An analytics technique that measures user progression through a series of sequential steps (signup, activate, trial, convert, retain). It identifies where users drop off and which fixes would move the most volume.
Funnel Analysis defines a sequence of steps users should take, then measures conversion rate at each step. The 'leaky bucket' visualization reveals where the biggest drop-offs occur. A typical e-commerce funnel: viewed-product → added-to-cart → started-checkout → completed-purchase. Each step's conversion compounds, so a 10pp improvement at the top of the funnel has the largest absolute impact. Tools like Mixpanel, Amplitude, and Heap automate funnel definition and tracking.
Discovering that 60% of e-commerce checkout drop-off happens at the shipping-address step. Fixing autofill recovered $400K/month in lost orders.
Funnel Analysis is the most direct way to find quick wins, since every step with > 30% drop-off is a candidate for high-ROI optimization investigation.
Need help implementing this in your business?
Get Started