Retailers are often challenged to find new growth vectors in an increasingly competitive online landscape. On one hand, strategies such as omni-channel marketing hold promise, but new marketplaces often require strong margin to succeed. On the other, attribution modeling and programmatic are popular with advertisers, but these strategies require sufficient sales volume and learned analysis to provide results.
Small online merchants are further limited by the extent to which they can afford to test these strategies – both from a capital and an operational readiness perspective – and instead double down on the products, channels, and customers that already demonstrate returns. However, these returns can diminish over time as the channel saturates and costs increase.
In this article, we examine how to boost eCommerce sales by establishing effective marketing and sales funnels that map each stage of the customer journey to marketing channels, brand interactions, offers, and products.
The first step in building effective marketing and sales funnels is to analyze the order and sequence in which traffic sources lead to conversion. To get started, navigate to your Google Analytics profile and click Conversions then Multi-Channel Funnels. The following reports provide a multi-dimensional view of conversions across your marketing channels:
- Multi-Channel Funnels Overview: Provides a basic visualization of multi-channel conversions.
- Assisted Conversions: Indicates the relative position of each channel in the funnel based on the ratio of direct to direct conversions.
- Top Conversion Paths: Groups conversion paths where interactions along the path are represented by channels.
- Time Lag: Groups conversions by the number of days between first interaction and conversion.
- Path Length: Groups conversions by the number of interactions prior to conversion.
This report helps merchants understand the relative position of each channel in the multi-channel funnel. By examining the ratio of assisted to direct conversions, merchants can determine whether a channel functions in a direct or assistive role as customers transact. Values close to 0 indicate that the channel acts primarily as the final step in the path (near the bottom of the funnel); values close to 1 indicate that the channel functions primarily as an intermediary step in the path (higher in the funnel).
For example, the report above suggests that direct traffic (ratio = 0.39) is positioned closer to the bottom of the multi-channel funnel than is paid search (ratio = 0.64). If the merchant wishes to re-position these channels within the funnel, they might consider incorporating promotions in paid search.
Top Conversion Paths
This report provides structure to the multi-channel funnel by grouping channels according to the sequence in which they lead to conversions. For example, the report below depicts a very limited funnel that requires brand-aware customers to navigate directly to the site and convert. In structuring their marketing funnel, the merchant may try to improve their visibility during the awareness stage by diversifying their channels.
Merchants can use this report to gain insight into the duration of the online sales cycle. Although time lag varies naturally by product category, market, and other variables, short sales cycles and low conversion rates may indicate a narrow multi-channel funnel.
Conversion Path Length
This report counts the channel interactions that occur prior to conversion and allows merchants to boost eCommerce sales by optimizing the number of steps in their multi-channel funnel based on either total conversions or conversion value.
Having analyzed funnel dynamics by channel position, sequence, and length, you can now begin to construct a multi-channel funnel that aligns buyer stages with marketing and sales channels. The number of buyer stages featured in the multi-channel funnel will depend on the conversion path length for each buyer persona or customer type.
Typically, eCommerce funnels feature several stages, including awareness, consideration, conversion, and retention. Each stage considers the customer’s goal, the brand’s goal, and the optimal mechanism (e.g., an ad served on Google) to shepherd customers along the conversion path.
Key performance indicators can also be attached to each stage or channel to help merchants understand how to improve funnel progression. For example, a low conversion rate from one stage in the funnel to the next may necessitate an intermediary stage to which additional marketing channels can be attached.
Multi-channel funnels place customer experiences in the context of goals while repositioning marketing channels as mechanisms for content delivery. Retailers can also map funnel stages to key performance indicators (e.g., newsletter signups, orders, time since last order, etc.) and optimize for funnel progression. Further, considering the impact of ads and offer quality on funnel stages rather than the entire buyer journey may help improve ad-level metrics (e.g., return on ad spend) and, following this logic, may contribute to improved eCommerce sales.