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Customer lifecycle: The 5 stages and strategies to implement

What is the customer lifecycle?

The customer lifecycle describes the steps a customer takes when making a purchase. The lifecycle has multiple stages, which vary depending on your audience and product. Still, most begin before a customer is product-aware and continue long after the final transaction. 

Customer lifecycle vs. customer journey

Although the terms customer “journey” and "lifecycle" are frequently used interchangeably, they aren’t the same. Brands design the customer lifecycle based on customer data, but customers lead their own journeys through their choices.  

The lifecycle is a cyclical process that follows customers through their entire engagement with a brand. The cycle occurs over months or years, spanning multiple transactions. In contrast, the customer journey refers to a customer's single path toward a purchase.  

The 5 customer lifecycle stages

1. Awareness

During the awareness stage, customers discover a problem and start looking for a solution. This marks an opportunity for brands to engage potential customers with educational content and information that spotlights the customer’s pain point and describes a solution. 

All customers start their journey at this stage, but it’s important to note that each consumer has their own level of awareness. While one customer might have just realised they have a problem, another might already be searching for a solution. 

2. Engagement

The engagement phase starts when a consumer interacts with your brand for the first time. At this point, the customer is likely to reach out to ask questions or find self-service materials to compare your solutions with others. 

Potential customers might call you, browse your knowledge base, engage with your online chat function or interact with you on social media. This is your chance to create a helpful first impression and position your company as the ideal solution to their problem. 

3. Conversion

A consumer's decision to purchase comes after reviewing your content and comparing you to your competitors. Purchasing is the moment they officially become a customer. Remember, however, that this is just the beginning of the customer relationship. While the initial purchase is important, what happens next determines whether a customer will return for more.  

4. Retention 

Your most valuable customers are those who continue to buy from you. At this stage, a customer has made one or more purchases and has some interest in your brand. Your job is to encourage them to stick around by providing exclusive post-purchase perks, such as, referral bonuses and product discounts. 

5. Loyalty

During the loyalty stage, customers become brand ambassadors and are an essential asset to your company. You can expect loyal customers to promote your products and recommend you to family and friends. Nurture them by inviting their feedback, including them in product development and offering rewards through a loyalty program. 

Understanding customer lifecycle management

Customer lifecycle management is the process of monitoring and optimising the stages a customer goes through during their relationship with your brand. It involves tracking and analysing data from each step and using it to improve content, tactics and messaging sent to customers.

Knowing what your customers do and how they engage with your brand will give you insight into how your company performs at each stage of the customer lifecycle. For example, you might get a lot of website traffic, but it doesn’t matter if customers aren’t converting. 

Managing the customer lifecycle enhances the customer experience by ensuring consumers have access to the right information at the right time. In turn, this increases your conversion rate, revenue and loyalty.

Top tips to successfully manage the customer lifecycle

Know your audience

Lifecycle stage: Awareness

You must understand who your customers are to understand their lifecycle. Start by creating customer personas to match different segments of your target audience. For example, if you sell frozen vegetable packets, you might have one persona for a young fitness fanatic who loves smoothies and another for parents who want healthy food for their kids. 

This information will help you understand what information each persona might need at each stage of the lifecycle and what pain points they’re trying to solve. 

Map out the customer journey

Lifecycle stage: Awareness

Next, map out the consumer journey or the route they take to make a purchase. Knowing this route will give you a top-level view of the customer lifecycle and help you understand key pain points at each stage. This information helps predict customer needs and pinpoint fundamental touchpoints along the way. 

Here’s a quick overview of how you can start mapping the customer journey.

  • Set overall business goals and objectives.

  • Build out your customer personas.

  • Segment your audience into different customer personas.

  • Use data to identify different touchpoints for each persona.

  • Create and publish content for each touchpoint. 

Share relevant content

Lifecycle stage: Awareness

Customers in the awareness stage are eager for educational content. They need to validate their problem and figure out a solution. At this stage, create valuable, engaging content that potential customers can find via search engines and social media. 

Be sure you’re publishing a variety of content, including detailed blog posts, templates, newsletters, infographics and ebooks‌ — ‌anything that'll help consumers better understand the solution they need.

Create self-service touchpoints

Lifecycle stage: Engagement 

You need to stay in the minds of your customers once they discover your brand as a potential solution. Do this by creating a hub of self-service resources such as tutorials, demos, case studies and FAQs that customers can browse through in their own time. These materials should position your product as the ideal solution and positively compare it against other solutions in the market. 

The more information you can provide at this stage, the less friction will arise. When customers can't find what they're looking for, they may go elsewhere or pause the buying process to reconsider the solution.

Provide timely customer service

Lifecycle stage: Engagement 

Even with a rich self-service content library, there’s still a chance customers may have additional questions. For example, they might want to know how your product will work in a specific scenario or whether it’s suited to their unique circumstances. This is a pivotal moment for your brand — rather than letting customers contact you on their own, be proactive. 

The sales team can reach out to hesitant customers and quell their objections, or you can implement an automated support tool on your website that directs shoppers to the content they need. Use this opportunity to promote your products while establishing a deeper connection with the customer by providing personalised help. 

Create a personalised customer experience

Lifecycle stage: Conversion

Customers want to feel special. Enhance the customer experience by using customer data points to serve personalised product recommendations and relevant content. 

Past metrics such as previous purchasing history, website pages visited or products added to cart can tell you a lot about what a customer is looking for. You can use this information to create a tailored journey for each customer at scale. 

Streamline the purchase process

Lifecycle stage: Conversion

Make it easy for customers to buy. A more complicated checkout process makes it more likely they will move on to a competitor. Streamline the checkout process so that customers don't have to fill out a long form to complete a purchase.

Even better, offer a guest checkout option to secure first-time purchases, then encourage customers to sign up for an account after they’ve invested in your brand.

Consider using automation

Lifecycle stage: Retention 

Purchasing data allows you to nurture customers even after they’ve bought from you. Consider using automated triggers to send personalised emails and content to existing shoppers. This will keep you front of mind and make you the first choice when customers need to buy again. 

Use your customer relationship management (CRM) system as an automation hub that delivers the right post-purchase content at the right time. For example, you can automatically email previous buyers when you launch a new product, send recommendations based on their previous purchases, or trigger replenishment reminders after a set period.

Encourage feedback and referrals

Lifecycle stage: Loyalty

Encourage loyal customers to share their experiences in a testimonial or by referring a friend or family member. Using this method, you can show them you value their business and gather relevant information to help you improve your products. 

As well as inviting reviews and referrals, you can also reward your best customers with exclusive discounts, early-bird opportunities and prizes for their ongoing loyalty. 

More information: 

To find out more about managing customers and all other aspects of running a business, check out our library of Business Guides.

At MYOB, we have you covered. 

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