Customer life cycle management best practices
What are the various stages of the customer life cycle? Are there any customer life cycle management best practices to keep customers moving through the life cycle, while at the same time building customer worth?
It's not really up to us so much to move our customers through the customer life cycle
as it is for us to be responsive to what a customer's life cycle is. Of course, that will be wildly different for different kinds of product and service categories. For example, I'm sometimes asked if there are companies that can only sell a product one time and therefore don't need to build customer relationships. What we ask in response is, what kind of company would that be? Would it be an appliance company, for example, where you buy a refrigerator and don't need another for twenty years? Perhaps, but if you buy a refrigerator from a company then from that same company you might want a stove or you might need to change out your washer and dryer or you might want to put a small fridge in your office, and so on. So, what about a product that you really
only need once -- wedding planning, for example. As a wedding planner, I'd make it my business to make sure that if I planned a couple's wedding, a year later I would be planning their anniversary. And when they started having children I'd do their birthday parties, and every other party that couple ever gives.
So, unless we are devoid of creativity, we should be thinking of ways that we can fit our business model into the life stages of our customers, and we would look at our most valuable customers and think about how we might want to go about doing that. I think that when we look at the various stages of the customer life cycle what we are really doing is convincing our customers to try us once, and then working on becoming more and more valuable to a customer over time. We must always ask ourselves: What can we do for this customer that nobody else knows how to do, and that goes beyond what can we do for this customer based on our differentiated products or services. It's really a matter of how much do we know about the customer and how can we use that knowledge to do something none of our competitors know how to do.
Hear more in Creating Customer Value, a SearchCRM.com monthly podcast series with Peppers and Rogers.
This was first published in August 2008