What is Customer Lifecycle?

What is customer lifecycle?

Customer lifecycle in a SaaS model is basically a customer’s journey and his interaction with a company beginning from awareness about a product/service to purchasing the product after thorough considerations. There are five unique stages of how a customer affiliates with a brand and ensures loyalty. The stages involve awareness, consideration, purchase, loyalty, and advocacy. Each stage employs a different technique for resonating with customer needs.

In other words, customer lifecycle management involves tracking customers journeys and optimizing customer engagement, satisfaction, and loyalty through each stage. The main motive behind customer life cycle management is to gain customers, gauge customer support, build brand reputation, and increase revenue via a strong and competitive market presence with rates that are affordable for a stronger lifetime value.

There are 5 major stages of the customer lifecycle, which are

Awareness:

At the initial stage, potential buyers gain awareness about your product and if it aligns with their needs. They gain meaningful information about your product through digital media, word of mouth via friends and family, and traditional methods of advertising.

Consideration:

Buyers are searching for solutions to their issues and critically evaluating them based on their needs. They consider their preferences, such as certain features, services, or price range, as per pocket. Accurate information must be provided by B2B companies so that customers can decide what goes best for them. Informed decision-making is a crucial aspect of utilizing a service or a product.

Purchase

At this point, buyers decide whether they wish to purchase your product. B2B companies must manage a well-defined sales process that can help potential buyers to make a purchase decision with ease.

Loyalty

As soon as a customer buys your products, it is crucial to maintain a long-lasting relationship. B2B companies must offer top-notch customer service, which can involve smooth onboarding, training, and other processes that can enhance the product value attained from buying it. Loyal customers must be given value via rewards and discounts or vouchers to learn about any new offers and upgrades.

Advocacy

At this stage customers have already utilized your product and have become advocates for it. They can be trusted with reviews on your product and spreading the word to others.

What is the difference between B2B and B2C customer lifecycles?

It is important to know that the customer lifecycle for a business-to-business company is different from that of a business-to-customer company. B2B firms are likely to concentrate on establishing relationships and cultivating leads on a mid-to-long-term basis, while B2C firms will normally concentrate on rapid conversion of leads into customers. Moreover, onboarding processes for B2B customers might involve more advanced steps than onboarding processes required for B2C customers.

Differences in the customer lifecycles for these types also lie in how long it takes to finish every step and the acquisition and retention cost overall. Finally, one must understand how the customer lifecycle is executed in each of these business models so that one may create meaningful relationships with customers.

A simple method of distinguishing between the two is

B2B customer lifecycle:

Lead nurturing: B2B firms spend time educating and engaging their potential customers via content marketing, thought leadership, and personalized communication.

Relationship building:

B2B customer relations are built on trust and mutual benefit. Sales teams sort out customer goals and challenges they face to devise solutions.

Sales Lifecycle

B2B sales cycles are complex with many stakeholders and decision-makers at each stage, making them prolonged and complicated.

Advanced onboarding

B2B processes onboarding require rigorous training and support and customization for integrations with the customer’s system or tech stack.

B2C customer lifecycles

Rapid conversion: B2C companies try to convert leads into customers as rapidly as possible, usually by using optimized sales funnels and convincing marketing strategies.

Transactional relationships: B2C relationships tend to be more superficial, with customers deciding to buy based on convenience, price, and personal choice.

Straightforward sales cycles: B2C sales cycles are usually shorter and simpler, with fewer decision-makers and stakeholders.

Simple onboarding: B2C onboarding activities tend to be less complicated and automated in nature, and customers can easily begin utilizing products or services.

What is the importance of customer lifecycle?

Customer lifecycle holds great significance for the growth and well-being of a successful business. The customer lifecycle must be viewed as a whole and not segmented. For instance, if a business puts all of its attention on the initial stages, such as reach, acquisition, and conversion, but ignores the post-purchase stage or winning the customer phase, it can have a detrimental effect in the long run. If less attention is paid to post-purchase, it is likely that the customer churn would increase due to customer dissatisfaction.

Businesses must emphasize all 5 stages of the customer lifecycle. They can use metrics to measure the success at each stage. For example,

Reach: They can sue for branded searches, impressions, website visits, bounce rates, etc.

Acquisition: Leads and inquiries can all signify how the acquisition process is going.

Conversion: Opportunity to close rates or lead conversion can showcase health at this stage.

