Conversion funnel theory is a marketing concept that describes the customer journey from initial discovery of a product or service to conversion to a paying customer. It visualizes the path prospective customers take to reach their goal and identifies points where potential customers drop off, allowing marketers to optimize the journey for maximum efficiency. By understanding the customer journey, marketers can create targeted campaigns that focus on the most important steps in the funnel. This helps to ensure that customers are more likely to convert and that the marketing budget is being used effectively.