Using Analytics to Drive the Flywheel
Whether you’re a marketing service provider looking to grow your business or a brand looking to improve your customer experience through digital engagement, understanding the evolving customer acquisition cycle is key. The digital landscape is noisy and it’s difficult to get noticed. To make matters more difficult, consumer trust is at an all-time low. The good news is that data-driven insights and tools now make the customer journey more accessible than ever if you know where to look.
We’ve all seen the stats around the efficacy of word-of-mouth. In the digital age, creating a footprint that can build trust through reviews and referrals is the best way to grow customers. The traditional sales funnel ends at conversion, neglecting to consider what happens after the check is signed. In today’s world, the customer journey can be more accurately seen as a flywheel. At conversion, we need to delight our customers and activate them as ambassadors so that we can engage prospects and build trust.
What is the Flywheel?
Before we start discussing how to track the customer journey in Google Analytics, we have to consider why the flywheel is so much more effective at describing the modern business. The old model of the sales funnel was great at driving new sales through increasing awareness and engagement, but its linear approach to growth is a major flaw. You spend all your time publicizing your products or services, interacting and engaging with prospects, and ultimately converting them into paying customers, but what happens after that? With a funnel, what you put in spills out the bottom: all that time and energy you spent nurturing the client relationship to the point of conversion goes out the window at the end of the funnel. Conceptually, this presents a huge problem, since the funnel model can’t account for the ways that paying customers help grow your business. That’s where the idea of momentum and the flywheel comes into play.
Put simply, a flywheel is a wheel on an axis that is incredibly energy-efficient. The amount of energy it stores depends on a number of factors: how much friction there is, how fast you spin it, and the size and weight of the disk itself. So what does that have to do with the customer journey, you might be asking? The flywheel provides a new way to conceptualize the customer journey that equally values the pre- and post-conversion stages.
Rather than describe the sales process in a linear fashion, the flywheel provides a model that more accurately describes the circular nature of the process. As you engage with prospects and create exceptional experiences, you generate greater customer satisfaction, which in turn transforms your customers into advocates and drives further growth. As you spin the flywheel, it gains momentum and carries itself forward. Equally helpful from a conceptual point of view is the idea of friction. With a flywheel, the momentum you’re able to generate depends on minimizing the amount of friction in the system. Similarly, reducing the number of hiccups and pain points in your customer’s experience is key to generating real growth.
How fast you can spin the wheel, or rather the growth you’re able to generate for your business, depends on applying force in the right areas. The flywheel approach to the customer journey focuses on three key phases:
The Engage phase is about attracting new prospects using your expertise and credibility. Through the content you create and the conversations you have, you begin to build fruitful, meaningful relationships. At a certain point, it comes time to Convert a friendly relationship into a business deal. By providing great experiences and effective solutions for your clients, you turn paying customers into brand advocates through Delight. Each business has unique needs and a unique situation, so knowing which area of the flywheel to focus on is crucial.
Using Analytics to Drive the Flywheel
No matter what industry you’re in, your business needs a website. In fact, these days your website should be the foundation of your marketing efforts. Consequently, the data you gather from your website about your prospects and customers can be used to identify the areas of the flywheel with the most friction and the areas that are generating the most momentum.
Engaged prospects and customers return to your site to consume your content; they interact with you on social media; they share your links with their friends. Luckily, these are all touchpoints that can be easily measured with the help of basic web analytics tools. For most businesses, the core metric that best measures the success of the Engage phase will be monthly website traffic. Using Google Analytics, you can easily dive deeper into your monthly website traffic using Acquisition reports to further quantify the marketing efforts that drive the greatest growth.
The Engage phase is about creating brand awareness, finding some way to make potential customers take interest in your brand over the countless others that are being presented to them. One of the most effective ways to accomplish this is through targeted content production. By understanding your audience and creating content that helps them resolve a need, you create a stable foundation for a meaningful relationship. The modern consumer is savvier than ever; they can smell a sales pitch from miles away. Building your brand’s organic reach through useful, relevant content provides value to the consumer before the first official contact is ever made.
Providing value to the consumer for free gets them in the door. It’s up to you to keep them around, to convert them. The key performance indicator of a strong Convert phase is, you guessed it, conversions, but what form a conversion takes depends on your business and your company goals.
Through Google Analytics, you’re able to track a wide array of actions and events on your website. Anything from form fill outs to clicks on a particular link to purchases on an e-commerce store can be quantified and tracked with a minimal amount of setup required. These metrics are great for identifying the ways in which users interact with your site, allowing you to better adapt your copy and design to ease any pain points you might uncover.
That being said, it’s equally important to track how many of these clients churn. If your company is great at driving engagement and facilitating conversions, you might see some growth in the short-term; however, you’ll constantly fight an uphill battle against churn if those new customer relationships aren’t managed properly. Herein lies the fundamental problem with the funnel model.
The flywheel model incorporates an additional post-conversion phase that has become crucial: Delight. Referrals have long been a steady source of new prospects for successful brands, and the advent of the Internet has only increased the importance of word-of-mouth. The success of the flywheel depends on momentum. No matter how much energy you put into engaging and converting prospects, your momentum can be stopped in its tracks by a poor online reputation.
Your relationship with your client doesn’t end at the sale. On the contrary, it’s just beginning! Tracking and quantifying the success of the Delight phase can be handled in a number of ways, and one of the most obvious is by analyzing customer retention. High sales and low churn are clear indicators of the success of a business, but too much focus on these numbers can lead you back to the shortcomings of the funnel model. Instead, emphasizing client-centric KPIs like number and quality of reviews or net promoter score can provide you with a much more clear picture of how customers view your brand.
Tracking the Customer Journey
There’s no doubt that the flywheel presents clear advantages over the traditional sales funnel, but as with any model, it’s only effective when you have the necessary data to back it up. Whether you choose to use Google Analytics, your own custom-designed reports, or a comprehensive reporting software like UpCity, the important thing is to understand the key performance indicators that you want to track for each phase of the flywheel. Once you’ve set your sights on a given metric, the easy part is figuring out how to gather it. If you’re curious about how to use Google Analytics and UpCity software to take control of your web analytics, download our ebook today!