Sales funnel in e-commerce – how to build it and use it?
- 24 March 2021
How to effectively attract customers to an online shop? This is a question frequently asked by many e-commerce sellers. Generating site traffic is not enough. To turn visitors into paying customers, you have to build an effective sales funnel. What is a sales funnel and how to use it to improve sales?
How to build a sales funnel?
A sales funnel is a planned process that allows you to have a regular supply of potential customers who can be convinced to place an order in your shop. If you want the sales funnel to work effectively, you have to base it on a thoughtful strategy, taking into account your business model, marketing budgets and target customer group.
When building a sales funnel, you have to carefully analyse and understand the behaviours of your customers. You have to know what makes them decide to place an order and what makes them leave the site and abandon their shopping cart. It is also crucial to learn when the customers quit the shopping process and why. With this knowledge, you will know how to optimise the sales funnel and maintain a satisfactory conversion level.
Stages of the sales funnel
A typical sales funnel can be divided into 4 stages:
If a potential customer is to buy a product in a shop, they first have to know that the shop even exists. That is why you have to encourage them to visit the shop’s website and get to know the offering. You can achieve this goal using content marketing, social media or online advertisements. A valuable article, catchy headline or interesting image can gain your customers’ attention and encourage them to visit the shop’s website.
In e-commerce, an attractive price is also a strong magnet for customers – especially those checking price comparison websites. If you want to set an appropriate price, you need to carefully monitor the market. You can do this using automatic price monitoring tools. They will allow you to remain up to date with the offering of your competitors and be sure that the prices in your shop are attractive to the customers.
This is the stage where you have to convince the person who visits your website to learn more about your offering and make a purchase. The key factors here are as follows:
- Easy website navigation – if a customer is to purchase a product, they should be able to easily and comfortably navigate through your website. Logically designed categories and an option to filter the content will help the customer to quickly find the product they are looking for. This way, the entire shopping process will be shorter, increasing the chances that it will end with a purchase.
- Valuable content – detailed descriptions, clear product specifications and good photos can alleviate your customer’s concerns about the purchase. The content of your website should fully answer your customer’s questions, adequately to their needs and knowledge. If you want to check which versions of descriptions and product pages achieve a higher conversion rate, you should regularly conduct A/B tests and optimise your content on an ongoing basis.
Customers often visit and browse a website, choose products and then… change their mind. It is at this moment that shops lose the highest number of potential orders – abandoned carts are one of the biggest problems in e-commerce. That is why, at this stage, you have to make sure that the customer finalises their order. You can do this using the following methods:
- Promotions – displaying information about discounts in a visible place, especially if they are time-limited (e.g. -20% till the end of the week), can be an incentive to many customers. If you want to set the right discount, you should also monitor prices and check how your prices rank in comparison with your competition. This way, you can make sure that your offering is really attractive to your customers.
- Remarketing – if we have a customer who visited our website but did not finalise the order or simply abandoned their cart, we can still attract their attention through reminder advertisements displayed on social media or other websites. There is still a chance that the customer will come back and complete the order.
- Transparent costs – hidden fees or high delivery cost that are not communicated until the transaction is about to be finalised can often discourage the customers from purchasing a product. Therefore, you should make sure that the customer is aware of all costs from the very beginning.
- Convenient payments – if we do not want the customer to change their mind just before the finishing line, we have to finalise the transaction as quickly as possible. For this reason, you should implement fast payments and make it easy for your customer to pay for their order.
It is always easier to persuade a person who has already trusted us to make another purchase than it is to acquire a new customer. That is why the last and very important stage of the sales funnel is building and maintaining good relations with the customers.
A practical tool that you can use at this stage is mailing. If you send e-mails directly to your customers’ inbox, you may successfully encourage them to make further purchases also during the next few years. However, your newsletters should only include valuable information, such as news, promotions or materials useful to the customers. You should also always place a “Call to Action” button and tell your customers directly what you expect them to do (e.g. Buy now, Take advantage of our special offer, Subscribe, Receive a discount).
You might also want to encourage customers to follow your shop on social media. This way, they will have contact with your content once in a while and will not forget you. Another useful idea is to encourage customers to leave their opinion about your shop on social media – good reviews make it easier to attract new customers.
Sales funnel – example
What can a well-designed sales funnel look like? Imagine that a customer visits a website to read an article they found in the search engine. After a few minutes, they leave without doing anything. During the next few days, however, the customer sees remarketing advertisements that encourage them to visit the website once again. Finally, the customer decides to go back to the website and buy one product. They also subscribe to the newsletter to get a discount code. From that moment, the customer regularly receives e-mails from the shop. After a few months, they receive information about another promotion and decide to place another order.
Remember – if a sales funnel is to be effective, it has to be frequently optimised. Regularly observe your customers’ actions, conduct tests, analyse reports and draw appropriate conclusions. Make sure to also check how your customers react to price changes – you can significantly increase your sales if you use promotions well. If you need an effective tool for price monitoring, contact us – we will be happy to help you choose the right solution.