What is a customer lifespan?

5-phases-of-a-customer-lifespanDid you know that customers have a lifespan?  Or, that there are 5 phases in a customer lifespan? Perhaps life cycle is the better term. It sounds so much more on-going, doesn’t it?  Once you’ve found a potential customer or client,  or they’ve found you, the business relationship is official.

Some customers will come to you for one purchase or project. Others may stay for a long time, doing business with you over and over again.  You would think that the customer lifespan begins with the first purchase, or order, or signing of a contract to do business. But, That’s not where the relationship begins at all. In reality, the lifespan begins before that first sale.  Following you will find more detail on each of the 5 phases of a customer lifespan.

Five phases of a customer lifespan

Phase 1:  Attraction

The first thing you need to do is get noticed by a potential customer.  Get their attention.  Make them take notice. Create interest in yourself, your company, your products or your services.  How you do that can take on many forms. No one tactic is necessarily best for all companies or all situations. Find the best one(s) for you and start sending out messages to attract customers.

Perhaps you do public speaking as a marketing tactic to meet people who can use your product or service. Maybe you have written an e-book, or a printed book, as a way to build your credibility and share your expertise. You may do some basic paid advertising, networking or social media marketing. One way or another, you have to get noticed before anything happens.

Phase 2:  Persuasion

Once you have gained the attention of a potential customer, you need to convince them that you are worth doing business with; that you are the ideal firm to help solve their problem. Just because they saw your ad, heard you talk or met you at a networking event, doesn’t mean they are ready to do business with you or your firm.
How do you go about persuading a prospect that you are the answer to their dreams? There are oh, so many, ways to do this.

Kevan Lee wrote an article on psychological theories to persuade people for Fast Company magazine.  Jason Nazar contributed 21 principles of persuasion to Forbes magazine.   Personally, I recommend that you approach them as your authentic self. Listen, listen, listen before you talk. Understand their needs, then offer your recommendations for achieving the best solution. Throw in evidence of your credibility like your education, background and testimonials from customers who already know that you are exceptional at what you do. Be persuasive, not pushy.

Phase 3:  Conversion

Ideally, the above steps will allow you to add your prospect to your database and sales funnel so you can maintain contact with them until they are ready to make a decision. Your sales system  should contain a series of tactics you will use to reach out to the prospect, building your relationship and reiterating your capabilities and credibility.

Sending regular communications through a newsletter, blog or email marketing piece work well for this stage of the customer lifecycle. Each of these communications should contain a ‘call to action.’   Invite them to subscribe to your newsletter or blog, download your e-book or a white paper that applies to their specific needs.  At set intervals, recommend a brief telephone call where you can further discuss their problem or needs. The idea is to continually move them forward to making their ‘buy now’ decision.

Phase 4:  The Sale!

Congratulations!  You’ve attracted a prospect, converted them to a customer and they have made a purchase or signed a contract.  Hallelujah! But, stop — this isn’t the end of the customer lifespan.  All of your previous efforts don’t stop at the sale or signing of a contract. Taking their money and moving on to your next prospect are not good concepts for keeping satisfied customers. It costs far more to go out and develop new customers than it does to keep the ones you have coming back. How you handle taking the order, shipping the order or beginning the project, working through it to the end, customer service and your entire customer experience become key for the final step in your customer lifespan cycle.

Phase 5:  Re-engagement

You have now officially reached the ‘rinse and repeat’ phase.  Hopefully, that first sale won’t also be the last. You worked hard for it, expending  time, effort, and money, so why would you let that customer get away? It costs far more to go out and develop new customers than it does to keep the ones you have coming back. Make sure that your sales system includes strategies and tactics for targeting this group. They might need your products again. How can you make it easy to re-order? Once your first project or assignment is completed, how can you get that customer to expand the project or engage you to do another project?

If you haven’t yet created your strategies and tactics for managing your customer lifespan, don’t wait another day.  Every business is made up of a series of systems and processes.  Your sales system is just one of them.  Be sure that yours includes tactics for managing your customer lifespan both before and after a sale has been made.  Attract potential customers and clients.  Persuade them that you are the best solution to their problems and challenges.  Convert them from prospects to actual paying customers.   Make that first sale, then start the process of re-engaging them to stay on and be your customer again in the future.

I’d love to hear your tips on getting and keeping customers.  Please share your thoughts with us below.