BLOG. SMART PRACTICAL BUSINESS ADVICE

Customer Lifecycle Management – What Is It?

“Customer relationship management” and “customer lifecycle management” are two terms you’re bound to come across many times on this blog. These two terms can often be misunderstood as being one and the same. There’s one big difference between them, though: in the latter, time is an important factor.

Simply put, the customer lifecycle is a running record of important milestones in your relationship with your customers. By keeping track of the customer lifecycle, you can better align your processes according to customer experience. This can be done by keeping a close eye on customer behavior — purchase history, how much and how often they buy, how often they use post-sales services like support, and how long they’ve been doing business with your company.

The customer lifecycle can be broken down into six simple stages:

The Customer Lifecycle

Find the customer

This stage is where you use all the leads and other usable data in your CRM to find the greatest number of new customers as you can. Whether it’s through webforms, email and web marketing campaigns, ads, word-of-mouth — it all starts here.

Sell to the customer

Think of the first sale as the first date. You put your best foot forward so your customer gets a good first impression of your brand. You sell so you can deliver.

Deliver to the customer

OK, so your customer is sold on one of your items. Now you better make sure you deliver on all your earlier promises and sales pitches. This stage, along with the first, is possibly the most important stage as it can affect every interaction you have with your customer in the future.

Bill the customer

The billing stage covers everything from transactional receipts and renewals to successful and failed payment notifications. A lot of customer churn occurs in billing — especially in subscription billing — so an efficient, well-documented billing system is necessary to at least lessen the load on the next stage, supporting the customer.

Support the customer

Let’s say that the first sale went fine. With the “first date” over, you now turn your attention to future dates. At this stage, you focus on keeping your customers from leaving. You up-sell, cross-sell, and identify potential problem areas before they become too big to handle. You try to woo back any lapsed customers.

That can be a big factor financially, especially to small businesses and startups. Online marketing startup Flowtown crunched the numbers a couple of years ago and found that it costs six to seven times more to get a new customer compared to retaining existing ones. Others place the cost increase higher, at ten times or so.

Relatively smaller retention costs can lead to big gains, too. The Harvard Business Review notes Fred Reichheld’s view on retention in his book, The Loyalty Effect. In it, Reichheld estimates that a mere 5% improvement in retention rates could yield anywhere between a 25 to 100% increase in profit.  That’s a big gain any way you cut it.

Gain the customer’s loyalty

This is the ultimate end-goal but only in the sense that it’s the final stop before it all loops back to selling.

Reaching this point doesn’t mean you just grow complacent, either. Once you acquire customer loyalty, you have to ensure that it doesn’t waver. Aloyal customer base not only reduces churn, it can become a steady source of powerful brand advocates and word-of-mouth advertisers.

Now, because the customer lifecycle touches almost every part of your business, successful customer lifecycle management  requires absolute synergy between all of your company’s different departments. Everyone from marketing and sales to finance and support must be in sync, as a complete picture of the customer lifecycle can’t be seen if one part is missing.

See all

Featured Posts

Gartner’s GetApp Ranks WORK[etc] #2 in Top 25 Business Cloud Apps

WORK[etc] is ranked second only to industry behemoth NetSuite, whose enterprise value was estimated to be $7.4 billion by Forbes last year. The way the GetRank rankings work, GetApp scores each software on five criteria: Reviews, Integrations, Mobile, Media, and Security. Each one is worth 20 points, for a highest possible total of 100. It’s […]

Our Top Posts and Integrations for 2015

2015 was a pretty big year for WORK[etc]. We saw the release of our new native mobile apps for Android and iOS, for example, as well as a whole host of app improvements and enhancements. We didn’t just spend the past year improving and enhancing WORK[etc] and its robust feature set, however — we also […]

In Development: Capture, Nurture, and Close Sales Leads Faster on One Page

Project management is a big part of what separates WORK[etc] from other CRMs in the market, but it’s not the only thing we’re focusing on for our next massive update. Along with the upcoming changes to the Contact and Project Management modules, we’ll also be giving Sales and Leads a million-dollar makeover. The Leads List […]

Saving the World, One Hotel at a Time

“It seems like a stupid thing, but honestly, companies just go through boxes and boxes and boxes of paper,” he explains. “We really don’t need to print. If we can take advantage of shared folders and Google Drives and PDF documents and email, we can reduce our printing needs to almost zero.” Rick is a […]

An Inside Look at WORK[etc]’s Upcoming Workspaces

Most CRM apps and project management apps are little more than glorified dumping grounds. Yes, they collect a lot of info, but all of it mostly just gets dumped into a text field on the page. Maybe users can filter them, do a little slicing and dicing, add some visualizations — but that’s usually it. […]

Be Part of WORK[etc]’s Big Wins 2015 User Success Stories

For the past two years, we’ve published annual blog posts detailing the successes our users have had with WORK[etc]. Since 2015 is almost over, we think it’s about time we look back and tell the world about our users’ biggest wins this past year. We want to celebrate your success — and you cannot afford […]