Why your funnel approach is failing?
Today, 57% of B2B purchase processes are completed before buyers ever reach out to vendors. (HubSpot)
Do you still see marketing funnels in all your company meetings? Are they still the most prevalent model used in your inbound marketing plans? Do you use the majority of your marketing budget to pique interest and increase public awareness of your product or brand? If so, it might be time to make some major changes to your sales and marketing strategy.
What is this marketing “funnel”?
A marketing funnel is a model that follows the journey of a customer from becoming aware of your product or service to making a purchase. It has been used by marketing agencies for many years as the leading force behind their campaigns.
However, in recent years, the funnel has lost its relevance. Several changes in the marketing landscape of today have caused it to become ineffective, leading high growth teams to weigh the revenue impact of the funnel vs flywheel paradigm shift.
In the past, customers were not able to get recommendations from their peers or third party sources at the push of a button. They couldn’t scour through reviews online, or send a quick text to a colleague to ask for their suggestion.
That is why the funnel made so much sense and worked so well. It provided an easy way for customers to learn about a brand. They would retrieve or receive marketing information, contact a sales representative and go on to purchase a product, becoming a customer.
It was that straightforward and simple. Nowadays, the process has become a little bit more involved – in a good way.
With the internet, social media, and the technology boom in general, people from all around the world are able to access information from a smartphone or personal computer, do their own investigation about a brand and share what they think about it with their peers before ever even visiting the website or coming into contact with the marketing or sales team.
Customers are overloaded with advertisements every day, all day long. They no longer trust everything they see or hear. They are not so willing to give out their email addresses or phone numbers anymore to receive information about a brand. They worry their inboxes will be flooded with junk mail.
On the other hand, customers want to feel valued long after they engage with your company. They get excited by being the first of their friends to discover a new product or service, as they post to their social media about it for their followers to see. Customers today want to play a part in the story of the brands they like.
Customers also assume businesses understand their needs. According to a study done by HubSpot, out of 6,000 customers, 76% expected companies to understand their expectations and challenges.
Sales and marketing agencies have to adjust their strategies in order to stay on top in the marketing landscape of 2021. With so many new ways to engage with the customer, it’s crucial to get creative with your marketing campaigns to appeal to them.
The Funnel is Linear
The funnel is a linear strategy. Prospective buyers are introduced to your brand at the top and make their way from an awareness stage to a consideration stage, until finally, they make their decision and purchase. The days of simply relying on lead scoring models and what actions lead to a sales qualified lead is no longer sufficient insights needed to find buying triggers in a linear funnel.
The problem with this is that, in today’s world, prospects enter at any stage of the process. Now that they are able to do their own research, they may skip the attraction phase entirely and go straight to the consideration or decision phases.
A perfect example of this is what takes place on popular e-commerce websites. A customer can find the product they need, read reviews, move it to their cart and purchase it all within a few minutes. In a way, they walk themselves through the funnel without ever coming into contact with your marketing strategies or team.
The funnel also works off of the idea that once a customer makes a purchase, their involvement with your brand is over. The time spent generating the lead, nurturing it into a sale, and building a relationship with the customer is a waste. You’re back to square one.
It’s a shame to think that all of the money and time invested working to create a bond with the customer in order to sell them on your brand is for nothing. At the beginning of the quarter, month or week, you’re back to where you started again: the top of the funnel.
This linear methodology does not take into account one crucial aspect about how society affects the buyer’s journey of today: a customer’s ability to share, promote, and attract more business.
The HubSpot Flywheel Model
At the Inbound Conference back in 2018, Brian Halligan, co-founder of HubSpot, declared the death of the marketing funnel as an effective marketing tool. Soon after, he unveiled a prop: a vibrant wheel attached to a stand. Halligan coined this the ‘Marketing Flywheel’.
Since its big reveal in 2018, companies have ditched the inadequate funnel model. They’ve begun incorporating the HubSpot flywheel paradigm into their inbound marketing campaigns.
The flywheel works like any other wheel. Imagine the wheels on a car or a train. As they spin, they catch a rhythm, build up momentum and start to move forward, faster and faster.
This momentum-building, forward-moving idea can be (and should be) applied to business. Who doesn’t want their business to move like wheels on a car, pick up speed and take them great distances?
The flywheel is incredibly efficient at storing and releasing energy. This comes in handy when applied to your company using customers to grow your business.
Flywheel and Inbound Marketing
As a B2B company, you should already be implementing methods of inbound marketing that further aligns objectives of your sales and marketing teams. This describes the style of marketing that includes creative content, social media outreach, and an overall enjoyable customer experience. It consists of three major phases in a buyer’s journey: attract, engage and delight.
Attract New Leads
The attraction phase entails drawing customers into your reach. You can achieve this with the use of creative content across all social platforms.
