Explained: Marketing Flywheel
TLDR: Focused on CX, brands can use the continuous momentum of satisfied customers to drive referrals and increase sales. The momentum depends on three elements – spin speed, friction, and size. It is critical for all brands to align business strategies to address all three elements. With CX gaining importance every day, a comprehensive marketing […]
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TLDR: Focused on CX, brands can use the continuous momentum of satisfied customers to drive referrals and increase sales. The momentum depends on three elements – spin speed, friction, and size. It is critical for all brands to align business strategies to address all three elements.
With CX gaining importance every day, a comprehensive marketing flywheel model can have a positive impact on any business model
Martechvibe Stamp: It’s not a ruse or jargon. The marketing funnel is the new-age business system that holds customers at its heart.
Amazon is a leader in customer experience (CX), and has constantly raised the bar on standards. Interestingly, the core of its business model is the flywheel marketing strategy making better CX possible. Referring to it as the virtuous cycle in their annual report, the flywheel model represents a tangible method of driving traffic. The eCommerce giant focuses on three key elements to create business momentum and accelerate success — lower prices, choices, and seamless delivery experience. Sounds about right, but where does a flywheel fit in?
Understanding the Metaphor
We are familiar with the flywheel as a heavy wheel that takes an enormous effort to move. You push it until it gains momentum and spins faster. The same concept is applied to business strategy.
Author Jim Collins popularised the business tool in his book Good to Great. He wrote, “In building a great company or social sector enterprise, there is no single defining action, no grand program, no one killer innovation, no solitary lucky break, no miracle moment. Rather, the process resembles relentlessly pushing a giant, heavy flywheel, turn upon turn, building momentum until a point of breakthrough, and beyond.”
HubSpot entertains a flywheel model, too. It redesigned its inbound methodology as a flywheel with three components — attract, engage, and delight. By applying force to the three, businesses can create a powerful customer experience.
Focused on CX, brands can use the continuous momentum of satisfied customers to drive referrals and increase sales. The momentum depends on three elements – spin speed, friction, and size. It is critical for all brands to align business strategies to address all three elements.
Also Read: Cracking The Customer Loyalty Code
Understanding the mechanism
To gain momentum, adding force to the flywheel for better speed is critical. The forces are the company’s programmes and strategies, such as inbound marketing, paid advertising, or a freemium model, all of which provide customers with a catalyst to help increase brand sales and referrals.
But where there is force, there is friction. Brands need to eliminate friction such as poor communication, lack of delivery guarantee, and poor internal processes from their business strategies. With increased speed, less friction, and a maximised flywheel model, powerful momentum can be achieved.
Best marketing results come from integrating all marketing activities — the spokes of the wheel — to focus on long term company goals. It is important to choose marketing initiatives that complement each other and develop an ecosystem to drive growth. If all marketing resources are centred on revenue generation, brands may lose out on customer acquisition through brand awareness and other mediums.
Additionally, experts recommend brands have multiple flywheels. One focused on a single core business and several others that support individual campaigns and focused criteria such as brand valuation or customer expectations throughout the year.
Brands can align their marketing, sales, and customer service with a single goal. With the clear objective of customer satisfaction, a fast-spinning flywheel can accelerate business success.
Also Read: Is Data The Key To Customer Conversion And Acquisition?
The Flywheel vs the funnel
For decades, companies have leveraged the marketing funnel model. It worked for a long time. It was developed by Elias St. Elmo to help marketers understand customer journeys better. But with major shifts in modern customer behaviour, the rise of SaaS and inbound methodology, the funnel is not good enough. Customer is king, and the linear funnel model fails to understand that.
The marketing funnel focuses on increasing customers but it does not view them as the driving force. With CX gaining importance every day, the comprehensive flywheel model helps. It can account for leads that do not fit into the linear sales pattern, and bringing continuity to the sales and marketing process, it leverages customers who have the potential to become brand promoters. For instance, shoppable UGC is a popular trend today working wonders on several industry fronts.
But funnels can’t be entirely eliminated. Marketers will create funnel-shaped charts and graphs to demonstrate the efficiency of particular marketing processes and how it adds value to the business performance. It has become a piece of the bigger picture – the flywheel.
Transforming the business strategy into a flywheel model can take time and include major adjustments, but the key is to identify and work on the unstable business processes, and evaluate the core performance metrics of the company.
