In 1898, E Lewis developed a model to understand a consumer’s journey to enable businesses to improve their customer acquisition rates. We call this the Sales Funnel Model and it’s based on the AIDA principle. Awareness, Interest, Desire, Action.
This model has been successfully used for over a century by sales and marketing teams the world over. Now, it has served its time, and current circumstances have necessitated a better and more wholesome understanding between businesses and customers. Cue: The Flywheel.
In this article, we’ll discuss what the Flywheel model is and why it is replacing the sales funnel model. Then we’ll break down the Flywheel model into its components to give you a better understanding of how it works.
Finally, we’ll discuss how you can use the flywheel to grow your own business.
What is the Flywheel model?
This is how Hubspot defines the Flywheel:
Unlike the funnel, the flywheel is remarkable at storing and releasing energy — and it turns out that’s pretty important when thinking about your business strategy. Invented by James Watt, the flywheel is simply a wheel that’s incredibly energy-efficient. The amount of energy it stores depends on how fast it spins, the amount of friction it encounters, and its size. Think of it like the wheels on a train or a car.
This energy is especially helpful when thinking about how customers can help your business grow.
credits : Hubspot
With this model, customers aren’t the end product, they are the central consideration. This allows your business to focus and synchronize all departments that work to attract, engage and delight customers.
The flywheel works on a basic principle, the more momentum you apply to it, the better results you’ll witness. Essentially, there are three parts to the flywheel.
- How fast you spin it
- How much friction it has
- How big the size of the flywheel is
The fastness of spin refers to the intensity of efforts and productivity of your sales, service, and marketing departments.
Friction means the difficulty your customer has to face to acquire and use your product. The lesser the friction, the happier your customer and the more the energy your flywheel can carry.
The size of the flywheel is all about the pool of customers you have.
With the flywheel, you use the momentum of your happy customers to drive referrals and repeat sales. Basically, your business keeps spinning.
Why is the Flywheel replacing the Sales Funnel?
The need for a change originates from a shift in how customers want to be treated and how businesses understand them. The mid-twentieth century was dominated by a ‘push’ philosophy where you’d make products and then convince people to buy them.
Now customers are more aware and have information available about products outside of what companies have to say about them. In this context, it becomes clear that the sales funnel isn’t customer-centric. The sales funnel model hopes to attract attention and then convince customers to buy. The flywheel model assumes that customers are at the center of their business activities. Such an approach puts the needs of the customers first so that they are more likely to engage with your business.
Second, in the Sales Funnel model, leads are treated mechanically and they’re passed from marketing to sales to customer support (sometimes customer support isn’t even a consideration). The flywheel model encourages all these 3 departments to synchronize and assumes that the customer can come in touch with a company at any stage. There is no chronological treatment of a customer from marketing to sales to support.
Most importantly, the flywheel emphasizes on momentum.
The more force you apply to a flywheel, the more places on it where you add force, the faster it spins. This means, unlike the sales funnel, the effort you make in one department reverberates through others as well, including customers. All your efforts are interconnected and affect the customer directly.
The Flywheel and its components.
The flywheel consists of 4 moving parts. The three outer ones are your marketing, sales, and service departments. The inner core consists of customers.
There’s another way to look at the Flywheel which enables you to look at it according to the actions needed to make the wheel spin:
If we break the Flywheel down like shown in the figure, Here is what each component represents:
- Customers: The backbone of any business, keep them happy, reduce friction and you won’t lose momentum
- Attract: You can’t force attention, you’ll have to earn it. Attract customers with useful content and make it easy for them to learn about you and your products
- Engage: Instead of just closing deals, build relationships with customers, and engage them regularly. Reach out to them on their preferred channels and mode of communication.
- Delight: To keep your customers happy, tie your success to your customers’ success. You grow when they grow. This way you’ll align your resources to deliver an optimum customer experience.
Here’s how Hubspot describes the flywheel in action:
The actions taken by each team at your company impact each other. Your marketing inputs affect how quickly prospects move through your sales process. Your sales motion affects how likely it is prospects will become happy and successful customers. And of course, your support and service activities impact whether your customers become promoters — people who recommend you to their colleagues — or warn their networks to stay away.
How to grow your business using the Flywheel
We’ll look at all three departments, marketing sales, and customer service and see how they can attract, engage and delight customers to grow their businesses.
To attract customers, use tactics like SEO, social media, content marketing, and ads to draw people to your brand.
To successfully attract customers, study them thoroughly, and create buyer personas to qualify people you actually want to attract and who’d be interested in your brand.
Once you’ve attracted potential customers and they land on your website, this is the time to engage them, acquire their contact information, and convert them into a lead. This way you’ll have established a direct line of communication with your customers.
To do this, use pop-ups and opt-in forms. Be sure to show only offers you think are relevant to them. If you can track how and why a visitor ended up on your website, you can show them customized offers.
Once you have leads, it’s time to delight them, give them value and make them feel positive about your business using long-form content tailored for them, video content, white papers, and content that helps solve their problems. This is also a good time to showcase how your product can be of value to them.
There’s an overlap between marketing and sales when it comes to attracting customers. While Marketing is doing the job of delighting leads, Sales can come in at this point and reach out to leads to enroll them in the sales process.
The flywheel model suggests that the whole thing can also start without marketing. A sales rep may directly communicate with a prospect over social media, or through inbound communication and enroll them through the sales process.
Engagement on part of Sales includes having meetings, calls, and email communications with leads once they’ve shown interest. This is to keep them interested and answer all questions they may have regarding a company or product.
Give your prospects the leeway in deciding the time and preferred mode of communication to keep them comfortable throughout the process.
To delight your customers, make the buying process as easy as possible for them. Not only should they find it easy to make the actual payment, but make sure they understand how your product works and help them with checklists and product videos.
If you go above and beyond while attracting and selling, you’ll have delighted customers who’ll be highly likely to recommend your product to their peers, attracting new prospects to your flywheel.
In the attraction phase, most of the heavy lifting is done by sales and marketing. Nonetheless, service plays an important role. Good service ensures minimum friction.
You as a business can do that by offering assessments, product demos, freemium offerings, or bringing members of your service delivery team onto sales calls. Let your prospects try your product and allow them to experience it firsthand to make your case stronger.
Customer service personnel can engage customers by ensuring they are clear on what to expect from your company. Then deliver beyond their expectation. Have a knowledge database available that customers can refer to for technical questions and FAQs.
When you help your customers succeed, they’ll favor you positively and will be willing to listen to you. Then you can get case studies, reviews, and referrals that help your company attract more customers.
Replacing the sales funnel model with the flywheel brings a lot of advantages to your businesses. The flywheel focuses on building momentum, synchronizing teams and always putting the customer first.
If you tie your success to your customer’s success, you will experience a harmonious relationship with them where both of you grow together.