Broken Marketing Funnels
Most people have heard of the traditional marketing funnel...but has marketing finally fallen out of love with the idea?
Early versions of the funnel were very sales focused.
More sophisticated versions of the funnel evolved as the world - transformed forever by the internet - changed from a seller’s market to a buyer’s market.
Funnels became more concerned with the buyer’s journey - rather than a sales process.
Most funnels still shared a fundamental problem. They stopped at the point where a prospect became a customer. They suggested that the journey was complete once a customer was won.
In a hyper-connected world where digital word of mouth can make or break a business, this is a short-sighted and potentially dangerous model.
Advocates of your brand can effectively become your marketing team in the new world - but unhappy customers can kill it.
Future business success will depend more on how you design an end-to-end customer experience to produce advocates rather than how well your sales and marketing funnels work.
Economics of Extraordinary Customer Happiness
Customer lifetime value is one of the most critical concepts in marketing. Marketing professionals have long obsessed about RFM (recency, frequency and monetary value) metrics.
We know that it is seven times more expensive to sell to new customers than to existing ones. As long ago as 2000 Harvard Business School published a report demonstrating that improving customer retention by as little as 5% can impact bottom line profitability by 25-90%.
Despite all this established marketing wisdom, many businesses still fail to balance their obsession with sales funnels with an obsession for creating extraordinary levels of customer happiness.
The degree to which a single raving fan can impact future sales today is extraordinary. So customer reviews and social media conversations really matter. There is a huge gap in value between a ‘satisfied’ customer and a raving fan in today’s hyper-connected world.
Routinely creating raving fans is now your priority. This means that every touch post-sale is at least as important as every touch pre-sale.
This is why the traditional marketing funnel isn’t enough. Meet the marketing flywheel...
The Marketing Flywheel Revolution
Many marketers are embracing the marketing flywheel concept because it better represents this new thinking.
In the past businesses investment often mirrored the funnel, with far more resources being dedicated to winning new customers than to delighting existing ones.
As advertising costs increase and the market becomes ever more crowded, it’s taking more time, money and effort to fill the tops of your funnels with the prospects you need for growth.
As customer acquisition costs continue to rise and the dynamics of customer acquisition change, businesses have to adapt - but most salespeople today are failing.
Flywheel thinking mean evening out investment across all customer-facing departments. For many businesses this represents a significant change to their model - especially for those which have traditionally relied on new business sales to drive growth.
The flywheel model uses savings in sales to provide a better level of service to each customer through every contact they have with your business. Every touch point can be improved. Every expectation can be exceeded and each customer delighted to the point of becoming a raving fan.
Customer Satisfaction Is Dead
Flywheels are devices that store energy. Businesses spend huge amounts of energy creating prospects and converting them into customers. This energy is wasted if you let customers drift away after the purchase.
By investing in delighting hard-won customers, businesses can reap the benefits of having legions of raving fans rather than satisfied customers. It is these fans who create winning brands in the new hyper-connected world.
By going the extra mile to create raving fans rather than satisfied customers, you maximise repeat business, referrals and recommendations. Your raving fans bring new prospects to you through their networks. The process repeats...and your flywheel gathers unstoppable momentum.
The flywheel is a model for long-term success in a super-connected world.
Adopting flywheel thinking means accepting that we are all in the business of creating raving fans rather than satisfied customers.
This means we are all in the business of designing better customer experiences.
For more information about designing better experiences at every stage of the process, download our Introduction to Inbound Marketing Automation white paper.