This is a guest post by Jin Choi. Jin Choi is a writer who runs the MoneyNam blog. His favorite hobbies include learning about the newest trends in online marketing and lifting heavy iron at the gym.
The customer lifecycle consists of the stages that a customer goes through from the moment they become aware of your company to the moment they purchase your product.
It’s essential to apply the right strategies for each stage of the customer lifecycle if you want to maximize your customer lifetime value (CLV).
In order to build a successful company, it’s important to focus on the CLV.
Because repeat customers are nine times more likely to buy the same product from a new seller.
This Process Street guest post provides you with the tools to understand each of the stages of the customer lifecycle so that you can maximize the value of each and every customer you acquire.
- The stages of the customer lifecycle
- Customer lifecycle stage 1: Awareness
- Customer lifecycle stage 2: Engagement
- Customer lifecycle stage 3: Evaluation
- Customer lifecycle stage 4: Purchase
- Customer lifecycle stage 5: Post-purchase
- Customer lifecycle stage 6: Advocacy
- Customer lifecycle marketing: A summary
The stages of the customer lifecycle
Customer lifecycle stage 1: Awareness
The first stage of a customer lifecycle is awareness. This is the first time that a prospect becomes aware of your brand, product, or service.
During this phase, it is crucial that you get a clear idea of where your target audience spends most of their time.
With average Americans spending more than 6 hours per day online, it should be fairly trouble-free identifying, reaching, and analyzing your target audience’s actions online.
Strategies for raising awareness
Paid Ads 💸
One effective way to increase awareness for your company is to use paid advertising.
For Google and Facebook, advertising makes up over 60 percent of digital ad spending in the US.
Google search ad is intent-based marketing, which means the customer is actively looking for solutions to their problems.
Facebook, on the other hand, is interruption marketing wherein the customer sees ads they weren’t actively looking for.
Check out this article if you want a detailed comparison between Facebook’s and Google’s advertising.
Content Strategies 🚀
Content marketing is another powerful way to increase brand awareness and attract customers.
Because you are starting off a relationship with a prospect by providing value to your potential customers.
In other words, the more you give, the more you are likely to receive.
Capgemini is one of many examples of a company that steered away from ineffective paid ads and focused its efforts on content marketing strategies to grow its revenue and traffic.
At its peak, the company reached nearly $20 million a year in revenue as a result of their content marketing effort.
Influencer marketing 🙋🏼♀️
When Pottery Barn wanted to promote their new collection, they reached out to an influencer who was a well-known figure in the industry.
The influencer demonstrated different ways in which her readers could incorporate Pottery Barn’s product into their homes.
The use of just that one influencer generated more than a thousand engagements.
Influencer marketing is effective because people trust their favorite influencers. If we trust someone, we are more likely to pay attention to the person’s recommendation.
It’s no different than if your friend were to introduce you to her other friend for the first time.
You and your friend’s friend are likely to put more effort into getting to know each other than if you were to meet randomly without a proper introduction from someone you know and trust.
Customer lifecycle stage 2: Engagement
When prospects become aware of your brand, they will want to engage with you if your product or service is relevant to their interests.
Your prospects may have additional questions about your product or services before they go ahead with the purchase.
An FAQ page is an efficient way to engage with prospects as it is likely that you will get asked the same questions over and over again.
Many customers also prefer to engage with a company without having to interact with a person directly.
But building a subpar FAQ page won’t cut it in this day and age. Check out this article by Bluleadz to see different examples of a great FAQ page.
Social media 👭
Your prospects are looking for you on social media, so you want to make sure your company has a good social media strategy for well-known platforms, such as Facebook, YouTube, Instagram, Linkedin, and Twitter.
They encouraged their existing customers to post content related to their product with a hashtag that contained their brand name.
This strategy allowed them to amass thousands of shares and spread their message without spending any additional marketing budget.
Useful content for engagement 🛠
Providing useful content is a time-tested way to engage your audience. When you write good content, you establish yourself as an authority in your domain.
Quality content also gets shared by people and helps your company attract new customers.
Their infographic amassed referrals from more than 100 articles, 6 billion unique visits, and 5,300 social media shares.
Customer lifecycle stage 3: Evaluation
This is the last stage before a customer purchases your company’s products or services.
Your customers are comparing your product to your competitors and trying to confirm for one last time that you are the best choice out of all the options available.
