Flywheels, Not Funnels: Revolutionizing Customer Acquisition and Brand Building
In the world of sales and marketing, no model has had more adoption than that of the ‘funnel’. Originated by advertising giant and agency owner Elias St. Elmo Lewis in the 1800’s, the funnel has been a key part of marketing strategies for over a century. The AIDA model (awareness, interest, desire, action) follows the basics of marketing/sales models which have remained largely unchanged: leads enter at the top of the funnel through your marketing > interested parties filter into sales channels > and a smaller subset take action and become customers. But there’s limitations to the funnel’s linear approach. First, it doesn’t account for what happens after the sale, missing out on the potential of happy customers to drive further growth. Second, the transactional nature doesn’t equate for the way customers buy from brands today (i.e. buyers are researching products/brands more extensively before they buy). And finally, the ‘funnel’ assumes one entry point and one destination, which doesn’t account for omni-channel, multi-platform strategies.
Enter the flywheel model - which prioritizes engagement, nurturing, and dynamic growth in the customer’s journey, with multiple points of entry across a brand’s various channels, platforms and products/services. In this beginner's guide, we’ll dive into the shift from static funnels to dynamic flywheels, and how this evolution is reshaping customer acquisition, and the impact on short and long-term brand building.
The Flywheel vs. the Funnel:
While the funnel model has been a well-traveled approach to customer acquisition, it fails to consider the role of customers in driving growth. The flywheel model, on the other hand, views customers as a driving force and focuses on creating promoters who help spin the flywheel. By prioritizing customer experience and aligning all teams around the inbound methodology, companies can provide a more holistic and delightful experience to customers.
The Rise of Flywheels
Flywheels as a concept have been around for decades, but are gaining renewed attention in the business world. Walt Disney's 'Synergy Map' from 1957 serves as an early example of a flywheel, illustrating how different components of an ecosystem can coexist and drive growth. The flywheel effect, as described by Jim Collins in Good to Great, emphasizes the importance of aligning all aspects of an organization towards a common goal, generating momentum with minimal friction. Companies like Zappos and Peloton have successfully leveraged the flywheel concept to drive sustained growth and engagement. Below are two examples for how the flywheel model creates synergy between products, services, media, etc, allowing customers more freedom to choose how and where they interact with your brand without losing the flow of interaction.
Walt Disney Synergy Map, 1957
This same model can be applied at a micro level too. To understand how the flywheel can transform your brand, let’s break down its core components:
Attract: Draw in potential customers with valuable content, experiences, and products.
Engage: Build meaningful relationships through personalized interactions at multiple touch points.
Delight: Exceed customer expectations to turn them into ambassadors who fuel further growth.
The Flywheel's Impact on Short-Term Brand Building
The advantages of the flywheel model extend beyond immediate customer interactions, offering tangible benefits for short-term brand building:
Attracting Potential Buyers: In the short term, the flywheel model helps brands attract potential buyers by leveraging content, experiences and products/services. By consistently showing up for your target audience in multiple ways, you can boost your brand’s visibility, establish a strong presence in the market, and increase the entry points to engagement with your brand.
Nurturing Customers: Building relationships through personalized interactions is crucial for short-term brand building. When customers and potential buyers feel understood and valued, they are more likely to trust your brand and engage with it further. This trust quickly strengthens your brand identity and fosters a loyal customer base.
Cultivating a Community: Continuing to cultivate the customer relationship post-sale with loyalty rewards, exceptional service, content, events, and consistent opportunities to interact with the brand can lead to repeat purchases and brand loyalty, but also turns customers into advocates who actively promote your brand to others, creating a community of supporters.
The Flywheel's Impact on Long-Term Brand Building
Beyond immediate gains, the flywheel model offers substantial long-term benefits for brand development and customer loyalty:
Creating a Loyal Fan Base: Long-term brand building relies on sustained customer engagement. By continuously nurturing your customers, you foster loyalty that goes beyond the initial purchase. A loyal customer base is more likely to make repeat purchases and engage with your brand over time, providing a stable foundation for growth.
Building Brand Advocates: Customers who have had consistently positive experiences with your brand become the most powerful advocates. These advocates spread the word about your brand, contributing to organic growth and enhancing your brand’s reputation. The compounding effect of these advocates can lead to exponential growth over time.
Continuous Feedback Loop: The flywheel model encourages leveraging customer feedback for ongoing improvement. By actively listening to your customers and adapting your strategies based on their input, you can stay ahead of market trends and continuously innovate. This adaptability ensures your brand remains relevant and competitive in the long run.
Practical Steps to Implement the Flywheel Model
Identify Key Forces: Create a list of significant, replicable successes your company has achieved. This should include channels, initiatives and offerings that exceeded expectations. Determine the activities that will attract, engage, and delight your customers.
Sketch Out Your Flywheel: Focus on creating high-value evergreen content, products/services that amplify your competitive edge, and branded experiences your customers will LOVE with multiple access points (i.e. don’t assume everyone is following the same pattern of entry). 4-6 components on the flywheel is a great starting point. Anything more than that and you might be overcomplicating it.
Align Your Team: Ensure team members are working towards a common goal to implement engagement opportunities for your brand across the flywheel (simultaneously rather than sequentially). This alignment is crucial for reducing friction and cultivating the relationship between brand and customer.
Measure and Optimize: To keep the flywheel spinning, you need to continually renew, and improve each and every component. Utilize analytics to track the effectiveness of your flywheel strategy. Gather qualitative feedback - especially from your die hard fans - and optimize your flywheel components based on what customers are telling you they LOVE and WANT MORE of.
Reduce Friction: Streamline your processes and improve communication to make it easier for customers to engage with your brand at each stage. Reducing friction enhances the overall customer experience and keeps the flywheel spinning smoothly.
The shift from funnels to flywheels represents a fundamental change in how brands approach customer acquisition and brand building. By embracing a flywheel mindset, B2C brands can create a continuous cycle of attraction, engagement, and delight that amplifies their competitive edge and drives sustained growth. This model not only enhances short-term brand visibility but also fosters long-term loyalty and advocacy. As the marketplace continues to evolve, adopting the flywheel model offers a sustainable and scalable roadmap for success.