The internet has changed the way we live and do business. However, the growth of online marketing and sales has led to a question: How long do customers stick with an online brand/product? More and more companies are realizing the importance of understanding customer lifespans in order to grow their business successfully. In this article, we’ll discuss what a customer lifecycle is and how you can use it to your advantage.
Customer Lifecycle – What is it?
Put simply, the customer lifecycle is the lifespan of a customer for a particular product or service. This can vary from the initial discovery of a product or service, to the point where the customer no longer identifies with your brand, to the point where they are likely to turn to your competitor for products or services. In practice, a customer’s lifecycle can be broken down into five distinct stages:
- Discovery: Consumers discover your product or service and decide to invest in your brand.
- Attachment: Over time, they come to see your brand as a natural fit for their needs and values.
- Cohabitation: While they are generally happy with your product, they start to question its relevance to them as their requirements change.
- Established Usage: They have grown accustomed to your product and see it as essential in their life. However, as time goes on, they realize that there are other brands that can better serve their needs.
- Satisfaction: Ultimately, they are completely satisfied with your product and see no reason to switch.
Let’s take a closer look at each stage.
Discovery is the stage in a customer’s lifecycle where they first hear about your product or service through mainstream media. As an entrepreneur who owns and manages multiple brand online stores, I see tons of traffic from consumers who have come across my websites by chance or through an advertisement.
It’s amazing how many people have stumbled upon my site by chance or through an online ad. When they find my blog posts, many of them are often curious about my products and what they are used for. However, most people aren’t looking to buy a luxury handbag brand overnight, so they quickly move on to the next thing they find interesting.
In my experience, most companies completely miss this phase because they assume people want to buy their product or service right away. However, if you want to grow your business successfully, you have to learn to listen to your customers and understand what they are looking for. Luckily for you, I have five tips on how you can increase your conversion rates and make more money from your online store.
Attachment (also known as “brand attachment”)
In the attachment stage of the customer lifecycle, your customers will start to see your brand as a natural fit for their needs and values. This is a very crucial stage because it marks the beginning of a long-term commitment from their side. Up until this point, they have only discovered your product or service through mainstream media or advertisements and might not have been particularly interested in your brand. But now that they are aware of your company, they will begin to associate your brand with interesting and valuable products. This is where you should begin to see an increase in your conversion rates.
To put it simply, brand attachment occurs when your customers begin to see your brand as a natural fit for their needs and values. This is often achieved through effective marketing and brand awareness campaigns that bring your product or service to the attention of the public. Once they have heard about your product or service, they will go away and do their own research before buying from your brand. This stage can take months or even years to fully form, so be patient.
After a brand has established a good reputation with their customers, they will start to encounter problems that they were unable to solve with their existing product or service. This is where they start to question its relevance to them as their requirements change. Essentially, they have become accustomed to your brand, and while they still see value in what you offer, their needs no longer correspond with what you are providing.
To combat this, you must begin to research and understand the requirements of your customers in this stage. What are their questions and concerns? What are their frustrations and their hopes and dreams? By getting a clear picture of what your customers need, you stand the chance of providing them with the right solution. Furthermore, you can use this insight to guide your product and service development.
In the established usage stage of the customer lifecycle, you will find customers who are completely happy with your product. They have grown accustomed to it and see no reason to switch. While this stage can vary from the initial purchase to the point where they no longer need or want your product, it is typically somewhere in between. This means you still have the chance of increasing your conversion rates if you can convince them to come back.
This is also the stage where you can begin to see a decrease in your conversion rates. If you want to grow your business successfully, you must begin to analyze and understand the drop off in your conversion rates. Are you attracting the wrong type of consumer to your site? Are people finding your site but having a hard time converting? Once you have identified the problem, you can begin to fix it. To bring in more of the right consumers, you can try implementing a loyalty program, engaging with your customers on social media, or offering special promotions and deals. These are just a few of the many techniques that you can utilize to increase your conversion rates and make more money from your online store.
When a customer is completely satisfied with your product, they will usually remain satisfied for the rest of their life. This is why it’s important to get this stage right after you’ve established a good relationship with your customer. If you want to grow your business successfully, you must learn to identify and satisfy your customers’ needs with relevant and valuable products and services. In practice, the satisfaction stage can range from weeks to years, depending on the type of product or service you offer. Unfortunately, this is the stage where many businesses completely drop the ball, failing to notice that their customer is starting to feel disconnected from their brand. Once you’ve reached this stage, it can be very hard to bring your customer back. Don’t get me wrong, you can always try, but at that point, it might be too late.
To increase the chance of your customers feeling satisfied with your product, ask yourself the following questions:
- Are you delivering value to your customers?
- Is your product or service solving a problem for the customer?
- Are you meeting the needs of your customers?
- Are you consistently improving your product or service to meet the demands of your customers?
- Are your customers recommending your product or service to family and friends?
- Are you adding new, distinctive features that make your product or service desirable?
Of course, answering these questions is not as easy as it may seem. After all, you’re already operating on a shoestring budget, and you want to be sure you’re investing in the right things. But by understanding your customers’ needs and the problems they are trying to solve, you can begin to craft a solid product roadmap filled with valuable and unique solutions.
Customer Lifecycle – How Do I Measure It Successfully?
In the marketing industry, we often talk about the “lifecycle of a customer” in terms of the stages outlined above. However, instead of looking at the lifespan of a consumer, you should be looking at the total lifetime value (TLV) of a customer. This is the total amount of money a customer is likely to spend with your product or service over their lifetime, including past and future purchases. This figure can be broken down into three parts: