how to calculate
marketing funnel?

Marketing funnel is the journey of your visitor through your website that starts with ad impression and ends with a successful purchase.

In other words, that's what makes $4500 out of $1000 you spend on marketing. You may calculate your ROI using these numbers - which appears to be 350%.

A marketing funnel has to be built in order to determine where do you lose your customers. It's comprised of several common stages:

Ad impressions, ad clicks = website visits, product views, adding to cart, trying to checkout and successful checkout.

Your goal is to calculate the number of users that reach certain stage and determine conversion rates from one to another.

Let's take a look at the example.

• You've had 5000 ad impressions with 100 clicks total.

  CTR = 100/5000*100% = 2%

• Only 75 users out of 100 viewed a product page:

  Visit to product views: 75/100*100%=75%

• Only 50 users out of 75 added something to cart:

  Product views to add to cart = 50/75*100%=67%

• Only 25 out of 50 tried to place the order:

  Add to cart to Try to checkout = 25/50*100%=50%

• Only 15 out of 25 made it through the order form:

  Try to checkout to Checkout = 15/25*100%=60%

In 99% cases the answer is "ABSOLUTELY"!

Let's take a closer look at Visit to Product Views conversion. Itis 75%, which means you've lost 25% of your visitors for unknown reasons - people are asked to register or are landed on a wrong page, for example.

Imagine what happens to your ROI when this conversion becomes 100%? According to your funnel, that will increase the number of customers from 15 to 20 with $6000 revenue (20*$300)

ROI=[($6000-$1000)/$1000]*100%=500% Therefore, we have increased our ROI by analyzing and working with our marketing funnel.

There are a few things you should know when creating funnels in Google Analytics:

• It’s a pretty basic funnel. If you don’t want to dive deep into the data and optimize, you can go with this.

• You cannot go back and retroactively view data. Once you create your funnel, you’ll only be able to the funnel going forward as the data comes in.

• You depend on the level of your account sampling. Thus it’s a huge problem for big projects, but the funnel accuracy is vulnerable to it.