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

Large-Scale Data Migration? “What could possibly go wrong?”

Losing hundreds of thousands of hours’ worth of work. An immense hit on their reputation. Staggering financial costs just to rebuild their records from scratch. These were the risks that a law firm* in Chicago had to consider when they wanted to switch from their old CRM system to a new one. They kept asking […]

Empowering Tomorrow’s Leaders to Be the Change They Want to See

School’s out for the summer in the UK, and while the kids are out enjoying the summer break, Mandy Potter is also enjoying a recess of sorts. “June and July are typically our busiest months, since it’s usually when the schools finish our awards program,” she says. “They usually start calling us up during that […]

WORKetc Again Breaks into Top 5 List on Gartner’s GetApp

The Gartner-owned software comparison site GetApp recently revealed their Q3 2016 rankings of the best business management software available right now, and WORKetc has once again secured a highly-coveted spot in the top 5. “In GetApp’s 2016 Q3 ranking of the top Business Management software, WORKetc came out strong, securing a spot within the Top […]

A New Spin on an Old Spreadsheet App

Conventional wisdom holds that salespeople are usually extroverted, outgoing individuals. CleverAnt co-founder and VP of Sales, Maxime Soucy, is, by his own admission, neither of those things. He does have an ace in the hole when it comes to getting people to buy his company’s product, however: a very deep technical understanding of how it […]

3 Top Business Management Hacks Every Business Owner Needs to Know

Most people start a business because they love what they do, not because they just happen to love managing businesses. But the plain truth is you can’t expect to stay in business or be able to pay yourself at the end of the month if you don’t pay careful attention to when and from where […]

Unlock WORKetc’s Full Potential for $0

It takes time and effort to completely get to know the ins and outs of a typical CRM system. WORKetc, with its broad feature set and multiple integrated business management modules, can be an even tougher beast to tame for some. That’s where the QuickStart Onboarding Program comes in. Experienced WORKetc product specialists do most […]