Attracting strategies include:
- Informative blog posts and how-to guides
- Social media presence
- SEO keywords
- Content offers
- Customer Testimonials
Engage and Nurture Leads
During the engagement phase, you want to continue to put out useful content that keeps the attention of your customers while entertaining them. This is also when your marketing and sales teams can begin building a relationship with the customer.
Engaging strategies include:
- Landing pages
- Sales calls
Delight Your Customers
The delight phase is last in the cycle, however it shouldn’t be thought of in that way. With a flywheel mindset, this phase should come into play throughout the entire journey. Delighting a customer allows you to make sure your customers are happy and satisfied with their experience, which is extremely important to keep the flywheel on the move.
Delighting strategies include:
- Smart content
- Social monitoring
The flywheel approach works wonders for your inbound marketing strategies. It allows you to powerfully move through each phase, attracting qualified leads, engaging with compelling content and delighting customers the whole way through the process.
When you take your inbound marketing plans and incorporate them into the structure of the flywheel, each phase feeds into another. By focusing on delighting the customer throughout the entire process, you put customers at the center of your B2B marketing strategy and keep them there.
With this concept in mind, you’re in a constant state of building momentum and spinning the wheel, which moves your company forward. Your leads are nurtured into sales and your sales into customers. And after a “delightful” experience, your customers then become excited advocates for your brand.
Halligan notes that people are much more inclined to trust other customers, compared to other marketing tactics. In fact, at HubSpot, 33% of their customers said they had been directed to their service via word of mouth. Astonishingly, no other form of marketing came close to bringing in the percentage of people that word of mouth did, including Google.
In other words, now more than ever, happy customers go on to share their experience with their friends, family and colleagues and as a result, bring more customers to you. Their satisfaction feeds back into the attraction phase, leading to referrals and repeat sales.
For this reason, Halligan suggests that the majority of your marketing budget should be directed towards ensuring the delight of the customer, compared to the funnel model which directs the better part of a budget into the attract and engage stages of the marketing process.
How It Works
So how does the marketing flywheel work?
A successful flywheel depends on three factors.
- Speed (How fast does it spin?)
- Friction (What is causing it to slow down?)
- Size (How big is your wheel? What is its capacity?)
How fast does your flywheel spin? After evaluating your past marketing efforts and how they were perceived, you can understand what areas provide the strongest push. Focus your strategies on these more effective areas and you’ll witness your wheel pick up speed.
As your brand leverages growth marketing and accelerates at faster speeds and generates higher revenue, you want to eliminate any bumps in the road that cause friction and slow down the wheel. For example, making sure your internal performance isn’t causing any unwanted friction.
Alignment within the different departments of your team is a critical factor in the success of the flywheel. It’s important that all operations run smoothly between your marketing, sales and customer service teams for your flywheel agency to keep its momentum.
Another way to ease any unwanted friction is to identify your customer’s pain points. This can include what makes their experience unpleasant or frustrating in any way when interacting with your brand. Shifting some of your focus and budget to updating any elements that might deter your customers away from your brand can help your wheel roll on with ease.
It goes without saying that the size of your wheel will affect the impact it has. The bigger your company, the more output it can produce. As long as your teams are working together, your flywheel will make great strides and your business will grow.
Why You Should Switch to the Flywheel
When you put customers at the center of your company’s structure, they become impactful contributors to the force that accelerates growth. Your business gains incredibly effective promotion without any of the exorbitant costs. The flywheel approach has proven that it is more important than ever before to ensure that the customer journey is one they would recommend.
This new and improved methodology promotes a simplified customer experience. It allows for easier hand-offs between marketing and sales teams. When you have a common goal between teams to connect with customers and delight them, your internal processes can run smoother and quicker.
The Hubspot flywheel provides a better way to measure growth and evaluate how your efforts are being received. While the funnel may have helped businesses grow before, a flywheel promotes a way to grow smarter.
How to Make the Switch from Funnel to Flywheel
Now that you understand the impact the flywheel can have on accelerating your growth, let’s explore how to wean your company off it’s beloved funnel and utilize the power of the flywheel. It is going to take some adjusting, which includes refining your companies value proposition to align with your flywheels objectives
For starters, it’s important to do your “homework”. Evaluate your company’s performance metrics as they stand and the key forces of each phase of your inbound strategy. Recreate those same forces with the intention of maximizing delight, customer satisfaction, and word of mouth.
Establish what your goals are for each phase and what tools you have implemented to achieve them. You might discover that you have many different answers for these questions. That’s perfectly fine. Most companies will have multiple flywheels spinning at the same time.
