As a customer success leader, you know that each account requires a slightly different approach.
Even when your team's armed with a scalable strategy and some seriously sophisticated segmentation, every customer still has their own unique needs.
The question is, how do you adapt your strategy to your customers’ goals as they evolve over time? And — maybe more important — how do you maintain that personalized touch even as your user base grows?
The answer to these questions, and to optimizing your success strategy, can be found in the same place: The customer lifecycle.
Maximizing customer lifetime value
Consumers are looking for brands to provide a one-of-a-kind customer experience. Those who succeed in capturing this differentiator report an average revenue growth of 84%, digital consultancy Dimension Data found.
What about those who compete solely on a great product?
The same report found those companies consistently lag behind, as customers have no shortage of technology to choose from. However, it's the interactions with your success team that make the real difference.
At each stage of the customer lifecycle, users have different needs that your team will need to fulfill. As a CSM, it’s your responsibility to uncover those expectations and create a scalable strategy that helps your team deliver. By doing so, you can successfully maximize the value of your existing users — boosting that all-important piece of your long-term profitability: recurring revenue.
As you work to uncover new opportunities for both you and your users, defining your customer lifecycle stages will provide many of the answers you seek.
The lifecycle stages throughout each customer relationship
The SaaS industry’s understanding of the customer lifecycle has changed over the years. What was once thought to be a linear experience has evolved into … well, for lack of a better term, a cycle.
Every customer starts their journey at the same stage, but it’s up to your CS team to help guide them through to the next tier. While each team may have a slightly different definition of what their customer lifecycle looks like, there are generally five steps you’ll want to consider:
1. Awareness and education
Here, a potential customer realizes they have some sort of problem that needs solving and is now searching for an answer.
While you can’t always actively engage these customers, what you can do is work with marketing to position your brand as a thought leader. Build out your content strategy with free resources like blogs, videos or social media posts that educate readers and speak to how your solution has helped existing customers.
Your marketing strategy has done the heavy lifting. Now, it's time to nurture those leads. Your prospect has learned about your solution and maybe they downloaded an eBook or attended your webinar to learn more. Deploy targeted messaging that guides them to making their first purchase.
3. Purchase and activation
Congratulations! Your prospect has officially become a new customer. Now comes the sales-to-success transition.
Before you set out in search of a guide on effective onboarding — don't worry, we already wrote it (you're welcome). Try to ensure that the post-purchase experience aligns with pre-purchase expectations. Demonstrate your value through a proactive customer success strategy and collect feedback to refine your processes moving forward.
4. Ongoing engagement and support
Your customer has successfully adopted your process and is using it on a day-to-day basis.
However, your job isn’t done just yet.
Even though an active customer is using your product, churn isn’t out of the question. Your team will need to provide ongoing outreach, education and helpful resources to prevent any possible points of frustration that could lead to a customer canceling or choosing not to renew.
We recommend leveraging health scores to keep a close eye on accounts and provide support when and where it's needed most.
5. Renewal and advocacy
As renewal looms near, your team should kick off a personalized campaign that highlights how a customer has grown with your company. This may include emails highlighting long-term wins and a formal return-on-investment summary to be presented during a one-on-one call.
This is where the cyclical nature of the customer lifecycle comes into play. If your CS team has done its job, your customer will re-enter the cycle at step three or four depending on whether they opted into expansion.
Maintaining customer engagement throughout the duration of the relationship will be key to retaining accounts — and to transforming active users into loyal brand advocates.
Each stage represents the potential for users either to continue on in their journey with your company or to exit the cycle completely, resulting in customer churn. It’s your job to ensure it's the former.
Connecting with your target audience across each stage
You've likely heard all about making a customer journey map, the visual story that walks through the process of your customers' first interaction with your brand to that final purchase.
We'd like to introduce you to your new best friend: lifecycle mapping.
Lifecycle mapping takes the concept of the customer journey a step further. With your trusty map in hand, your team can identify the specific events in each stage of the customer lifecycle and the triggers that indicate movement through their relationship with your brand.
Also, a word to the wise: Don’t get caught up in the “visual” component of your map. It just needs to clearly depict the stages of your customer lifecycle and provides your team with some objective definitions. No one's asking you to become the next Picasso.
While the events in your map will vary depending on how your team defines wins at each stage, there are some common questions that can help you get started:
- Which success metrics are related to movement through each stage? Can your team effectively measure customer data with tools you already have or do you need some additional software support?
- Are there specific drivers of success associated with positive customer outcomes? What about indicators that a customer is about to exit the cycle?
- Which social media platforms are your customers coming into contact with at each stage of their lifecycle? What should your content strategy communicate at each of these touchpoints?
As your team combines objective data and your expert knowledge of your user base to create a lifecycle map, you’ll get a clear picture of how customers move through their relationship with your company.
Putting customer data to use: Letting your users drive the business
You’ve perfected your map and know which data to track.
Basically, you have your lifecycle down to a science.
What comes next?
For that answer we’ll look outside the SaaS industry and toward the world of banking.
Barclays Africa, the South African branch of one of the world’s largest financial institutions, knew how to create a compelling product that drove customers through the sales funnel and to their first time to value — using their credit card. However, the team struggled when it came to the "now what?" part of the equation.
How could they better engage customers and maximize their lifetime value?
Facing increased competition from both existing issuers and new industry entrants, Barclays partnered with Visa Analytics and Consulting to bring a more disciplined strategy to their customer lifecycle management.
After establishing clear KPIs and analyzing their existing customer base by segment, the two executed a simple yet highly effective strategy:
- Engage non-active users: After finding that 12% of their customer base was dormant, the team leveraged segmentation and personalized campaigns, pushing messaging through the segment's preferred channels. Over a quarter of these accounts have remained active users since.
- Feature expansion: Barclays used customer feedback to better understand what features their customers would be most likely to use, finding it was something they already offered: installment-based pay-back plans with competitive interest rates. After creating a marketing campaign to boost awareness, almost 40% of customers took advantage of the offering.
- Reward customer loyalty: Not only did Barclays target under-performing accounts, but they also rewarded their loyal customers and brand advocates with an increased credit limit and comprehensive rewards-based loyalty program, improving account stickiness and engagement.
Long story short: Barclays found that simply offering premium features and services wasn’t enough.
The team needed to guide customers to them.
By understanding how and where consumers interacted with them over time, Barclays was able to create personalized campaigns by segment, maximizing overall customer satisfaction and lifetime value.
Optimizing your customer lifecycle
As you map how your customers’ behavior and needs evolve over time, you’ll have a clear understanding of exactly what your team needs to do to support them.
You’ll quickly find your users’ success throughout their relationship with your brand will translate to your own: stronger customer retention and higher expansion in the long term.