How do you scale a business quickly and accelerate long term growth?
Consider the Flywheel Effect.
A flywheel is a large and heavy metal disk. It takes lots of effort to get it moving, but once it begins to turn, it builds momentum. So, once it starts turning, the flywheel will turn faster and faster with the same amount of effort.
The Flywheel effect helps many organizations build and grow their business strategy.
Example Of The Flywheel Effect
Amazon's Flywheel is a strategy focused on customer experience to drive traffic to their platform and third-party sellers & partners.
1. The flywheel starts at Customer Experience. Excellent customer experience drives traffic to Amazon.com.
Because Amazon attracts lots of customers, sellers put their products on Amazon.com. This creates a greater selection of products for customers.
Increased sales allow Amazon to lower the cost structure and reduce prices. This, along with customer experience, increases the traffic to Amazon.com.
Each element starts to increase and it take on a life of its own. More traffic leads to more sales, leading to lower prices. In other words, the flywheel starts to turn faster. All of this results in the accelerated growth.
What is the starting point of the Amazon Flywheel?
A Customer Focused Flywheel
The flywheel isn’t just a business or marketing strategy, but rather a business mindset. The distinction is important, as a marketing strategy makes it applicable only to certain areas of a business, like sales.
A customer mindset puts the customer at the centre of your business, helps you identify and refine products, keep customers engaged, and drive a selling process. If you can build a flywheel around the experience of your customer, you'll unlock new potential for your business.
When do you stop focusing on customers?
Think About Replicable Success
What successes can you create, and recreate?
These will be key elements of your organization's flywheel, and will empower your success to snowball, with increasing speed.
Could you benefit from the flywheel effect?
Think about where you want your business to be in 5 years. Now work backwards.
What type of customer-centric flywheel will help you get there?