A sales funnel is your customer’s path from first contact to purchase. In theory, the customer goes through four main stages — Awareness, Interest, Desire, Action (AIDA). In practice, a funnel can have more steps, with more concrete detail.

A business can be running, sales can be coming in, ads can be set up — and still revenue relative to costs may fall short of expectations. That usually means there is a bottleneck at some stage of the sales funnel. Situations vary widely. Sometimes managers handle leads poorly; sometimes the offer in the ad does not match reality. By collecting conversion stats for each stage, you can walk the full customer journey, find where the “bottleneck” is, and look for ways to fix it.