Conversion Funnel Analysis is an essential tool for understanding how users interact with a website. It helps businesses identify and analyze the various steps in the process that leads to a desired goal, such as a purchase or sign-up. By tracking user behavior throughout this journey, companies can optimize their websites to maximize conversions and profitability. The funnel itself consists of several stages, each representing different points of interaction between the customer and product. Starting from the top of the funnel, this includes acquisition, activation, retention, referral and revenue. Through careful analysis of these areas, organizations are able to pinpoint weak spots in their strategy and make improvements accordingly. Ultimately, Conversion Funnel Analysis gives marketers invaluable insight into user behavior so they can better serve their customers' needs - leading to increased conversion rates and higher profits!