The Lifecycle of a Customer: Why is it Important to Track?

The lifecycle of a customer: why is it important to track? Ultimately it’s because the customer lifecycle directly links to increased sales velocity and higher client retention. Pareto’s Law, if you’re not familiar with it; is the rule of 80/20. Eighty percent of your business comes from 20% of your customer base. When you can begin to understand how such a relatively small percentage of your customer base drives the majority of your revenue, you can then start to understand how to better extract value from the reminding customer base.

The key to tracking the lifecycle of your customer is a proper web analytics tool that has the ability, not only to track what people are looking at on your website, but also to track the journey of a customer from the minute they first hit your website to the last support ticket they filed with your customer service team. Tools like HubSpotMarketoSalesforce’s Marketing Cloud, and Oracle’s Eloqua are some of the more popular tools available on the market today.

When tracking the customer lifecycle, the first step is to consider the customer base from both pre- and post-sales perspectives. Post-sales analysis will begin to show which customers drive the majority of your revenue and tend to generate lower expenses over time. Factors typically underlying good customers could be:

  • A higher demand for the product going into the sales process
  • The quality of the sales team’s interactions with the customer through the process
  • The post-sales team was more effective working with the customer in the setup process
  • The setup process itself was more effective, resulting in reduced customer service calls
  • The customer uses more features and functions of the product
  • The customer consumed a wider array of marketing and educational content

These are only a few of the factors that your organization can look into to understand what makes a top customer. Once, you have this information, you can then find operational improvements in people, process, and technology enablers to influence optimal behaviors throughout your customer base. This is also where a good marketing automation tool will come into place. Collecting the data to conduct these analyses can be done manually, but it’s a heck of a lot easier to do with tools specifically built for this purpose.

Once you trace the anatomy of a good customer, you will wish to begin dissecting their habits as well as investigating how they become a customer in the first place. You’ll do this by looking at questions such as:

  • What marking campaign or traffic source first brought the customer to the website?
  • What content or collateral did the customer review and at what stages of their journey?
  • When did sales get involved?
  • What were the stages and the sequence of the sales process?
  • What information or collateral did sales share?
  • What information did the customer review right before making the final decision?

The same principles we applied when we thought about driving customers to be better customers, we apply here to help drive changes in sales strategy that generate faster-closing, higher-quality leads.

Progress is cyclical. Once you know what your good customers do, you can then start to encourage those same behaviors across the rest of your customer base. The same can be said in the pre-sales process: once you know what you did to acquire those good customers in the first place, you can formally incorporate them into your pre-sales methodology.

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