Retention: Here, renewal rates can indicate performance.

Loyalty: Net Promoter Score or customer satisfaction scores can help.

With the tracking of these metrics, businesses can measure business growth and the success of processes. Comparison of business metrics against other competitors in the field can help fill in the competitive gaps in offerings.

What are customer lifecycle management best practices?

Properly handled customer lifecycle can be advantageous for understanding customers and maintaining a good reputation in the business landscape. Here we have put forth certain helpful steps to improve your practices for managing customers.

Understand target audience:

Identify your target audience before you market your product. You must know who your ideal customer is. It is not advisable to target everybody. Once you have identified your target audience, you can design offers and post appropriate content depending on the stage of the customer lifecycle. If you are looking to use your resources optimally, it is a good idea to create a buyer persona. It will be your ideal customer and include demographic and behavior traits.

Produce applicable content.

To gain trust and develop a good reputation, you must pour all your experience and knowledge into your website content, social media, and blog posts. Consequently, you’ll publish good guides, thorough instructions, informative video tutorials, etc. To do well in Google, you must include keywords that individuals use to look for solutions to their queries. Offer solutions to such questions in your content. Creating informative and useful blog entries guarantees that visitors will discover your site and utilize your content.

Centralize your brand details.

Give a central hub of your brand information. Give self-service materials to enable users to discover your product more deeply. Build a site encompassing your company, pricing, and product details. Build a knowledge base and a blog to give necessary materials regarding your product and answers to FAQs. Users who have access to a central database will make knowledgeable buying decisions and won’t call customer support for minor things.

Provide support during the buying phase.

If a product is costly, consumers may find decision-making complicated. To eliminate customer uncertainty, consider providing support throughout every phase. A live chat icon connected to a support agent can enable users to escape many issues. After customers have questions, they can reach out to your support and receive help.

Make Use of a CRM

As soon as you gain more customers, you must integrate a CRM to store subscribers’ data. CRM allows centralization of databases. It allows interaction with prospects and improves customer service. It also helps improve customer service; you can manage contact lists and personal data with ease.

Gather feedback from customers.

If your customers are happy with your product, allow them to share their experience with others and assist them in making purchasing decisions. Send surveys to customers, post your profiles on Yelp and Google Reviews websites, and create referral programs. They will promote word-of-mouth. Reward customers with discounts, gifts, and special products for referring friends. They will promote word-of-mouth.

What are the benefits of effective customer lifecycle management?

There are plenty of benefits associated with customer lifecycle management. CLM in an effective manner can maximize business standing in the competitive market. The benefits are

Improved customer retention

When you address the common pain points of your business through effective CLM strategies, it can help build lasting customer relationships. Loyal customers are likely to make repeat purchases, increasing lifetime value.

Increased customer satisfaction

A well-curated CLM strategy helps to improve customer satisfaction. By delivering an exceptional experience, seeking customer feedback, and understanding what customers prefer, you can boost customer satisfaction.

Improved Brand Loyalty

CLM can play a crucial role in ensuring brand loyalty. Customers who feel valued can develop a strong affiliation with your brand. Through CLM, you can easily target loyalty programs and exclusive offers and offer personalized communication with customers, deepening customer business ties.

Increased Profits

A well-designed CLM plan can increase customer lifetime value. By retaining customers, you can maximize profits from them, thereby incurring repeat purchasing. Moreover, it can help you cross-sell or upsell your products, thus generating more revenue from each existing customer.

Customer Journey

Comprehending the customer journey through a well-designed CLM approach can help gain knowledge about customer preferences. Using this information, you can optimize sales and marketing campaigns with ease. Thus, ensuring what you do aligns with customer requirements.

What are some challenges in the customer lifecycle?

When it comes to handling customer lifecycle, there are numerous challenges you are likely to face. They are:

Defining your brand strategy

You must emphasize clearly defining your brand strategy before curating the CLM process. You must look at factors such as product and price differentiation from customers.

Setting CLM objectives

Setting goals for CLM processes can be tough. The best method is to initiate with 2 to 3 goals, and as CLM processes mature, you can add to it.

Data handling

Centralizing data in an organized manner can help save time and effort. However, data handling is a big challenge for organizations; thus, data in a unified place can help to stay organized and avoid complexities or lost or missed data.

Managing customer’s experience

Maintaining customer experience can be tough. Correctly responding to the customer’s needs by devising actionable strategies can be helpful to manage customer experience.