The following are some of the questions you want to answer during this stage:
- What is unique about your product?
- Does your company provide any sort of guarantee to minimize risks for customers?
- What are additional details that can move the needle for a customer to make the purchase?
Here at Process Street, we have created a superpowered checklist that takes you through the product evaluation process. Simply sign up (it’s free) to get access to the checklist embedded below.
Strategies for evaluation
Reviews And Testimonials✍🏼
Studies show that 92 percent of consumers read reviews before they make a purchasing decision, and 95 percent of people say reviews affect their purchasing decisions.
Bigcommerce did a study that showed that the regular use of testimonials could boost revenue by more than 62 percent.
Kissmetrics provides a good example of how a company should design an effective testimonial.
They post customer testimonials in the form of a quote. In the quote, the customer details unique features about their product along with statistics to add extra credibility.
What do you do when you see a review from a frustrated customer?
You write a reply!
Harvard Business Review shows that a company tends to have a better online rating when it promptly replies to frustrated reviews.
Customer-generated comparison 👯♂️
This usually comes in the form of a third-party blog post or a video.
Bloggers can write reviews that compare the advantages and disadvantages of you and your competitor’s products.
They can then provide a recommendation based on which product they believe is better, overall.
Such articles have a powerful effect on influencing prospects because they tend to appear unbiased and authentic.
YouTube is another giant platform where many people visit to watch video reviews of products.
On average, customer-generated review videos get ten times more views than the videos published by brands on YouTube.
For example, James Wrights, a popular YouTube vlogger, once posted a video review on Patti LaBelle sweet potato pie on his YouTube channel. The video amassed a staggering 3 million views in a matter of twelve days.
The company’s pies were sold only at Walmart at the time, and they quickly went out of stock soon after the video started gaining popularity.
Customer lifecycle stage 4: Purchase
This stage is all about making it easy for your prospects to buy from your company.
You want to simplify the purchasing process as much as you can, as a seemingly small change can have a significant influence on your prospect’s behaviors.
For example, one case study shows that a simple addition of a single call-to-action (CTA) in an email can increase sales by 1617 percent.
People respond well to urgency. Your prospects will rush to buy your product if your product page contains a sense of believable urgency.
For example, Marcus Taylor saw an impressive 332 percent increase in sales when he added a simple urgency (in the form of a 100 hour sale featuring limited products) to his product page.
Website speed 🏎
A second of extra load time may seem trivial, but it can mean billions of sales lost for some companies.
How fast your website loads can have a significant impact on your conversion rate.
Walmart found that their conversion improved by 2 percent for every one-second improvement in its page load time.
If you are looking for in-depth advice on how to improve your website speed, check out this article from Crazyegg.
Multiple payment options 💵
A study shows that offering multiple payment options can boost revenue by 30 percent.
It really shouldn’t come as a surprise that the easier you make it for customers to pay for your product, the more likely they are to purchase.
Nonetheless, many businesses still only offer a few payment options.
Shopify has a great article on how best to improve your product page.
Customer lifecycle stage 5: Post-purchase
You can just relax since your customer has already made the purchase, right?
Well, not quite.
In fact, you have some of the best opportunities to increase the CLV at this stage of the customer lifecycle. And you certainly don’t want to let this opportunity slip away.
The data by Bain shows that If you can increase your customer retention by 5 percent, you may be able to increase your company’s profitability by nearly 75 percent.
This makes sense considering most companies have a 60 to 70 percent chance of selling to an existing customer, whereas it’s a lot more difficult to sell to new prospects.
Post purchase strategies
Thank you page 💕
A thank-you page is a perfect opportunity to re-engage customers after they purchase your product.
Three elements are always present in an effective thank-you page:
- A message that confirms that a customer’s action was successfully completed.
- A call to action.
- Words that specifically instruct the customer on the next course of action.
Check out this article from Impactbnd to see examples of what other reputable companies are doing on their thank-you page to increase engagement.
Email marketing 📨
One survey shows that 80 percent of businesses rely on email marketing to retain customers.
And it is for good reason, since nearly 99 percent of consumers check their emails daily.
But with the average American employee receiving 126 emails a day, it is more important than ever to stand out from your competition.
CD Baby, for example, creatively incorporated humor into its follow-up email to show appreciation for its customers.
Not only did the email leave a lasting impression on its customers, but they liked the email so much that they started sharing it online.
