Step 1) to a sign-up form (Step 2) to a success page (Step 3). In order to see the content they were interested in, visitors needed to sign up on step 2 with their name and email address.

By analyzing the funnel, the team at CMS Connected identified a huge drop-off of around 82% between Steps 2 and 3, meaning that for every ten people making it to the page, more than eight left without interacting with the content.

As a result, the team decided to remove Step 2 from the funnel and make the content available to all visitors. This obviously solved a problem for visitors, who could freely flow towards the page(s) they were interested in, but also guaranteed that CMS Connected’s content was given a true chance to shine and help their readers.

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Fio Dossetto

Fio was the Senior Editor at Hotjar until October 2020. She managed editorial production at Hotjar, generally over-used em dashes, and made sure every piece we published got you one step closer to really understanding your website users.