Blog 65: Lifecycle marketing goes beyond the marketing funnel
- Idea2Product2Business Team
- Jun 30, 2024
- 3 min read
Updated: Sep 8, 2024
In blog 42, we spoke about the marketing funnel. Targeted campaigns are used, depending on where a potential or prospect is, in the ‘marketing funnel’. This increases the probability of conversion.
Acquiring a new customer is anywhere from five to 25 times more expensive than retaining an existing one (source: hbr.org). Lifecycle marketing is a customer centric strategy that helps in retaining an existing customer. Hence, a holistic marketing strategy that manages a customer’s experience beyond the marketing funnel. The first four stages (until action) overlap.
Four stages of the marketing funnel:
i) Awareness: When a prospective customer becomes aware of a product, solution, or service that will meet their needs. This can happen through advertising, word of mouth, prospect research, social media (refer blog 7) etc. The objective of this phase is to stay on top of mind.
ii) Interest: When a prospect is interested, they go through a consideration process. They research for more information, compare competitor offerings etc. Hence, firms should educate customers on how the product meets their needs. This includes positive customer reviews, testimonials, and case studies, etc.
iii) Desire: Also referred to as the conversion or purchase phase. The goal of this phase is to encourage a purchase (as the product meets a prospect’s needs).
iv) Action: The final stage of the funnel is action or acquisition. Wherein, the prospect becomes an active customer. It is possible to convert a one-time customer into a repeat customer.
Lifecycle marketing goes beyond this. Additional two stages ensure improved customer experience. They include:
Support: According to a research study, the probability of selling to an existing customer is 60 to 70%.
In addition, 80 percent of future profits will come from just 20 percent of existing customers. By providing meaningful support we can build long-term relationships with our customers. According to a study, 71% of customers end their relationship when they receive poor customer service and become a part of a competitor’s marketing funnel.
Loyalty: To build loyalty, it’s important to engage with customers. The phase is also called engagement phase. In this stage, we can encourage an existing customer to refer our products to their friends and family (i.e., referral). 97% of customers look at reviews before buying, and around 92% hesitate to buy a product without online reviews.
In this stage, strategies such as upsell and cross-sell are also leveraged (refer blog 76 to learn more about upsell and cross-sell).
Lifecycle marketing aims to engage users at each step of the customer journey:
- Brand awareness to brand consideration
- One-time customer to loyal customer
- Loyal customer to brand advocate
Hence, lifecycle marketing can be defined as:
“The customer life cycle describes the points in the continuum where you: 1) Claim someone’s attention 2) Bring them into your sphere of influence 3) Turn them into a registered and/or paying customer 4) Keep them as a customer 5) Turn them into a company advocate. - Sterne and Cutler, authors of the paper introducing the concept of the customer lifecycle back in 2000.”
Below image highlights different touch points (in orange font) across a prospect’s journey across the customer lifecycle.
It is important to have a strategy to reach the right person with the right message at the right time. For e.g.,
- Prospects require many impressions and touch points with a brand prior to using it (via Google ads, social media targeting).
- Personalised recommendations with offers, or content.
- Social media retargeting.
- Personalised re-engagement emails that can connect with lost customers.
Refer to blog 66 for more on lifecycle email marketing and push notification strategies.
Tools for lifecycle marketing include marketing automation tools (such as HubSpot), email marketing tools (such as Mailchimp), and CRM (such as Salesforce).
Jump to blog 100 to refer to the overall product management mind map.
Source:
I wish you the best for your journey. 😊