Customer lifecycle

What is the customer lifecycle?

In terms of customer relationship management, the customer lifecycle describes the various stages a consumer goes through before, during and after they complete a transaction. Simply put, it’s the Point A to Point B journey a customer takes until they make the final purchase.

The phases a customer passes through during the course of an ongoing relationship with a brand vary on a case-by-case basis, but here are five basic stages of a customer lifecycle:

  • Reach: Your marketing material and content needs to be in places where consumers will find it. Reach is the first step in the lifecycle because it develops awareness right away.
  • Acquire: Ecommerce acquisition is very important. Reaching potential customers won’t mean much if you can’t offer relevant content or messaging. Understanding your brand, the products you offer and what type of person will buy them will help with acquisition. Contacting them directly with personalized communication improves the odds of a future conversion.
  • Develop/nurture: Once that first purchase is made, your business needs to keep in contact with the customer. This is where you develop a relationship with the buyer, ensuring they’re fully satisfied with their initial transaction. You can also use back-end analytics to predict what else they may like based on what they bought the first time around. Asking for feedback also helps develop the relationship; customers like that their opinion is valued.
  • Retention: If you’re able to continually send relevant and meaningful messaging to a customer, the chances that they return and make another purchase are higher. Retention begins with satisfying a consumer’s needs, caring for them and cultivating the relationship. If you can take a customer’s feedback and use it to improve a product or service, you make them feel as if they were a part of the process. Performing a customer feedback analysis is key in finding actionable insights that can lead to a stronger customer relationship. This type of trust is valuable to customer retention.
  • Advocacy: Once the retention stage of the lifecycle is reached, you want these customers to become a brand advocate for your business. If they are truly satisfied, they likely won’t have issues recommending your products or services to friends and family. Spreading awareness amongst social circles is easy to do once a customer is loyal to a brand, and if they continually spread positive recommendations, their extended network is more likely to convert as well.

The beauty of the customer lifecycle lies in the fact that it’s nonlinear, meaning it follows a cyclical pattern at the end. Customer retention is the end goal in developing strong brand loyalty, but your business needs to continually offer relevant and timely messaging to prior customers, otherwise your top-of-mind awareness will quickly fade.

The customer lifecycle can help your business maximize the revenue potential for each client who makes a purchase on your website. Once a customer has become a brand advocate, the potential for upselling increases as a result. New product features, releases or exclusive offers are also a great way to progress consumers through the lifecycle. As long as your messaging is consistent, relevant and is in tune with their needs, you can turn one-time buyers into loyal customers quickly.

How to Manage the Customer Lifecycle

1. Identify your target audience.

Customer Lifecycle Stage: Reach

Before your customers discover your company, you need to determine who you’re trying to reach. Rather than marketing to everyone, identifying a specific target audience, which will help you create content that’s relevant to your customers.

The easiest way to define your target audience is to create buyer personas. Buyer personas are fictional people that represent the demographic and behavioral characteristics of your customer base. They have names, backstories, and even hobbies. Everything you need to know about your customers is found in these personas. Remember, however, that they’re fictional, and that the needs of your customers may evolve.

2. Share relevant content.

Customer Lifecycle Stage: Reach

Give your customers a reason to trust you before they invest in you. By putting out lots of useful, engaging, search-engine-optimized content, your company will pop up more frequently when customers are searching for related topics.

Content can include original blog posts offering industry information; templates for email, infographics, and other marketing tools; and online courses.

Later, when customers are looking for certain products or services, your company will be the first that comes to mind. This is the basis of the inbound marketing methodology.

3. Provide self-service resources.

Customer Lifecycle Stage: Acquisition

Once a customer has gotten acquainted with your brand and its content, it’s time to take it a step further by providing self-service resources that go over every detail of your product. You’ll make potential customers’ lives easier by offering as much information as possible. It limits their need to reach out to your customer service team and will facilitate a well-informed purchasing decision.

For example, you can create a knowledge base — a centralized, online database offered by your company containing extensive information on the uses of your products and services and answers to FAQs. Customers like to handle as much of the purchasing process on their own, so providing them with a means to educate themselves will further attract them to your brand.

4. Use proactive customer service.

Customer Lifecycle Stage: Acquisition

Even if people haven’t bought your product, they may still have questions about it or your company. They may not know how it works, or even what it does, and this can lead to potential customers walking away from a purchase.

Rather than relying solely on self-service tools, your sales team should be working proactively as well. They should be reaching out to leads and offering them trials or demos that help familiarize customers with your products. This not only promotes your product line but also establishes a personal relationship with the customer.

5. Remove friction from the purchase stage.

Customer Lifecycle Stage: Conversion

Build a simple, online ordering system. That way, the most difficult part of the purchasing process is the customer writing out their credit card number. While it may seem obvious; the easier it is to add items to a cart, add shipping and card information, and press “submit,” the more likely it is that a customer will make a purchase.

6. Provide support options during the purchasing decision.

Customer Lifecycle Stage: Conversion

Depending on what you’re selling, the purchase stage can be a high-stress moment for the customer. No one wants to have buyer’s remorse, and this fear of regret can act as a major point of friction during the customer experience.

One way to counteract this is to provide support options during the purchase stage. For example, you can add a live chat widget to your website that links to a support rep. That way, customers can easily contact your team when they have questions while they’re shopping. Instead of navigating away from the page they’re on, they can just click on the chat widget, ask a question, and return to their purchase.

7. Personalize the customer’s experience after a purchase.

Customer Lifecycle Stage: Retention

Don’t forget about your customers after they’ve made a purchase. If you do, that usually ensures they’ll be a one-time customer.

Make the customer feel just as cared for post-purchase as they are pre-purchase. Set up an automated email system that immediately thanks customers for their orders post-purchase. Or you can personally reach out after their product has been shipped to ensure they got exactly what they wanted and are happy with their purchase.

8. Invest in automation.

Customer Lifecycle Stage: Retention

Personalizing your post-purchase engagement is easy when your team only works with a handful of customers each day. But as your customer base grows, you’ll need to scale your efforts accordingly to keep pace with customer demand.

This is where marketing automation comes into play. Pairing it with your contact base and CRM allows you to quickly access user information and turn it into personalized content.

For example, you can set up a workflow that automatically sends customers an email whenever a new product or service is released. This keeps you in steady communication with your customers and helps you maintain an active relationship with them.

9. Invite customer reviews and encourage referrals.

Customer Lifecycle Stage: Loyalty

A customer will need that final push to encourage them to go above and beyond for your brand. Encourage happy customers to share their experiences by making it simple to do so. Email them brief surveys, link them to your Yelp or Google Reviews sites, and offer them discounts or compensation for referring friends.

Managing the customer lifecycle is critical to guide customers to your brand. You can follow these steps to ensure you’re always maximizing the effects of customer lifecycle management.

At every stage, you should follow best practices to ensure you’re getting the most of your efforts.