The customer lifecycle describes the chro­no­lo­gic­al course of the business re­la­tion­ship between you and your customers. From the first to the last point of contact. When it comes to customer re­la­tion­ship man­age­ment (CRM), it makes sense to make the in­di­vidu­al customer lifecycle stages more tangible so that customer sat­is­fac­tion and loyalty can be increased in the long term.

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What is a customer lifecycle?

The customer lifecycle (CLC) is a concept that views the customer re­la­tion­ship as a long-term, con­tinu­ous process. Customers pass through various stages, from the first point of contact to the moment when the business re­la­tion­ship ends. During the customer lifecycle, each contact between the customer and the company is clas­si­fied as a trigger for further in­ter­ac­tion and pur­chas­ing processes.

The customer lifecycle plays an important role in CRM (customer re­la­tion­ship man­age­ment). Taking a detailed look at the in­di­vidu­al stages of the cycle helps to optimise customer loyalty and sat­is­fac­tion in the long run. The insights gained from this can be used for targeted re­tar­get­ing or for acquiring new customers.

Sometimes it’s possible to win back customers even after the business re­la­tion­ship has ended, and the customer lifecycle therefore starts all over again.

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What are the customer lifecycle stages?

The customer lifecycle is made up of various stages. However, they aren’t uniformly defined, which is why some models show three stages and some show six. Our lifecycle model contains six stages.

Note

Re­gard­less of the model used, it’s worth noting that not every customer ne­ces­sar­ily has to go through every stage. These are merely sample templates that can be spe­cific­ally adapted to the observed behaviour of each in­di­vidu­al.

Stage 1: Awareness

The first stage is dealing with potential customers. They’re getting clued up about certain products, comparing suppliers, offers or models and, in case they’re unsure, they will re­con­sider or postpone the purchase. In this stage, it is important to get the customer’s attention so they are aware of what you’re offering. This can be done through classic marketing measures, for example:

  • Search engine op­tim­isa­tion
  • Ad­vert­ise­ments
  • Affiliate programs
  • Com­pet­i­tions

Stage 2: Ac­quis­i­tion

A stylish design, high-quality product images and de­scrip­tions and, above all, per­son­al­ised dialogue will help you to gain the customer’s trust. Including trust­worthy reviews from other customers or cer­ti­fic­a­tion bodies also helps to win over potential customers.

If all in­form­a­tion about data pro­tec­tion, ordering and delivery processes is available, and the desired payment method is offered, the chances of the customer making a purpose are high. It makes sense to regularly analyse the bounce rate to learn which areas of your website can be improved.

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Stage 3: Con­ver­sion

This is probably the most important stage of the customer lifecycle. The user buys a product or uses a service and therefore of­fi­cially becomes a customer. It is important that the entire con­ver­sion process runs as smoothly as possible.

After you have convinced the newly acquired customer that you are a trust­worthy partner, you also need to justify this trust. In concrete terms, this means, for example, that you fulfil all promises regarding the condition and delivery of the goods or com­mu­nic­ate any com­plic­a­tions ap­pro­pri­ately. Thank them for choosing your business and offer them the op­por­tun­ity to give feedback or make a complaint.

Stage 4: Retention

While the previous measures are very typical and fre­quently applied, the real focus of customer re­la­tion­ship man­age­ment now follows. In the existing customer stage, you can outshine your com­pet­it­ors through in­di­vidu­al­ity and cre­ativ­ity to ensure a par­tic­u­larly long-lasting customer lifecycle. Demon­strate your ap­pre­ci­ation through, for example:

  • Bonus systems / premiums
  • Com­pet­i­tions / raffles
  • Vouchers / gifts
  • Special offers / discount campaigns
  • Special con­di­tions e.g. quicker delivery time

Make sure to keep in contact with loyal shoppers by regularly asking about their sat­is­fac­tion and making im­prove­ments to your business according to their answers. Don’t forget to respond to your customers’ comments on social networks such as Facebook or Twitter. If you ignore your followers and use the platform solely for marketing purposes, it won’t do much for your repu­ta­tion. For many companies, social media channels are in­creas­ingly becoming the first point of contact for customers due to their easy ac­cess­ib­il­ity.

