3 Uses for Funnel Charts

Funnel charts are similar to bar charts in the sense that they utilize bars to showcase data. These graphical representations are meant for you to visualize how data moves through a specific process. Funnel charts essentially showcase a dependent variable’s value and how it diminishes in the following stages. Let’s say that you own a real estate company and you’re running through a sales pitch by speaking to potential home buyers and figuring out where they’re at in the home buying process. The top of the funnel would involve all of the prospective customers represented by a long bar. But as the sales pitch goes through the next steps and following stages, the bar length shortens to indicate the number of home buyers that are responding well to the pitch. And this is just one example of how funnel charts can be used in practical applications. Keep reading to find out more about the best uses for funnel charts below.

1. Selection Process

funnel chart is not a linear process, which means that you can utilize its visuals to represent the entire selection of data. This can be anything from interview stages to a tournament or competition. For example, if there are 100 candidates who applied for a specific role, then the top of the funnel chart would show all 100 candidates that applied. Other stages might involve resume screening, telephone interviews, in-person interviews, then receiving a job offer as the last step. As the user moves down the stacked bar chart, the number of candidates decreases in width, essentially creating a funnel shape. The funnel visualization is a great way to show the pool of candidates depending on the stage of the funnel. What started out as 100 candidates can easily become 40 toward the middle and 10 toward the end.

2. Order Fulfillment

Funnel charts are also great for the order fulfillment process. When evaluating specific orders and where they’re at in the journey, the funnel chart can showcase every step of the sales process. For example, the top of the funnel shows all of the orders that an e-commerce retailer receives. The following stages will include processing, approving, shipping, and delivery. Since the numerical value is shown within each stage, it’s easier to keep tabs on how many orders have yet to be processed, approved, shipped, and delivered as you move down the different stages.

3. Customer Dropout

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The sales process typically starts out with a set number of potential customers. As the stages move down the funnel, customers eventually drop out when they’re no longer interested. The bottom stage will show how many sales are actually transacted, and it’s a good way to see which area needs more work. The stages found in a sales funnel chart might include leads, sales calls, follow-up, conversion, and sales. If a business identifies a huge drop in customers after the follow-up process, then it may want to consider restructuring its follow-up protocol. Perhaps it turns off customers and causes a huge drop in sales. This is just another example in which a funnel chart can help organizations learn more about their business processes and find ways to improve strategies.

The three uses above are just a few examples of what funnel charts can be used for. They can also be used to visualize bottlenecks in a process or examine the clear reduction of data at each stage of a specific process. It’s best used for businesses that tend to follow a particular sequence to generate revenue. If you’re using funnel charts, make sure to use an effective color scheme, clear annotations, and a definite number of stages to showcase the sequential process.

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