Giffgaff, a British pay-as-you-go mobile network, takes a unique approach to managing customer service, marketing, and sales. Rather than hire scores of employees, the company leverages its customer base to do the lion’s share of the work.
An online customer community handles most service-related questions. As for sales, the company rewards customers for referrals by providing discounts on monthly service plans and other perks.
Not only does this “flip-the-funnel” approach create an army of enthusiastic brand advocates, it relieves the company of expenses associated with full-time employees and improves profit margins in the offing.
Start with Your Current Customers
In his best-selling book, Flip the Funnel, author Joseph Jaffe encourages marketers to rethink the traditional AIDA (Attention, Interest, Desire, and Action) sales model and, instead, start with the customers you already have.
Jaffe even introduces a new version of the acronym, with a slight reordering of the letters:
• A: Acknowledge your customers
• D: Engage them in Dialogue
• I: Incentivize further action
• A: Activate recommendations and additional purchases
Ask yourself: What proportion of your business comes from existing customers versus new customers? What percentage of your marketing budget is spent on existing customers versus new customers? Is there a mismatch? Ask new customers how many came to you via marketing messages, and how many came via word of mouth. A mismatch may exist there, too, between what you spend on advocacy activation versus old-school AIDA selling,
The message is simple but smart: flip the funnel and make customer retention your new acquisition strategy. Focus your sales and marketing investment on delivering remarkable experiences that are worth recommending.
Use Social Media to Flip the Funnel
Flipping the funnel has implications where social media is concerned. What bigger megaphone exists today than social networks, and what better way to turn customers into a sales force than by leveraging social technologies?
In his e-book, Flipping the Funnel, author and well-known marketing expert Seth Godin outlines a slightly different path than Jaffe. He recommends that brands “turn strangers into friends, friends into customers, and customers into salespeople.” Anything you can do to incite social sharing and get people talking about you is worth the effort.
The social focus of your flip-the-funnel strategy should be to activate advocacy and facilitate sharing. Here are some ideas to inspire your thinking:
- Align sales and marketing costs to your revenue: if 70 percent of revenue comes from existing customers, your budget should reflect this.
- Ask your customers what prompted them to come to you in the first place. If 50 percent came through word of mouth, half of your sales and marketing effort should be invested in stimulating recommendations.
- Add social plugins to your site to enable customers to share freely.
- Whenever you run an event, think about how you could use it to bring existing customers together with prospects, and let the power of recommendation do its magic.
- Build social sharing into your product or service — either virtually using social media connectivity or in-person by bringing people together at marketing events.
- Create video content that you encourage fans and followers to remix and make their own then share with friends.
By empowering customers to become brand advocates, companies can build loyalty, increase lifetime value, and leverage word-of-mouth referrals. The key lies in flipping the funnel and turning retention into a primary customer acquisition strategy.