Next step, identify any points of friction between departments. How are your customer handoffs from marketing to sales to customer relations? Determine how you can improve communication, organization and alignment to alleviate any unwanted resistance throughout the buyer’s journey.
Internal Employee Buy-Ins
What needs to change within your internal operations to encourage your employees to adapt to this kind of thinking? The answer is: altering the employee reward system.
An example of this would be changing the criteria for employee commission. At HubSpot, commission is achieved when employees keep an account for eight months, rather than when a deal is closed. This pragmatic approach ensures that employees are focused on keeping their customers happy– delighted, even –throughout their experience, as opposed to staying focused on getting the account and not necessarily on keeping it.
The funnel archetype views customers as an outcome or as a means to an end. It focuses on short-term goals, and ignores the bigger picture.
Customers should be thought of as active contributors to the success of your business. A customer-centric flywheel should invest in improving the buyer’s experience.
How can you adjust your marketing strategies and tools to enhance your customers’ interactions with your brand?
In the past, the best product would usually win. Nowadays, the best customer experience wins.
Buying On Their Terms
The former high-friction model of a sale included full service and also involved interacting with other human beings, in a 9 to 5 setting. The new low-friction model uses a self-service method with 24/7 access. Furthermore, consumers can try the product before they make a steadfast monetary commitment.
Halligan suggests that, instead of making your product ten times better than the competition, it is actually smarter to make your service ten times lighter than the competition. In a sense, there should be as little friction as possible in the consumer’s experience.
Typically, modern day consumers don’t want to have to leave their homes to travel to a shop or interact with other people unnecessarily. They also want to be able to return the product if they aren’t satisfied with it, and they want the freedom to be able to make a purchase as soon as they feel like it.
Customers want to make a decision on their own time and on their terms. Understanding this and making it possible for them is a sure fire way to improve your customer service strategy.
The “Give Before You Ask” Strategy
Inbound marketing starts with inviting leads to discover your brand and “asking” them to take an action. Most of the time this means requesting a way to contact them. Customers today worry if they offer up their email addresses or phone numbers, they will be harassed with spam. This can take on many forms of messaging, along with many types of content, which is outlined in the chart below.
This is why a creative way to ease their concerns is to follow the “give before you ask” tactic. You can present your customers with calls to action that are paired with something they would like for free.
This can include:
- Free white papers
- Free webinars and training videos
- Free eBooks
- Free trial
1. Going Mobile
Smartphones, social media and mobile apps have changed how customers become aware of and engage with a brand. For this reason, it is crucial to build a mobile version of your website to ensure a positive customer experience.
There are several opportunities to take advantage of this new age of technology and provide a clever alternative for your customers to interact with your brand. Premium mobile apps that act as a game or loyalty membership are becoming more and more popular.
Your most loyal customers are the ones that are most likely to buy from you again or recommend your brand to a friend or family member. Still, even those customers can be difficult to keep around and continue to attract. With a premium app, you can show that your brand is staying one step ahead of the rest.
2. Going Virtual
Sometimes, a lack of representatives to assist your customers can cause a report of dissatisfaction. If you often experience a heavy influx of customer calls and emails, implementing a virtual approach can be beneficial to your customer service department. Virtual assistants and chat rooms can help you tend to the problems your customers are having more efficiently.
SaaS trials, for example, has also become an extremely popular means of allowing your customers to shop on their own terms. Adding this option to your website provides an option for the buyer to try out a SaaS product before they decide to purchase.
3. Behavioral Pairing
This last suggestion for upgrading your customer service is behavioral pairing and is a relatively new technology. For returning customers with a history of interacting with your brand, you can better assist them by pairing them with the right representative based on their previous requests, behaviors and communications.
Rather than connecting a caller with a random representative, behavioral pairing eases the process and provides direct support for every kind of need, goal or expectation a customer might have.
Though it served us well in the past, the marketing funnel is outdated, less effective and a drain on your company’s budget. By comparison, the flywheel focuses on delighting the customer by making the customer experience as enjoyable as possible, with as little friction as possible, as well as providing the consumer a killer product.
Over 80% of businesses that are shifting their focus to improving their customer service are seeing an increase in revenue. (HubSpot)
It isn’t about selling the best product or service anymore. It’s all about providing the best customer service possible.
When you put your customers at the center of your marketing strategies and turn your marketing efforts towards delighting them throughout their entire experience with your brand, you transform your buyers into more than just revenue. They become motivated promoters of your product or service. This method is both more effective than traditional marketing methods, and substantially cheaper.
The marketing flywheel is a powerful approach to accelerate the growth of your business. It has revealed how incredibly important customer satisfaction is as a way to stand out amongst your competitors while keeping your sales playbook agile as shifts in buying behaviors continue over time.
So, what are you waiting for? Ditch the funnel. Embrace the flywheel.