Marketing is essential to a business but effective and planned marketing is what will save the day.
Customer Lifecycle Marketing is one such framework that will help you achieve fantastic marketing results, if done right.
What is a Customer Lifecycle?
A Customer lifecycle is indicative of the various stages that a customer is likely to go through on being introduced to your product or service. It signifies the relationship between a prospect, a customer and your brand. It is replete with highs and lows and different levels of activity. Longevity of a customer’s life cycle is dependent on the quality of your product/service and your interaction with the prospect or customer. Your interaction or engagement is very crucial in relationship building and needs to be customized based on various phases of the lifecycle. So let us understand what the different stages of a lifecycle are and what each stage entails.
- Awareness – This involves reaching out and trying to get people to notice your product / service. You are essentially trying to make your target audience aware of your offerings.
- Consideration – At this stage, the goal is customer participation and interaction with your business in any form, wherein your product/ service is being considered.
- Purchase – This is the point of purchase, the moment of truth. This occurs when your prospect finally decides to become your customer.
- Retention – This includes retaining your existing customers and going deeper into the customer relationship through up-selling and/or cross-selling.
- Advocacy – This is when the customer turns into an advocate for your company. Brand loyalty goes beyond buying the product consistently.
Many a times a customer life cycle is cut short by Abandonment or Attrition. Let us explore these further.
- Abandonment – Occurs when a prospect is lured away to another brand/company thereby terminating what could have been your lead or your customer. This typically happens before the prospect buys from you.
- Attrition – Occurs when existing or converted customers stop buying your product / service and go elsewhere.
What is Customer Lifecycle Marketing and how it can benefits your business?
Customer Lifecycle marketing is about building engagement throughout the lifecycle of every lead and customer. Nurturing customer interaction with your brand helps further the relationship in the right direction.
The integration of marketing efforts to match the varied nature of each lifecycle phase basically describes what customer lifecycle marketing involves.
Awareness: In the first phase you are trying to reach out to prospects who may or may not be aware of your brand or product / service. You need to spark their interest with useful content on your blog and other web properties. Once they are interested, you need to establish the right level of trust to get the prospect to want to become a customer. This stage often involves publishing educational content which addresses customer pain points.
Consideration: The second phase marked by customer participation in any form involves the development of “Leads” i.e. people who have indicated their interest in your brand. This is measured through prospects signing up for special offers distributed freely. Offers can include free eBooks, consultations, email courses, whitepaper downloads, demos, webinars, etc.
Purchase: The prospect is now a paying or registered customer in the third phase of purchase or conversion. Your goal is to ensure he establishes a long-term commitment with your brand. This is where you step in to continue to build a relationship so that he stays on (read interact and purchase) for a long time to come. Undoubtedly the quality of your product / service takes precedence over all other factors but a continued form of communication to express your appreciation for their time and business is the only way forward. The first few days after purchase are crucial as you want to make sure your on-boarding efforts really wow this first time customer.
Retention: The fourth phase involves increased communication of your brand and its product/services. The customer needs to be informed of the choices he has if he were to stick on with your brand. This is where the up-selling or cross-selling efforts come in wherein existing customers have a wider range to choose from based on the relevant information provided by you. You want to ensure their key problems are solved, and they get fantastic support from your team. Keep the customer happy will ensure he stays on for a long lifetime with your brand.
Advocacy: The fifth phase in which you have a loyal customer base needs to be handled differently. Once customers become repeat customers, the extent of communication will undergo some change. You want to send periodic reminders of how important their business is to you and also give them adequate incentives to stay loyal to your company. Competition out there can be quite fierce and you want to hold onto your customer base through ongoing dialogue with the use of communication channels, especially email. A solid referral program can go a long way in ensuring you capture maximum value from loyal customers.
Customers may break away from the lifecycle for various reasons. When a customer does not interact with your brand or company for a considerable amount of time or does not purchase a product/service he is referred to as a “lapsed” customer, one who has not made a repeat purchase within a certain time frame. At times lapsed customers also turn into inactive customers that discontinue purchases or any kind of interaction with your company. Reasons for this customer behaviour could vary: from a bad customer service experience, to lack of incentives to simply having moved onto your competition, to lack of value being extracted from your product. Based on the nature of the customer lost you may want to cease all communication with the customer or try and gain him back with a re-engagement plan.
Business often focus heavily on acquiring new customers (top of the funnel), but ignore the implications of the other stages of the lifecycle. Remember, your existing customers are your biggest source of new leads, so don’t ignore the other stages of the funnel. Your business will benefit tremendously from adopting a “customer lifecycle marketing” approach.