Little Glossary · Go-to-market

Conversion funnel

The conversion funnel is the model that represents the stages a buyer goes through from first hearing about a company to becoming a customer. It's drawn as a funnel because fewer people remain at each stage than at the one before.

Updated October 5, 2026

Origin

The most cited precursor is the AIDA model (attention, interest, desire, action), attributed to the American advertiser Elias St. Elmo Lewis in the late 19th century. Digital marketing adapted it into measurable stages.

Typical stages

A common version splits the funnel into three parts:

  • TOFU (top of the funnel): discovery. Articles, social media, ads, educational content.
  • MOFU (middle of the funnel): consideration. Comparisons, case studies, webinars, lead magnets.
  • BOFU (bottom of the funnel): decision. Demo, trial, pricing, sales proposal.

In a B2B tech company with a sales team, the funnel is usually measured with CRM stages: visit, lead, MQL, SQL, opportunity and customer.

How it's used

  1. Define each stage with an objective, recorded criterion, such as a submitted form or a meeting held.
  2. Measure conversion between each pair of stages and how long it takes to move from one to the next.
  3. Fix the step with the biggest relative drop first, not the one with the most volume.

Its limits

  • B2B buying isn't linear: buyers research on their own, loop back and split the work among several people. Gartner describes the process as a set of tasks that repeat, not a straight line.
  • The funnel ends at the sale, but in a subscription model much of the value is decided afterwards, in retention and expansion. That's why some teams prefer circular or loop models.

Related terms

Sources

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