Inside any business, sales funnels help you steer leads toward converting and purchasing from your business. Whether you’re a product-based business or a service provider, tracking your sales funnel metrics is absolutely essential! That data is what lets you keep your funnels running effectively.
Simply having a sales funnel isn’t enough to create amazing results for your business. Of course, they help you shape and follow a specific customer journey…but really, the juicy part of a sales funnel lies in the metrics.
Most of us are a little intimidated by the idea of analytics like sales funnel metrics. But they’re actually pretty easy to track and calculate—and they’re going to benefit your business in SO MANY ways.
Wait, What’s A Sales Funnel?
Let’s start with a refresher on the basics before we dive into sales funnel metrics. Your sales funnel is the buying process that your leads and customers go through.
Inside a sales funnel, you nurture customers at different points in the sales process…and you’re able to learn a lot about your customer along the way. It’s kind of cyclical—the better your sales funnels, the more you’ll know about your customers…and from there, you’ll be better able to optimize those sales funnels.
No matter the type of business you have, your business size, or your niche, a sales funnel will help you grow.
There are different layers to a sales funnel.
Typically, the “top” of the funnel is wide-reaching. It introduces leads to your brand, helps educate them about what you have to offer, and boosts brand awareness.
In the middle of the funnel, you try to provide true value to your leads and continue to prioritize building relationships.
Then at the bottom of the funnel, your leads are considered “warm,” meaning that they’re likely to convert, become a repeat customer, or even give referrals to others for your business.
Obviously, the steps inside your funnel vary depending on your unique business. But no matter what, the goal is conversions…and really, sales funnel metrics are the most underutilized way to optimize your funnels and boost conversion rates and revenue.
The 5 Sales Funnel Metrics You Need To Start Tracking
Ready to get started with tracking your sales funnel metrics? These five pieces of information are going to really help you improve your sales funnels and see even better results in your business.
Users During Each Step
First, you’ll want to consider the users entering your funnel at each stage. In order to figure this out, you definitely need to fully understand what the beginning of your funnel actually looks like. Does someone enter your funnel when they join your email list, click on an ad, or visit your website?
Defining this “entry point” is the first step in tracking how many users enter at each stage in your funnel.
To calculate the number of users, add up how many leads entered your funnel during a specific time period. Then, get more specific based on ad campaigns, platforms, channels, or website traffic as a whole.
Your conversion rate is the number of leads who “convert” by taking an action. These actions include making a purchase, subscribing to your email list, registering for a webinar, or any other desired action inside your business. Every business owner hopes to boost their conversion rates…and that’s why this is one of the most important sales funnel metrics.
When you pay attention to this metric, you’ll be able to figure out if there are any obstacles to conversion that you need to improve within your sales funnel. Plus, you’ll become more efficient and drive more revenue when you know your conversion rate and how to improve it.
Whether you’re tracking a large-scale conversion, like a purchase, or smaller conversions, like joining your email list, your conversion rate is key to track.
Luckily, it’s also one of the easiest sales funnel metrics for you to calculate! To figure out your conversion rate, divide your total number of conversions by the total number of leads who entered your funnel. To see that number as a percentage, just multiply by 100!
Cart Abandonment Rate
Next up, you’ll want to keep track of your cart abandonment rate. This is another of the most important sales funnel metrics—it helps you know why a lead leaves without making a purchase.
Knowing this metric means you’ll be able to make better decisions and make strategic adjustments, like creating free shipping policies or sending out cart recovery emails.
Whenever someone adds items to their cart and leaves before checkout, that’s considered an abandoned cart. If your cart abandonment rate is high, it could mean that there are problems somewhere in the checkout process. When you track this metric, you can make improvements and boost your overall conversion rates long-term.
But what does your cart abandonment rate have to do with your sales funnel?
It represents how many customers you’ve successfully funneled through to the point of being ready to purchase. Then, it allows you to make improvements to those areas causing hang-ups with your potential customers.
To calculate your cart abandonment rate, divide the number of complete purchases by the number of shopping carts created. Then, just multiply the number by 100 to get a convenient percentage.
Average Order Value
Your average order value helps you get great insights into what you need to focus on in your funnel.
If you have a super high average order value, you can concentrate on finding customers for your business who are primed to shop again and again. But if your average order value is really low, it’s a sign that you need to expand your target audience. You might even need to shift your offerings.
To find your average order value, you’re going to calculate how much revenue is typically generated from a single order in your business (at the bottom of your sales funnel, of course). Simply take the total revenue generated in a certain timeframe and divide by how many orders you received.
Of course, one of the most important sales funnel metrics is your total sales. All business owners want to generate revenue—that’s the whole point of a sales funnel!
Your total sales are the revenue generated in a specific timeframe. By tracking this metric, you can evaluate how effective your sales funnel is. This is one of the most important metrics to help you facilitate growth over time.
For example, if you’re making lots of sales but your revenue isn’t where you want to be, it might be time to increase your prices.
Tracking these 5 essential sales funnel metrics is going to help you grow your business. Optimizing your funnels takes work. But with analytics on your side, you can make decisions based on data—which really does help generate better results.
If you’re running Facebook Ads as part of your sales funnel, tracking your metrics is key.