A sales funnel is the path a buyer takes from first noticing you to paying, and the pages and messages you put along it. Many people enter at the top and fewer are left at each step, which is where the funnel shape comes from. The usual stages are awareness, interest, decision and action.
Online, a sales funnel is a sequence of pages: an ad, a landing page, a checkout, an upsell and a thank-you page. ElasticFunnels builds those pages, tests each step and ties every order back to the ad that started it.
I spent nine years as CTO of a direct-response company, building the funnel system, the checkout and the attribution behind its offers. So I've spent more time than is healthy thinking about what happens between one page and the next. The textbook definition is below, and it's fine. The part I care about comes later, when you measure each step in money, which is exactly where most funnel advice goes quiet.
What a sales funnel is
Nobody goes from never having heard of you to buying in one step. They notice something, get curious, weigh it up and then decide. A sales funnel is a plan for that journey: what the buyer sees at each step and what moves them to the next one.
The funnel shape is the honest part of the metaphor. A thousand people might see an ad, a few hundred click, a few dozen reach the checkout and a handful buy. Every step loses people. The work is to lose fewer of the right ones, and to make more from the ones who buy.
The sales funnel stages
The most common model has four stages, from the old AIDA formula: awareness, interest, decision and action. The names change from book to book; the idea does not.
| Stage | The buyer is thinking | What you show them | What to measure |
|---|---|---|---|
| Awareness | "That's interesting." | An ad, a post, a search result | Click-through rate, cost per click |
| Interest | "Could this solve my problem?" | A landing, presell or video page | Clicks to the offer, opt-ins |
| Decision | "Is it worth the price?" | The offer, proof, the guarantee, the checkout | Checkout conversion rate |
| Action | "I'll buy it." | The order, an upsell, the thank-you page | Orders, average order value, upsell take rate |
Many funnels add a fifth stage after the purchase: retention. The receipt, onboarding, a follow-up offer and a subscription renewal all live there, and repeat buyers are usually the cheapest sales you will make.
Of the four columns in that table, the last one is where I'd spend my time. Naming the stages is easy. Knowing what each one converts at this week, and what that is worth in money, is the part that pays.
Sales funnel vs marketing funnel
The two terms overlap and people use them loosely. A marketing funnel usually means the top: reaching people and turning them into leads. A sales funnel usually means the path to the purchase, or only the bottom half where leads become buyers. For an online offer sold with paid traffic, the difference hardly matters: the same sequence of pages runs from the ad to the order, and "sales funnel" is the name most people use for it. I wouldn't spend a meeting on the terminology. Spend it on the pages.
The pages of an online sales funnel
Online, each stage becomes a page with one job and one button to the next step. A landing page that also tries to be the checkout and the FAQ tends to do all three badly, and when it underperforms you can't tell which job it failed at.
- The ad or the post earns the click. It makes one promise the next page has to keep.
- The landing page makes the case. For cold traffic it is often a presell such as an advertorial, a quiz or a video sales letter before the offer.
- The checkout takes the order, often with an order bump: a small add-on ticked before paying.
- The upsell comes right after the purchase and offers more, charged in one click. See what is an upsell.
- The thank-you page confirms the order and says what happens next, and the follow-up emails start.
Sales funnel examples
Most funnels are a variation on one of five shapes. Which one fits depends on the price, how well the buyer already knows the problem, and where the traffic comes from.
- Lead magnet funnel. A free guide or checklist in exchange for an email, then an email sequence that leads to the offer. Good for higher prices and longer decisions.
- VSL funnel. A video sales letter makes the whole pitch, then the checkout and upsells. Good for offers that need a story or a demonstration. More on the VSL funnel page.
- Presell funnel. An advertorial or listicle warms cold traffic from social and native ads before the sales page. The standard shape for affiliates and direct-response vendors.
- Quiz funnel. A few questions, then a personalised result that recommends a product. Good when you sell several options. See the quiz funnel builder.
- Product funnel. For one ecommerce product: a product landing page, a checkout with an order bump, then an upsell. Shorter than a store, and easier to test.
If you sell one offer on cold paid traffic and can't decide, I'd start with the presell funnel. It's the standard shape for that traffic, and it gives you a page to test before anyone sees the price.
How to measure a sales funnel
A funnel is only as good as its weakest step, so measure each step, and measure it in money. Take 1,000 visitors from an ad. 300 click through to the offer (30%), 30 of them buy a $50 product (10% of the clicks, 3% of visitors), and 6 of those take a $30 upsell (20%). That is $1,680, or $1.68 per visitor.
- Conversion rate per step: the share of people who move to the next page. It tells you where people leave.
- Revenue per visitor: the funnel's total revenue divided by the visitors who entered. If it is higher than what a visitor costs, the funnel makes money. The ROAS calculator does the arithmetic.
- Average order value: what the bump and the upsell add to each order.
At the company where I was CTO, we ran a stack of separate tools, and every quarter I watched revenue leak between them. Sales didn't reach the CRM, and postbacks broke when URLs changed. A leak between two steps shows up in nobody's report, because each tool only sees its own step.
In the example, lifting the checkout from 10% to 12% of the clicks adds 6 orders, $300 before any upsell, with no extra ad spend. That is why you fix steps before you buy more traffic. When buyers come through several channels, marketing attribution models explains how to share the credit between them.
Building a sales funnel in ElasticFunnels
Those leaks between tools are why I built ElasticFunnels with the pages, the checkout, the CRM and the attribution sharing one customer record. ElasticFunnels is sales funnel software for people who sell with paid traffic. Each stage of the funnel has its part of the platform:
- Pages: the AI page builder writes any page you describe, from landing, presell and VSL pages to checkout and upsell pages, or start from a template.
- Tests: split testing runs variants of any step under the URL your ads already use.
- Checkout and upsells: custom checkouts with order bumps, and one-click upsells after them.
- Follow-up: CRM and automations for what happens after the order.
- Numbers: analytics tie every order to its ad, page and variant.
Ready to build one? How to create a sales funnel walks through it step by step, and the best sales funnel software compares the tools.
- A step that converts better can still earn less. I'd never judge one on its conversion rate alone.
- More traffic into a funnel that leaks at the checkout just buys a bigger leak.
- Be suspicious of any step whose numbers live in a different tool from the orders. That's where money goes missing without anyone noticing.
- A page that does two jobs does neither well, and you can't tell which one it failed at.
A funnel diagram looks tidy on a slide. The real one is messier, with people leaving at every step and money slipping out at the joins. Put a money number on each step and the funnel stops being a metaphor and turns into the most useful map of your business you'll have.