Tip

Aside from social networks, you can inform your new customers about what you have to offer them beyond the purchase they have already made. Use pro­fes­sion­al email marketing software to present news or in­ter­est­ing products in per­son­al­ised news­let­ters.

Stage 5: Loyalty

If your customers are satisfied with your product range and the services offered, this increases the chance of them making more purchases in the future. On the other hand, existing customers become long-term am­bas­sad­ors for your brand. In the best case, loyalty is reflected not only in regular purchases, but also in the fact that a satisfied customer will recommend your products and services to others. This is known as referral marketing and helps you to strengthen your cred­ib­il­ity and to win over potential new customers more quickly.

Stage 6: Re-en­gage­ment

If customers have not made a purchase for a while, they are con­sidered lost or former buyers so it makes sense that you would want to 're­act­iv­ate' them in the hopes of them making further purchases. Try to persuade them by calling them or sending an email. Create ad­di­tion­al in­cent­ives by offering special con­di­tions, such as long-term discounts or free delivery.

The role of marketing auto­ma­tion in the customer lifecycle

It is important for a business to include the customer lifecycle in its own marketing and sales processes. However, following the customer journey as closely and sat­is­fact­or­ily as possible presents companies with a huge challenge, es­pe­cially at the beginning and par­tic­u­larly when many customers are involved.

The solution in this case is to automate the various steps and processes with the help of marketing auto­ma­tion tools. On the one hand, programs like these help to collect and analyse the in­form­a­tion. On the other hand, marketing auto­ma­tion aims to make the customer approach and marketing as in­di­vidu­al as possible within the customer lifecycle, even as the customer base grows. Using solutions like these does mean increased effort for the company at the beginning, but as soon as the basic guidelines are defined, the high degree of auto­ma­tion will save the business a lot of time and money.

Customer lifecycle and CRM — the perfect symbiotic re­la­tion­ship

The ob­ser­va­tion and constant op­tim­isa­tion of the customer lifecycle is an ele­ment­ary pillar of customer re­la­tion­ship man­age­ment (CRM). This dis­cip­line deals in­tens­ively with how companies can improve and intensify in­ter­ac­tion with customers via the various channels.

It is therefore not sur­pris­ing that CRM tools also offer suitable features to optimise the customer lifecycle. A pro­fes­sion­al CRM tool helps to achieve the following goals:

  • Optimally adapting the customer lifecycle to customer ex­pect­a­tions
  • Ex­tens­ively auto­mat­ing per­son­al­ised customer com­mu­nic­a­tion
  • Using touch points in the in­di­vidu­al customer lifecycle stages as ef­fect­ively as possible
Note

Both CRM systems and marketing auto­ma­tion software belong to the MarTech (Marketing Tech­no­logy) tools category.

The biggest advantage of combining a customer lifecycle and CRM platform is that you can store and record all in­form­a­tion and insights centrally. This not only fa­cil­it­ates col­lab­or­a­tion between the various de­part­ments such as marketing, sales or dis­tri­bu­tion, but also helps you keep track of your customers.

Tip

Do you want to get started with e-commerce, customer re­la­tion­ship man­age­ment, etc.? Create your own online shop with IONOS today to offer your goods online. With the suitable cloud apps, you can then install open source CRM like SuiteCRM or Zurmo with just one click!

Con­clu­sion

If you take a close look at the customer lifecycle of your users, you will gain an optimal overview of how your brand is perceived. By spe­cific­ally mon­it­or­ing in­di­vidu­al customers (es­pe­cially in com­bin­a­tion with CRM) you can take your marketing measures to the next level. In addition, you gain valuable insights, which enable you to improve customer in­ter­ac­tion in the long term and to win over potential customers even faster.

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