The rapid pace of digital disruption and the growing number of connected devices has upended traditional marketing and altered customer expectations. To keep up, brands must provide tangible value, seamless experiences, and personalized interactions with every customer touchpoint.
But this kind of customer-centricity demands an updated marketing model.
In this article, we’ll share with you why the traditional marketing funnel is losing relevancy and introduce you to a modern marketing model that is helping brands thrive in the digital era.
Why the funnel no longer works
First, the traditional marketing funnel assumes a linear customer decision journey; either initiation, research, comparison, transaction, and experience; or, attention, interest, desire, action. And while customers today still go through these phases, that journey is not always a straight line.
With the explosion of devices, apps, social media, chatbots, and digital assistants, the customer decision journey has become more of a winding road, where a consumer may take any number of actions such as searching online, checking social media, talking to a friend, or shopping on a mobile device at any point of time.
Furthermore, the consumer may backtrack, take a long break, or start shopping for one product and purchase something entirely different. The possibilities are as complex as they are endless, and the traditional marketing funnel simply can’t accommodate the impact all these new inputs and touchpoints have to the modern customer decision journey.
Second, the funnel is product-centric — meaning that it’s focused on conversions, not customers. The driving force is making a sale. The funnel does not account for how customers grow your business and how engaged fans drive future customers and purchases. It misses out on word-of-mouth advertising. The customer is simply a byproduct to achieve a conversion.
Finally, the marketing funnel is inefficient. The time and effort put into the funnel is lost at the end of the line. Each day, week, and month, marketers must drive leads into the funnel. The more leads, the more outputs. Marketers must continue putting energy in at the top to drive customers down the funnel. There’s no momentum to be had.
To truly understand and market to the modern customer decision journey, brands should shed the marketing funnel model and don a much more customer-centric lens.
How the marketing flywheel fuels the future
The flywheel is a mechanical device that stores rotational energy — also known as kinetic energy. The more energy you put in and the less friction you have, the faster and longer it spins. Once the flywheel gets going, less energy is needed to keep it going.
The marketing flywheel is an efficient model that feeds on its own momentum. The efficiency of the flywheel is based on the force (programs and touchpoints), the energy (data), and the amount of friction (churn or disruption in processes, people, and data).
With the flywheel, the energy and force are not lost. They feed the momentum to keep the flywheel spinning to create a virtuous cycle where more data leads to more touchpoints which leads to better data.
The flywheel model puts the customer at the heart of everything, where you attract and engage a consumer, attain them as a customer, and then delight them so that they become fans. By repeating this process through the marketing flywheel, you create strong customer-centric experiences that provide the data for optimization and even better performance. And thus, the flywheel spins faster.
Creating a marketing flywheel
To meet growing customer expectations, marketers must increase their ability to understand and market to the customer journey. This capability is something that we call the Customer Experience Quotient (CXQ)
We recently conducted a series of comprehensive interviews and an online survey of markets and agencies across companies of all sizes and verticals. As part of the study we have found that the top 20% of marketers have advanced CXQ capabilities. These marketers have embraced the marketing flywheel, and they’re achieving higher sales, revenue, and marketing ROI than their counterparts.
So, what’s required to create a marketing flywheel?
To begin with, you need plenty of data. Having a strategy that captures and consolidates high quality, internal and external data is the first step in understanding and marketing to a highly complex customer journey. You cannot create personalized touchpoints and experiences if you don’t know anything about your customer, what they’re doing, and when they’re doing it.
But unlocking that kind of data at scale is key. And for that, you need artificial intelligence (AI) and machine learning (ML). Top CXQ marketers are combining their data with AI technologies like cognitive services, chatbots, and digital assistants to build personalized, interactive brand experiences. They’re using ML to make AI systems smarter with every interaction. They’re applying ML to anticipate behaviors and consumer actions to attract, engage, attain, and delight customers. They’re creating smarter, more tailored experiences at key points along the customer decision journey.
These same technologies are also helping marketers to reduce friction. From a marketing standpoint, friction can be anything that disrupts the cycle, such as a lack of insight into why customers are getting stuck in the prospect phase or why some customers are leaving. Of course, friction can also stem from clunky internal processes and disconnects or lack of cohesion across customer touchpoints.
The point is that top marketers are doing everything they can to fuel the marketing flywheel with data, create force through touchpoints, and minimize friction. And the better the marketing flywheel, the more success they’re seeing.
So, the question is: are you ready to say goodbye to the funnel and hello to the flywheel?
To learn more, download Creating smarter customer journeys
. This eBook goes into the specific strategies that top marketers use to understand and market to the customer decision journey and create a marketing flywheel that delivers results.