The end result was over 20,000 citations with many new customers.
While the example is somewhat dated, the principle remains the same.
If you want customers to remember you, you need to find a way to differentiate your brand from your competitors.
Thank you email with a discount🎖
It makes sense that if customers are happy after purchasing your product, they are more likely to return in the future.
A thank-you email is a good way to re-engage your customers and show appreciation, so they feel good about their purchase.
In fact, thank-you emails often have a much higher open rate than a traditional email.
In your thank-you email, you want to highlight your company’s contact information clearly, so your customers know exactly where to contact should they have any concerns or questions.
This will make it less likely for your customers to resort to venting their frustration on a third-party review site.
Additionally, you want to encourage your customers to purchase more in your post-purchase email by offering incentives, such as discount coupons.
Nearly 75 percent of consumers report searching through their email inbox to find relevant discounts.
So discount coupons serve as an effective tool to motivate customers to purchase your product when they are on the fence.
Segmentation allows your company to enhance relationships with existing customers by personalizing your company’s marketing message.
A customer that buys a dog product likely has a different interest than a customer that buys a cat product.
Unsurprisingly, companies that focus on personalizing experience for their customers see a 20 percent increase in sales on average.
Click here If you want to learn more about how to segment customers for B2B marketing.
Customer lifecycle stage 6: Advocacy
This is the final phase of the customer lifecycle.
Your marketing doesn’t end when you sell a product, nor does it end when you turn your existing customer into a repeat customer.
The final stage of the lifecycle is about forming a strong relationship with your customers, so they can’t help but become an advocate of your brand and product.
Your company will experience an explosive level of growth when you have many happy customers vouching for your company.
Apple is one of the best examples of a company that successfully managed to turn its customers into brand advocates.
Review request 📧
An effective strategy to turn your customer into an advocate is to simply ask them to become one.
For example, you can ask your customers for a product review over an email.
J.Crew, for instance, uses a dynamic email to auto-populate emails with a recently purchased product.
When customers receive emails from the company, they can simply click a call-to-action button within an email to start writing a review.
Even if your customers absolutely love your product, it is unlikely that they will go out of their way to write reviews for your company.
So it is important you make the entire process easy for them.
Referral programs 👥
A referral program is another effective way to incentivize customers to advocate for your brand.
Dropbox is perhaps one of the best examples of a company that successfully implemented a referral program.
In its infancy, Dropbox experienced an astonishing 3900 percent growth in just a little over one year, and the company’s referral program played a substantial role in its success.
They structured their referral program so that an existing user gets extra storage space when they refer to a new user.
Additionally, new customers also received extra storage when they signed up from the referral.
By providing incentives for all parties involved, Dropbox made it a no-brainer for all users to partake in the referral program.
With affiliate marketing, you are giving away a certain percentage of your sale to an affiliate when a referred customer buys your product.
There is a reason why 81 percent of brands offer affiliate programs.
If you have a good product that converts, it is one of the best ways to acquire new customers without spending any money on marketing.
Customer lifecycle marketing: A summary
When trying to improve your customer lifecycle marketing strategy, it is important to look at your data.
Jeff Bezos, the founder of Amazon, would agree that you need to make a data-driven decision to grow your company.
This software will allow you to virtually track everything that your customers do on your website and mobile app.
Once you have collected data, you need to analyze and come up with solutions to improve the customer experience.
For example, if your data shows that your website visitors leave shortly after visiting your FAQ page, you may test writing a more detailed FAQ page; or you may encourage your site visitors to contact your team via chat, so that you can help answer any of their questions.
Also, it is essential that you systematize your customer lifecycle marketing strategy if your goal is to scale the process.
Deming believed that 85 percent of businesses fail because of the lack of effective systems and processes rather than the failure of employees.
Using a tool, such as Process Street, can help get your team on the same page regarding how your business should engage customers at different stages of the lifecycle.
Specifically, you can outline the entire customer journey using the software, so there is no guesswork, and your team knows exactly what to do to serve customers better. Check out the webinar below to see how Process Street can ensure client and customer success:
At the end of the day, your goal is to help reduce friction for your customers as much as you can throughout the entire journey.
The strategies outlined in this article, along with the right tools to facilitate the entire process, should give your company a competitive edge over others.
We’d love to hear about the different ways you engage with CLV in the comments. Who knows? You may even get featured in an upcoming article! 👇🏼